New Image Chiropractic, P.C., as Assignee of Krystal Hayes, Respondent, v. Kemper Insurance Company, Appellant. (2026)

ORDERED that the order, as amended and insofar as appealed from, is modified by providing that plaintiff's cross-motion for summary judgment is denied and by striking the provision thereof that plaintiff had "established its prima facie case of timely mailing the bills to Kemper"; as so modified, the order, as amended and insofar as appealed from, is affirmed, without costs.

In April 2021, plaintiff New Image Chiropractic, P.C. commenced this action against Kemper Insurance Company (Kemper) to recover assigned first-party no-fault benefits for services it rendered to its assignor, who was allegedly injured in an automobile accident on or about May 18, 2020. Plaintiff asserted that it timely furnished Kemper with claim forms, that Kemper assigned claim number 1052953401 to this claim, and that Kemper had failed to properly deny or pay the claim within 30 days of its receipt. Unitrin Safeguard Insurance Company (Unitrin), alleging that it was sued herein as Kemper Insurance Company, served an answer. In April 2021, Unitrin brought a declaratory judgment action in the Supreme Court, New York County, against New Image Chiropractor, P.C. and its assignor herein, Krystal Hayes, among other parties, pertaining to a May 18, 2020 accident. Thereafter, Unitrin moved in the Supreme Court to enter a default judgment against New Image Chiropractor, P.C., among others, when they failed to appear or answer. In a default judgment dated July 27, 2022, the Supreme Court declared that "UNITRIN owes no duty to provide No-Fault reimbursements to" New Image Chiropractic, P.C. "relating to the alleged May 18, 2020 loss (UNITRIN claim number C109887NY20)."

Subsequently, "defendant" moved in the Civil Court for summary judgment dismissing the complaint on the ground of res judicata or collateral estoppel, based on the aforementioned July 27, 2022 Supreme Court default declaratory judgment. Plaintiff cross-moved for summary judgment, asserting that it had provided medically necessary services to its assignor, that the relevant claim forms were mailed to Kemper and that Kemper had failed to pay or deny the claims. Kemper appeals from so much of an order of the Civil Court (Sandra E. Roper, J.) dated January 9, 2025, as amended by an order of that court dated July 15, 2025, as denied "defendant's" motion for summary judgment and "granted" plaintiff's cross-motion to the extent of finding that plaintiff had "established its prima facie case of timely mailing the bills to Kemper" (see CPLR 3212 [g]).

The doctrine of res judicata generally requires a final adjudication of a claim on the merits and precludes relitigation of that claim and all claims arising out of the same transaction or series of transactions (see Matter of Hunter, 4 NY3d 260 [2005]; Schuylkill Fuel Corp. v Nieberg Realty Corp., 250 NY 304 [1929]; Ciraldo v JP Morgan Chase Bank, N.A., 140 AD3d 912 [2016]; Quality Health Supply Corp. v Hertz Co., 68 Misc 3d 131[A], 2020 NY Slip Op 50996[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2020]). It is well settled that default judgments, which have not been vacated, can have res judicata effect (see Lazides v P & G Enters., 58 AD3d 607 [2009]; Matter of Allstate Ins. Co. v Williams, 29 AD3d 688 [2006]; Matter of Eagle Ins. Co. v Facey, 272 AD2d 399 [2000]). Moreover, collateral estoppel precludes a party from relitigating an issue where "the issue in the second action is identical to an issue which was raised, necessarily decided and material in the first action, and the plaintiff had a full and fair opportunity to litigate the issue in the earlier action" (Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343, 349 [1999]; see D'Arata v New York Cent. Mut. Fire Ins. Co., 76 NY2d 659 [1990]; Manko v Gabay, 175 AD3d 484 [2019]). While "[a]n issue is not actually litigated if, for example, there has been a default" (Kaufman v Eli Lilly & Co., 65 NY2d 449, 456-457 [1985]), collateral estoppel may be applied to default judgments where the party against whom preclusion is sought appears in the prior action and then defaults (see Miller v Falco, 170 AD3d 707 [2019]).

Unitrin's default declaratory judgment against New Image Chiropractic, P.C. has no res judicata effect on this case, as there has been no demonstration that Kemper is, in fact, Unitrin, or even that Unitrin, and not Kemper, is "the proper insurer" (see Quality Health Supply Corp. v Hertz Co., 2020 NY Slip Op 50996[U]). Indeed, both Kemper and Unitrin appear to have two different claim numbers for this claim without any explanation. Moreover, as New Image Chiropractic, P.C. did not appear in the declaratory judgment action, it did not have a full and fair opportunity to litigate whether Unitrin owes a duty to provide no-fault reimbursements to it and, therefore, there is no collateral estoppel effect against it based on the default declaratory judgment (see Kaufman v Eli Lilly & Co., 65 NY2d at 456-457). Thus, the Civil Court properly denied "defendant's" motion to dismiss.

Plaintiff's cross-motion for summary judgment should have been denied as plaintiff did not submit any evidence of an address for Kemper, and thus failed to establish that the prescribed statutory claim form had been received by Kemper (see Insurance Law § 5106 [a]; Westchester Med. Ctr. v Nationwide Mut. Ins. Co., 78 AD3d 1168 [2010]). In any event, there is a triable issue of fact as to whether Kemper was the insurer for this accident.

Accordingly, the order, as amended and insofar as appealed from, is modified by providing that plaintiff's cross-motion for summary judgment dismissing the complaint is denied and by striking the provision thereof that plaintiff had "established its prima facie case of timely mailing the bills to Kemper"; as so modified, the order, as amended and insofar as appealed from, is affirmed.

TOUSSAINT, P.J., BUGGS and QUIÑONES, JJ., concur.

ENTER:

Jennifer Chan

Chief Clerk

Decision Date: June 17, 2026