Air Plus Surgical Supply, Inc. v Country Wide Ins. Co.

Supreme Court, Appellate Term, Second Department, 2d, 11th And 13th Judicial Districts

Decided on February 27, 2026

2025-87 Q C

Present: : Chereé A. Buggs, J.P., Lisa S. Ottley, Joanne D. Quiñones, JJ

Glinkenhouse Queen, Esqs. (Alan Queen of counsel), for appellant. Thomas Torto, for respondent.

Appeal from an order of the Civil Court of the City of New York, Queens County (Ira R. Greenberg, J.), dated July 9, 2024. The order granted defendant's motion to vacate a judgment entered June 7, 2023 pursuant to a default under a settlement.

ORDERED that the order is modified by granting defendant's motion only to the extent of vacating so much of the June 7, 2023 judgment as awarded plaintiff $850 in attorney's fees; as so modified, the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits for an accident which occurred in 2000, the parties entered into a settlement in May 2008, which provided that defendant would pay plaintiff the total sum of $1,030.20. Approximately eight years later, plaintiff moved to enter a judgment due to defendant's failure to pay pursuant to the settlement. Defendant opposed this motion, on the ground that plaintiff was not entitled to recover accrued compound interest. Plaintiff subsequently withdrew this motion. However, on June 7, 2023, pursuant to an ex parte application, a judgment was entered which awarded plaintiff, insofar as is relevant, the principal sum of $1,030.20, plus accrued compound interest, plus $850 in attorney's fees, for a total sum of $29,087.

Defendant moved to vacate the judgment arguing, among other things, that plaintiff had [*2]failed to provide defendant with 14 days' notice, as required by an alleged modification of the settlement agreement, before seeking entry of a judgment based upon defendant's failure to make payment. The motion also sought, in the alternative, to vacate so much of the judgment as awarded compound interest and $850 in attorney's fees. By order dated July 9, 2024, the Civil Court (Ira R. Greenberg, J.) granted the branch of defendant's motion seeking to vacate the judgment, finding that plaintiff had accepted defendant's modification of the settlement agreement and that plaintiff did not establish that it had provided defendant with the requisite 14 days' notice before entry of the judgment, and denied, as moot, the branches of defendant's motion seeking alternative relief.

As defendant's motion concedes, defendant was served with plaintiff's motion to enter judgment in 2016 due to defendant's failure to pay in accordance with the settlement. Thus, even if the alleged modification of the settlement agreement is enforceable, the prior motion was sufficient to satisfy the requirement that defendant receive written notice 14 days prior to the entry of judgment. Upon receiving the 2016 motion, defendant could have paid plaintiff in accordance with the settlement, but it apparently chose not to do so. As a result, the branch of defendant's motion seeking to vacate the June 7, 2023 judgment on that ground should have been denied.

Defendant's contention that plaintiff was not entitled to recover compound accrued interest lacks merit. The claims in this case are "governed by the former regulations providing for compound interest because the accident occurred prior to the effective date of the current regulations, which now provide for a simple rate of interest" (New Life Acupuncture, P.C. v Country Wide Ins. Co., 81 Misc 3d 142[A], 2024 NY Slip Op 50120[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2024]; see 11 NYCRR 65-3.9 [a], effective April 5, 2002; Matter of B.Z. Chiropractic, P.C. v Allstate Ins. Co., 197 AD3d 144, 155-156 [2021]; Health Value Med., P.C. v Country Wide Ins. Co., 66 Misc 3d 127[A], 2019 NY Slip Op 52036[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]).

However, the branch of defendant's motion seeking to vacate the $850 award of attorney's fees set forth in the judgment should have been granted, as CPLR 5003-a (e) does not provide for attorney's fees to be separately awarded in a judgment entered upon a settling defendant's failure to pay the settlement amount (see Liss v Brigham Park Coop. Apts. Sec. No. 3, 264 AD2d 717 [1999]).

Defendant's remaining bases to vacate the judgment lack merit (see Mundel v Harris, 199 AD3d 814, 815 [2021]; Arguelles, M.D., P.C. v AIG Natl. Ins. Co., 86 Misc 3d 132[A], 2025 NY Slip Op 51142[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2025]; Seaside Rehabilitation v Allstate Ins. Co., 62 Misc 3d 162[A], 2019 NY Slip Op 50918[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]).

Accordingly, the order is modified by granting defendant's motion only to the extent of vacating so much of the June 7, 2023 judgment as awarded plaintiff $850 in attorney's fees.

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

ENTER:

Jennifer Chan

Chief Clerk

Decision Date: February 27, 2026