AIG v. Health Insurance Plan of Greater New York

AIG v Health Ins. Plan of Greater N.Y. (2015 NY Slip Op 01586)

AIG v Health Ins. Plan of Greater N.Y.

2015 NY Slip Op 01586

Decided on February 24, 2015

Appellate Division, First Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on February 24, 2015
Friedman, J.P., Sweeny, Saxe, Feinman, Clark, JJ.

158055/12 -158056/12 14331B 158057/12 14331A 14331

[*1] AIG, et al., Petitioners-Respondents,

v

Health Insurance Plan of Greater New York, etc., et al., Respondents-Appellants. AIG, et al., Petitioners-Respondents, -against-

Group Health Incorporated, etc., et al., Respondents-Appellants. AIG, et al.,

Petitioners-Respondents, -against-

v

Health Insurance Plan of Greater New York, etc., et al., Respondents-Appellants.

Bond, Schoeneck & King, PLLC, Albany (Hermes Fernandez of counsel), for appellants.

Weiss, Wexler & Wornow, P.C., New York (Cory I. Zimmerman of counsel), for respondents.

Three orders and judgments (three papers), Supreme Court, New York County (Alice Schlesinger, J.), entered July 22, 2013, which granted petitioners' CPLR article 75 petitions to vacate July 5, 2012 arbitration awards rendered in favor of respondents and against petitioners, and directed respondents to submit HIMP-1 forms to petitioners in the event they seek new arbitrations in these matters, unanimously affirmed, with costs.

Although the IAS court, in analyzing the petitions, should have applied CPLR 7511, instead of CPLR 5015 (see Ingham v Thompson, 113 AD3d 534, 534 [1st Dept 2014], lv denied 22 NY3d 866 [2014]), the court correctly granted the petitions, as petitioners did not have proper notice of these compulsory arbitrations (see 12 NYCRR subpart 325-6; see also Matter of Motor [*2]Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214, 223 [1996] [closer judicial scrutiny is applied where arbitration is compulsory]). Although respondents submitted sufficient proof of the mailing and delivery of their HIMP-1 and HIMP-3 forms, it is undisputed that the notices of the requests for arbitration before the AAA, the "dispute forum," were faxed and not mailed to petitioners, as required by 22 NYCRR 325-6.10. Since petitioners were prejudiced by the awards entered upon their unintentional default, the court correctly vacated the awards (see CPLR 7511[b][2][i], [b][1][i]; compare Thermasol, Ltd. v Dreiske, 78 AD2d 838 [1st Dept 1980], affd 52 NY2d 1069 [1981], cert denied 454 US 826 [1981][court erred in vacating award, where the respondent received proper notice of the pending arbitration proceedings and thus his rights were not impaired]). Upon vacating the awards, rather than remanding to the same or new arbitrator (see CPLR 7511[d]), the IAS court properly directed respondents to restart the dispute resolution process in accordance with 12 NYCRR subpart 325-6 in the event they decide to seek new arbitrations in these matters.

THIS CONSTITUTES THE DECISION AND ORDER

OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: FEBRUARY 24, 2015

CLERK