Sutter Pharmacy v State Farm Mut. Auto. Ins. Co. (2021 NY Slip Op 50610(U))

CV-702946-18/KI

Attorney for Plaintiff: Allen Tsirelman, Esq., Gary Tsirelman P.C., 129 Livingston Street Brooklyn, Brooklyn, New York 11201

Attorney for Defendant: Michael Philippou, Esq., Rubin, Fiorella, Friedman & Mercante LLP, 630 Thrid Ave. 3rd Floor, New York, NY 10017

The court’s Decision and Order is based upon consideration of the following papers:

NOTICE OF MOTION & AFFIDAVITS ANNEXED 1

OPPOSITION/CROSS-MOTION 2

REPLY/OPPOSITION TO CROSS-MOTION 3

EXHIBITS

CPLR 2219(a) Recitation

Upon the foregoing cited papers, after oral argument, on June 4, 2021, the Decision and Order on Defendant’s Motion to Dismiss pursuant to CPLR 3211(A)(5) and 3212 on the grounds that it is barred by res judicata and collateral estoppel is as follows:

This action to seeking reimbursement of No-Fault benefits, was commenced on or about January 19, 2018. Issue was joined on or about February 21, 2018 with the service of Defendant’s Answer. The Answer contained numerous affirmative defenses including the defense that the action was barred by res judicata and/or collateral estoppel. On May 2, 2018 Defendant filed a summary judgment motion claiming that the underlying accident was staged and that there was fraud in the procurement of the policy. The motion was denied on April 16, 2019 as the court preserved these claims as questions of fact for trial. Plaintiff filed a Notice of Trial on or about May 7, 2019 that Defendant claims they received on May 20, 2019. The court file indicates that Defendant filed a motion to strike the notice of trial on June 18, 2019 and that after a number of adjournments due to COVID quarantine and/or requests by the parties, the motion will appear on the No-Fault motion calendar for argument on August 22, 2022. Thus, the motion to strike is not before this court.

On or about April 19, 2018, State Farm commenced a declaratory action in New York Supreme Court. On September 11, 2019, the Supreme Court issued an order declaring that State Farm has no obligation to cover No-Fault claims for the plaintiff, date of loss and claim number herein. “‘Under the doctrine of res judicata, a final adjudication of a claim on the merits precludes re-litigation of that claim and all claims arising out of the same transaction or series of transactions by a party or those in privity with a party'” (Milton v. Subraj, et al, 67 Misc 3d 140[A] [App Term, 2d Dept., 11th & 13th Jud. Dists. 2020] quoting Ciraldo v. JP Morgan Chase Bank, N.A.,140 AD3d 912 at 913 [2d Dept. 2016]; see Schuylkill Fuel Corp. v. Nieberg Realty Corp., 250 NY 304 [1929]). Defendant now seeks dismissal of this action based upon that Supreme Court order.

Plaintiff opposes the instant motion claiming that it is procedurally defective. Specifically, Plaintiff claims that Defendant improperly seeks relief under CPLR 3211(a)(5) because such a motion must be made before issue is joined, which was not done here. Additionally, Plaintiff argues that Defendant cannot move pursuant to CPLR 3212 because this motion was filed more than one hundred twenty (120) days after the filing of the Notice of Trial. Notably, Plaintiff does not oppose the motion on substantive grounds.

It is well established that CPLR 3212(a) provides that if no date is set by the court, a motion for summary judgment shall be made no later than one hundred twenty (120) days after the filing of the note of issue, except with leave of court on good cause shown (Brill v. City of New York, 2 NY3d 648 [2004]). Good cause has been defined as “a satisfactory explanation for the untimeliness” (Brill v. City of New York, 2 NY3d 648, 652). In this matter, Plaintiff correctly claims that this motion was filed beyond the one hundred and twenty (120) day period of the filing of the notice of trial. It is also noted that Defendant’s motion to strike the notice of trial has been adjourned well into next year and is not before the court at this time. Consequently, the May 7, 2019 filing of the notice of trial remains and the summary judgment motion is late.

Notwithstanding the above, the circumstances surrounding this case present good cause for the court to entertain a late summary judgment motion. Here summary judgment is sought based upon an order of the Supreme Court order which holds that as between the parties, Defendant bears no obligation to provide no fault coverage to Plaintiff stemming from the subject collision. In Armentano v Broadway Mall Properties, Inc., the Second Department found that the lower court had good cause to entertain a late summary judgment motion because it was based upon an order of the Appellate Department in a prior appeal of the matter which dismissed the case (Armentano v Broadway Mall Properties, Inc., 48 AD3d 493 [2d Dept 2008]). Similarly, in the instant action, the September 11, 2019 Supreme Court order is dispositive as to the merits of this matter and warrants dismissal of the case.

Further, Defendant could not have moved based on those defenses prior to joinder of issue as required by CPLR 3211(a)(5) because the declaratory judgment order did not exist at the time (see generally Renelique v State Wide Ins. Co., 50 Misc 3d 137[A] [App Term, 2d Dept., 11th & 13th Jud. Dists. 2016]; Metro Health Products, Inc. v. Nationwide Ins., 52 Misc 3d 138[A] [App Term, 2d Dept., 11th & 13th Jud. Dists. 2016]; see Atlantic Chiropractic, P.C., 62 Misc 3d 145[A] [App Term, 2d Dept.,11th & 13th Jud. Dists. 2019]; Milton v. Subraj, 67 Misc 3d 140 [A]). Likewise, when the first summary judgment motion was filed, the declaratory judgment order had not been issued; the only grounds for the initial summary judgment motion at that time were Defendant’s claims of fraud and staged accident.

Furthermore, to deny relief based on the untimeliness of the summary judgment motion under these facts would result in a disregard of a Supreme Court order and lead to an unjust result. Any judgment issued in favor of Plaintiff would destroy or impair rights or interests established by the judgment in the declaratory action. (see Active Chiropractic, P.C. v. Allstate Ins., 58 Misc 3d 156[A] [App Term, 2d Dept.,11th & 13th Jud. Dists. 2018]; Metro Health Products, Inc. v. Nationwide Ins., 52 Misc 3d 138 [A] [App Term, 2d Dept.,11th & 13th Jud. Dists. 2016]).

It is further noted that Plaintiff cannot now claim prejudice or surprise. Plaintiff was on notice of these defenses since early 2018, when Defendant raised its res judicata and collateral estoppel affirmative defenses in its Answer.

Although this is Defendant’s second summary judgment motion, the court will entertain the motion as it is based on the new evidence: the subsequently issued order of the Supreme Court which directly affects this action. “Multiple summary judgment motions in the same action should be discouraged in the absence of a showing of newly discovered evidence or other sufficient cause (Burbige v. Siben & Ferber, 152 AD3d 641,642 [2d Dept 2017]; see Valley Natl. Bank v. INI Holding, LLC, 95 AD3d 1108 [2d Dept 2012]).

Lastly, Plaintiff’s assertion that the declaratory judgment has no merit because it was granted on default is erroneous. It is well settled that “res judicata applies ‘to an order or judgment taken by default which has not been vacated, as well as to issues which were or could have been raised in the prior [action]'” (Lazides v. P & G Enters., 58 AD3d 607, 609 [2d Dept 2009] [internal citation omitted]). “[A] Supreme Court’s order is a conclusive final determination, notwithstanding that it was entered on default, and res judicata applies to an order or judgment taken by default” (Ava Acupuncture, P.C. v. NY Central Mut. Fire Ins. Co., 34 Misc 3d 149 [A] [App Term, 2d Dept. 2d, 11th and 13th Jud Dists 2012]; Atlantic Chiropractic, P.C. v. Utica Mutual Ins. Co., 62 Misc 3d 145[A]).

Based on the foregoing, Defendant’s motion is Granted. Defendant established that it properly preserved its res judicata and collateral estoppel defenses; that a declaratory judgment order was issued regarding this claim; and that the order has preclusive effect given the identity of issues and parties. Accordingly, the complaint is dismissed with prejudice.

This constitutes the Decision and Order of the Court.

ENTER.
June 24, 2021
Brooklyn, NY
Hon. Consuelo Mallafre Melendez
Judge, Civil Court