American Alternative Ins. Corp. v Washington (2018 NY Slip Op 51210(U))

652007/17

Attorney for Plaintiff

GOTTLIEB OSTRAGER, LLP

300 Wheeler Road, Suite 204

Hauppauge, New York 11788

By: AARON EITAN MEYER, Esq.

Attorney for Defendants Hattie M. Washington and Alexander Anglada

Brian J. Levy & Associates PLLC

303 Jackson Ave

Syosset, NY 11791

By: BRIAN J. LEVY, Esq.

Attorney for Defendants DHD MEDICAL SUNSET PARK and D.H.D. MEDICAL, P.C.

LAW OFFICES OF GEWURZ & ZACCARIA

50 Charles Lindbergh Blvd, Ste 204 Uniondale, NY 11553-3600

By: DAYVA ZACCARIA, Esq.

Attorney for Defendant NEW YORK COMMUNITY HOSPITAL

BREA YANKOWITZ PC

15 Verbena AvenueFloral Park, NY 11001

By: PATRICK JOHN BREA, Esq.

Attorney for Defendant AARON ROVNER MD, PLLC

Russell Friedman & Associates, LLP

3000 Marcus Avenue, Suite 2E03

New Hyde Park, NY 11042

By: CHARLES H. HORN, Esq.

No appearance for all other defendants

In this action for a declaratory judgment, defendants Hattie M. Washington (Washington) and Alexander Anglada (Anglada) claim to have been involved in an accident involving a vehicle insured by plaintiff American Alternative Insurance Corporation. Washington and Anglada both contend that they were pedestrians who were struck by that vehicle, and then fell to the ground, sustaining injuries caused by that fall.

Plaintiff now moves, pursuant to CPLR 3215, for an order granting it a default judgment against non-answering defendants DHD Medical Sunset Park, D.H.D. Medical, P.C., Englington Medical P.C., Greater Health Through Chiropractic PC, East Midwood Volunteer Ambulance, Lomis Acupuncture P.C., Lenox Hill Radiology & Medical Imaging Associates, Integral Assist Medical PC, NYEEQASC, LLC (North Queens Surgical Center), Rockville Anesthesia Group, LLP, Aaron Rovner MD, PLLC, County Line Pharmacy and ISurply LLC (collectively, the provider defendants or the defaulting defendants), and directing the Clerk to enter judgment that plaintiff, and any and all of its subsidiaries and affiliates, are not obligated to provide any coverage, reimbursements or pay any invoices, sums or funds to the provider defendants on behalf of individual defendants Washington or Anglada, for any and all no-fault related services for which claims/bills have been or may in the future be submitted by said defendants to plaintiff relating to these claims, for a permanent stay of any and all No-Fault lawsuits and arbitrations that have been or may be brought by defaulting medical providers relating to these claims, and for costs and disbursements of this action.

For the reasons set forth below, plaintiff’s motion is granted.

BACKGROUND

On May 24, 2017, the defaulting defendants, with the exception of County Line Pharmacy, were served with the Notice of Commencement of Action Subject to Mandatory Filing, and the summons and complaint (see affirmation of Aaron E. Meyer, Esq., exhibit A [*2][proofs of service]). Pursuant to CPLR 3215 (g) (4) (i), on August 1, 2017, plaintiff mailed additional notices of the summons and complaint to the defaulting defendants, with the exception of County Line Pharmacy (see id., exhibit B). Plaintiff asserts that, as of the date of the affirmation, the additional notices have not been returned as undeliverable by the U.S. Postal Service.

On June 6, 2017, defaulting defendant County Line Pharmacy was personally served with the Notice of Commencement of Action Subject to Mandatory Filing, and the summons and complaint (see id., exhibit C [proof of service]).

Accordingly, County Line Pharmacy’s response was due on June 26, 2017, and the responses of the remaining of the defaulting defendants were due on September 5, 2017.

Plaintiff contends that, as of the date of the motion, the defaulting defendants have not responded to the complaint.

Subsequent to the filing of the motion, the action was discontinued against defendant DHD Medical, P.C. by stipulation. In addition, plaintiff asserts that it no longer seeks a default judgment against defendant Aaron Rovner MD LLP.

The core claim of both Washington and Anglada was that each was caused to fall to the ground as the result of the operation of the vehicle at issue. Plaintiff contends that, however, the insured vehicle was equipped with four video cameras, which do not show that either Washington or Anglada was knocked down or fell during the alleged incident.

Plaintiff denied benefits to both Washington and Anglada, the defaulting defendants’ assignors, based on the video evidence, subsequent investigation, witness testimony and sworn testimony by claimants, on the ground that their purported injuries neither arose out of a covered incident nor occurred as alleged. Specifically, plaintiff denied the claims on the ground that Washington and Anglada intentionally made fraudulent statements calculated to result in the provision of first party benefits to which neither was entitled.

Pursuant to CPLR 3215 (f), “‘[a]n applicant for a default judgment against a defendant must submit proof of service of the summons and complaint, proof of the facts constituting the claim, and proof of the defaulting defendant’s failure to answer or appear'” (HSBC Bank USA, N.A. v Clayton, 146 AD3d 942, 944 [2d Dept 2017] [citation omitted]; accord 154 E. 62 LLC v 156 E. 62nd St. LLC, 159 AD3d 498, 498 [1st Dept 2018]; Bank of Am. N.A. v Agarwal, 150 AD3d 651, 652 [2d Dept 2017]). The plaintiff can satisfy this requirement through an affidavit of a party with personal knowledge of the facts (Reynolds Sec. v Underwriters Bank & Trust Co., 44 NY2d 568, 572 [1978]; Goodman v New York City Health & Hosps. Corp., 2 AD3d 581, 581 [2d Dept 2003]).

Plaintiff has satisfied the first and third of these requirements by submitting the affidavits of service, and the affirmation of Aaron E. Meyer, its attorney, in which Meyer asserts that the defaulting defendants have not answered or appeared. Plaintiff has also submitted proof of the facts constituting its claims.

An insurer may disclaim all insurance coverage based upon “the fact or founded belief that the alleged injury does not arise out of an insured incident” (Central Gen. Hosp. v Chubb Grp. of Ins. Co., 90 NY2d 195, 199 [1997]). In meeting this burden, a No-Fault insurer is “not required to establish that the subject collision was the product of fraud, which would require proof of all elements of fraud, including scienter, by clear and convincing evidence” (V.S. Med. Servs., P.C. v [*3]Allstate Ins. Co., 25 Misc 3d 39, 41 [App Term, 2d Dept 2009] [internal citation omitted]). Rather, the No-Fault insurer must demonstrate the facts elicited during an investigation that make up the founded belief. Circumstantial evidence is sufficient to prove such facts if a party’s conduct “may be ‘reasonably inferred’ based upon ‘logical inferences to be drawn from the evidence'” (Benzaken v Verizon Communications, Inc., 21 AD3d 864, 865 [2d Dept 2005] [citation omitted]).

An assignee, such as the provider defendants, may only obtain the rights of its assignors. The general rule of assignment provides that the assignee stands in the shoes of the assignor upon assignment of the interest, and takes the assignment subject to the defenses assertable against the assignor (Kolbeck v LIT America Inc., 923 F Supp 557, 567 [SD NY 1996]; see also Long Is. Radiology v Allstate Ins. Co., 36 AD3d 763, 765 [2d Dept 2007])

Plaintiff submits the affidavit of Ellen C. Henry, liability representative for Glatfelter Claims Management, Inc, which provides claims management services to plaintiff, in which Henry sets forth the proof of the facts constituting plaintiff’s claim (the denial of coverage and the basis therefor). Henry avers that she personally obtained the recorded statements of both Washington and Anglada, in which they stated that the collision with the insured vehicle caused them to fall to the ground (Henry aff, ¶¶ 7-10). Washington and Anglada repeated these statements to defendant medical providers (id., ¶¶ 11-13). Henry also avers that she “can personally attest to the fact that the video evidence directly and materially conflicted with both Defendants’ statements made to their treating medical providers and to myself” (id., ¶ 16). Specifically, Henry avers that the video evidence revealed that “while it is at best debatable as to whether the vehicle ever came into actual contact with either Defendant, it is indisputable that neither Defendant was knocked down or otherwise fell during the course of the incident” (id., ¶ 22). Accordingly, Henry determined that the claims were fraudulent and denied them (id., ¶ 23).

The facts set forth in the Henry affidavit are sufficient to create a founded belief that the claims were fraudulent, and that, as such, Washington and Anglada are not entitled to no-fault benefits. As assignees of the allegedly fraudulent claims, the defaulting defendants would likewise not be entitled to receive any payments for services allegedly provided as the result of the accident. Accordingly, plaintiff is entitled to a default judgment as against the defaulting defendants.

The defaulting defendants do not oppose the motion. The only opposition was submitted by Washington and Anglada. However, their response is completely irrelevant, as the motion was not brought against them. Moreover, their response does not speak to plaintiff’s prima facie entitlement to judgment against the defaulting providers, or excuse the non-answering defendants for their failure to take any action.

The court has considered the remaining arguments, and finds them to be without merit.

Accordingly, it is

ORDERED that plaintiff’s motion for a default judgment is granted, and plaintiff is directed to serve a copy of this Decision and Order with Notice of Entry upon defendants within 20 days.

Dated: August 14, 2018

ENTER:

_______________________

J.S.C.