theCPLRblog

5015 and Defaults

Pichardo-Garcia v Josephine's Spa Corp., 2012 NY Slip Op 00004 (1st Dept., 2012)

In the absence of a determination by the motion court, pursuant to CPLR 5015(a)(1), of the reasonableness of plaintiff's proffered excuse for her failure to appear at a scheduled compliance conference, we reject the claim of law office failure as "conclusory and perfunctory" (see Perez v New York City Hous. Auth., 47 AD3d 505, 505 [2008]). Counsel explained that the failure to appear was due to a conflict between scheduled appearances in this action and in an unrelated action. However, he did not state that he took any steps to resolve or alleviate the conflict or that he was unaware of the conflict. Counsel's "overbooking of cases and inability to keep track of his appearances" does not constitute a reasonable excuse for the failure to appear (id.; see also Youni Gems Corp. v Bassco Creations Inc., 70 AD3d 454, 455 [2010], lv dismissed 15 NY3d 863 [2010]). Moreover, plaintiff made no attempt to vacate the default until almost a year after being served with the notice of its entry (see Youni, 70 AD3d at 455).

Kohn v Tri-State Hardwoods, Ltd., 2012 NY Slip Op 00933 (2nd Dept., 2012)

It is undisputed that the plaintiff defaulted in serving a reply to the appellant's counterclaim and that the appellant failed to move for leave to enter a default judgment on the counterclaim within one year after the default. Since the appellant failed to make a timely motion for leave to enter a default judgment, it was required to demonstrate a reasonable excuse for its delay in seeking a default judgment and a potentially meritorious claim (see Giglio v NTIMP, Inc., 86 AD3d 301, 308; Costello v Reilly, 36 AD3d 581; Iorizzo v Mattikow, 25 AD3d 762, 763; Oparaji v Madison Queens-Guy Brewer, 293 AD2d 591, 592). The appellant failed to demonstrate a reasonable excuse for its delay of over two years after the one-year statutory time period had expired (see Butindaro v Grinberg, 57 AD3d 932, 933; Mattera v Capric, 54 AD3d 827, 828; Lugauer v Forest City Ratner Co., 44 AD3d 829, 830; Opia v Chukwu, 278 AD2d 394). Accordingly, the appellant's motion for leave to enter a default judgment on the counterclaim was properly denied.

2261 Palmer Ave. Corp. v Malick, 2012 NY Slip Op 00506 (2nd Dept., 2012)

In order to vacate her default in appearing or answering the complaint, the defendant was required to demonstrate both a reasonable excuse for the default and the existence of a potentially meritorious defense to the action (see CPLR 5015[a][1]; Bank of Am. v Faracco, 89 AD3d 879; Community Preserv. Corp. v Bridgewater Condominiums, LLC, 89 AD3d 784; see also Swensen v MV Transp., Inc., 89 AD3d 924). Even if the defendant demonstrated a reasonable excuse for her default, our review of the record establishes that she failed to demonstrate a potentially meritorious defense to the action. The papers submitted in support of her cross motion, inter alia, to vacate her default in appearing or answering the compalint were replete with self-serving, vague, and unsubstantiated denials and unsupported legal conclusions as to whether a potentially meritorious defense to the action existed, and were thus an insufficient basis for vacating her default (see Thapt v Lutheran Med. Ctr., 89 AD3d 837; Garal Wholesalers, Ltd. v Raven Brands, Inc., 82 AD3d 1041).

Accordingly, the Supreme Court properly granted that branch of the plaintiff's motion which was pursuant to CPLR 3215 for leave to enter a default judgment, and properly denied that branch of the defendant's cross motion which was to vacate her default in appearing or answering the complaint.

Toll Bros., Inc. v Dorsch, 2012 NY Slip Op 00359 (2nd Dept., 2012)

"A defendant seeking to vacate a default pursuant to CPLR 5015(a)(1) must demonstrate both a reasonable excuse for the default and a potentially meritorious defense to the action" (Clover M. Barrett, P.C. v Gordon,AD3d, 2011 NY Slip Op 09581, *1 [2d Dept 2011]; see Development Strategies Co., LLC, Profit Sharing Plan v Astoria Equities, Inc., 71 AD3d 628). "Other factors which the court should consider include whether the default prejudiced the opposing party, whether it was willful or evinced an intent to abandon the litigation, and whether vacating the default would serve the strong public policy of resolving cases on their merits when possible" (Dimitriadis v Visiting Nurse Serv. of N.Y., 84 AD3d 1150, 1150-1151; see U.S. Bank, N.A. v Dick, 67 AD3d 900, 902; Moore v Day, 55 AD3d 803, 804).

Here, the defendant established both a reasonable excuse for the default, and the [*2]existence of a potentially meritorious defense to the action. Further, there was no showing by the plaintiff that it was prejudiced by the default or that the default was willful, and public policy favors the resolution of cases on their merits (see Dimitriadis v Visiting Nurse Serv. of N.Y., 84 AD3d at 1151; Moore v Day, 55 AD3d at 805; Li Gang Ma v Hong Guang Hu, 54 AD3d 312, 313; Ahmad v Aniolowiski, 28 AD3d 692, 693). Accordingly, under the circumstances of this case, the Supreme Court improvidently exercised its discretion in denying that branch of the defendant's motion which was pursuant to CPLR 5015(a)(1) to vacate his default.

Procedural cornucopia and 5015

CPLR R. 5015

CPLR § 5501

Pollak v Moore, 2011 NY Slip Op 05351 (1^st Dept. 2011)

Plaintiff's appeal from the judgment does not bring up for review an order of the motion court, entered November 20, 2009 (Richard B. Lowe, III, J.), which was marked "final disposition" and, in fact, disposed of all of plaintiff's claims, leaving nothing further in the action that would require non-ministerial judicial action (see CPLR 5015[a][1]; Burke v Crosson, 85 NY2d 10 [1995]). While the judgment explicitly referred to the November 20, 2009 order, and such order "affected" the judgment, the November 20, 2009 order did not meet the further criterion that the underlying order sought to be reviewed on appeal from the judgment be "non-final" (see CPLR 5501[a][1]). Plaintiff abandoned his appeal from the November 20, 2009 order, and cannot revive that appeal by the expedient of effecting a ministerial entry of judgment upon the final order after expiration of the time to perfect the initial appeal. 

Assuming we were able to reach plaintiff's appellate arguments on the merits, we would find them unavailing. Plaintiff's initial argument that Justice Lowe's November 20, 2009 order was void as it was dated approximately two weeks after Justice Lowe had transferred the action to another IAS part, and such transfer was based on his recusing himself from the action, is unsupported by the record. A review of the relevant transfer orders indicates that the transfer of the action to Justice Walter Tolub, who was handling a related foreclosure proceeding, was done for judicial economy purposes. Moreover, it is noted that prior to the transfer, defendants' motion to dismiss was fully submitted and orally argued before Justice Lowe, and Justice Lowe informed the parties that he would render a decision on the motion (see generally Hudson View II Assoc. v Miller, 282 AD2d 345 [2001], lv dismissed 96 NY2d 937 [2001]; Zelman v Lipsig, 178 AD2d 298 [1991]). Plaintiff offers no evidence to indicate bias or impropriety in the rendering of the November 20, 2009 order (see generally Hudson View II Assoc., 282 AD2d 345). We find plaintiff's related due process arguments unavailing.

We find that plaintiff's breach of contract claim, which was predicated upon a purported agreement by defendants to sell plaintiff a portion of a lot (with improvements thereon) pending formal division of the lot on the New York City tax map, to be barred by the statute of frauds. The documentary evidence established that the purported agreement was not signed by all the parties to be charged (see General Obligations Law § 5-703[2]; Naldi v Grunberg, 80 AD3d 1 [2010], lv denied __ NY3d __, 2011 NY Slip Op 71494 [2011]), the sale terms were modified by plaintiff, and the parties had an opportunity to execute plaintiff's marked-up contract of sale, but did not elect to execute such agreement. To the extent plaintiff relies on other writings to argue that they demonstrate the parties to be charged agreed to the sale of a portion of a lot to plaintiff (see generally WWP Group USA v Interpublic Group of Cos., 228 AD2d 296 [1996]), we find that the writings do no more than reflect interest of the parties to be charged in effecting a sale of the portion of the property to plaintiff upon appropriate terms.Plaintiff's alternative claims sounding in breach of fiduciary duty, fraud, fraud in the inducement and negligent misrepresentation were duplicative of his breach of contract claims and, as such, properly dismissed (see J.E. Morgan Knitting Mills v Reeves Bros., 243 AD2d 422 [1997]; cf. Deerfield Communications Corp. v Chesebrough-Ponds, Inc., 68 NY2d 954 [1986]). Plaintiff's claim for unjust enrichment was unsupported by evidence that defendants, whose interest in the property at stake was foreclosed against, were enriched at plaintiff's expense (see generally Paramount Film Distrib. Corp. v State of New York, 30 NY2d 415 (1972), cert denied 414 US 829 [1973]; Weiner v Lazard Freres & Co., 241 AD2d 114, 119-120 [1998]).

Insofar as plaintiff requested leave to serve a second amended complaint, denial of such relief was a proper exercise of discretion as plaintiff failed to annex a copy of a proposed second amended pleading to his motion papers, and he did not otherwise offer an affidavit of merit or any "new" facts as would overcome the legal defects in his prior two complaints (see generally Jebran v LaSalle Bus. Credit, LLC, 33 AD3d 424 [2006]; Gonik v Israel Discount Bank of N.Y., 80 AD3d 437, 438-439 [2011]).

Kohn v Kohn, 2011 NY Slip Op 06095 (2^nd Dept., 2011)

To vacate her default in opposing the plaintiff's motion, the defendant was required to demonstrate both a reasonable excuse for her default and a potentially meritorious opposition (see Remote Meter Tech. of NY, Inc. v Aris Realty Corp., 83 AD3d 1030; Bazoyah v Herschitz, 79 AD3d 1081). A motion to vacate a default is addressed to the sound discretion of the Supreme Court (see Dimitriadis v Visiting Nurse Serv. of N.Y., 84 AD3d 1150). The Supreme Court has the discretion to accept law office failure as a reasonable excuse (see CPLR 2005), where the claim of law office failure is supported by a "detailed and credible" explanation of the default (see Remote Meter Tech. of N.Y., Inc. v Aris Realty Corp., 83 AD3d 1030; Winthrop Univ. Hosp. v Metropolitan Suburban Bus Auth., 78 AD3d 685, 686). Here, the defendant's claim of law office failure was supported by a "detailed and credible" explanation of the default, and the Supreme Court providently exercised its discretion in accepting that explanation. Moreover, the defendant demonstrated the existence of a potentially meritorious opposition to the plaintiff's motion.

5015

CPLR R. 5015 Relief from judgment or order
(a) On motion
(1) excusable default...
(2) newly-discovered evidence...
(3) fraud, misrepresentation, or other misconduct of an adverse party
(4) lack of jurisdiction to render the judgment or order
(5) reversal, modification or vacatur of a prior judgment or order upon which it is based

CPLR § 3126 Penalties for refusal to comply with order or to disclose

Dimitriadis v Visiting Nurse Serv. of N.Y., 2011 NY Slip Op 04410 (App. Div., 2nd 2011)

A motion to vacate a default is addressed to the sound discretion of the Supreme Court (see Gerdes v Canales, 74 AD3d 1017; Scala v 4020 Jerusalem Owners, Inc., 72 AD3d 926, 927; Matter of Lee v Morgan, 67 AD3d 681, 682; Holt Constr. Corp. v J & R Music World, 294 AD2d 540). To obtain relief from a default pursuant to CPLR 5015(a)(1), the moving defendant must demonstrate a reasonable excuse for the default and the existence of a potentially meritorious defense to the action (see Felsen v Stop & Shop Supermarket Co., LLC,AD3d, 2011 NY Slip Op 02840 [2d Dept 2011]; Westchester Med. Ctr. v Allstate Ins. Co., 80 AD3d 695, 696; Farrah v Pinos, 78 AD3d 1115; Francis v Long Is. Coll. Hosp., 45 AD3d 529, 530). Other factors which the court should consider include whether the default prejudiced the opposing party, whether it was willful or evinced an intent to abandon the litigation, and whether vacating the default would serve the strong public policy of resolving cases on their merits when possible (see U.S. Bank, N.A. v Dick, 67 AD3d 900, 902; Klughaupt v Hi-Tower Contrs., Inc., 64 AD3d 545, 546; Westchester Med. Ctr. v Hartford Cas. Ins. Co., 58 AD3d 832, 832-833; Moore v Day, 55 AD3d 803, 804).

Contrary to the plaintiffs' contentions, the Supreme Court providently exercised its discretion in granting the defendant's motion to vacate its default. The defendant established a reasonable excuse for the default, and the affidavit of its expert demonstrated the existence of a potentially meritorious defense. Furthermore, the record does not indicate that the plaintiffs were prejudiced by the default or that the default was willful or part of a pattern of neglect, and the vacatur of the default advances the public policy of resolving actions on their merits (see e.g. Dorio v County of Suffolk, 58 AD3d 594, 595; Li Gang Ma v Hong Guang Hu, 54 AD3d 312, 313; Verde Elec. Corp. v Federal Ins. Co., 50 AD3d 672, 673; Cooney v Cambridge Mgt. & Realty Corp., 35 AD3d 522, 523).

Assael v 15 Broad St., LLC, 2011 NY Slip Op 03984 (App. DIv., 2nd 2011)

Upon the plaintiff's appeal, in a decision and order dated March 16, 2010, this Court determined that the defendant's motion to vacate the default judgment should have been denied (see Assael v 15 Broad St., LLC, 71 AD3d 802). Following that appeal, the plaintiff sought to collect the proceeds of the subject bond. The defendant moved, inter alia, to discharge the subject bond, arguing that it had been issued as a condition of vacating the default judgment. The Supreme Court, among other things, granted that branch of the defendant's motion which was to discharge the subject bond. We affirm the order insofar as appealed from.

"A court which renders a judgment or order may relieve a party from it upon such terms as may be just'(CPLR 5015[a]), including the imposition of a bond or undertaking" (Doris v Lewis, 76 AD3d 536, 537; see Yadid, LLC v GCW Bell Corp., 48 AD3d 799, 800; Testwell Craig Labs. v Charles Assoc., 264 AD2d 836, 837). Here, the Supreme Court directed the defendant to post a bond "as a condition of vacatur" of the default judgment. However, upon this Court's decision and order dated March 16, 2010, determining that the defendant's motion to vacate the aforementioned default judgment should have been denied, the parties were, in effect, returned to the status quo ante, namely, that prior to the defendant's motion to vacate its default. Accordingly, the Supreme Court properly granted that branch of the defendant's motion which was to discharge the subject bond.

Ogunmoyin v 1515 Broadway Fee Owner, LLC, 2011 NY Slip Op 05469 (App. Div., 2nd 2011)

While law office failure can be accepted as a reasonable excuse in the exercise of a court's sound discretion, the movant must submit supporting facts to explain and justify the default, and mere neglect is not accepted as a reasonable excuse (see Morrison v Rosenberg, 278 AD2d 392, 392; Cole-Hatchard v Grand Union, 270 AD2d 447, 447; De Vito v Marine Midland Bank, 100 AD2d 530, 531).

Here, the plaintiff's proffered excuse of law office failure was vague and unsubstantiated and, thus, did not constitute a reasonable excuse for the default (see Knowles v Schaeffer, 70 AD3d 897, 898; Chechen v Spencer, 68 AD3d 801, 802; Murray v New York City Health & Hosps. Corp., 52 AD3d 792, 793; St. Luke's Roosevelt Hosp. v Blue Ridge Ins. Co., 21 AD3d 946, 947). Accordingly, the Supreme Court providently exercised its discretion in denying the plaintiff's motion to vacate so much of the order dated November 13, 2009, as was entered upon her default in opposing the defendants' separate motions for summary judgment dismissing the complaint (see Star Indus., Inc. v Innovative Beverages, Inc., 55 AD3d 903, 904; Antoine v Bee, 26 AD3d 306; Matter of Hye-Young Chon v Country-Wide Ins. Co., 22 AD3d 849).

Tribeca Lending Corp. v Bartlett, 2011 NY Slip Op 03896 (App. DIv., 1st 2011)

To the extent that defendant's motion to vacate can be construed as based on lack of jurisdiction, pursuant to CPLR 5015(a)(4), the motion fails because defendant formally appeared in this action in June 2007 when he served an answer (see CPLR 320). The fact that an order was entered in January 2008
striking his answer does not vitiate defendant's formal appearance or divest the court of personal jurisdiction over him.

Stasiak v Forlenza, 2011 NY Slip Op 04448 (App. Div., 2nd 2011

The order dated January 12, 2009, granting the wife's unopposed motion, in effect, for summary judgment on the complaint, was rendered at a time when the proceedings were stayed pursuant to both the order dated January 8, 2009, and CPLR 321(c) (see Moray v Koven & Krause, Esqs., 15 NY3d 384, 388-390; Albert v Albert, 309 AD2d 884, 886; Chavoustie v Shaad, 133 AD2d 532). Thus, the Supreme Court erred in issuing the judgment entered March 2, 2009, upon the order dated January 12, 2009. Accordingly, the Supreme Court should have granted that branch of the husband's motion which was to vacate the judgment entered on March 2, 2009, pursuant to CPLR 5015(a) in the interests of substantial justice (see Woodson v Mendon Leasing Corp., 100 NY2d 62, 68; Wade v Village of Whitehall, 46 AD3d 1302, 1303; F & C Gen. Contrs. Corp. v Atlantic Mut. Mtge. Corp., 202 AD2d 629, 630; Lane v Lane, 175 AD2d 103, 105).

The Supreme Court also erred in issuing the judgment entered July 8, 2009. At the time of the inquest, the wife had already been granted all of the relief she requested in the complaint, and the husband had no notice that the wife would be seeking an additional award far greater than that sought in the complaint. Moreover, the husband had no representation at the inquest, and did not ask any questions or present any evidence. Based on the wife's testimony that she was owed a particular amount, the Supreme Court awarded her all of the sums that could potentially become due over the 10-year period following the date of the separation agreement. Because the separation agreement did not contain an acceleration clause, the wife was not entitled to these sums at time she made the request (see Long Is. R.R. Co. v Northville Indus. Corp., 41 NY2d 455, 466; McCready v Lindenborn, 172 NY 400, 408; Runfola v Cavagnaro, 78 AD3d 1035; Zarembka v Zarembka, 81 AD2d 742; Gutman v Gutman, 51 AD2d 535, 536). Further, the amount awarded in the judgment entered July 8, 2009, was based on the assumption that the husband would be required to pay the maximum $1,000 per month for the wife's health insurance premiums and $350 per month for the wife's cell phone expenses, while the evidence the wife submitted in support of her earlier motion, in effect, for summary judgment on the complaint showed that her actual monthly health insurance and cell phone expenses were usually substantially less than these amounts. Accordingly, the Supreme Court should have granted that branch of the husband's motion which was to vacate the judgment entered July 8, 2009, pursuant to CPLR 5015(a) in the interests of substantial justice (see Woodson v Mendon Leasing Corp., 100 NY2d at 68; Wade v Village of Whitehall, 46 AD3d at 1303; F & C Gen. Contrs. Corp. v Atlantic Mut. Mtge. Corp., 202 AD2d at 630; Lane v Lane, 175 AD2d at 105).

 

Rampersant v Nationwide Mut. Fire Ins. Co., 2010 NY Slip Op 02530 (App. Div., 2nd, 2010)

The defendant moved pursuant to 22 NYCRR 202.21(e), inter alia, to vacate the note of issue, contending that the plaintiff failed to comply with, among other things, certain demands for bank and credit card statements and authorizations for cellular phone records for the years 2005 and 2006. By order dated March 6, 2009, the Supreme Court granted the defendant's motion, inter alia, to vacate the note of issue only to the extent of directing the plaintiff to provide authorizations for the disclosure of his Wachovia Bank statements, credit card statements, and cellular phone records for the time period between January 1, 2006, and August 2006. The defendant subsequently moved, inter alia, to modify the order dated March 6, 2009, to extend the time period of disclosure to include August 1, 2005, through December 31, 2005. In support thereof, the defendant submitted the plaintiff's application for automobile insurance dated August 7, 2005, to demonstrate that the requested discovery was material and necessary to the defense of this action. The court denied that branch of the defendant's motion which was to modify the prior order.

The Supreme Court providently exercised its discretion in declining to vacate the note of issue, since it directed discovery to be completed by a date certain (see Joseph v Propst, 306 AD2d 246; Matter of Long Is. Light. Co. v Assessor of Town of Brookhaven, 122 AD2d 794, 795).

However, that branch of the defendant's motion which was to modify the order dated March 6, 2009, to extend the time period of disclosure to include August 1, 2005, through December 31, 2005, should have been granted (see CPLR 5015[a][4]). By submitting the plaintiff's application for insurance dated August 7, 2005, the defendant demonstrated that the disclosure sought for the time period between August 1, 2005, and December 31, 2005, was material and necessary to the defense of this action (see CPLR 3101[a]; Insurance Law § 3105[a]; Cain v United Ins. Co., 232 SC 397, 401, 102 SE2d 360; Barkan v New York Schools Ins. Reciprocal, 65 AD3d 1061, 1064; Tannenbaum v Provident Mut. Life Ins. Co. of Phila., 53 AD2d 86 affd 41 NY2d 1087).

5015(a)(3); 317; 2005; Renewal Judgment

CPLR R. 5015 Relief from judgment or order
(a) On motion
(1) excusable default...
(2) newly-discovered evidence...
(3) fraud, misrepresentation, or other misconduct of an adverse party
(4) lack of jurisdiction to render the judgment or order
(5) reversal, modification or vacatur of a prior judgment or order upon which it is based

CPLR § 317

CPLR § 2005

Matter of Travelers Ins. Co. v Rogers, 2011 NY Slip Op 03729 (App. DIv., 1st 2011)

Supreme Court abused its discretion in refusing to vacate its prior order granting a permanent stay of arbitration of respondents Rogers and Westwater's uninsured motorist claim, which was granted upon their failure to appear at the petition hearing or to submit papers in opposition. Vacatur should have been granted on the ground of "fraud, misrepresentation, or other misconduct of an adverse party" (CPLR 5015[a][3]). A review of the record in this case reveals several potential instances of intentional and material misrepresentations of fact by petitioner, which, at least in part, may have formed the basis of Supreme Court's decision and order to permanently stay arbitration. Hence, it was an abuse of discretion to conclude that the failure to proffer a reasonable excuse precluded relief pursuant to CPLR 5015(a)(3), since that section does not require such a showing (cf. CPLR 5015 [a] [1]; see Shouse v Lyons, 4 AD3d 821, 822 [2004]). To the extent that some of respondents' allegations of fraud, misrepresentation or other misconduct are not conclusively established by the evidence in the record, they present issues of fact which should not be determined without holding a hearing (Readick v Readick, 80 AD3d 512, 513 [2011]; see also Tonawonda Sch. Emples. Fed. Credit Union v Zack, 242 AD2d 894, 894-95 [1997]).

Olivaria v Lin & Son Realty, Corp., 2011 NY Slip Op 03655 (App. Div., 1st 2011)

Relief under CPLR 5015(a)(1) was properly denied. The record shows that Lin did not receive process because it failed to maintain a current address on file with the Secretary of State for 18 years (see On Assignment v Medasorb Tech., LLC, 50 AD3d 342 [2008]; Business Corporation Law § 408).

The Supreme Court should not have concluded, however, that Lin's request for relief under CPLR 317 was untimely. The statute permits a defendant who has been "served with a summons other than by personal delivery" and has not appeared to defend the action upon a finding of the court that the defendant "did not personally receive notice of the summons in time to defend and has a meritorious defense" (CPLR 317). A defendant so served may be allowed to defend the action "within one year after [such defendant] obtains knowledge of entry of the judgment, but in no event more than five years after such entry . . ." (id.)^[FN1]. In making a CPLR 317 motion, a defendant does not have to come forward with a reasonable excuse for its default (see Pena v Mittleman, 179 AD2d 607, 609 [1992]).

By regarding the February 4, 2003 order as an entered judgment, the court reached the conclusion that the statutory five-year period had expired. This was error. "A judgment is entered when, after it has been signed by the clerk, it is filed by him" (CPLR 5016[a]). Unlike the 2003 order, the 2009 judgment was duly signed and entered by the County Clerk. Accordingly, the motion was timely because August 20, 2009 is the date of entry from which Lin's time is to be measured.

The lease between Lin and the injured plaintiff's employer provided for heating through perimeter ducts and made no mention of portable heaters. Lin's president states by affidavit that the company had no knowledge of the tenant's use of portable heaters. Thus, Lin has demonstrated, prima facie, that it has a meritorious defense to plaintiffs' claims. Moreover, it does not appear that Lin deliberately attempted to avoid notice of this action (see e.g. Eugene Di Lorenzo, Inc. v Dutton Lbr. Co., 67 NY2d 138, 143 [1986]). In the exercise of discretion, we therefore grant Lin's motion to vacate the default judgment pursuant to CPLR 317.

Casali v Cyran, 2011 NY Slip Op 03791 (App. Div., 2nd 2011)

To vacate his default, the plaintiff was required to demonstrate a reasonable excuse for the default and potentially meritorious opposition to the motion (see CPLR 5015[a]; Legaretta v Ekhstor, 74 AD3d 899; Rivera v Komor, 69 AD3d 833; Nowell v NYU Med. Ctr., 55 AD3d 573). The plaintiff's excuse for failing to oppose the motion of the defendant Daniel J. Cyran for summary judgment dismissing the compaint insofar as asserted against Cyran can only be classified as law office failure. Although the Supreme Court has the discretion to excuse a default resulting from law office failure (see CPLR 2005), here, the plaintiff's attorney, in his affirmation, admitted that there was "no excuse, reasonable or otherwise." Additionally, the plaintiff failed to establish that he had potentially meritorious opposition to the motion (see Bollino v Hitzig, 34 AD3d 711). Accordingly, the Supreme Court properly denied the plaintiff's motion to vacate the prior order granting Cyran's motion for summary judgment dismissing the complaint insofar as asserted against Cyran.

n Tend Masoers Dist. Council Welfare Fund v Diamond Constr. & Maintenance, Inc., 2011 NY Slip Op 03815 (App. Div., 2nd 2011)

In an action for leave to enter a renewal judgment pursuant to CPLR 5014, nonparty Deutsche Bank National Trust Company appeals from an order of the Supreme Court, Richmond County (Minardo, J.), dated July 22, 2010, which denied its motion pursuant to CPLR 5015(a)(4) to vacate a renewal judgment of the same court dated January 11, 2010 on the ground that the Supreme Court lacked jurisdiction to issue the renewal judgment because Deutsche Bank National Trust Company was not joined as a necessary party.
ORDERED that the order is affirmed, with costs.
"Persons who ought to be parties if complete relief is to be accorded between the persons who are parties to the action or who might be inequitably affected by a judgment in the action shall be made plaintiffs or defendants" (CPLR 1001[a]). This statute "limit[s] the scope of indispensable parties to those cases and only those cases where the determination of the court will adversely affect the rights of nonparties" (Matter of Castaways Motel v Schuyler, 24 NY2d 120, 125; see Spector v Toys "R" Us, Inc., 12 AD3d 358, 359).
Here, the Supreme Court properly found that nonparty Deutsche Bank National Trust Company did not need to be joined in the instant action in order to accord complete relief to the parties, and that Deutsche Bank National Trust Company was not inequitably affected by the renewal judgment.
In an action for leave to enter a renewal judgment pursuant to CPLR 5014, nonparty Deutsche Bank National Trust Company appeals from an order of the Supreme Court, Richmond County (Minardo, J.), dated July 22, 2010, which denied its motion pursuant to CPLR 5015(a)(4) to vacate a renewal judgment of the same court dated January 11, 2010 on the ground that the Supreme Court lacked jurisdiction to issue the renewal judgment because Deutsche Bank National Trust Company was not joined as a necessary party.

s

5015; 3012; and a Sur-Reply

CPLR § 3012 Service of pleadings and demand for complaint
(d) Extension of time to appear or plead

CPLR R. 5015 Relief from judgment or order

Garal Wholesalers, Ltd. v Raven Brands, Inc., 2011 NY Slip Op 02349 (App. Div., 2nd 2011)

A party seeking to vacate a default in appearing or answering and to serve a late answer must demonstrate a reasonable excuse for the default and a potentially meritorious defense to the action (see CPLR 5015[a][1]; Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141; Heidari v First Advance Funding Corp., 55 AD3d 669; Levi v Levi, 46 AD3d 519; 599 Ralph Ave. Dev., LLC. v 799 Sterling Inc., 34 AD3d 726; New York & Presbyt. Hosp. v Travelers Prop. Cas. Ins. Co., 27 AD3d 708). The good-faith belief of the president of the defendant Raven Brands, Inc. (hereinafter Raven), that his telephone conversation with the plaintiff's attorney and his subsequent letters denying the allegations in the complaint were sufficient to answer the complaint did not constitute a sufficient excuse for the default, particularly since the plaintiff's attorney responded by letter stating that Raven was in default in answering the complaint (see Tucker v Rogers, 95 AD2d 960). Furthermore, Raven's erroneous assumptions regarding the validity of the action and the need to defend did not constitute reasonable excuses for its default in answering and for its almost four-month delay in appearing in this action (see Yao Ping Tang v Grand Estate, LLC, 77 AD3d 822, 823; Awad v Severino, 122 AD2d 242; Passalacqua v Banat, 103 AD2d 769). Moreover, the affidavit of Raven's president, which contained only conclusory assertions without any evidentiary support, was insufficient to establish a potentially meritorious defense to the action (see Kolajo v City of New York, 248 AD2d 512, 513; Peterson v Scandurra Trucking Co., 226 AD2d 691, 692; Lener v Club Med, 168 AD2d 433, 435).

Pena-Vazquez v Beharry, 2011 NY Slip Op 02462 (App. Div., 1st, 2011)

The court providently exercised its discretion in denying plaintiffs' motion and deeming defendants' answer timely served nunc pro tunc. Plaintiffs' acceptance of defendants' answer, without objection, constituted a waiver of the late service and default (see Ligotti v Wilson, 287 AD2d 550, 551 [2001]). In any event, the settlement discussions between plaintiffs and defendants' insurer constitute a reasonable excuse for defendants' delay in answering (see CPLR 3012[d]; see also Finkelstein v East 65th St. Laundromat, 215 AD2d 178 [1995]). Contrary to plaintiffs' contention, defendants were not required to demonstrate the existence of a meritorious defense (see Verizon N.Y. Inc. v Case Constr. Co., Inc., 63 AD3d 521 [2009]).

The court providently exercised its discretion in considering defendants' surreply. The court granted permission for the filing of the surreply, which contained courtesy copies of affidavits that had been filed with the Clerk prior to the motion return date (see generally Barbuto v Winthrop Univ. Hosp., 305 AD2d 623, 623-624 [2003]).

I missed this case, but found it on JT's blog.

Ferdico v Zweig, 2011 NY Slip Op 02621 (App. Div., 2nd 2011)

The Supreme Court providently exercised its discretion in denying that branch of the cross motion of the defendants Brian Mullen and Marybeth Mullen (hereinafter together the Mullens) which was to vacate a judgment dated March 11, 2009, pursuant to CPLR 5015(a)(2). The Mullens failed to establish, inter alia, that the purportedly newly discovered evidence, a report of an alleged handwriting expert concluding that the alleged signature of Morris Zweig on a contract of sale dated July 15, 2004, that had been attached as an exhibit to the plaintiffs' complaint was a forgery, could not have been discovered earlier through the exercise of due diligence (see Sicurelli v Sicurelli, 73 AD3d 735; Vogelgesang v Vogelgesang, 71 AD3d 1132, 1133-1134; Sieger v Sieger, 51 AD3d 1004, 1005; Matter of State Farm Ins. Co. v Colangelo, 44 AD3d 868). The Supreme Court also properly denied that branch of the Mullens' cross motion which was to vacate the judgment dated March 11, 2009, pursuant to CPLR 5015(a)(3), as they failed to establish that the judgment was procured as a result of fraud, misrepresentation, or other improper conduct (see Matter of Johnson v New York City Dept. of Educ., 73 AD3d 927, 928; Sicurelli v Sicurelli, 73 AD3d 735; Matter of Tellez, 56 AD3d 678).

The Supreme Court also properly denied that branch of the Mullens' cross motion which was to renew their motion for summary judgment dismissing the complaint insofar as asserted against them and their opposition to the plaintiffs' motion for summary judgment on the first cause of action for specific performance of the contract of sale dated July 15, 2004, as they failed to set forth both "new facts not offered on the prior motion[s] that would change the prior determination" and a "reasonable justification for the failure to present such facts on the prior motion[s]" (CPLR 2221[e][2], [3]; see Bank of Am., N.A., USA v Friedman, 44 AD3d 696; Yarde v New York City Tr. Auth., 4 AD3d 352, 353; Johnson v Marquez, 2 AD3d 786, 788-789; Riccio v DePeralta, 274 AD2d 384). The Mullens failed to set forth a reasonable justification as to why they did not previously obtain the report of their alleged handwriting expert in time to submit it in support of their original cross motion or in opposition to the plaintiffs' original motion, given that the contract of sale analyzed by their alleged expert was attached as an exhibit to the complaint in the instant action.

The No-Fault (most of March 2011)

I just realized that I haven't posted a no-fault case in over a month.

Appellate Division, Second Department

Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 2011 NY Slip Op 02379 (App. Div., 2nd 2011)

The plaintiff hospital, as assignee of Bartolo Reyes, was awarded judgment against the defendant in the principal sum of $416,039.42, in this action to recover no-fault medical benefits under a contract of insurance entered into between the plaintiff's assignee and the defendant. The defendant thereafter moved to modify the judgment pursuant to CPLR 5015(a), belatedly asserting that the judgment exceeded the coverage limit of the subject policy due, in part, to payments previously made under the policy to other health care providers. In the order appealed from, the Supreme Court properly denied the defendant's motion to modify the judgment.

The defendant failed to specify on which of the five subdivisions of CPLR 5015(a) its motion was based, much less establish its entitlement to relief on any of the enumerated grounds. To the extent that the defendant sought modification pursuant to CPLR 5015(a)(2) based upon "newly-discovered evidence," the defendant failed to demonstrate that the evidence offered in support of the motion, i.e., an affidavit of an employee setting forth the policy limits and the amount of benefits paid for alleged prior claims, "was not available at the time of the prejudgment proceedings" (Jonas v Jonas, 4 AD3d 336, 336; see Sicurelli v Sicurelli, 73 AD3d 735).

Moreover, although courts possess inherent discretionary power to grant relief from a judgment or order in the interest of justice, this "extraordinary relief" is not appropriate under the circumstances presented (Jakobleff v Jakobleff, 108 AD2d 725, 726-727; see Selinger v Selinger, 250 AD2d 752). The plaintiff previously moved for summary judgment on the complaint, seeking a certain amount of benefits, in accordance with the no-fault billing statement sent to the defendant, and this Court reversed the denial of that motion and granted the plaintiff's motion for summary judgment on the complaint (see Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 60 AD3d 1045). Only after the plaintiff obtained, upon this Court's order, a judgment from the Clerk of the Supreme Court, Nassau County, representing, inter alia, the amount of benefits sought in the complaint, did the defendant raise the issue of exhaustion of the policy limits. Under these circumstances, modification of the judgment in the interest of justice is not warranted.

Manuel v New York City Tr. Auth., 2011 NY Slip Op 02362 (App. Div., 2nd 2011) ("Alighting")

For the no-fault statute to apply, the vehicle must be a proximate cause of the injury (see Walton v Lumbermens Mut. Cas. Co., 88 NY2d 211, 215). To be a proximate cause of the injury, the use of the motor vehicle must be closely related to the injury (see Zaccari v Progressive Northwestern Ins. Co., 35 AD3d 597; Elite Ambulette Corp. v All City Ins. Co., 293 AD2d 643). Also, the injury must result from the intrinsic nature of the motor vehicle as such, and the use of the vehicle must do more than merely contribute to the condition which produced it (see Zaccari v Progressive Northwestern Ins. Co., 35 AD3d 597; Republic Long Is., Inc. v Andrew J. Vanacore, Inc., 29 AD3d 665; Duroseau v Town of Hempstead, 117 AD2d 579).

Here, the negligent operation of a motor vehicle was the proximate cause of the plaintiff's injuries. The plaintiff's theory of liability is that her injuries resulted from the manner in which the bus driver operated the bus, specifically his positioning of the bus next to a hole in the street when he pulled over at the bus stop. Moreover, this is not a case in which the plaintiff was completely outside of the vehicle when the accident occurred (see Walton v Lumbermens Mut. Cas. Co., 88 NY2d at 215; Santo v Government Empls. Ins. Co., 31 AD3d 525; Elite Ambulette Corp. v All City Ins. Co., 293 AD2d 643), or in which the plaintiff was the victim of an intentional tort (see Lancer Ins. Co. v Peterson, 175 AD2d 239; Locascio v Atlantic Mut. Ins. Co., 127 AD2d 746; Matter of Manhattan & Bronx Surface Tr. Operating Auth. [Gholson], 71 AD2d 1004).

This case is analogous to Hill v Metropolitan Suburban Bus Auth. (157 AD2d 93). In Hill, the plaintiff fell while descending the stairs of the rear exit of a bus, when she tripped on a nail or tile on the bus staircase and fell into a hole in the sidewalk. This Court agreed with the defendant's assertion that the no-fault law applied, because the accident arose from the use or operation of a bus (see Matter of Celona v Royal Globe Ins. Co., (85 AD2d 635).

NYCTA was not estopped from arguing that the accident arose from the use or operation of the insured vehicle, as NYCTA never did anything to lead the plaintiff to believe that it would not argue that the accident arose from the use or operation of a motor vehicle (see Walsh v Prudential Ins. Co. of Amer., 101 AD2d 988). NYCTA stated at trial that first-party benefits had been denied because it had no record of the accident.

Appellate Division, FIrst Department

Unitrin Advantage Ins. Co. v Bayshore Physical Therapy, PLLC, 2011 NY Slip Op 01948 (App. Div., 1st 2011)

The motion court properly determined that plaintiff insurer may retroactively deny claims on the basis of defendants' assignors' failure to appear for independent medical examinations (IMEs) requested by plaintiff, even though plaintiff initially denied the claims on the ground of lack of medical necessity (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720, 721-722 [2006]). The failure to appear for IMEs requested by the insurer "when, and as often as, [it] may reasonably require" (Insurance Department Regulations [11 NYCRR] § 65-1.1) is a breach of a condition precedent to coverage under the No-Fault policy, and therefore fits squarely within the exception to the preclusion doctrine, as set forth in Central Gen. Hosp. v Chubb Group of Ins. Cos. (90 NY2d 195 [1997]). Accordingly, when defendants' assignors failed to appear for the requested IMEs, plaintiff had the right to deny all claims retroactively to the date of loss, regardless of whether the denials were timely issued (see Insurance Department Regulations [11 NYCRR] § 65-3.8[c]; Fogel, 35 AD3d at 721-22).

It is of no moment that the retroactive denials premised on failure to attend IMEs were embodied in blanket denial forms, or that they were issued based on failure to attend IMEs in a different medical speciality from that which underlies the claims at issue. A denial premised on breach of a condition precedent to coverage voids the policy ab initio and, in such case, the insurer cannot be precluded from asserting a defense premised on no coverage (see Chubb, 90 NY2d at 199).

There is likewise no merit to defendants' contention that the IME request notices were invalid. Plaintiff satisfied its prima facie burden on summary judgment of establishing that it requested IMEs in accordance with the procedures and time-frames set forth in the No-Fault implementing regulations, and that defendants' assignors did not appear. In opposition, defendants failed to raise an issue of fact that the requests were unreasonable (see generally Celtic Med. P.C. v New York Cent. Mut. Fire Ins. Co., 15 Misc 3d 13, 14-15 [2007]; A.B. Med. Servs. PLLC v USAA Gen. Indem. Co., 9 Misc 3d 19, 21 [2005]).

Defendants' argument that plaintiff was required to demonstrate that the assignors' failure to appear for the IMEs was willful is unpreserved and, in any event, without merit. The doctrine of willfulness, as addressed in Thrasher v United States Liab. Ins. Co. (19 NY2d 159 [1967]), applies in the context of liability policies, and has no application in the No-Fault context, where the eligible injured party has full control over the requirements and conditions necessary to obtain coverage (cf. id. at 168).

I think this is an absolutely terrible decision.  The language of the decision permits an insurance policty to be voided ab initio as a result of the actions of someone other than the insured.  So if the insured has an accident and a passenger gets hurt, but does not attend an IME, the insured's policy goes bye bye.  It also expands the scope of a coverage defense beyond the Court of Appeal's definition.  And the decision is in conflict with longstanding law from the Second Department.  Hopefully the Court of Appeals will take this one.

For a much longer discussion of this decision and what it spells for the future of no-fault, head over to No-Fault Defender where there are 60 comments and counting.

Appellate Term, Second Department

The Appellate Term denied leave for Belt Parkway Imaging, P.C. v State Wide Ins. Co., 2010 NY Slip Op 52229(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2010).

Gateway Med., P.C. v Progressive Ins. Co., 2011 NY Slip Op 50336(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2011).

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved to dismiss the complaint for lack of personal jurisdiction since the purported service of the summons and complaint under CPLR 312-a was never completed, as defendant never signed and returned an acknowledgment of service. Plaintiff opposed the motion, arguing that defendant should be compelled to sign the acknowledgment or, in the alternative, that plaintiff should be permitted to serve the summons and complaint by another manner. The Civil Court denied defendant's motion, and this appeal ensued.

The record reveals that an acknowledgment of receipt was never signed by defendant and returned to plaintiff. "If the acknowledgment of receipt is not mailed or returned to the sender, the sender is required to effect personal service in another manner" (Dominguez v Stimpson Mfg. Corp., 207 AD2d 375 [1994]; see also Patterson v Balaquiot, 188 AD2d 275 [1992]). Plaintiffs did not effect service in another manner. Accordingly, the service was defective and defendant's motion to dismiss the complaint should have been granted.

JT had an interesting take on the case.

W & Z Acupuncture, P.C. v Allstate Ins. Co., 2010 NY Slip Op 52385(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2010).

Subsequent to that [discovery] order, the Civil Court issued an order dismissing the action since plaintiff failed to produce the court-ordered discovery. The dismissal of the action rendered the instant appeal academic (see Livny v Rotella, 305 AD2d 377 [2003]; Delta Diagnostic Radiology, P.C. v Allstate Ins. Co., 15 Misc 3d 131[A], 2007 NY Slip Op 50673[U] [App Term, 2d & 11th Jud Dists 2007]; Fair Price Med. Supply Corp. v ELRAC Inc., 13 Misc 3d 33 [App Term, 2d & 11th Jud Dists 2006]).

The bracketed word is mine.

Jamaica Med. Supply, Inc. v Kemper Cas. Ins. Co., 2011 NY Slip Op 50315(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2010).

The billing records submitted by plaintiff in support of its motion for summary judgment do not assert that the supplies at issue had been delivered to plaintiff's assignor. Nor did plaintiff's affiant state that he had delivered the supplies to plaintiff's assignor. Indeed, he stated that it is his general practice to either (1) deliver his supplies directly to the eligible injured person or to (2) deliver them to the prescribing healthcare providers for subsequent delivery to the eligible injured person. He did not specify in his affidavit which method of delivery was used in this case. Accordingly, plaintiff's moving papers failed to demonstrate its prima facie entitlement to summary judgment. 

We note that the holding in Fair Price Med. Supply Corp. v Travelers Indem. Co. (10 NY3d 556 [2008]) does not impact our decision in this case because, in that case, the issue of whether the plaintiff had made out a prima facie case was not dealt with by either the Appellate Division (42 AD3d 277 [2007]) or the Court of Appeals (10 NY3d 556). The Court of Appeals held that a defense that the billed-for services or supplies were never provided is precluded if the insurer fails to timely deny the claim, and both courts limited their discussions to the preclusion issue. Here, we are asked to consider whether plaintiff's moving papers made out a prima facie case in the first instance so as to even shift the burden to defendant to raise a non-precluded defense (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]), and we conclude that they did not.

The Court distinguishes Fair Price in a way that renders the Court of Appeals' decision meaningless.

Quality Health Prods. v Country-Wide Ins. Co., 2011 NY Slip Op 50328(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2010).

Plaintiff established that defendant did not pay plaintiff's claim. However, plaintiff failed to establish that the claim was not denied within 30 days (see New York & Presbyt. Hosp. v Allstate Ins. Co., 31 AD3d 512 [2006]; see also Westchester Med. Ctr. v Nationwide Mut. Ins. Co., 78 AD3d 1168 [2010]). Plaintiff attached a copy of a portion of defendant's denial of claim form to its motion papers, but this copy did not establish that defendant did not deny the claim within 30 days, since the date of the denial of claim form was not contained in the portion of the form annexed to plaintiff's papers. Moreover, plaintiff's affiant did not provide the date on which the denial of claim form was received by plaintiff. Furthermore, the reason for defendant's denial of the claim was also not included in the annexed portion of the form. As plaintiff failed to show that the claim was not denied within 30 days or that the basis for the denial was conclusory, vague or had no merit as a matter of law, it failed to make a prima facie showing of its entitlement to judgment as a matter of law (see Westchester Med. Ctr., 78 AD3d 1168). As a result, we need not consider the sufficiency of defendant's paper's submitted in opposition to the motion (see Westchester Med. Ctr., 78 AD3d 1168). Accordingly, the order denying plaintiff's motion for summary judgment is affirmed, albeit on a different ground.

Westchester doesn't quite say what they cite it to say.

Exoto, Inc. v Progressive Ins. Co., 2011 NY Slip Op 50329(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2010).

On appeal, plaintiff asserts that it provided defendant with the NF-3 form it requested as additional verification. Plaintiff did not subsequently respond to defendant's follow-up request seeking the same verification because defendant failed to clearly state why the previously submitted NF-3 form was insufficient. Consequently, plaintiff argues, it is not in default in providing the requested verification.

A review of the record indicates that each of defendant's requests for NF-3 forms states, in pertinent part, that "Every box must be fully completed, blank boxes will not be accepted." It is uncontroverted that the box on the NF-3 form plaintiff provided in response to defendant's initial verification request - - wherein the provider's signature should be placed - - was left blank. Therefore, when defendant issued its follow-up request which, again, informed plaintiff that "Every box must be fully completed, blank boxes will not be accepted," defendant clearly apprised plaintiff of why the submitted NF-3 form did not satisfy its request for verification.

Since plaintiff did not demonstrate that it had provided defendant with the requested verification prior to the commencement of the instant action, the 30-day period within which defendant was required to pay or deny the claim did not begin to run (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]; Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492 [2005]). Consequently, the Civil Court properly granted defendant's motion for summary judgment dismissing the complaint as premature and denied plaintiff's cross motion for summary judgment. Accordingly, the judgment is affirmed.

If you knew the facts of this case you would cringe after reading this decision.

CPLR R. 2219 Time and form of order.

Omega Diagnostic Imaging, P.C. v MVAIC, 2011 NY Slip Op 50331(U) (App. Term, 2nd 11th & 13th Jud. Dists. 2010).

Contrary to the determination of the Civil Court, MVAIC defaulted because it failed to submit written opposition to plaintiff's motion for summary judgment (see CPLR 2219 [a]; Coneys v Johnson Controls, Inc., 11 AD3d 576 [2004]; Marino v Termini, 4 AD3d 342 [2004]; Millennium Med. Instruments v MVAIC, 27 Misc 3d 127[A], 2010 NY Slip Op 50583[U] [App Term, 2d, 11th & 13th Jud Dists 2010]). Accordingly, MVAIC's motion properly sought to vacate the default judgment entered against it.

In support of its motion, under the circumstances presented, MVAIC established both a reasonable excuse for its default and the existence of a potentially meritorious defense. Accordingly, MVAIC's motion to vacate the default judgment entered against it should have been granted (see Strauss v R & K Envtl., 66 AD3d 766 [2009]; New York Univ. Hosp. Rusk Inst. v Illinois Natl. Ins. Co., 31 AD3d 511 [2006]; New York & Presbyt. Hosp. v American Home Assur. Co., 28 AD3d 442 [2006]).

Go here for some background on this appeal.

Appellate Term, First Department

Now take a look at how the First Department approaches and MVAIC appeal.  Same attorneys.

Omega Diagnostic Imaging, P.C. v MVAIC, 2011 NY Slip Op 50432(U) (App. Term, 1st 2011)

[A]ffirmed, with $10 costs.

In this action by plaintiff-provider to recover assigned first-party no-fault benefits, defendant MVAIC's motion for summary judgment dismissing the claim based on plaintiff's failure to establish that its assignor qualified for MVAIC coverage, was properly denied (see Matter of MVAIC v Interboro Med. Care & Diagnostic, PC, 73 AD3d 667 [2010]; Englington Med., P.C. v Motor Veh. Acc. Indem. Corp. (___AD3d ___, 2011 NY Slip Op 00176 [2011]). Nor has defendant established that plaintiff was required to "exhaust its remedies" prior to commencing this action (see Omega Diagnostic Imaging, P.C. v MVAIC, 29 Misc 3d 129[A], 2010 NY Slip Op 51779[U] [2010]). Defendant's argument, raised for the first time on appeal, that it is entitled to dismissal of the action as premature based on outstanding verification requests is without merit (id.).

Kind of a big deal (below).  I forgot whether I posted this before and I don't feel like checking.

Pomona Med. Diagnostics, P.C. v GEICO Ins. Co., 30 Misc 3d 141(A) (App. Term, 1st 2011)

In opposition to plaintiff's prima facie showing of entitlement to judgment as a matter of law (see Countrywide Ins. Co. v 563 Grand Med., P.C., 50 AD3d 313, 314 [2008]; Central Nassau Diagnostic Imaging, P.C. v GEICO, 28 Misc 3d 34, 36 [2010]; Fair Price Med. Supply, Inc. v St. Paul Travelers Ins. Co., 16 Misc 3d 8, 9 [2007]), the report of defendant's peer review doctor, which relied on the assignor's medical records (see Cross Cont. Med., P.C. v Allstate Ins. Co., 13 Misc 3d 10, 11 [2006]; see also Urban Radiology, P.C. v Tri-State Consumer Ins. Co., 27 Misc 3d 140[A], 2010 NY Slip Op 50987[U] [2010]), raised a triable issue of fact as to whether the services provided by plaintiff were medically necessary (see Krishna v Liberty Mut. Ins. Co., 24 Misc 3d 128[A], 2009 NY Slip Op 51312[U] [2009]). Contrary to defendant's contention, however, its "submissions did not conclusively establish as a matter of law its defense of lack of medical necessity," and its cross motion was properly denied (A Plus Med., P.C. v Mercury Cas. Co., 23 Misc 3d 136[A], 2009 NY Slip Op 50824[U] [2009]).

Combine this decision with Abdalla v Mazl Taxi, Inc., 2010 NY Slip Op 06071 (App. Div., 2nd, 2010), Stephen Fealy, M.D., P.C. v State Farm Mut. Auto Ins. Co., 2010 NY Slip Op 51442(U) (App. Term, 2nd, 11th & 13th Jud. Dists. 2010), and Hillcrest Radiology Assoc. v State Farm Mut. Auto. Ins. Co., 2010 NY Slip Op 51467(U) (App. Term, 2nd, 11th & 13th Jud. Dists. 2010), and you have something interesting.

5015 generally

CPLR R. 5015

Giraldo v Weingarten, 2011 NY Slip Op 01433 (App. Div., 2nd 2011)

In support of that branch of the motion of the defendant Koytcho Koev (hereinafter the defendant) which was pursuant to CPLR 5015(a)(1) to vacate the judgment entered upon an order granting the plaintiffs' unopposed motion for leave to enter a judgment upon his failure to appear or answer the complaint, the defendant failed to demonstrate a reasonable excuse for his default in opposing the plaintiffs' motion and a potentially meritorious defense to the action (see NY SMS Waterproofing, Inc. v Congregation Machne Chaim, Inc.,AD3d, 2011 NY Slip Op 00661 [2d Dept 2011]; Bazoyah v Herschitz, 79 AD3d 1081; Campbell-Jarvis v Alves, 68 AD3d 701). Furthermore, the defendant did not offer any explanation for the six-month delay in moving to vacate the default judgment after he received it in the mail (see Alterbaum v Shubert Org., Inc., AD3d, 2011 NY Slip Op 00339 [2d Dept 2011]; Bekker v Fleischman, 35 AD3d 334; Epps v LaSalle Bus, 271 AD2d 400).

In support of that branch of his motion which was pursuant to CPLR 317 to vacate the default judgment, the defendant failed to demonstrate that he did not personally receive notice of the summons in time to defend the action (see Thas v Dayrich Trading, Inc., 78 AD3d 1163; Commissioners of State Ins. Fund v Nobre, Inc., 29 AD3d 511; General Motors Acceptance Corp. [*2]v Grade A Auto Body, Inc., 21 AD3d 447).

 

The Court's inherent power to vacate shouldnt be invoked all willy nilly like

CPLR R. 5015

Galasso, Langione & Botter, LLP v Liotti, 2011 NY Slip Op 01432 (App. Div., 2nd 2011)

Although the court has an inherent discretionary power to relieve a party from a judgment or order for sufficient reason and in the interest of substantial justice (see Woodson v Mendon Leasing Corp., 100 NY2d 62, 68; Katz v Marra, 74 AD3d 888; see generally Selinger v Selinger, 250 AD2d 752, 753), the invocation of the court's inherent power to vacate its judgment or order was not warranted herein. Thus, the Supreme Court properly denied the appellant's motion to vacate the judgment, and properly denied his motion for leave to renew his motion to vacate the judgment. Moreover, the Supreme Court also providently exercised its discretion, upon granting the third-party defendant's motion for sanctions, in imposing a sanction in the sum of $1,000 on the appellant (see 22 NYCRR 130-1.1 [c]; Tornheim v Blue & White Food Prods. Corp., 73 AD3d 749).

Indeed, the conduct of the pro se appellant attorney in pursuing the instant appeal appears to be completely without merit in law or fact and unsupported by a reasonable argument for an extension, modification, or reversal of existing law, or undertaken primarily to delay or prolong the resolution of litigation or to harass or maliciously injure another (see 22 NYCRR 130-1.1[c]; Tornheim v Blue & White Food Prods. Corp., 73 AD3d 749; Weinstock v Weinstock, 253 AD2d 873, 874, cert denied 526 US 1088).

3215(c)(f): Defaults

CPLR § 3215 Default judgment

Brown v Andreoli, 2011 NY Slip Op 01060 (App. Div., 1st 2011)

Order, Supreme Court, New York County (George J. Silver, J.), entered June 9, 2010, which, in an action for personal injuries arising out of a motor vehicle accident, granted plaintiff's motion for a default judgment to the extent that if defendant did not file her answer within 45 days of service of the order with notice of entry, a default judgment would be entered against her, unanimously reversed, on the law, without costs, the motion denied, and the complaint dismissed as abandoned. The Clerk is directed to enter judgment accordingly.

Plaintiff failed to demonstrate a reasonable excuse for failing to move for a default judgment until more than one year after defendant's time to answer had expired (see CPLR 3215[c]; Mejia-Ortiz v Inoa, 71 AD3d 517 [2010]). Counsel's proffered explanation for the delay in moving for a default judgment, namely health problems, did not constitute a reasonable excuse since those health problems occurred outside the one-year period in which plaintiff had to move (see Mattera v Capric, 54 AD3d 827 [2008]).

The motion court, after determining that no reasonable excuse had been established, should have dismissed the complaint as abandoned (see CPLR 3215[c]; Perricone v City of New York, 62 NY2d 661, 663 [1984]; Opia v Chukwu, 278 AD2d 394 [2000]).

Midfirst Bank v Al-Rahman, 2011 NY Slip Op 01252 (App. Div., 2nd 2011)

The Supreme Court also properly denied that branch of the appellants' motion which was pursuant to CPLR 5015(a)(3) to vacate the judgment of foreclosure and sale, as they "failed to establish that the plaintiff procured the judgment of foreclosure and sale by fraud, misrepresentation, or other misconduct" (Tribeca Lending Corp. v Crawford, 79 AD3d at 1020; see Feldstein v Rounick, 295 AD2d 398).

Further, the plaintiff's alleged failure to comply with CPLR 3215(f) did not render the judgment a nullity, or warrant excusing the appellants' default in the absence of a reasonable excuse or a potentially meritorious defense (see Neuman v Zurich N. Am., 36 AD3d 601, 602; Araujo v Aviles, 33 AD3d 830; Coulter v Town of Highlands, 26 AD3d 456, 457).

I was looking around for this and realized that I never posted it.

Westchester Med. Ctr. v Philadelphia Indem. Ins. Co., 69 AD3d 613 (App. Div., 2nd 2010)

A defendant seeking to vacate a judgment entered upon its default in appearing and answering the complaint must demonstrate a reasonable excuse for its delay in appearing and answering, as well as the existence of a meritorious defense to the action (see CPLR 5015 [a] [1]; Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141 [1986]; Verde Elec. Corp. v Federal Ins. Co., 50 AD3d 672, 672-673 [2008]). The Special Deputy Superintendent of the State of New York Insurance Department acknowledged service upon him of the summons and complaint in this matter and notified the defendant, through Debra Sutton at its Pennsylvania office, of service as effected above (see Insurance Law § 1212; Montefiore Med. Ctr. v Auto One Ins. Co., 57 AD3d 958, 959 [2008]). In response, the defendant failed to meet its burden of showing a reasonable excuse for its failure to timely appear or answer the complaint and the existence of a meritorious defense. The affidavit of a senior claims examiner employed in the defendant's Texas office averred that there was no record of the summons and complaint in the defendant's computer system, but failed to demonstrate any knowledge of the office procedures employed in the handling of a summons and complaint received at the defendant's Pennsylvania office. Thus, that affidavit was insufficient to show that the failure to timely appear and answer was due to a clerical error which caused the summons and complaint to be overlooked (see Montefiore Med. Ctr. v Auto One Ins. Co., [*2]57 AD3d at 959; New York & Presbyt. Hosp. v Allstate Ins. Co., 29 AD3d 968 [2006]; Kaperonis v Aetna Cas. & Sur. Co., 254 AD2d 334 [1998]; cf. Hospital for Joint Diseases v Lincoln Gen. Ins. Co., 55 AD3d 543, 544 [2008]).

Furthermore, the defendant failed to set forth facts from an individual with personal knowledge sufficient to demonstrate the existence of a meritorious defense. The affidavit of the plaintiff's biller showed that the forms N-F5 and UB-92 relating to this matter were mailed on April 23, 2008, and signed for by the defendant on April 28, 2008. At that time, according to the defendant's own records, there were still sufficient funds remaining under the policy to pay this bill (see 11 NYCRR 65-3.15; Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294 [2007]). In response, the defendant offered only the same aforementioned affidavit, which also averred that there was no record of the bill in question in the defendant's computer system. This was insufficient for a similar reason; that is, the affiant failed to show any knowledge of the office procedures employed in the handling of billing forms received at the defendant's Pennsylvania office (see St. Barnabas Hosp. v American Tr. Ins. Co., 57 AD3d 517 [2008]; New York & Presbyt. Hosp. v Allstate Ins. Co., 29 AD3d at 968; see generally New York Hosp. Med. Ctr. of Queens v Insurance Co. of State of Pa., 16 AD3d 391, 392 [2005]; Peacock v Kalikow, 239 AD2d 188, 190 [1997]; cf. St. Vincent's Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]). Accordingly, the defendant's motion to vacate the judgment entered upon its failure to appear or answer should have been denied.

The Supreme Court, in effect, denied, as academic, the plaintiff's motion to hold the defendant in contempt. In light of our determination, we remit the matter to the Supreme Court, Nassau County, for a determination on the merits of the plaintiff's motion.

The bold is mine.