August 2, 2004

Aviyon Med. Rehabilitation, P.C. v Allstate Ins. Co. (2004 NY Slip Op 50819(U))


The relevant facts of this case are that Aviyon Medical Rehabilitation, P.C. brought an action against Allstate Insurance Company for its failure to pay the total amount due on assigned no-fault claims, leaving an unpaid balance of $105,218.78. Allstate Insurance Company moved to sever and dismiss the claims, arguing that the claims did not arise from a series of transactions or occurrences and that joinder would cause prejudice and lead to jury confusion. The main issues decided by the court were whether the claims should be severed and dismissed, and whether the court had subject matter jurisdiction. The holding of the court was that defendant's motion to sever and dismiss the claims was denied, and the court retained subject matter jurisdiction over the case. The court based its decision on the liberal joinder policy to prevent multiplicity of suits and the absence of logistical difficulties in preparing a defense to the claims.

Reported in New York Official Reports at Aviyon Med. Rehabilitation, P.C. v Allstate Ins. Co. (2004 NY Slip Op 50819(U))

Aviyon Med. Rehabilitation, P.C. v Allstate Ins. Co. (2004 NY Slip Op 50819(U)) [*1]
Aviyon Med. Rehabilitation, P.C. v Allstate Ins. Co.
2004 NY Slip Op 50819(U)
Decided on August 2, 2004
Supreme Court, Kings County
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.
Decided on August 2, 2004

Supreme Court, Kings County

(named in Exhibit “A” in plaintiff’s complaint), Plaintiff,




Francois Rivera, J.

The defendant Allstate Insurance Company moves pursuant to CPLR §603 to sever and dismiss the claims brought by plaintiff Aviyon Medical Rehabilitation, P.C. Plaintiff opposes defendant’s motion.

Plaintiff is a health care provider authorized to practice and render diagnostic services in New York State and maintains an office at 107-13 Jamaica, Richmond Hill in Queens County. Defendant is a foreign corporation, duly authorized to conduct the business of providing automobile liability and no fault insurance to New York State motorists.

On October 9, 2003, plaintiff commenced this action by filing a summons and verified complaint with the Kings County Clerk’ s Office. Defendant answered with a general denial and asserted (28) twenty-eight affirmative defenses. Plaintiff’s verified complaint annexed a list containing the names of (36) thirty-six motor vehicle accident victims, the dates of their accidents, the amount of their unpaid no fault claims, and the corresponding claim numbers assigned to them by the defendant. Plaintiff alleged that all these individuals were injured while covered by an automobile liability insurance policy containing a New York State no-fault endorsement issued by the defendant.

Plaintiff allegedly provided health services to each of these individuals for their accident related injuries and they each assigned to plaintiff the right to receive their no-fault benefits for these services. Plaintiff contended that contrary to the requirements of Insurance Law §5106(a), defendant failed to pay the total amount due on the assigned claims leaving an aggregate unpaid balance in the amount of $105,218.78.

CPLR §603 provide as follows:

Severance and separate trials. In furtherance of convenience or to avoid prejudice the court may order a severance of claims, or may order a separate trial of any claim, or of any separate issue. The court may order the trial of any claim or issue prior to the trial of the others. [*2]

In support of its motion for severance, defendant contends that joinder is improper pursuant to CPLR §1002(a) because the thirty-six (36) joined claims do not arise from a series of transactions or occurrences and do not contain a common question of law or fact. Defendant further alleges that joinder would cause defendant prejudice and lead to jury confusion. Defendant ‘s claim of prejudice is premised on the alleged logistical difficulty of coordinating and preparing a defense for each claim between the various assigned claims representatives spread throughout the state. Defendant also claims a likelihood of jury confusion based solely on the volume of claims.

CPLR §1002(a) provides:

Persons who assert any right to relief jointly, severally, or in the alternative arising out of the same transaction or occurrence, or series of transactions or occurrences, may join in one action as plaintiffs if any common question of law or fact would arise.

Although defendant claims improper joinder, the case at bar has but one party on each side, Aviyon Medical Rehabilitation, P.C. and Allstate Insurance Company. Pursuant to the liberal pleading provisions of CPLR §601(a), a plaintiff in a complaint, or the defendant in an answer setting forth a counterclaim or cross-claim, may join as many claims as he may have against an adverse party. Thus, the plaintiff is free to join in one lawsuit as many claims as it may have against Allstate.

Here, the plaintiff has accumulated thirty-six claims against Allstate and has chosen to join them in a single action. It is well settled that joinder of claims by a plaintiff against a single defendant need not be consistent or even related (Collins v. Telcoa Intern. Corp., 283 A.D.2d 128, 131 [2nd Dept. 2001]; see also Twitchell v. McKay, 78 A.D.2d125, 127 [4th Dept. 1980]). The purpose of this policy of liberal joinder is to prevent multiplicity of suits so that the aggrieved party can obtain complete relief in one action (Saunders v. Saunders, 54 Misc.2d 1081.[Supreme Court, Special Term, Kings County 1967]; See also George Cohen Agency Inc. v. Donald S. Perlman Agency Inc., 69 A.D.2d 725 [2nd Dept. 1979]). It is also intended to reduce the caseload of the courts and its personnel and avoid unnecessary expenditure of time, money and manpower.

However, if joinder of all the claims a plaintiff may have against a defendant would achieve an undesirable result, the court is well within its discretion, and defendant may so move, to sever the claims pursuant to CPLR §603 ( Anderson v. Singh 305 AD 2d 620 [2nd Dept. 2003]; see also Broome County v. Aetna Casualty & Sur. Co. 126 A.D.2d 818 [3rd Dept. 1987]). The decision whether to grant a severance pursuant to CPLR 603 is a matter of judicial discretion which will not be disturbed on appeal absent an abuse of discretion or prejudice to a substantial right of the party seeking severance (Finning v. Niagra Mohawk Power Corp., 281 A.D.2d 844 [3rd Dept. 2001]). In the case of Hempstead General Hospital v. Liberty Mutual 134 A.D.2d 569; [2nd Dept. 1987], a healthcare provider sued an insurance carrier as assignee of twenty-nine (29) claims to recover no-fault benefits allegedly unpaid and past due. All of the assignors had received treatment at the plaintiff facility, were insured by the same defendant insurance company, and were claiming breach of the no-fault provisions of their respective policies. The Appellate Division Second Department upheld the trial court’s discretionary use of joinder in Hempstead finding that there was a common question of law. The court stated that: [*3]

“The Supreme Court did not abuse its discretion in denying the defendant’s request to sever the 29 claims. The joinder of the claims is proper under CPLR 1002(a) since the claims arise out of a uniform contract of insurance and involve the interpretation of the same no-fault provisions of the Insurance Law. While the claims involved relate to separate accidents and individuals, it has been held that multiple transactions by multiple plaintiffs “do not lose their character as a series of transactions because they occurred at different places and times extending through many months” (Akely v. Kinnicutt, 238 NY 466,474). Since the issues herein involve a common question of law, such joinder is proper and severance was appropriately denied” (Hempstead General Hospital v. Liberty Mutual supra, 134 A.D.2d at 570.

Defendant Allstate relies on Mount Sinai Hospital a/a/o Jefferson v. Motor Vehicle Accident Indemnity Corporation, 291 A.D.2d 536 [2nd Dept. 2002], for the proposition that in no fault actions with multiple assignors, the claims must be severed where there are unrelated assignors with no common contract of insurance. While the Appellate Division Second Department in Mount Sinai did indeed make such a determination, it also reversed the lower court ruling which severed the plaintiff’s third and fourth cause of action. The court found that those claims involving one assignee seeking to recover no fault benefits and involved a common question of law. The court found that those claims were properly joined pursuant to CPLR §1002.

The case at bar is virtually indistinguishable from Hempstead, but for the number of claims brought by the plaintiff. Plaintiff herein alleges that each assignor had either purchased or was covered by a contract of automobile liability insurance from the defendant and each of them assigned their rights to receive no fault benefits under that contract to the plaintiff. Thus, defendant’s reliance on the Mount Sinai decision in support of its application for severance is misplaced.

Insurance Law §5106(a) imposes upon insurers a prescribed time frame for settling bodily injury claims covered by a policy of bodily injury liability insurance. It provides in pertinent part:

Payments of first party benefits and additional first party benefits shall be made as the loss is incurred. Such benefits are overdue if not paid within thirty days after the claimant supplies proof of the fact and amount of loss sustained. If proof is not supplied as to the entire claim, the amount which is supported by proof is overdue if not paid within thirty days after such proof is supplied. All overdue payments shall bear interest at the rate of two percent per month. If a valid claim or portion was overdue, the claimant shall also be entitled to recover his attorney`s reasonable fee, for services necessarily performed in connection with securing payment of the overdue claim, subject to limitations promulgated by the superintendent in regulations.

At its core, plaintiff’s cause of action is for a breach of contract contrary to the requirements of Insurance Law §5106(a). Plaintiff’s verified complaint alleges defendant’s breach of the no fault provision of its insurance contract covering each assignor. The alleged facts provide the requisite series of transactions or voluntary course of dealings needed to support the joinder of the claims in a single action.

Defendant argues that if severance is denied, it will fall victim to undue prejudice caused [*4]by the voluminous amount of litigation which accompanies such a high number of claims. The court sees no apparent, logistical difficulties in preparing a defense to these claims such that the defendant would be prejudiced by going forward with the instant proceedings. In this age of sophisticated technology, the defendant should be able to instantly gather any files or documents necessary to the defend the action because these items are within the defendant’s custody and control. Similarly defendant should be able to communicate with or summon at will any employee needed for their defense. Moreover, it is more likely that defendant would suffer greater prejudice defending thirty-six (36) claims in potentially numerous venues when one considers the cost of separate filing fees, pre-trial preparation costs and duplication of effort to resolve a common question of law. Defendant’s allegations of prejudice are unpersuasive. The court finds much more convincing plaintiff’s simple argument that the defendant has ample resources available to muster a defense.

Defendant also argues that failure to sever the claims will lead to jury confusion. Defendant cites Doll v. Castiglione 86 A.D.2d 711 [3rd Dept. 1982] and Bender v. Underwood, 93 A.D.2d 747 [1st Dept. 1983] as authority for this contention. Both cases are distinguishable from the case at bar. In Doll, the plaintiff attempted to join two claims arising from two separate traffic accidents on separate days, months apart against two separate defendants. There was no commonality between the claims apart from the fact they both involved auto collisions and a single plaintiff. In the Bender case, six plaintiffs attempted to join in one action claiming negligence and medical malpractice against a single defendant. However, unlike the case at bar, there was no commonality among the claims other than that each had undergone a similar procedure by the same defendant. While the court acknowledged that some common issues of law or fact were present, it also found that individual issues concerning particular circumstances applicable to each plaintiff predominated so as to preclude the direction of a joint trial. The court went on to state that:

“Although it is claimed that each plaintiff underwent the same implantation process and was allegedly subjected to the same basic type of malpractice, clearly, each treatment was separate and distinct, involving different plaintiffs, each with individual medical histories” (Bender v. Underwood, supra, 93 A.D.2d at 748).

The sole link between the plaintiffs in the Bender case is that they all alleged a similar negligent practice by the same defendant. However, there was no common contract between the defendant and the several plaintiffs, nor was there even evidence that the negligence or the procedures were identical. Furthermore, the central proposition of the case was that severance was proper to avoid prejudice; jury confusion was merely an ancillary concern of the court in issuing its ruling.

This court finds that the analysis of the Appellate Division Second Department in Hempstead , upholding the joinder of twenty nine (29) claims on facts nearly identical to the case at bar, permits the discretionary joinder of plaintiff’s thirty-six (36) claims against the defendant. This court does not find that an additional seven claims will produce the undesirable effect expressed by the defendant.

Defendant also contends that if the court severs plaintiff’s complaints, they would fall below the minimum monetary jurisdictional limit of the Supreme Court and thus warrant dismissal. The New York State Supreme Court is the State’s only court of general jurisdiction, [*5]retaining nearly the entire jurisdiction conferred upon it by the constitution. This encompassing jurisdiction is limited in only two instances; those cases over which Congress has conferred exclusive jurisdiction on the Federal Courts, and actions against the State, which the New York Legislature has declared the exclusive domain of the Court of Claims. Thus no threshold minimum monetary amount exists for subject matter jurisdiction in the Supreme Court as it does in the Federal Courts. Nor is there a maximum monetary limit as is proscribed for the New York City Civil Court. And despite the fact that it is the policy of this State to have a money action brought in the lowest court jurisdiction competent to entertain it, the fact that such a forum exists does not divest the Supreme Court of its original jurisdiction [D. Siegel, New York Practice, 3rd ed. §12 (1999)] This policy is effectuated by certain penalties and incentives delineated in CPLR §8102, which states that a plaintiff is not entitled to costs:

“In an action brought in the Supreme Court in a county within the city of New York which could have been brought, except for the amount claimed, in the civil court of New York, unless he shall recover six thousand dollars or more.” CPLR §8102(1).

A similar restriction regarding disbursement of costs adheres in the Supreme Court outside of the city of New York, but with a substantially lower recovery requirement of five hundred dollars. CPLR §8102(2). In sum, the defendant’s request to dismiss is improper under any circumstances, because this court is not deprived of its subject matter jurisdiction whether the matters remain joined or are severed.

Based on the foregoing, defendant’s motion to sever and dismiss plaintiff’s complaint is denied. This constitutes the decision and order of this court.

Dated: August 2, 2004