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FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019
NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
_________________________________-------------- X
STATE FARM FIRE AND CASUALTY COMPANY,
Index No.: 156986/19
Plaintiff,
AFFIRMATION
-against-
MANUAL APPROACH PHYSICAL THERAPY, P.C.,
PROACT PHYSICAL THERAPY P.C., UTR CHIROPRACTIC
SERVICES P.C., NEW SENSE ACUPUNCTURE P.C., ALL
COUNTY, LLC, ATB SERVICES, INC., THE MOUNT SINAI
HOSPITAL a/k/a FPA HOSPITAL BASED NON PAR MT,
CHELSEA MOBILITY INC., THE MOUNT SINAI HOSPITAL
a/k/a MOUNT SINAI HOSPITAL QUEENS, BIRCH
MEDICAL & DIAGNOSTIC, P.C. and KADHEIJAH NOEL,
Defendants.
-----------------------------------------------X
DAVID F. BOUCHER, JR., an attorney duly licensed to practice law before the
Court of the State of New York, affirms the
following statements to be true upon
information and belief, under the penalty of perjury:
BACKGROUND
1. I am an attorney licensed to practice law in the State of New York and a
member of the law firm of Rubin, Fiorella, Friedman & Mercante LLP, attorneys for the
Plaintiff, STATE FARM FIRE AND CASUALTY COMPANY, ("State Farm").
2. This affirmation is submitted in support of the within motion a
seeking
Default Judgment pursuant to CPLR 3215 against all of the defendants except for
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CHELSEA MOBILITY, INC. (collectively, "the Defaulting Defendants"), based on their
failures to answer the Verified Complaint for the judgment.1
declaratory
3. State Farm's motion should be granted because State Farm has proven
service of the Summons and Verified Complaint, that the
Defaulting Defendants have
defaulted in answering, and that the Defaulting Defendants have no meritorious
defense. A copy of the Summons and Verified Complaint is annexed hereto as Exhibit
"A". Copies of the affidavit of services on the Defaulting Defendants are annexed hereto
as Exhibit "B".
4. As will be shown below, State Farm established that the No-Fault
regulations and the terms of the insurance policy have been violated in that
("Noel"
KADHEIJAH NOEL or "the Insured") materially misrepresented her residence
location and the primary garage location of the insured vehicle when the policy was
procured, and State Farm would not have issued the policy, or would not have issued
the under the same terms or at the same rate.
policy
FACTUALBACKGROUND
5. State Farm is an insurance company and
existing under the laws of the
State of New York and is authorized by the State of New York to conduct the business
of insurance. By this action, State Farm seeks a declaration that it owes no duty to pay
No-Fault benefits to the Defendants in relation to a March 30, 2019, collision.
Defaulting
("Noel"
6. KADHEIJAH NOEL or "the Insured") and non-party Sidney
CHELSEA MOBILITY, INC. answered the Summons and Verified Complaint for thedeclaratory judgment.
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Wright ("Wright") were involved in a motor vehicle collision on March 30, 2019, while
occupants of a 2016 Mercedes Sedan ("the Insured Vehicle"), driven Wright, and
by
insured by
State Farm in Noel's name.
According to the police report, the insured
vehicle was stopped at a red light when the adverse vehicle rear-ended the insured
vehicle. The police report further states that the driver of the adverse vehicle stated that
she was waiting at a red light behind the insured vehicle when her vehicle started
driving away, the brakes too late, and the insured vehicle.
slightly hitting rear-ending
The police report further states that Noel complained of neck pain and was taken to
Wyckoff Hospital by ambulance. See Exhibit "C".
7. Thereafter, State Farm received notice that Noel reported to have
sustained serious injuries as a result of the March 30, 2019 collision. State Farm
bodily
assigned claim number 52-01W6-00T, to all claims relating to the March 30, 2019
collision. See Exhibit "D".
8. Prior to March 30, 2019, State Farm issued an automobile policy of
insurance no. 2695-593-52 (hereinafter "the Policy") to the Insured, for the insured
vehicle, occupants of the vehicle for and
covering any any medically necessary causally
related medical expenses out of the use or operation of the insured vehicle as a
arising
result of an accidental collision. The Policy also covers any other person who sustains
personal out of the use or operation of the insured vehicle in the State of
injury arising
New York.
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9. Under 11 N.Y.C.R.R. 65-1.1, which governs No-Fault claims for the
Endorsement"
Claimants, the "New York Mandatory Personal Injury Protection of the
regulation requires that insurers such as State Farm provide No-Fault benefits to
persons injured in the use or operation of vehicles in New York State, subject to certain
"conditions"
conditions and terms. The provision of the New York Mandatory Personal
Injury Protection endorsement states:
Conditions
Action Against Company. No action shall lie against the
Company unless, as a condition precedent thereto, there
shall have been full compliance with the terms of this
coverage.
* * *
. . . Upon request by the Company, the eligible injured
person or that personDs assignee or representative shall:
* * *
as be required submit to
(a) may reasonably
examinations under oath by any person named by the
Company and subscribe the same;
(d) provide any other pertinent information that may assist the
in the amount due and payable.
Company determining
"exclusions"
10. That the provision of the New York Mandatory Personal
Injury Protection endorsement states:
Exclusions
This coverage does not apply to personal injury sustained by:
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(f) Any person who intentionally causes his or her own personal
injury...
11. In addition, 11 N.Y.C.R.R. 65-3.5(c) provides that an insurer is entitled to
all items necessary to verify the claim directly from the parties from whom such
verificationwasrequested.
12. Noel was a person who allegedly sustained personal injuries allegedly
out of the use or operation of the insured vehicle and began treatment
arising receiving
from defendants MANUAL APPROACH PHYSICAL THERAPY, P.C., PROACT
PHYSICAL THERAPY P.C., UTR CHIROPRACTIC SERVICES P.C., NEW SENSE
ACUPUNCTURE P.C., ALL COUNTY, LLC, ATB SERVICES, INC., THE MOUNT
SINAI HOSPITAL a/k/a FPA HOSPITAL BASED NON PAR MT, CHELSEA
MOBILITY INC., THE MOUNT SINAI HOSPITAL a/k/a MOUNT SINAI HOSPITAL
QUEENS and BIRCH MEDICAL & DIAGNOSTIC, P.C., (collectively, "the Medical
Provider Defendants"). To date, the Medical Provider Defendants have submitted over
$40,000 in bills for medicaltreatmentallegedly provided to Noel.
13. The Policy was issued as a New York State personal automobile policy
and was procured Noel. The policy application stated that the Insured's principal
by
residence and garage location of the insured vehicle was 11 Bridge Street,
primary
Florida, New York 10921 (the "Policy Address"). However, State Farm's initial
investigation revealed a likelihood that Noel resided at 567 E. 108 th
strong actually
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Street, Apartment 1D, Brooklyn, New York 11236, ("the Brooklyn Address") and
garaged the insured vehicle at that location, for the reasons:
primarily following
- The loss occurred in New six miles
Brooklyn, York, approximately
from the Insured's likely Brooklyn Address;
"Accruint"
- searches revealed that the Insured resides at the
likely
Brooklyn, New York address;
- A State Farm representative went to the Brooklyn Address and the
property manager at that address told State Farm that Noel has
lived at the Brooklyn Address since 1996;
- A State Farm representative went to the Address and there
Policy
was no indication that Noel resided there. The address is a single
family home that has been turned into two apartments. Both
apartments appeared vacant. One of the mailboxes showed a name
Sale"
"Guarino", and a "For sign was posted on the property;
- Noel is registered to vote in Brooklyn;
- Noel's cellular phone is registered to the Brooklyn Address;
- Noel stated to State Farm, on a recorded that the
statement, Policy
Address belongs to her parents, but she did not provide the
Company with any supporting documentation such as a lease
agreement or bank statements; and
- The was cancelled for Noel's failure to provide proof of
Policy
residency.
See Affidavit of Bonnie Henderson-Bunn
14. These factors raised a strong possibility that the Insured made a material
misrepresentation his residence and the primary garage location of the
regarding
Insured Vehicle when the policy was procured.
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15. Based upon these State pursuant to its rights under the No-
factors, Farm,
Fault Regulations, and properly sought an examination under oath ("EUO") of
duly
Noel to confirm the representations made in
procuring the policy were accurate, and to
confirm the of this loss and the necessity of any alleged treatment and
legitimacy
referrals. See Exhibit "E".
16. Noel appeared for her EUO; however, her testimony led State Farm to
conclude that she made a material misrepresentation
regarding her residence and
regarding the primary garage location of the Insured Vehicle when the policy was
procured, for the following reasons:
- Noel testified that she lives in lived in Brooklyn
currently Brooklyn,
at the time of the policy procurement, and garages the vehicle
primarily in Brooklyn;
- Noel testified that neither she nor members ever lived at
any family
the Address; and
Policy
- All of Noel's evidence reveals the Brooklyn
documentary Address,
including her tax returns, driver's license, and vehicle paperwork
"F"
See Transcripts annexed hereto as Exhibit and Affidavit of Bonnie Henderson-Bunn
17. State Farm's department has determined that it would not
underwriting
have issued the to the Insured under the same terms or at the same rate had the
policy
Insured been truthful when applying for, and renewing, the policy. See Affidavit of
Kelli Ivey.
18. Based upon the investigation of this claim and the EUO testimony of Noel
State Farm maintains that Noel made a misrepresentation when she procured the policy
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her residence location and the primary garage location of the insured vehicle,
regarding
that the misrepresentation was material, and that the Policy would not have been issued
under the same terms or at the same rate had State Farm known the truth. State Farm
has denied all claims of the defendants on that basis. See Affidavits of Bonnie
Henderson-Bunn and Kellie Ivey.
ARGUMENT
I. STATE FARM'S MOTION FOR A
DEFAULTTUDGMENT SHOULD BE GRANTED
A. The Standard on a Motion for a Default Judgment
19. It is well-established that a party is entitled to a default judgment
pursuant to CPLR 3215 upon "submit[ting] proof of service of the summons and
complaint, proof of the facts its claim, and proof of the party's
constituting defaulting
appearing."
default in or Atl. Cas. Ins. Co. v. R[NJ Services, Inc., 89 A.D.3d
answering
N.Y.S.2d 111 (2nd Dep't 2011). See also Integon Nat'l Ins. Co. v.
649, 651, 932 109,
930 N.Y.S.2d 261 (2nd Dep't (insurer "established
Noterile, 88 A.D.3d 654, 655, 260, 2011)
its entitlement to a default judgment against the [insured] proof of
by submitting
service of the summons and the complaint, the facts constituting the claim, and the
[insured's] default"); Cas. Co. v. Surgical Center At Milburn, LLC, 65 A.D.3d
Mercury
885 N.Y.S.2d 219 (2nd Dep't ("The plaintiff demonstrated its entitlement
1102, 218, 2009)
to a default judgment against the defendant by submitting proof of service of the
summons and complaint, proof of the facts constituting its claim, and proof of the
defendant's default in or appearing").
answering
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20. To satisfy the requirement of CPLR 3215(f), a party seeking to enter a
facts."
default judgment must only submit "some firsthand confirmation of the Joosten v
Gale, 129 AD2d 531, 535; St. Paul Fire & Mar. Ins. Co. v A.L. Eastmond & Sons, 244
AD2d 294 [1st The standard of proof to establish entitlement to a default
Dept., 1997].)
amounts" facts."
judgment only to some firsthand confirmation of the Feffer v Malpeso,
210 AD2d 61 [1stDept. 1994].
60,
21. In fact, allegations contained within a verified complaint are admitted as
defendants'
truth in the event of a default. Rokina Opt. Co. v Camera King, 63 NY2d
728; McClelland v Climax Hosiery Mills, 252 NY 347; Green v
Dolphy Constr. Co., 187
AD2d 636 [2nd Lippman v 138 A.D.2d 525 N.Y.S.2d
635, Dept., 1992]; Hines, 845, 955;
Muhlhahn v Triple Cee Bar & Rest. Supply Co., 133 A.D.2d 996, 521 N.Y.S.2d 146;
Rokina Opt. Co. v Camera King; 63 N.Y.2d 728, 469 N.E.2d 518, 480 N.Y.S.2d 197;
McClelland v Climax Hosiery Mills, 252 N.Y. 347, 169 N.E. 605; Woodson v Mendon
Leasing Corp., 100 NY2d 62, 64 [2003]. The legal conclusions to be drawn from such
proof are reserved for the court's determination. Id. See CPLR 3215 [b], [e]; Silberstein v
Presbyterian Hosp., 96 AD2d 1096; Wine Antiques v St. Paul Fire & Mar. Ins. Co., 40
AD2d 657, affd 34 NY2d 781; 4 Weinstein-Korn-Miller, NY Civ Prac P 3215.25).
B. State Farm Has Submitted Proof Of The Facts Constituting Its Claim
22. The Affirmation of David F. Boucher, Jr., the Affidavits of Bonnie
Henderson-Bunn and Kelli Ivey, and the Exhibits annexed thereto, are proof of the facts
constituting State Farm's claim. They show that State Farm is entitled to a Default
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Judgment against the Defendants in default, declaring that there is no No-Fault
coverage for the alleged claims relating to the alleged March 30, 2019 collision
referenced by State Farm claim number 52-01W6-00T.
C. Material Misrepresentation in Procuring the Policy
23. State Farm's First Cause of Action is that the Insured made a
misrepresentation when he procured the Policy regarding his residence location and the
garage location of the Insured Vehicle, that the misrepresentation was material,
primary
and that the Policy would not have been issued under the same terms or at the same
rate had State Farm known the truth. State Farm has denied all claims of the defendants
on that basis.
24. In the context of No-Fault, insurers may assert material
misrepresentations in the procurement of the policy as a defense against a party
involved in the misrepresentation in the policy's procurement. Ins. Co. of N. Am. v.
Kaplun, 274 A.D.2d 293 (2d Dep't 2000).
25. The court in Kaplun held that the insurance carrier would be permitted to
raise the claim of fraud in the procurement of the policy as a defense for any No-Fault
action brought by the claimant or those providers who submitted claims on behalf of
the claimant because the claimant was aware of the misrepresentation. See also Quality
Med. Care, P.C. v Progressive Cas. Ins. Co., 56 Misc. 3d 1214 (A)(2017 N.Y.Misc. LEXIS
2965)(2017). The court in Kaplun reasoned that while an insurance could not
company
use the insured's misrepresentation to disclaim against innocent third parties, an
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insured or other party involved in the fraudulent procurement of the should not
policy
have that same protection. See Integon Ins. Co. v. Goldson, 300 A.D.2d 396, 751
N.Y.S.2d (2nd 2002).
527, Dep't,
26. In order to establish that representation was material, "the insurer must
present documentation its underwriting practices, such as
concerning underwriting
manuals, bulletins, or rules pertaining
to similar risks that show it would not have
application."
issued the same policy if the correct information had been disclosed in the
Schirmer v. Penkert, 41 A.D.3d 688, 690-691 (2d Dep't 2007). No-fault benefits may be
denied to an insured where an insurer submits evidence in admissible form showing
that the insured had procured the insurance policy (see W.H.O.
fraudulently
Acupuncture, P.C. v Infinity Prop. & Cas. Co., 36 Misc 3d 4 [App Term, 2d, 11th & 13th
Jud Dists 2012]; New Millennium Psychological Servs., P.C. v Commerce Ins. Co., 34
Misc 3d 127 [A], 2011 NY Slip Op 52286[U] [App Term, 2d, 11th & 13th Jud Dists 2011]).
27. In AA Acupuncture Services, P.C. v. Safeco Ins. Co. of America, 25
Misc.3d 30, 887 N.Y.S.2d 739, the Appellate Term, First Department upheld a denial of
an insured's No-Fault claims for misrepresentation, where the insured inaccurately
claimed in her application that she lived in Connecticut rather than Brooklyn.
policy
In its defense, the court found relevant that the insurer attested that "the
establishing
annual premium of $1,236 paid by the insured was based on her representation that she
resided in Connecticut, and that the annual premium for the same policy based on her
$4,807."
Brooklyn address would have been Id.
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28. According to the Affidavit of Kelli Ivey State Farm would not have issued
the Policy to the Insured under the same terms or conditions had it been aware that the
Insured Vehicle was being garaged in Brooklyn, New York as opposed to the address in
Florida, New York. State Farm's underwriting department has determined that the
difference in the monthly premium between the Policy Address and the Brooklyn
Address would be $2,889.66 over a six month period, which is a significant enough
difference to determine that the misrepresentation was material. See Affidavit of Kelli
Ivey.
29. Accordingly, State Farm is entitled to a default judgment against all of the
defendants in default on the basis that a material misrepresentation was made to State
Farm when the policy was procured and because State Farm would not have issued the
Policy, or would have issued it at substantially different rates or terms, had it been
given truthful information.
II. The Defaulting Defendants Have No Meritorious Defense
30. Since the Defendants have no reasonable excuse for their
Defaulting
months of continuing default after they were served with the Summons and Verified
Complaint and the Notice of Default, this Court need not address whether have
they
any meritorious defense to this action. See Abdul v. Hirschfield, 71 A.D.3d 707,
708 - 898 N.Y.S.2d 45 (2nd Dep't ("In view of the lack of a reasonable
709, 44, 2010)
excuse, it is to consider whether [defendant] sufficiently demonstrated the
unnecessary
existence of a meritorious defense"); Kranenburg v. Butwell, 34 A.D.3d 1005, 1006, 825
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N.Y.S.2d 165 (3rd Dep't ("Given the of defendant's submission
163, 2006) insufficiency
a reasonable excuse for the default, it is not necessary to address whether
concerning
defendant has a meritorious defense to the action"). Moreover, the Defaulting
Defendants have not shown any meritorious defenses.
31. On October 2, 2019, the undersigned duly executed a search with the
Service members Civil Relief Act (SCRA) website
regarding defendant KADHEIJAH
NOEL. The undersigned searched using this defendant's social security number, or date
of birth, or both. The search revealed that KADHEIJAH NOEL is not currently on active
duty in the military. See Exhibit "G".
A. Notice of Default
32. As described above and in the annexed Affidavit of Bonnie Henderson-
Bunn and Kelli Ivey, State Farm maintains meritorious causes of action, the defendants
in default have no defense to this action, and they have failed to answer State Farm's
complaint and are in default in answering same. A Notice of Default was sent to the
defendants served through the secretary of state. See Notice of Default annexed hereto
as Exhibit "H".
33. Accordingly, State Farm is entitled to a Default Judgment against the
Defendants in Default, that there is no No-Fault coverage for their alleged
declaring
claims relating to the alleged March 30, 2019 collision referenced by State Farm claim
number 52-01W6-00T.
34. No prior request was made for the relief requested herein.
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IL STATE FARM'S MOTION TO ADD THE PROPOSED
ADDITIONAL DEFENDANT TO THIS ACTION SHOULD BE GRANTED
35. State Farm seeks leave pursuant to CPLR 3025(b) to amend the Amended
Summons and Amended Verified Complaint to add EASTERN MEDICAL PRACTICE,
P.C. ("Proposed Additional Defendant"), as an additional defendant.
36. Since filing the Amended Summons and Verified Complaint in this action,
State Farm has received medical bills and established defenses for the claims of the
Proposed Additional Defendant, who submitted bills to State Farm, seeking no-fault
reimbursement for medical services allegedly provided to the Claimant.
37. As elaborated prior in this motion, KADHEIJAH NOEL materially
misrepresented her residence location and the primary garage location of the insured
vehicle when the policy was procured, and State Farm would not have issued the
policy, or would not have issued the policy under the same terms or at the same rate.
38. Under CPLR § 3025(b), a party may seek leave of court to amend a
just."
pleading. "Leave shall be freely given upon such terms as may be See also Cohn
v. United States Trust 127 A.D.2d 512 N.Y.S.2d 37 (1stDep't 1987).
Co., 523,
39. As such, it is clear that State Farm maintains meritorious causes of action
against the Proposed Additional Defendants. These are further detailed in the affidavits
of Bonnie Henderson-Bunn and Kelli Ivey annexed hereto.
40. The proposed Amended Summons and Complaint is attached hereto as
Exhibit "I".
Preview
FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK _________________________________-------------- X STATE FARM FIRE AND CASUALTY COMPANY, Index No.: 156986/19 Plaintiff, AFFIRMATION -against- MANUAL APPROACH PHYSICAL THERAPY, P.C., PROACT PHYSICAL THERAPY P.C., UTR CHIROPRACTIC SERVICES P.C., NEW SENSE ACUPUNCTURE P.C., ALL COUNTY, LLC, ATB SERVICES, INC., THE MOUNT SINAI HOSPITAL a/k/a FPA HOSPITAL BASED NON PAR MT, CHELSEA MOBILITY INC., THE MOUNT SINAI HOSPITAL a/k/a MOUNT SINAI HOSPITAL QUEENS, BIRCH MEDICAL & DIAGNOSTIC, P.C. and KADHEIJAH NOEL, Defendants. -----------------------------------------------X DAVID F. BOUCHER, JR., an attorney duly licensed to practice law before the Court of the State of New York, affirms the following statements to be true upon information and belief, under the penalty of perjury: BACKGROUND 1. I am an attorney licensed to practice law in the State of New York and a member of the law firm of Rubin, Fiorella, Friedman & Mercante LLP, attorneys for the Plaintiff, STATE FARM FIRE AND CASUALTY COMPANY, ("State Farm"). 2. This affirmation is submitted in support of the within motion a seeking Default Judgment pursuant to CPLR 3215 against all of the defendants except for 1 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 CHELSEA MOBILITY, INC. (collectively, "the Defaulting Defendants"), based on their failures to answer the Verified Complaint for the judgment.1 declaratory 3. State Farm's motion should be granted because State Farm has proven service of the Summons and Verified Complaint, that the Defaulting Defendants have defaulted in answering, and that the Defaulting Defendants have no meritorious defense. A copy of the Summons and Verified Complaint is annexed hereto as Exhibit "A". Copies of the affidavit of services on the Defaulting Defendants are annexed hereto as Exhibit "B". 4. As will be shown below, State Farm established that the No-Fault regulations and the terms of the insurance policy have been violated in that ("Noel" KADHEIJAH NOEL or "the Insured") materially misrepresented her residence location and the primary garage location of the insured vehicle when the policy was procured, and State Farm would not have issued the policy, or would not have issued the under the same terms or at the same rate. policy FACTUALBACKGROUND 5. State Farm is an insurance company and existing under the laws of the State of New York and is authorized by the State of New York to conduct the business of insurance. By this action, State Farm seeks a declaration that it owes no duty to pay No-Fault benefits to the Defendants in relation to a March 30, 2019, collision. Defaulting ("Noel" 6. KADHEIJAH NOEL or "the Insured") and non-party Sidney CHELSEA MOBILITY, INC. answered the Summons and Verified Complaint for thedeclaratory judgment. 2 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 Wright ("Wright") were involved in a motor vehicle collision on March 30, 2019, while occupants of a 2016 Mercedes Sedan ("the Insured Vehicle"), driven Wright, and by insured by State Farm in Noel's name. According to the police report, the insured vehicle was stopped at a red light when the adverse vehicle rear-ended the insured vehicle. The police report further states that the driver of the adverse vehicle stated that she was waiting at a red light behind the insured vehicle when her vehicle started driving away, the brakes too late, and the insured vehicle. slightly hitting rear-ending The police report further states that Noel complained of neck pain and was taken to Wyckoff Hospital by ambulance. See Exhibit "C". 7. Thereafter, State Farm received notice that Noel reported to have sustained serious injuries as a result of the March 30, 2019 collision. State Farm bodily assigned claim number 52-01W6-00T, to all claims relating to the March 30, 2019 collision. See Exhibit "D". 8. Prior to March 30, 2019, State Farm issued an automobile policy of insurance no. 2695-593-52 (hereinafter "the Policy") to the Insured, for the insured vehicle, occupants of the vehicle for and covering any any medically necessary causally related medical expenses out of the use or operation of the insured vehicle as a arising result of an accidental collision. The Policy also covers any other person who sustains personal out of the use or operation of the insured vehicle in the State of injury arising New York. 3 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 9. Under 11 N.Y.C.R.R. 65-1.1, which governs No-Fault claims for the Endorsement" Claimants, the "New York Mandatory Personal Injury Protection of the regulation requires that insurers such as State Farm provide No-Fault benefits to persons injured in the use or operation of vehicles in New York State, subject to certain "conditions" conditions and terms. The provision of the New York Mandatory Personal Injury Protection endorsement states: Conditions Action Against Company. No action shall lie against the Company unless, as a condition precedent thereto, there shall have been full compliance with the terms of this coverage. * * * . . . Upon request by the Company, the eligible injured person or that personDs assignee or representative shall: * * * as be required submit to (a) may reasonably examinations under oath by any person named by the Company and subscribe the same; (d) provide any other pertinent information that may assist the in the amount due and payable. Company determining "exclusions" 10. That the provision of the New York Mandatory Personal Injury Protection endorsement states: Exclusions This coverage does not apply to personal injury sustained by: 4 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 (f) Any person who intentionally causes his or her own personal injury... 11. In addition, 11 N.Y.C.R.R. 65-3.5(c) provides that an insurer is entitled to all items necessary to verify the claim directly from the parties from whom such verificationwasrequested. 12. Noel was a person who allegedly sustained personal injuries allegedly out of the use or operation of the insured vehicle and began treatment arising receiving from defendants MANUAL APPROACH PHYSICAL THERAPY, P.C., PROACT PHYSICAL THERAPY P.C., UTR CHIROPRACTIC SERVICES P.C., NEW SENSE ACUPUNCTURE P.C., ALL COUNTY, LLC, ATB SERVICES, INC., THE MOUNT SINAI HOSPITAL a/k/a FPA HOSPITAL BASED NON PAR MT, CHELSEA MOBILITY INC., THE MOUNT SINAI HOSPITAL a/k/a MOUNT SINAI HOSPITAL QUEENS and BIRCH MEDICAL & DIAGNOSTIC, P.C., (collectively, "the Medical Provider Defendants"). To date, the Medical Provider Defendants have submitted over $40,000 in bills for medicaltreatmentallegedly provided to Noel. 13. The Policy was issued as a New York State personal automobile policy and was procured Noel. The policy application stated that the Insured's principal by residence and garage location of the insured vehicle was 11 Bridge Street, primary Florida, New York 10921 (the "Policy Address"). However, State Farm's initial investigation revealed a likelihood that Noel resided at 567 E. 108 th strong actually 5 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 Street, Apartment 1D, Brooklyn, New York 11236, ("the Brooklyn Address") and garaged the insured vehicle at that location, for the reasons: primarily following - The loss occurred in New six miles Brooklyn, York, approximately from the Insured's likely Brooklyn Address; "Accruint" - searches revealed that the Insured resides at the likely Brooklyn, New York address; - A State Farm representative went to the Brooklyn Address and the property manager at that address told State Farm that Noel has lived at the Brooklyn Address since 1996; - A State Farm representative went to the Address and there Policy was no indication that Noel resided there. The address is a single family home that has been turned into two apartments. Both apartments appeared vacant. One of the mailboxes showed a name Sale" "Guarino", and a "For sign was posted on the property; - Noel is registered to vote in Brooklyn; - Noel's cellular phone is registered to the Brooklyn Address; - Noel stated to State Farm, on a recorded that the statement, Policy Address belongs to her parents, but she did not provide the Company with any supporting documentation such as a lease agreement or bank statements; and - The was cancelled for Noel's failure to provide proof of Policy residency. See Affidavit of Bonnie Henderson-Bunn 14. These factors raised a strong possibility that the Insured made a material misrepresentation his residence and the primary garage location of the regarding Insured Vehicle when the policy was procured. 6 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 15. Based upon these State pursuant to its rights under the No- factors, Farm, Fault Regulations, and properly sought an examination under oath ("EUO") of duly Noel to confirm the representations made in procuring the policy were accurate, and to confirm the of this loss and the necessity of any alleged treatment and legitimacy referrals. See Exhibit "E". 16. Noel appeared for her EUO; however, her testimony led State Farm to conclude that she made a material misrepresentation regarding her residence and regarding the primary garage location of the Insured Vehicle when the policy was procured, for the following reasons: - Noel testified that she lives in lived in Brooklyn currently Brooklyn, at the time of the policy procurement, and garages the vehicle primarily in Brooklyn; - Noel testified that neither she nor members ever lived at any family the Address; and Policy - All of Noel's evidence reveals the Brooklyn documentary Address, including her tax returns, driver's license, and vehicle paperwork "F" See Transcripts annexed hereto as Exhibit and Affidavit of Bonnie Henderson-Bunn 17. State Farm's department has determined that it would not underwriting have issued the to the Insured under the same terms or at the same rate had the policy Insured been truthful when applying for, and renewing, the policy. See Affidavit of Kelli Ivey. 18. Based upon the investigation of this claim and the EUO testimony of Noel State Farm maintains that Noel made a misrepresentation when she procured the policy 7 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 her residence location and the primary garage location of the insured vehicle, regarding that the misrepresentation was material, and that the Policy would not have been issued under the same terms or at the same rate had State Farm known the truth. State Farm has denied all claims of the defendants on that basis. See Affidavits of Bonnie Henderson-Bunn and Kellie Ivey. ARGUMENT I. STATE FARM'S MOTION FOR A DEFAULTTUDGMENT SHOULD BE GRANTED A. The Standard on a Motion for a Default Judgment 19. It is well-established that a party is entitled to a default judgment pursuant to CPLR 3215 upon "submit[ting] proof of service of the summons and complaint, proof of the facts its claim, and proof of the party's constituting defaulting appearing." default in or Atl. Cas. Ins. Co. v. R[NJ Services, Inc., 89 A.D.3d answering N.Y.S.2d 111 (2nd Dep't 2011). See also Integon Nat'l Ins. Co. v. 649, 651, 932 109, 930 N.Y.S.2d 261 (2nd Dep't (insurer "established Noterile, 88 A.D.3d 654, 655, 260, 2011) its entitlement to a default judgment against the [insured] proof of by submitting service of the summons and the complaint, the facts constituting the claim, and the [insured's] default"); Cas. Co. v. Surgical Center At Milburn, LLC, 65 A.D.3d Mercury 885 N.Y.S.2d 219 (2nd Dep't ("The plaintiff demonstrated its entitlement 1102, 218, 2009) to a default judgment against the defendant by submitting proof of service of the summons and complaint, proof of the facts constituting its claim, and proof of the defendant's default in or appearing"). answering 8 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 20. To satisfy the requirement of CPLR 3215(f), a party seeking to enter a facts." default judgment must only submit "some firsthand confirmation of the Joosten v Gale, 129 AD2d 531, 535; St. Paul Fire & Mar. Ins. Co. v A.L. Eastmond & Sons, 244 AD2d 294 [1st The standard of proof to establish entitlement to a default Dept., 1997].) amounts" facts." judgment only to some firsthand confirmation of the Feffer v Malpeso, 210 AD2d 61 [1stDept. 1994]. 60, 21. In fact, allegations contained within a verified complaint are admitted as defendants' truth in the event of a default. Rokina Opt. Co. v Camera King, 63 NY2d 728; McClelland v Climax Hosiery Mills, 252 NY 347; Green v Dolphy Constr. Co., 187 AD2d 636 [2nd Lippman v 138 A.D.2d 525 N.Y.S.2d 635, Dept., 1992]; Hines, 845, 955; Muhlhahn v Triple Cee Bar & Rest. Supply Co., 133 A.D.2d 996, 521 N.Y.S.2d 146; Rokina Opt. Co. v Camera King; 63 N.Y.2d 728, 469 N.E.2d 518, 480 N.Y.S.2d 197; McClelland v Climax Hosiery Mills, 252 N.Y. 347, 169 N.E. 605; Woodson v Mendon Leasing Corp., 100 NY2d 62, 64 [2003]. The legal conclusions to be drawn from such proof are reserved for the court's determination. Id. See CPLR 3215 [b], [e]; Silberstein v Presbyterian Hosp., 96 AD2d 1096; Wine Antiques v St. Paul Fire & Mar. Ins. Co., 40 AD2d 657, affd 34 NY2d 781; 4 Weinstein-Korn-Miller, NY Civ Prac P 3215.25). B. State Farm Has Submitted Proof Of The Facts Constituting Its Claim 22. The Affirmation of David F. Boucher, Jr., the Affidavits of Bonnie Henderson-Bunn and Kelli Ivey, and the Exhibits annexed thereto, are proof of the facts constituting State Farm's claim. They show that State Farm is entitled to a Default 9 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 Judgment against the Defendants in default, declaring that there is no No-Fault coverage for the alleged claims relating to the alleged March 30, 2019 collision referenced by State Farm claim number 52-01W6-00T. C. Material Misrepresentation in Procuring the Policy 23. State Farm's First Cause of Action is that the Insured made a misrepresentation when he procured the Policy regarding his residence location and the garage location of the Insured Vehicle, that the misrepresentation was material, primary and that the Policy would not have been issued under the same terms or at the same rate had State Farm known the truth. State Farm has denied all claims of the defendants on that basis. 24. In the context of No-Fault, insurers may assert material misrepresentations in the procurement of the policy as a defense against a party involved in the misrepresentation in the policy's procurement. Ins. Co. of N. Am. v. Kaplun, 274 A.D.2d 293 (2d Dep't 2000). 25. The court in Kaplun held that the insurance carrier would be permitted to raise the claim of fraud in the procurement of the policy as a defense for any No-Fault action brought by the claimant or those providers who submitted claims on behalf of the claimant because the claimant was aware of the misrepresentation. See also Quality Med. Care, P.C. v Progressive Cas. Ins. Co., 56 Misc. 3d 1214 (A)(2017 N.Y.Misc. LEXIS 2965)(2017). The court in Kaplun reasoned that while an insurance could not company use the insured's misrepresentation to disclaim against innocent third parties, an 10 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 insured or other party involved in the fraudulent procurement of the should not policy have that same protection. See Integon Ins. Co. v. Goldson, 300 A.D.2d 396, 751 N.Y.S.2d (2nd 2002). 527, Dep't, 26. In order to establish that representation was material, "the insurer must present documentation its underwriting practices, such as concerning underwriting manuals, bulletins, or rules pertaining to similar risks that show it would not have application." issued the same policy if the correct information had been disclosed in the Schirmer v. Penkert, 41 A.D.3d 688, 690-691 (2d Dep't 2007). No-fault benefits may be denied to an insured where an insurer submits evidence in admissible form showing that the insured had procured the insurance policy (see W.H.O. fraudulently Acupuncture, P.C. v Infinity Prop. & Cas. Co., 36 Misc 3d 4 [App Term, 2d, 11th & 13th Jud Dists 2012]; New Millennium Psychological Servs., P.C. v Commerce Ins. Co., 34 Misc 3d 127 [A], 2011 NY Slip Op 52286[U] [App Term, 2d, 11th & 13th Jud Dists 2011]). 27. In AA Acupuncture Services, P.C. v. Safeco Ins. Co. of America, 25 Misc.3d 30, 887 N.Y.S.2d 739, the Appellate Term, First Department upheld a denial of an insured's No-Fault claims for misrepresentation, where the insured inaccurately claimed in her application that she lived in Connecticut rather than Brooklyn. policy In its defense, the court found relevant that the insurer attested that "the establishing annual premium of $1,236 paid by the insured was based on her representation that she resided in Connecticut, and that the annual premium for the same policy based on her $4,807." Brooklyn address would have been Id. 11 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 28. According to the Affidavit of Kelli Ivey State Farm would not have issued the Policy to the Insured under the same terms or conditions had it been aware that the Insured Vehicle was being garaged in Brooklyn, New York as opposed to the address in Florida, New York. State Farm's underwriting department has determined that the difference in the monthly premium between the Policy Address and the Brooklyn Address would be $2,889.66 over a six month period, which is a significant enough difference to determine that the misrepresentation was material. See Affidavit of Kelli Ivey. 29. Accordingly, State Farm is entitled to a default judgment against all of the defendants in default on the basis that a material misrepresentation was made to State Farm when the policy was procured and because State Farm would not have issued the Policy, or would have issued it at substantially different rates or terms, had it been given truthful information. II. The Defaulting Defendants Have No Meritorious Defense 30. Since the Defendants have no reasonable excuse for their Defaulting months of continuing default after they were served with the Summons and Verified Complaint and the Notice of Default, this Court need not address whether have they any meritorious defense to this action. See Abdul v. Hirschfield, 71 A.D.3d 707, 708 - 898 N.Y.S.2d 45 (2nd Dep't ("In view of the lack of a reasonable 709, 44, 2010) excuse, it is to consider whether [defendant] sufficiently demonstrated the unnecessary existence of a meritorious defense"); Kranenburg v. Butwell, 34 A.D.3d 1005, 1006, 825 12 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 N.Y.S.2d 165 (3rd Dep't ("Given the of defendant's submission 163, 2006) insufficiency a reasonable excuse for the default, it is not necessary to address whether concerning defendant has a meritorious defense to the action"). Moreover, the Defaulting Defendants have not shown any meritorious defenses. 31. On October 2, 2019, the undersigned duly executed a search with the Service members Civil Relief Act (SCRA) website regarding defendant KADHEIJAH NOEL. The undersigned searched using this defendant's social security number, or date of birth, or both. The search revealed that KADHEIJAH NOEL is not currently on active duty in the military. See Exhibit "G". A. Notice of Default 32. As described above and in the annexed Affidavit of Bonnie Henderson- Bunn and Kelli Ivey, State Farm maintains meritorious causes of action, the defendants in default have no defense to this action, and they have failed to answer State Farm's complaint and are in default in answering same. A Notice of Default was sent to the defendants served through the secretary of state. See Notice of Default annexed hereto as Exhibit "H". 33. Accordingly, State Farm is entitled to a Default Judgment against the Defendants in Default, that there is no No-Fault coverage for their alleged declaring claims relating to the alleged March 30, 2019 collision referenced by State Farm claim number 52-01W6-00T. 34. No prior request was made for the relief requested herein. 13 of 33 FILED: NEW YORK COUNTY CLERK 01/31/2020 03:02 PM INDEX NO. 156986/2019 NYSCEF DOC. NO. 20 RECEIVED NYSCEF: 01/31/2020 IL STATE FARM'S MOTION TO ADD THE PROPOSED ADDITIONAL DEFENDANT TO THIS ACTION SHOULD BE GRANTED 35. State Farm seeks leave pursuant to CPLR 3025(b) to amend the Amended Summons and Amended Verified Complaint to add EASTERN MEDICAL PRACTICE, P.C. ("Proposed Additional Defendant"), as an additional defendant. 36. Since filing the Amended Summons and Verified Complaint in this action, State Farm has received medical bills and established defenses for the claims of the Proposed Additional Defendant, who submitted bills to State Farm, seeking no-fault reimbursement for medical services allegedly provided to the Claimant. 37. As elaborated prior in this motion, KADHEIJAH NOEL materially misrepresented her residence location and the primary garage location of the insured vehicle when the policy was procured, and State Farm would not have issued the policy, or would not have issued the policy under the same terms or at the same rate. 38. Under CPLR § 3025(b), a party may seek leave of court to amend a just." pleading. "Leave shall be freely given upon such terms as may be See also Cohn v. United States Trust 127 A.D.2d 512 N.Y.S.2d 37 (1stDep't 1987). Co., 523, 39. As such, it is clear that State Farm maintains meritorious causes of action against the Proposed Additional Defendants. These are further detailed in the affidavits of Bonnie Henderson-Bunn and Kelli Ivey annexed hereto. 40. The proposed Amended Summons and Complaint is attached hereto as Exhibit "I".