February 6, 2008

Stracar Med. Servs., P.C. v State Farm Mut. Auto. Ins. Co. (2008 NY Slip Op 50277(U))

https://www.beynensonlaw.com/case-law/stracar-med-servs-p-c-v-state-farm-mut-auto-ins-co-2008-ny-slip-op50277u/

Court
Appellate Term, Second Department
Decided
February 6, 2008
Citation
2008 NY Slip Op 50277(U) · 18 Misc 3d 136(A)
Posture
Default or vacatur
Outcome
Provider prevailed
Issues
Defaults and vacatur Timeliness and preclusion
Legal questions
Vacating a default: excuse and defense · Proof of mailing (see the maps)
Cite as
Stracar Med. Servs., P.C. v State Farm Mut. Auto. Ins. Co., 18 Misc 3d 136(A), 2008 NY Slip Op 50277(U) (App Term, 2d Dept, 2d & 11th Jud Dists 2008)

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 justify vacatur because it proved neither a reasonable excuse for its default nor a meritorious defense. Under CPLR 5015 (a), both were required. Its conclusory defense allegations did not establish that the defenses appeared in timely denials, and its documentary proof did not support a presumption of timely mailing through a standard office procedure. Its claims representative also merely assumed that faxing a proposed stipulation extended the time to answer, without discussing an extension with the provider's counsel or receiving any indication of agreement. The Appellate Term, Second Department, found that vacatur was an improvident exercise of discretion, reversed the order, and denied the insurer's motion, leaving the provider's default judgment in place.

Reported in New York Official Reports at Stracar Med. Servs., P.C. v State Farm Mut. Auto. Ins. Co. (2008 NY Slip Op 50277(U))

[*1]
Stracar Med. Servs., P.C. v State Farm Mut. Auto. Ins. Co.
2008 NY Slip Op 50277(U) [18 Misc 3d 136(A)]
Decided on February 6, 2008
Appellate Term, Second Department
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This opinion is uncorrected and will not be published in the printed Official Reports.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 February 6, 2008

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS


PRESENT: : WESTON PATTERSON, J.P. and RIOS, J.
2006-910 K C
Stracar Medical Services, P.C. a/a/o PEDRO OVALLES, Appellant,

against

State Farm Mutual Automobile Ins. Co., Respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Bernard J. Graham, J.), entered March 2, 2006. The order granted defendant’s motion to vacate a default judgment.

Order reversed without costs and defendant’s motion to vacate a default judgment denied.

In order to vacate the default judgment entered in this action to recover assigned first-party no-fault benefits, defendant was required to establish, pursuant to CPLR 5015 (a), both a reasonable excuse for the default and a meritorious defense (see
Eugene Di Lorenzo, Inc. v Dutton Lbr. Co., 67 NY2d 138, 141 [1986]). A motion to vacate a default judgment is addressed to the sound discretion of the motion court (see Matter of Gambardella v Ortov Light., 278 AD2d 494 [2000]), and its determination will generally not be disturbed unless it can be shown that the court improvidently exercised its discretion (see Levy Williams Constr. Corp. v United States Fire Ins. Co., 280 AD2d 650 [2001]). Despite the strong public policy in favor of resolution of cases on the merits, upon a review of the record, we are of the opinion that the court below improvidently exercised its discretion in granting defendant’s motion to vacate the default judgment.

Defendant’s conclusory allegations that it possessed a meritorious defense were insufficient to warrant vacatur of the default judgment since defendant failed to show that its [*2]proffered defenses were set forth in timely denial of claim forms such that defendant is not precluded from interposing its defenses (see Insurance Department Regulations [11 NYCRR] § 65-3.5 [b]). The documentary proof annexed to defendant’s opposing papers was insufficient to give rise to a presumption that the denial of claim forms were timely mailed pursuant to a standard office practice or procedure (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274 [1997]; New York & Presbyt. Hosp. v Allstate Ins. Co., 29 AD3d 547 [2006]; PDG Psychological, P.C. v Lumbermans Mut. Cas. Co., 16 Misc 3d 131[A], 2007 NY Slip Op 51343[U] [App Term, 2d & 11th Jud Dists 2007]). Moreover, defendant failed to establish that it possessed a reasonable excuse for its failure to timely serve its answer. Defendant’s claims representative merely assumed that defendant’s time to serve its answer was enlarged because she faxed a proposed stipulation to plaintiff granting defendant an enlargement of its time to answer. The claims representative never spoke to plaintiff’s counsel about such an extension, and she never received any indication that plaintiff agreed to extend defendant’s time to answer.

In light of the foregoing, the order is reversed and defendant’s motion to vacate the default judgment is denied.
Weston Patterson, J.P. and Rios, J., concur.
Decision Date: February 06, 2008

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