August 16, 2019

Charles Deng Acupuncture, P.C. v Allstate Ins. Co. (2019 NY Slip Op 51358(U))

https://www.beynensonlaw.com/case-law/charles-deng-acupuncture-p-c-v-allstate-ins-co-2019-ny-slip-op51358u/

Court: Appellate Term, Second Department
Decided: August 16, 2019
Citation: 2019 NY Slip Op 51358(U)
Posture: Summary judgment
Outcome: Insurer prevailed
Issues: Declaratory judgment, res judicata Discovery and procedure
Legal questions: Effect of insurer's declaratory judgment (see the maps)

Cite as

Charles Deng Acupuncture, P.C. v Allstate Ins. Co., 2019 NY Slip Op 51358(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 no-fault action was barred by a prior declaratory order establishing that the insurer had no liability for a staged accident. The Appellate Term, Second Department, affirmed summary judgment dismissing the complaint. The Supreme Court, Kings County, had granted declaratory relief on default against the provider and assignor. Although the insurer had not pleaded res judicata or sought pre-answer dismissal under CPLR 3211 (a) (5), the provider alleged neither prejudice nor surprise under CPLR 3018 (b), so the answer was deemed amended. Res judicata barred claims arising from the same transaction because a provider's judgment would impair rights established by the declaratory order.

Reported in New York Official Reports at Charles Deng Acupuncture, P.C. v Allstate Ins. Co. (2019 NY Slip Op 51358(U))

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

Charles Deng Acupuncture, P.C., as Assignee of Pierre, Yva, Appellant,
against
Allstate Insurance Company, Respondent.

The Rybak Firm, PLLC (Damin J. Toell and Karina Barska of counsel), for appellant. Law Office of Karen L. Lawrence (Cheryl Scher of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Robin Kelly Sheares, J.), entered August 3, 2017. The order granted defendant’s motion for summary judgment dismissing the complaint.

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

Plaintiff commenced this action in the Civil Court on October 14, 2015 to recover assigned first-party no-fault benefits for services provided to its assignor, who was allegedly injured in an accident on October 24, 2011. Prior to the commencement of this action, defendant had brought a declaratory judgment action in the Supreme Court, Kings County, against plaintiff and its assignor herein, among other parties, pertaining to the October 24, 2011 accident. Thereafter, defendant moved in the Supreme Court for summary judgment, and, in an order entered April 28, 2014, the Supreme Court stated that defendant’s “motion for summary judgment for a declaration of a staged accident and that plaintiff is not liable in any respect for damages arising out of the accident is hereby granted in all respects on default” as to the present plaintiff and assignor, among other parties. Relying upon the Supreme Court’s order, defendant moved in the Civil Court for summary judgment dismissing the complaint on the ground that plaintiff’s action is barred by the doctrine of res judicata. Defendant annexed a copy of the Supreme Court’s order, pleadings and motion papers. Plaintiff appeals from an order of the Civil Court entered August 3, 2017 which granted defendant’s motion.

We note that defendant failed to include res judicata as an affirmative defense in its answer, or to move to dismiss the complaint on that ground pursuant to CPLR 3211 (a) (5) prior to serving its answer. Defendant instead moved for summary judgment based on res judicata and also sought “such other and further relief as [the Civil Court] may deem just and proper.” As plaintiff, in opposition to defendant’s motion, failed to allege any prejudice (see Barrett v Kasco [*2]Constr. Co., 84 AD2d 555, 556 [1981], affd 56 NY2d 830 [1982]) or surprise (see CPLR 3018 [b]; Rogoff v San Juan Racing Assn., 54 NY2d 883, 885 [1981]; Renelique v State-Wide Ins. Co., 50 Misc 3d 137[A], 2016 NY Slip Op 50096[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]) resulting from defendant’s seeking summary judgment based on that unpleaded affirmative defense, we deem defendant’s answer amended to include the affirmative defense of res judicata (see Barrett, 84 AD2d at 556; Metro Health Prods., Inc. v Nationwide Ins., 52 Misc 3d 138[A], 2016 NY Slip Op 51122[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]).

“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., 140 AD3d 912, 913-914 [2016]; see Matter of Hunter, 4 NY3d 260 [2005]; Schuylkill Fuel Corp. v Nieberg Realty Corp., 250 NY 304, 306-307 [1929]). In light of the order in the declaratory judgment action, the present action is barred under the doctrine of res judicata (see Island Life Chiropractic, P.C. v Unitrin Auto & Home Ins. Co., 52 Misc 3d 137[U], 2016 NY Slip Op 51076[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]; 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]; Ava Acupuncture, P.C. v NY Cent. Mut. Fire Ins. Co., 34 Misc 3d 149[A], 2012 NY Slip Op 50233[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]; SZ Med., P.C. v Erie Ins. Co., 24 Misc 3d 126[A], 2009 NY Slip Op 51221[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2009]), as any judgment in favor of plaintiff in the instant action would destroy or impair rights or interests established by the Supreme Court’s order (see Schuylkill Fuel Corp., 250 NY 304, 306-307; SZ Med., P.C., 24 Misc 3d 126[A], 2009 NY Slip Op 51221[U]).

Accordingly, the order is affirmed.

WESTON, J.P., ALIOTTA and ELLIOT, JJ., concur.
ENTER:
Paul Kenny
Chief Clerk
Decision Date: August 16, 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 res judicata because a Supreme Court order, granted on default against the provider and its assignor, declared the accident staged and the insurer not liable, and a recovery would impair that order.

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

Of the 163 decisions on this question in the Second Department courts and the Court of Appeals, 100 (this one included) are in the same category.

Cited in this decision

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

Renelique v State-Wide Ins. Co. (2016 NY Slip Op 50096(U))An unpleaded res judicata defense may support summary judgment absent surprise or prejudice to the opposing party.
Metro Health Prods., Inc. v Nationwide Ins. (2016 NY Slip Op 51122(U))An unpleaded res judicata defense may support summary judgment when it causes no surprise or prejudice to the opposing party.
Island Life Chiropractic, P.C. v Unitrin Auto & Home Ins. Co. (2016 NY Slip Op 51076(U)) FollowedThe provider's argument that the defendant insurer lacked privity with the declaratory judgment plaintiff was unpreserved.
EBM Med. Health Care, P.C. v Republic W. Ins. (2012 NY Slip Op 22300)An unvacated default declaratory judgment has res judicata effect in a provider's pending no-fault action.
Ava Acupuncture, P.C. v NY Cent. Mut. Fire Ins. Co. (2012 NY Slip Op 50233(U))An unvacated default declaratory order barring no-fault benefits is a final determination that can preclude a provider's action under res judicata.
SZ Med., P.C. v Erie Ins. Co. (2009 NY Slip Op 51221(U))The providers' no-fault action was barred by res judicata because a prior declaratory judgment resolved coverage for the same accident.

Similar decisions

Healing Art Acupuncture, P.C. v 21st Century Ins. Co. (2018 NY Slip Op 50583(U))A declaratory judgment barring coverage precluded the provider's no-fault recovery under res judicata and collateral estoppel.
Acupuncture Healthcare Plaza I, P.C. v Allstate Ins. Co. (2017 NY Slip Op 51903(U))The insurer failed to establish timely mailing of its fee-schedule denial, while the provider failed to establish entitlement to payment.
Charles Deng Acupuncture, P.C. v 21st Century Ins. Co. (2017 NY Slip Op 51197(U))The provider's summary judgment motion on one claim was denied on appeal because the propriety of the insurer's denial remained disputed.
Valdan Acupuncture, P.C. v Nationwide Mut. Fire Ins. Co. (2019 NY Slip Op 51098(U))The provider's claim was barred by res judicata because its assignment followed commencement of the insurer's declaratory judgment action.
Gl Acupuncture, P.C. v Allstate Ins. Co. (2018 NY Slip Op 50830(U))The insurer failed to establish timely mailing of its denials asserting that the provider's charges exceeded the fee schedule.