A.M. Medical Services, P.C. v. Liberty Mutual Insurance

OPINION OF THE COURT Memorandum. Ordered that the order is reversed without costs, defendant’s motion to vacate the default judgment is denied, and the judgment is reinstated. In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment in July 2003, which motion it subsequently withdrew. In May 2004, plaintiff made a second motion for summary judgment. When defendant failed to submit written opposition thereto, plaintiffs motion was granted on default and, in September 2007, a default judgment in the sum of $15,457.33 was entered against defendant. In March 2009, defendant moved, inter alia, to vacate the default judgment pursuant to CPLR 5015 (a) (3). Defendant argued that the default judgment had been obtained through plaintiff’s fraud, misrepresentation or misconduct since the claim forms plaintiff had annexed to its motions contained handwritten notations which were not on the original claim forms included with the complaint and provided to defendant, and the motions were supported by affidavits containing false statements. By order entered April 24, 2009, the Civil Court granted defendant’s motion, finding that defendant was deprived of the opportunity to timely oppose plaintiffs motion for summary judgment since plaintiff had failed to provide defendant with a courtesy copy of its motion, which the court found to be “tantamount to fraud.” The instant appeal by plaintiff ensued. CPLR 5015 (a) (3) provides that a judgment may be vacated on the ground of “fraud, misrepresentation, or other misconduct of an adverse party.” When a defendant’s CPLR 5015 (a) (3) motion alleges intrinsic fraud — i.e., that the plaintiffs allegations are false — the defendant must also provide a reasonable excuse for its default (see Bank of N.Y. v Stradford, 55 AD3d 765 [2008]; Bank of N.Y. v Lagakos, 27 AD3d 678 [2006]). [89] In support of its motion, defendant argued that plaintiff had submitted affidavits which contained false statements and that plaintiff had annexed to its motion papers false documentation. Defendant was, thus, alleging that plaintiff had obtained the default judgment through “intrinsic fraud” (Bank of N.Y. v Lagakos, 27 AD3d at 679). Consequently, defendant was required to show a reasonable excuse for its default (see Bank of N.Y. v Stradford, 55 AD3d at 765-766), which defendant failed to do. The affirmation of defendant’s attorney did not show that counsel had personal knowledge of any facts pertaining to the alleged law office failure and, therefore, the affirmation was insufficient to establish an excuse for the default (see Incorporated Vil. of Hempstead v Jablonsky, 283 AD2d 553, 554 [2001]). Further, since defendant’s attorney’s “supplemental” affirmation was, in fact, a reply affirmation, the factual allegations asserted for the first time therein must be disregarded (see McNair v Lee, 24 AD3d 159 [2005]; Juseinoski v Board of Educ. of City of N.Y., 15 AD3d 353, 355 [2005]). In view of the foregoing, we find that the Civil Court improvidently exercised its discretion in granting defendant’s motion. Accordingly, the order is reversed, defendant’s motion to vacate the default judgment is denied and the judgment is reinstated.