Unitrin Safeguard Ins. Co. v Advanced Recovery Solution, Inc. (2022 NY Slip Op 50517(U))

Index No. 160339/2020

Goldberg, Miller & Rubin, P.C., New York, NY (Harlan R. Schreiber and Lindsay A. Padover of counsel), for plaintiff.

Samandarov & Associates, P.C., Floral Park, NY (David M. Gottlieb of counsel), for defendant Quality Ortho Complete Joint Care, P.C.

In this no-fault insurance coverage action, plaintiff, Unitrin Safeguard Insurance Company, moves for default judgment under CPLR 3215 against no-fault claimants Oscar Galeas and Jairo Ruales. Unitrin also moves for default judgment against a number of medical providers who are benefits assignees of Galeas and Ruales (or assignees of two other defendants, no-fault claimants Milton Parra and Daniel Espinoza).^[FN1] Answering defendant Quality Ortho Complete Joint Care, P.C., cross-moves to dismiss under CPLR 3215 (c) and CPLR 3211 (a) (4).

Unitrin’s motion for default judgment is granted without opposition. Quality Ortho’s cross-motion to dismiss Unitrin’s claims against it is granted only to the extent of directing consolidation of this action with the parallel action brought by Unitrin against Quality Ortho.

With respect to Unitrin’s default-judgment motion, Unitrin has sufficiently established service on the defendants that are the subject of its motion, and those defendants’ defaults. And the affidavit of Unitrin’s no-fault claims representative (as supported by the accompanying police report) shows that Unitrin had a founded belief that the claimants’ injuries (and ensuing benefits claims for medical treatment) did not arise from a covered collision. (See NYSCEF Nos. 52-53.) Unitrin is therefore entitled to default judgment against these defendants.

Quality Ortho’s cross-motion to dismiss is based on two independent grounds. Quality Ortho contends first that Unitrin’s action must be dismissed as against it under CPLR 3215 (c) because Unitrin failed to take proceedings for the entry of default judgment against other defendants within one year of those defendants’ defaults. But it is undisputed that Quality Ortho timely answered.^[FN2] This court sees no basis on which Quality Ortho—as opposed to a different, defaulting defendant—may even seek dismissal under CPLR 3215 of Unitrin’s claims against it.^[FN3] Nor does Quality Ortho supply any authority for the proposition that a plaintiff’s failure to seek default judgment within a year against a defaulting defendant requires dismissal of the plaintiff’s claims as against a different, answering defendant. In any event, this court concludes that given the numerous defendants in the action, Unitrin’s active prosecution of its claims against some of the defendants, and its active settlement negotiations with other defendants, Unitrin has established good cause for its brief delay in bringing this motion for default judgment. (See NYSCEF No. 51 at &para 32.) The court declines to dismiss Unitrin’s claims against Quality Ortho on this ground.

Quality Ortho also argues that Unitrin’s claims against it must be dismissed under CPLR 3211 (a) (4). Quality Ortho contends that Unitrin’s claims here impermissibly duplicate claims asserted in a de novo challenge to an arbitration award, also pending in Supreme Court, New [*2]York County.^[FN4] This court is unpersuaded that Unitrin’s claims against Quality Ortho in this action should be dismissed. Unitrin filed this action 10 months before the parallel de novo action, seeking broader relief against more parties; and this action has progressed materially farther (including through the assignment of the undersigned pursuant to Unitrin’s RJI). Dismissal of Unitrin’s claims against Quality Ortho here would be inappropriate under the first-in-time rule that generally governs motions to dismiss under CPLR 311 (a) (4).^[FN5] (See National Union Fire Ins. Co. of Pittsburgh, Pa. v Jordache Enters., 205 AD2d 341, 343 [1st Dept 1994].)

At the same time, it is undisputed that the two actions each feature Unitrin as the plaintiff and Quality Ortho as a defendant and involve closely overlapping questions of fact and law, such that leaving the two actions to run along separate, parallel tracks could lead to needless duplication of judicial effort and inconsistent results. This court holds that the de novo action, Index No. 158403/2021, should be consolidated into this action under CPLR 3211 (a) (4) and CPLR 602.^[FN6]

Settle Order.

Footnotes

Footnote 1:Unitrin represents that defendants Parra and Espinoza have not yet been located for purposes of service. (See NYSCEF No. 51 at 2 n 1.)

Footnote 2:Indeed, Unitrin acknowledges this timely answer in explaining why its motion does not seek default judgment against Quality Ortho. (See NYSCEF No. 51 at 2 n 1.)

Footnote 3:To be clear, Quality Ortho may, under the language of CPLR 2215, cross-move against Unitrin although it was not a subject of Unitrin’s initial motion. This court holds only that Quality Ortho may not cross-move to dismiss under CPLR 3215 (c) when it did not default.

Footnote 4:See Unitrin Safeguard Insurance Company v Quality Orthopedics & Complete Joint Care, PC, Index No. 158403/2021 (Sup Ct, NY County).

Footnote 5:Quality Ortho has not moved to dismiss under CPLR 3211 (a) (4) in the parallel de novo action.

Footnote 6:This court may properly order consolidation sua sponte in the exercise of its authority under CPLR 3211 (a) (4) to “make such order as justice requires.” Thus, for example, in John J. Campagna, Jr., Inc. v Dune Alpin Farm Assocs. (81 AD2d 633, 634 [2d Dept 1981]), the Appellate Division, Second Department held that the motion court properly applied the first-in-time rule in denying dismissal under CPLR 3211 (a) (4). But the Second Department went on to hold that “to best serve the interests of judicial economy while still preserving the rights of the parties, the [motion] court should have sua sponte ordered consolidation of these actions,” and itself directed consolidation on appeal. (Id.)