June 28, 2019

Valdan Acupuncture, P.C. v Nationwide Mut. Fire Ins. Co. (2019 NY Slip Op 51098(U))

https://www.beynensonlaw.com/case-law/valdan-acupuncture-p-c-v-nationwide-mut-fire-ins-co-2019-ny-slip-op51098u/

Court: Appellate Term, Second Department
Decided: June 28, 2019
Citation: 2019 NY Slip Op 51098(U)
Posture: Summary judgment
Outcome: Insurer prevailed
Later treatment: Followed in 1 later decision (see Cited by)
Issues: Declaratory judgment, res judicata
Legal questions: Effect of insurer's declaratory judgment (see the maps)

Cite as

Valdan Acupuncture, P.C. v Nationwide Mut. Fire Ins. Co., 2019 NY Slip Op 51098(U) (App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019)

Posture, outcome, issues and treatment by other decisions are Beynenson Law’s classification. Treatment labels are assigned by a language model reading the citing decision; negative and appeal-history labels are checked by a second reader.

Summary

Editorial summary by Beynenson Law, not part of the court’s decision.

The provider's claim was barred by res judicata because its assignment followed commencement of the insurer's declaratory judgment action. The insurer obtained a Supreme Court declaration that it owed no no-fault benefits arising from the accident to the assignor and certain other providers. Although this provider was not a party to that action, its later assignment placed it in privity with the assignor and charged it with notice that its rights were subject to the competing claim. A judgment for the provider would impair rights established by the declaration. The Appellate Term, Second Department, affirmed the order granting the insurer summary judgment dismissing the complaint with prejudice.

Reported in New York Official Reports at Valdan Acupuncture, P.C. v Nationwide Mut. Fire Ins. Co. (2019 NY Slip Op 51098(U))

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Valdan Acupuncture, P.C., as Assignee of Joanne Watson Mack, Appellant,
against
Nationwide Mutual Fire Ins. Co., Respondent.

Gary Tsirelman, P.C. (Jung Pryjma of counsel), for appellant. McDonald, Safranek & Turchetti (Kevon Lewis of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (John J. Kelley, J.), entered April 21, 2017. The order granted defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order is affirmed, with $25 costs.

In October 2015, plaintiff commenced this action to recover assigned first-party no-fault benefits arising from a motor vehicle accident which had occurred on January 11, 2011. The injured party had assigned the no-fault benefits to plaintiff on September 21, 2011. Defendant moved for summary judgment dismissing the complaint or for an order staying the action, as defendant had commenced a declaratory judgment action in the Supreme Court, Onondaga County, against the assignor and numerous medical providers other than plaintiff herein, seeking a declaration that the accident in question was not a covered incident under the insurance policy. Plaintiff opposed the motion. In further support of the motion, defendant proffered an order of the Supreme Court, dated August 2, 2016, declaring that the insurer (defendant herein) is not required or obligated to provide no-fault benefits to the assignor (and numerous named providers, other than plaintiff) arising out of the January 11, 2011 accident, and defendant argued that, consequently, plaintiff’s action in the Civil Court is barred. Plaintiff appeals from an order of the Civil Court entered April 21, 2017 which granted defendant’s motion based upon the order in the declaratory judgment action and dismissed plaintiff’s complaint with prejudice.

“Under the doctrine of res judicata, a final adjudication of a claim on the merits precludes relitigation of that claim and all claims arising out of the same transaction or series of transactions by a party or those in privity with a party” (Ciraldo v JP Morgan Chase Bank, N.A., [*2]140 AD3d 912, 913-914 [2016]; see Matter of Hunter, 4 NY3d 260, 269 [2005]; Schuylkill Fuel Corp. v Nieberg Realty Corp., 250 NY 304, 306-307 [1929]). In the case at bar, as the injured party’s assignment to plaintiff was made on September 21, 2011, after the commencement in August 2011 of the declaratory judgment action, plaintiff is deemed to be in privity with the assignor and “charged with notice that [its] rights to the assignment are subject to the competing claim” (Gramatan Home Invs. Corp. v Lopez, 46 NY2d 481, 487 [1979]). Consequently, in light of the Supreme Court’s order, the Civil Court properly granted defendant’s motion for summary judgment (see EBM Med. Health Care, P.C. v Republic W. Ins., 38 Misc 3d 1, 3 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]), as any judgment in favor of plaintiff in this action would destroy or impair rights or interests established by the order in the declaratory judgment action (see Schuylkill Fuel Corp., 250 NY 304; Flushing Traditional Acupuncture, P.C. v Kemper Ins. Co., 42 Misc 3d 133[A], 2014 NY Slip Op 50052[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2014]; EBM Med. Health Care, P.C., 38 Misc 3d 1).

Accordingly, the order is affirmed.

ELLIOT, J.P., PESCE and SIEGAL, JJ., concur.

ENTER:
Paul Kenny
Chief Clerk
Decision Date: June 28, 2019

Legal questions

A question of no-fault law this decision rules on, from our Legal Questions pages. Bars count the decisions on the question by year and court, coloured by category; circles are this decision and the decisions on the question it cites or that cite it. Point at a bar or circle for details. The categories and summaries are Beynenson Law’s classification, made by a language model and checked by a second reading.

Effect of insurer's declaratory judgment

Open the full map

Does an insurer’s no-coverage declaratory judgment, or pending declaratory action, bar or stay a no-fault claimant’s action?

This decision: The DJ is given preclusive effect and bars every claim in the action that the court considered

Held the provider's action barred by the Supreme Court's no-coverage declaration although the provider was not named, because the assignment was made after the declaratory action began, so the provider was in privity with its assignor.

Barred by DJBarred in partNot bound: partiesDJ does not reachStayed pending DJStay deniedThis decisionCites it or cited by itCited or followed

Of the 164 decisions on this question in the Second Department courts and the Court of Appeals, 101 (this one included) are in the same category.

Cited in this decision

A label shows how this decision treated the case it cites.

EBM Med. Health Care, P.C. v Republic W. Ins. (2012 NY Slip Op 22300) FollowedAn unvacated default declaratory judgment has res judicata effect in a provider's pending no-fault action.
Flushing Traditional Acupuncture, P.C. v Kemper Ins. Co. (2014 NY Slip Op 50052(U))The provider's no-fault action was barred by res judicata because a default declaratory judgment denied its right to benefits.

Cited by

A label shows how the later decision treated this one.

Shafai Acupuncture, P.C. v State Farm Mut. Auto. Ins. Co. (2023 NY Slip Op 50795(U)) FollowedThe provider's sixth cause of action was barred by res judicata, and its mailing challenge failed on the remaining claims.
Horizon P.T. Care, P.C. v State Farm Mut. Auto. Ins. Co. (2023 NY Slip Op 50295(U))The provider's claims were barred by res judicata because a prior default declaratory judgment adjudicated the same bills.
Ahmed Med. Care, P.C. v State Farm Mut. Auto. Ins. Co. (2023 NY Slip Op 50276(U))The provider's first, second, third, fourth and sixth causes of action were barred by a prior default declaratory judgment.

Similar decisions

Valdan Acupuncture, P.C. v 21st Century Advantage Ins. Co. (2019 NY Slip Op 50822(U))An insurer may submit reply evidence responding to an IME-address objection first raised in opposition to summary judgment.
Vital Meridian Acupuncture, P.C. v American Tr. Ins. Co. (2016 NY Slip Op 51007(U))An unvacated default order declaring noncoverage is a conclusive final determination that can bar a provider's action under res judicata.
Vital Meridian Acupuncture, P.C. v Republic W. Ins. Co. (2015 NY Slip Op 50222(U))A default declaratory judgment conclusively determining no obligation to pay no-fault benefits bars a contrary recovery under res judicata.
Charles Deng Acupuncture, P.C. v Allstate Ins. Co. (2019 NY Slip Op 51358(U))The provider's no-fault action was barred by a prior declaratory order establishing that the insurer had no liability for a staged accident.
GBI Acupuncture, P.C. v Nationwide Ins. (2015 NY Slip Op 51048(U))An unvacated default declaratory order denying no-fault coverage bars a provider's benefits action under res judicata.