November 29, 2018

Ortho Passive Motion, Inc. v Allstate Ins. Co. (2018 NY Slip Op 51749(U))

https://www.beynensonlaw.com/case-law/ortho-passive-motion-inc-v-allstate-ins-co-2018-ny-slip-op-51749u/

Court: Appellate Term, Second Department
Decided: November 29, 2018
Citation: 2018 NY Slip Op 51749(U)
Posture: Other motion
Outcome: Provider prevailed
Later treatment: Followed in 1 later decision (see Cited by)
Issues: Policy issues

Cite as

Ortho Passive Motion, Inc. v Allstate Ins. Co., 2018 NY Slip Op 51749(U) (App Term, 2d Dept, 9th & 10th Jud Dists 2018)

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 insurer failed to establish policy exhaustion when the claims became complete and obtained no modification of the provider's judgment. After a nonjury trial, the insurer sought postjudgment relief under CPLR 5019 (a) and 5240, asserting that no policy funds remained. The exhaustion defense was not precluded by omission from the denial, but the motion papers failed to establish exhaustion at the relevant time under 11 NYCRR 65-3.15, Nyack Hosp. v General Motors Acceptance Corp., and Alleviation Med. Servs., P.C. v Allstate Ins. Co. The Appellate Term, Second Department, affirmed the order, insofar as appealed from, leaving open whether proven exhaustion would support postjudgment relief.

Reported in New York Official Reports at Ortho Passive Motion, Inc. v Allstate Ins. Co. (2018 NY Slip Op 51749(U))

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 9th and 10th JUDICIAL DISTRICTS

Ortho Passive Motion, Inc., as Assignee of Adan Rivera-Martinez, Respondent,
against
Allstate Insurance Company, Appellant.

Peter C. Merani, P.C. (Eric M. Wahrburg and Adam Kass of counsel), for appellant. Israel, Israel & Purdy, LLP (Ryan B. Berry of counsel), for respondent.

Appeal from an order of the District Court of Nassau County, Third District (Scott Fairgrieve, J.), dated March 1, 2017. The order, insofar as appealed from as limited by the brief, denied the branch of defendant’s motion seeking to modify a judgment of that court entered July 29, 2015, following a nonjury trial, awarding plaintiff the principal sum of $3,723.72.

ORDERED that the order, insofar as appealed from, is affirmed, with $25 costs.

In this action to recover assigned first-party no-fault benefits, defendant asserted, as an affirmative defense, that the insurance policy limits had been exhausted. At a nonjury trial, the District Court (Scott Fairgrieve, J.) noted that the parties had stipulated to, among other things, defendant’s timely denial of the claim at issue. Following the trial, a judgment was entered on July 29, 2015 awarding plaintiff the principal sum of $3,723.72. On November 7, 2016, defendant moved, insofar as is relevant to this appeal, pursuant to CPLR 5019 (a) and 5240, among others, to modify the judgment on the ground that the coverage limits of the insurance policy had been exhausted. Plaintiff opposed the motion. Defendant appeals from so much of an order of the District Court dated March 1, 2017 as denied the branch of defendant’s motion seeking to modify the judgment, citing CPLR 5240 as authority for its requested relief.

At the outset, we note that, although defendant did not deny the claim on the ground that the coverage limits of the insurance policy at issue had been exhausted, this defense is not [*2]precluded (see New York & Presbyt. Hosp. v Allstate Ins. Co., 12 AD3d 579 [2004]; Alleviation Med. Servs., P.C. v Allstate Ins. Co., 55 Misc 3d 44 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]).

In support of its motion, defendant argued that there are no funds available to pay the judgment because the $50,000 policy limit in basic personal injury protection had been exhausted. Assuming, arguendo, that such contention, if established, would entitle defendant to some form of postjudgment relief (see Hospital for Joint Diseases v Hertz Corp., 22 AD3d 724 [2005]), we find that, in any event, defendant’s motion papers failed to establish an exhaustion of the coverage limits of the insurance policy at issue, as defendant failed to demonstrate that the policy had been exhausted at the time the claims at issue had been deemed complete (see 11 NYCRR 65-3.15; Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294 [2007]; Alleviation Med. Servs., P.C., 55 Misc 3d 44). Consequently, defendant has established no basis to modify the judgment.

Accordingly, the order, insofar as appealed from, is affirmed

TOLBERT, J.P., BRANDS and RUDERMAN, JJ., concur.

ENTER:
Paul Kenny
Chief Clerk
Decision Date: November 29, 2018

Cited in this decision

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

New York & Presbyt. Hosp. v Allstate Ins. Co. (2004 NY Slip Op 08669) FollowedAn untimely denial does not preclude an exhaustion defense or establish entitlement to judgment on a previously denied duplicate claim.
Alleviation Med. Servs., P.C. v Allstate Ins. Co. (2017 NY Slip Op 27097) FollowedAn insurer cannot establish policy exhaustion through payments made after it denied a fully verified claim.
Hospital for Joint Diseases v Hertz Corp. (2005 NY Slip Op 07932)An insurer's contractual duties cease once it has paid the policy's full monetary limits.

Cited by

A label shows how the later decision treated this one.

North Queens Surgical Ctr. v Lancer Ins. Co. (2025 NY Slip Op 50191(U)) FollowedThe insurer's policy-exhaustion defense failed at trial and on appeal where it paid later-received claims after denying the provider's claim.

Similar decisions

JPC Med., P.C. v State Farm Mut. Auto. Ins. Co. (2022 NY Slip Op 50562(U))The insurer failed to establish policy exhaustion because its claim specialist did not lay a sufficient foundation for the payment log.
Pain Med., PLLC v State Farm Mut. Auto. Ins. Co. (2024 NY Slip Op 50069(U))The insurer failed to establish policy exhaustion because its claims specialist laid an insufficient foundation for the payment log.
Ortho Passive Motion Inc. v Allstate Ins. Co. (2017 NY Slip Op 27057)The insurer's postjudgment motion based on policy exhaustion was denied because it failed to prove that pleaded defense at trial.
Advanced Recovery Equip. & Supplies, LLC v Park Ins. Co. (2018 NY Slip Op 51630(U))The insurer failed to show that policy limits were exhausted when the provider's claim was complete.
New York & Presbyt. Hosp. v Allstate Ins. Co. (2006 NY Slip Op 02731)The insurer proved exhaustion of policy limits before it became obligated to pay the provider's claim.