Opinion
017608-05.
Decided March 17, 2006.
Upon the foregoing papers, defendant's motion pursuant to CPLR § 602 severing plaintiff's causes of action is denied. The issue raised is whether plaintiff should be permitted to join unrelated assigned claims for no-fault benefits.
The four causes of action in plaintiff's complaint seek to recover no-fault benefits for each of four unrelated claimants who received treatment by the same medical provider, plaintiff Westchester Medical Center (hereinafter "Medical Center"). The claimants were each covered under a uniform policy of insurance issued by the same insurance company, defendant Liberty Mutual Insurance Company (hereinafter "Liberty"), and each allegedly assigned their right to no-fault benefits to the Medical Center.
The plaintiff further alleges that no-fault billing was mailed to defendant in a timely manner and that the bills remain unpaid. The New York State No-Fault Law, Insurance Law § 5106(a) imposes upon insurers a prescribed time frame for settling bodily injury claims covered by a policy of bodily injury liability insurance:
"Payments of first party benefits and additional first party benefits shall be made as the loss if incurred. Such benefits are overdue if not paid within thirty days after the claimant supplies proof of the fact and amount of loss sustained. If proof is not supplied as to the entire claim, the amount which is supported by proof is overdue if not paid within thirty days after such proof is supplied. All overdue payments shall bear interest at the rate of two percent per month. If a valid claim or portion was overdue, the claimant shall also be entitled to recover his attorney's reasonable fee, for services necessarily performed in connection with securing payment of the overdue claim, subject to limitations promulgated by the superintendent in regulations.
The defendant argues that since the respective injuries of the claimants were unrelated, the accidents took place on various dates, and each claim submitted by the assignee was handled in a distinct manner, the causes of action should be severed. Defendant further argues that if the causes of action are not severed, it would involve mini-trials as to the individual claims.
While defendant's Answer alleges numerous affirmative defenses as to procedure under the no-fault statute and, among others, medical necessity and fraudulent conduct, the Answer was verified by counsel and the motion was supported only by an affirmation of counsel. There was no evidentiary proof nor an affidavit by a person with knowledge of the facts herein.
CPLR § 601 encourages and permits joinder with as many claims as one plaintiff might have against one defendant, regardless of whether such claims are unrelated or inconsistent. Collins v. Telcoa Intern. Corp., 283 AD2d 128, 131 (2nd Dept. 2001). CPLR § 1002(a) states: "Persons who assert any right to relief jointly, severally, or in the alternative arising out of the same transaction or occurrence, or series of transactions or occurrences, may join in one action as plaintiffs if any common question of law or fact would arise."
The purpose of this policy of liberal joinder is to prevent multiplicity of suits so that the aggrieved party can obtain relief in one action. Saunders v. Saunders, 54 Misc 2d 1081 (Supreme Ct Kings Co. 1967). "It is also intended to reduce the caseload of the courts and its personnel and avoid unnecessary expenditure of time, money and manpower." Aviyon Medical Rehabilitation v. Allstate Insurance Co., 4 Misc 3d 1011 (A), 2004 NY Slip Op 50819(U) (Supreme Ct Kings Co. 2004).
CPLR § 603 provides, however, that a court may order severance "in furtherance of convenience or to avoid prejudice." The decision whether to grant a severance pursuant to CPLR § 603 is a matter of judicial discretion, which will not be disturbed on appeal absent an abuse of discretion or prejudice to a substantial right of the party seeking severance. Anderson v. Singh, 305 AD2d 620 (2nd Dept. 2003); Finning v. Niagra Mohawk Power Corp., 281 AD2d 844 (3rd Dept. 2001); Aviyon Medical Rehabilitation, supra.
The Appellate Division, Second Department held in the leading case that when ". . . the claims arise out of a uniform contract of insurance and involve interpretation of the same no-fault provisions of the Insurance Law . . ." joinder of 29 claims by one assignee-plaintiff was proper under CPLR 1002(a). Hempstead General Hospital v. Liberty Mutual Ins. Co., 134 AD2d 569 (2nd Dept. 1987). Defendant Liberty relies on Mount Sinai Hospital a/a/o Jefferson v. MVIAC, 291 AD2d 53 (2nd Dept. 2002), for the proposition that in actions for reimbursement of no-fault benefits with multiple assignees and assignors, the claims must be severed, where there is no common contract of insurance and no other similarity except that no-fault benefits were not paid.
However, Liberty's reliance on Mount Sinai, supra, is misplaced. It is distinguishable from the instant case because in Mount Sinai both the assignees and assignors were different. While the Appellate Division approved severance as a "provident exercise of discretion", it modified the order appealed from to join two causes of action on behalf of the same assignor-claimant, citing Hempstead General Hospital. The instant case involves only one assignee-provider and four unrelated assignors-claimants, similar to but less than the 29 in Hempstead General Hospital, supra.
More recently, the Second Department, in Poole v. Allstate Insurance Co., 20 AD3d 518 (2nd Dept. 2005), severed 47 unrelated claims brought by one assignee against one insurance company. The Court not only cited Hempstead General Hospital without disapproval, but in its ruling held joinder of 47 claims in a single trial to be an "improvident exercise of discretion" because it was "unwieldy" and potentially confusing to a trier of fact. See also, Radiology Resource Network v. Fireman's Fund Insurance Co., 12 AD3d 185 (1st Dept. 2004) (68 claims severed); cf, Aviyon Medical Rehabilitation, supra (36 claims appropriately joined).
While there may be support for granting severance in no-fault actions, which Liberty mis-characterizes as controlling on this Court, analysis of the cases suggests that Hempstead General Hospital has never been overruled by the Second Department and that severance remains a matter of judicial discretion based upon a weighing of all the circumstances in a particular case.
For instance, the Appellate Term has cited Radiology and Mount Sinai with approval in granting severance in a number of recent cases. Metro Med v. MVAIC, 6 Misc 3d 136 A, 2005 NY Slip Opinion 50238(U) (App Term 2nd Dept. 2005) (3 claims); S.I.A. Med. v. GEICO, 8 Misc 3d 134 A, 2005 NY Slip Opinion 51170(U) (App Term 2nd Dept. 2005) (11 claims) ; Berger v. Liberty Mutual, 10 Misc 3d 139 A, 2005 NY Slip Opinion 52204(U) (App Term 2nd Dept. 2005) (14 claims). While Liberty argues that these decisions are binding on this Court and overrule Hempstead General Hospital, such argument is baseless. As a court of original jurisdiction, this Court is bound by stare decisis to follow determinations of the Appellate Division or the Court of Appeals. Ross Bicycles, Inc v. Citibank, 149 AD2d 330 (1st Dept. 1989); People v. Young, 82 Misc 2d 964 (Nassau County Ct 1975).
Not only has the Second Department not overruled Hempstead General Hospital, but even the First Department, in Radiology, supra, reconciled its ruling by explaining that Hempstead General Hospital ". . . does not stand for the proposition that the granting of a severance motion . . . is an abuse of judicial discretion." The standard applied in all of the cited cases remains the appropriate exercise of judicial discretion and the analysis remains focused on the circumstances in each particular case.
Although the facts of each cause of action herein may be different, each involves the same provider, the same insurance company, the same insurance contract, and common questions of the application and interpretation of Insurance Law § 5106(a). Defendant has failed to submit any proof or documentary evidence to the contrary.
Conclusory allegations (only made by counsel) that the claimants engaged in fraudulent conduct or that treatment was not medically necessary is an insufficient basis to sever these four actions. Considering all of these factors, the Court finds that the joinder of only four (4) assignors-claimants does not impose an undue burden on defendant nor would it likely create confusion for the trier of fact.
Accordingly, defendant's motion to sever is denied.
This shall constitute the Decision and Order of the Court.