February 23, 2016

Metropolitan Diagnostic Med. Care, P.C. v American Commerce Ins. Co. (2016 NY Slip Op 50216(U))

https://www.beynensonlaw.com/case-law/metropolitan-diagnostic-med-care-p-c-v-american-commerce-ins-co-2016-ny-slip-op-50216u/

Court: Appellate Term, Second Department
Decided: February 23, 2016
Citation: 2016 NY Slip Op 50216(U)
Posture: Summary judgment
Outcome: Insurer prevailed
Issues: Declaratory judgment, res judicata
Legal questions: Effect of insurer's declaratory judgment (see the maps)

Cite as

Metropolitan Diagnostic Med. Care, P.C. v American Commerce Ins. Co., 2016 NY Slip Op 50216(U) (App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016)

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 res judicata following a default declaratory judgment denying coverage for the same claims. The insurer had obtained a judgment in Supreme Court, New York County, declaring that it owed no benefits to the provider or assignor under the claim number at issue, based on alleged EUO nonappearances. It then sought summary judgment dismissing the provider's Civil Court action. The insurer's answer had pleaded res judicata, collateral estoppel, and another pending action, contrary to the provider's contention that pendency had not been asserted. The Appellate Term, Second Department, affirmed dismissal on res judicata grounds and rejected the provider's equitable estoppel argument.

Reported in New York Official Reports at Metropolitan Diagnostic Med. Care, P.C. v American Commerce Ins. Co. (2016 NY Slip Op 50216(U))

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

Metropolitan Diagnostic Medical Care, P.C., as Assignee of KESTER ALLEYNE, Appellant,
against
American Commerce Insurance Company, Respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Robin Kelly Sheares, J.), entered January 24, 2014. The order granted defendant’s motion for summary judgment dismissing the complaint.

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

Metropolitan Diagnostic Medical Care, P.C. (Metropolitan) commenced this action in the Civil Court on March 14, 2012 to recover first-party no-fault benefits for services provided to its assignor as a result of injuries that had been sustained in a motor vehicle accident. American Commerce Insurance Company (ACIC) answered the complaint, asserting, among other things, that Metropolitan’s action is barred by the doctrines of collateral estoppel and res judicata. Approximately one week before Metropolitan commenced its Civil Court action, ACIC had commenced a declaratory judgment action in Supreme Court, New York County, against Metropolitan and its assignor, Kester Alleyne, among others, alleging that Alleyne had breached the terms of the insurance policy by failing to appear for duly scheduled examinations under oath and that, as a result, ACIC is not obligated to pay any claims for first-party no-fault benefits submitted by Metropolitan as assignee of Alleyne arising from the accident in question. ACIC subsequently moved in Supreme Court for an order, pursuant to CPLR 3215, granting ACIC a default judgment. By “order and judgment” entered February 7, 2013, the Supreme Court awarded ACIC a declaratory judgment on default, declaring that ACIC had no obligation to pay Metropolitan or its assignor for any claims for no-fault benefits under the claim number at issue.

Thereafter, ACIC moved in the Civil Court for, among other things, summary judgment dismissing the complaint on the ground that Metropolitan’s cause of action is barred under the doctrines of res judicata and collateral estoppel. In opposition to the motion, Metropolitan submitted an affirmation by its counsel, who argued, among other things, that Metropolitan had been unaware of the Supreme Court action when it had commenced this action in the Civil Court, and that ACIC’s answer in the Civil Court had failed to assert the pendency of the declaratory judgment action as an affirmative defense. By order entered January 24, 2014, the Civil Court granted the branch of ACIC’s motion seeking summary judgment dismissing the complaint.

In light of the “order and judgment” in the declaratory judgment action, the present action [*2]is barred under the doctrine of res judicata (see EBM Med. Health Care, P.C. v Republic W. Ins., 38 Misc 3d 1 [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]). We note that, contrary to Metropolitan’s contention, defendant’s answer in the Civil Court, which answer had been filed after the Supreme Court declaratory judgment action had been commenced but before the default “order and judgment” had been entered, asserted that another action was “pending between the same parties for the same cause of action in a different court.” We also find no merit in the particular equitable estoppel argument raised by Metropolitan on appeal. Metropolitan’s remaining arguments similarly lack merit.

Accordingly, the order is affirmed.

Pesce, P.J., Weston and Solomon, JJ., concur.

Decision Date: February 23, 2016

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 in light of the default order and judgment declaring the insurer owed the provider nothing under the claim, rejecting arguments about unawareness, pleading and equitable estoppel.

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.
Ava Acupuncture, P.C. v NY Cent. Mut. Fire Ins. Co. (2012 NY Slip Op 50233(U)) FollowedAn 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)) FollowedThe providers' no-fault action was barred by res judicata because a prior declaratory judgment resolved coverage for the same accident.

Similar decisions

Metro Health Prods., Inc. v Nationwide Ins. (2017 NY Slip Op 50607(U))The provider's action was barred by res judicata because a default declaratory judgment established the insurer's nonliability for the same claims.
Active Care Med. Supply Corp. v American Commerce Ins. Co. (2016 NY Slip Op 51813(U))An unvacated default declaratory judgment order can bar a provider's no-fault action under res judicata without a notice of entry.
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.
Atlantic Chiropractic, P.C. v Liberty Mut. Fire Ins. Co. (2016 NY Slip Op 51072(U))An entered default declaratory judgment barring no-fault coverage has preclusive effect even without service of notice of entry.
Healthway Med. Care, P.C. v American Tr. Ins. Co. (2016 NY Slip Op 51786(U))The provider's claims were barred by res judicata because a prior declaration resolved coverage for the same accident between the same parties.