Thursday, May 29, 2008

No Flitting Between Forums For No-Fault Claim

Travelers Indem. Co. v. Sung Won Lee
(Sup. Ct., Queens Co., decided 5/28/2008)

By summons and complaint dated January 24, 2006, defendant EIP commenced an action against Travelers in Queens County Civil Court for "at least $25,000" in no-fault benefits, presumably for surgical costs that Mr. Lee had not yet incurred. Travelers answered and served discovery demands and a motion to dismiss. In October 2007, the court granted Travelers' motion "without prejudice" on the grounds that the lawsuit was premature as having been filed prior to plaintiff's surgery in August of 2007.

Two weeks later, Lee filed for no-fault arbitration of his claim for $19,000 in surgical costs with the American Arbitration Association. Travelers commenced this special proceeding for a permanent stay of that arbitration pursuant to CPLR article 75. Travelers argued that Lee was barred from proceeding with the arbitration since he had exercised his option and elected the courts as the forum within which to prosecute his claims. In response, Lee argued that the AAA arbitration may proceed as there currently was no court action pending in the subject no-fault dispute and because he did not have the option of filing for arbitration at the time he commenced the civil court action in January of 2006 since his surgery had not yet been performed.

In granting Traveler's petition for a permanent stay of the AAA arbitration, Queens County Supreme Court Justice Jaime Rios held:
Having decided his course of recovery, Lee cannot flit between forums for the resolution of issues or items of damages arising from the same injury (see Roggio v Nationwide Mut. Ins. Co., 106 AD2d 3 [3d Dept., 1985]; see also Gibeault v Home Ins. Co., 221 AD2d 826 [3d Dept., 1995]). To hold otherwise would create an intolerable drain on our resources for dispute resolution, senselessly prolonging controversies and inviting inconsistent adjudication (see A.B. Medical Services PLLC v. New York Cent. Mut. Fire Ins. Co., 2006 WL 901211 [Kings Cty Civ Ct, 2006]; Advanced Medical Care, PLLC ex rel. Kabelsky v Travelers Property Cas., 6 Misc 3d 1040[A] [NY City Civ Ct,2005]).

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