August 20, 2014

Ultimate Health Prods., Inc. v American Tr. Ins. Co. (2014 NY Slip Op 51321(U))

Headnote

The court considered the fact that Ultimate Health Products, Inc. had initiated a lawsuit to recover assigned first-party no-fault benefits for supplies provided to an individual who was injured in a motor vehicle accident. American Transit Insurance Company had also initiated a separate lawsuit, alleging that the injured individual had breached the insurance policy terms. In the end, the Supreme Court determined that the injured individual was not eligible for no-fault benefits and American Transit was not obligated to pay any claims for first-party no-fault benefits. The main issue was whether the present action was barred under the doctrine of res judicata, and the court held that it was, as any judgment in favor of the plaintiff in this action would destroy or impair rights or interests established by the Supreme Court declaratory judgment. Therefore, the court affirmed the order to dismiss the complaint.

Reported in New York Official Reports at Ultimate Health Prods., Inc. v American Tr. Ins. Co. (2014 NY Slip Op 51321(U))

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

Ultimate Health Products, Inc. as Assignee of CARLOS MARTINEZ, Appellant,

against

American Transit Ins. Co., Respondent.

Appeal from an order of the Civil Court of the City of New York, Queens County (William A. Viscovich, J.), entered January 18, 2013. The order implicitly denied plaintiff’s motion for summary judgment and granted defendant’s cross motion for summary judgment dismissing the complaint.

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

Ultimate Health Products, Inc. (Ultimate Health) commenced this action in the Civil Court, Queens County, to recover assigned first-party no-fault benefits for supplies provided to its assignor as a result of injuries sustained in a motor vehicle accident. While this no-fault action was pending, defendant, American Transit Insurance Company (American Transit), commenced a declaratory judgment action in Supreme Court, New York County, against Ultimate Health and its assignor, among others, alleging that the assignor had breached the terms of the insurance policy by failing to appear for duly scheduled examinations under oath and that, as a result, American Transit is not obligated to pay any claims for first-party no-fault benefits submitted by Ultimate Health as assignee of Carlos Martinez arising from the car accident in question. In December of 2011, plaintiff moved in the Civil Court for summary judgment. On May 15, 2012, the Supreme Court awarded American Transit a declaratory judgment on default. American Transit subsequently cross-moved in the Civil Court, pursuant to CPLR 3211 (a) (5), to dismiss plaintiff’s action, contending that this action is barred by virtue of the declaratory judgment. Plaintiff opposed defendant’s cross motion and now appeals from an order of the Civil Court, entered January 18, 2013, which implicitly denied plaintiff’s motion for summary judgment and granted defendant’s cross motion dismissing the complaint.

The Supreme Court determined that Ultimate Health’s assignor was not an eligible injured person entitled to no-fault benefits under the applicable policy, and that American Transit was not obligated to pay claims submitted by Ultimate Health as assignee of Carlos Martinez in any current or future proceedings arising under that policy from the car accident in question. In light of the declaratory judgment, the present action 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, 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, 11th & 13th Jud Dists 2012]; SZ Med., P.C. v Erie Ins. [*2]Co., 24 Misc 3d 126[A], 2009 NY Slip Op 51221[U] [App Term, 2d, 11th & 13th Jud Dists 2009]), as any judgment in favor of plaintiff in this action would destroy or impair rights or interests established by the Supreme Court declaratory judgment (see Schuylkill Fuel Corp. v Nieberg Realty Corp., 250 NY 304, 306-307 [1929]; SZ Med., P.C. v Erie Ins. Co., 24 Misc 3d 126[A], 2009 NY Slip Op 51221[U]). Plaintiff’s remaining arguments lack merit or were not preserved for appeal.

Accordingly, the order is affirmed.

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


Decision Date: August 20, 2014