Key Takeaway
Court rules insurer cannot modify no-fault judgment after losing summary judgment motion - defendant's belated policy limit defense fails procedural requirements.
Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 2011 NY Slip Op 02379 (2d Dept. 2011)
“The plaintiff hospital, as assignee of Bartolo Reyes, was awarded judgment against the defendant in the principal sum of $416,039.42, in this action to recover no-fault medical benefits under a contract of insurance entered into between the plaintiff’s assignee and the defendant. The defendant thereafter moved to modify the judgment pursuant to CPLR 5015(a), belatedly asserting that the judgment exceeded the coverage limit of the subject policy due, in part, to payments previously made under the policy to other health care providers. In the order appealed from, the Supreme Court properly denied the defendant’s motion to modify the judgment.”
“he defendant failed to demonstrate that the evidence offered in support of the motion, i.e., an affidavit of an employee setting forth the policy limits and the amount of benefits paid for alleged prior claims, “was not available at the time of the prejudgment proceedings” (Jonas v Jonas, 4 AD3d 336, 336; see Sicurelli v Sicurelli, 73 AD3d 735).
Moreover, although courts possess inherent discretionary power to grant relief from a judgment or order in the interest of justice, this “extraordinary relief” is not appropriate under the circumstances presented (Jakobleff v Jakobleff, 108 AD2d 725, 726-727; see Selinger v Selinger, 250 AD2d 752). The plaintiff previously moved for summary judgment on the complaint, seeking a certain amount of benefits, in accordance with the no-fault billing statement sent to the defendant, and [*2]this Court reversed the denial of that motion and granted the plaintiff’s motion for summary judgment on the complaint (see Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 60 AD3d 1045). Only after the plaintiff obtained, upon this Court’s order, a judgment from the Clerk of the Supreme Court, Nassau County, representing, inter alia, the amount of benefits sought in the complaint, did the defendant raise the issue of exhaustion of the policy limits. Under these circumstances, modification of the judgment in the interest of justice is not warranted.”
I find it really nauseating that the Appellate Division allowed a judgment to stand that was $350,000 over the policy limits, because the insurance carrier failed to move for partial summary judgment on the basis that should the carrier lose its main motion, then its damages are limited to $50,000. I realize it is the better practice to cover every contingency in a protective summary judgment motion, but this is just out of control. I know Medicaid funding is less, the malpractice cap failed, hospitals are going under and there is no sympathy for the insurance carriers. Still, the rule of law, reason and logic should prevail.
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- Understanding policy exhaustion and priority of payment requirements
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- Challenging arbitration awards in coverage disputes
- New York No-Fault Insurance Law
Legal Update (February 2026): Since this 2011 decision, New York’s no-fault insurance regulations have undergone multiple revisions, including updates to medical fee schedules, claims processing procedures, and policy limit notification requirements. Additionally, CPLR 5015 motion practice and standards for demonstrating newly discovered evidence may have evolved through subsequent case law and rule amendments. Practitioners should verify current provisions of the Insurance Law, no-fault regulations, and procedural rules when handling similar policy exhaustion and post-judgment relief matters.
