Decided on October 27, 2017
SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS
PRESENT: : MICHAEL L. PESCE, P.J., THOMAS P. ALIOTTA, MARTIN M. SOLOMON, JJ
2014-1574 Q C

The Rybak Firm, PLLC (Damin J. Toell, Esq.), for appellant. Bruno, Gerbino & Soriano, LLP (Mitchell L. Kaufman, Esq.), for respondent.

Appeal from an order of the Civil Court of the City of New York, Queens County (Richard G. Latin, J.), entered June 13, 2014. The order, insofar as appealed from and as limited by the brief, denied the branches of plaintiff’s motion seeking summary judgment on the second, third, fourth, eighth and ninth causes of action and granted the branches of defendant’s cross motion seeking summary judgment dismissing those causes of action.

ORDERED that the order, insofar as appealed from, is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment and defendant cross-moved for summary dismissing the complaint on various grounds. Insofar as is relevant to this appeal, by order entered June 13, 2014, the Civil Court denied the branches of plaintiff’s motion seeking summary judgment on the second, third, fourth, eighth and ninth causes of action, and granted the branches of defendant’s cross motion seeking summary judgment dismissing those causes of action on the ground that plaintiff had failed to appear for duly scheduled examinations under oath (EUOs). Contrary to plaintiff’s sole argument with respect to those claims, the affirmation submitted by defendant was sufficient to establish plaintiff’s failure to appear for the EUOs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]).

Plaintiff’s contention as to the branch of its motion seeking summary judgment on the first cause of action is not properly before this court, as that branch of its motion remains pending and undecided (see Andreas v Catskill Mtn. Lodging, LLC, 60 AD3d 604 [2009]).

Accordingly, the order, insofar as appealed from, is affirmed.

PESCE, P.J., ALIOTTA and SOLOMON, JJ., concur.

Defendant appeals from a judgment of the Civil Court of the City of New York, Bronx County (Shawn T. Kelly, J.), entered August 17, 2016 after a nonjury trial, in favor of plaintiff in the sum of $2,126.66.

Per Curiam.

Judgment (Shawn T. Kelly, J.), entered August 17, 2016, reversed, with $30 costs, and judgment directed in favor of defendant dismissing the complaint.

In this action by a provider to recover assigned first- party no-fault benefits, the parties stipulated that the only issue for trial would be whether the services rendered to plaintiff’s assignor on April 12, 2011 were medically necessary. Plaintiff also stipulated to the expertise of Dr. Vincent Notabartolo, defendant’s peer review doctor.

At trial, Dr. Notabartolo testified that in his opinion the services provided by plaintiff, specifically, electromyography and nerve conduction velocity diagnostic testing, were not medically necessary because there was no indication of a “diagnostic dilemma” that would warrant such testing. The witness explained that the assignor was not neurologically deteriorating and was responding to chiropractic treatment. Dr. Notabartolo’s peer review report reaching the same conclusion was also stipulated into evidence.

Dr. Notabartolo’s testimony, which the court expressly found credible, demonstrated a factual basis and a medical rationale for his determination that there was no medical necessity for the services at issue here (see New Horizon Surgical Ctr., L.L.C. v Allstate Ins. Co., 52 Misc 3d 139[A], 2016 NY Slip Op 51125[U] [App Term, 2d, 11th and 13th Jud Dists 2016]). Thus, the burden shifted to plaintiff to present his own evidence of medical necessity (see West Tremont Med. Diagnostic, P.C. v GEICO Ins. Co., 13 Misc 3d 131[A], 2006 NY Slip Op 51871[U] [App Term, 2nd and 11th Jud Dists 2006]). Plaintiff, however, called no witnesses to rebut defendant’s evidence. In these circumstances, plaintiff was not entitled to judgment in its favor (see All Is. [*2]Med. Care, P.C. v State Farm Mut. Auto. Ins. Co., 33 Misc 3d 142[A], 2011 NY Slip Op 52227[U] [App Term, 9th and 10th Jud Dists 2011]; Specialty Surgical Servs. v Travelers Ins. Co., 27 Misc 3d 134[A], 2010 NY Slip Op 50715[U] [App Term, 9th and 10th Jud Dists 2010]). Accordingly, we reverse and direct entry of judgment in favor of defendant dismissing the complaint.

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.

[*1]

The Russell Friedman Law Group, Lake Success (Charles Horn of counsel), for appellant.

Thomas Torto, New York, respondents.

Order, Supreme Court, New York County (Richard F. Braun, J.), entered November 25, 2015, which, inter alia, granted plaintiffs’ motion for summary judgment declaring that defendant is not entitled to no-fault insurance benefits from them with respect to the 31 claims at issue, unanimously affirmed, with costs.

The refusal by defendant’s principal, Dr. Alexandre Scheer, to answer questions at an examination under oath (EUO) about his compliance with a consent agreement and order he had entered into with the Office of Professional Medical Conduct (OPMC) constituted a failure to comply with the request for an EUO, a condition precedent to coverage under the insurance policy (see Hertz Corp. v Active Care Med. Supply Corp., 124 AD3d 411 [1st Dept 2015]).

Defendant argues that plaintiffs’ questions about Scheer’s compliance with the OPMC order were improper because the order is confidential. Defendant relies on Public Health Law § 230 (17), which provides that where an investigation of suspected professional misconduct by a physician reveals evidence insufficient to constitute misconduct but reasonable cause exists to believe the physician is unable to practice medicine with reasonable skill and safety, the physician may be ordered to have his or her practice monitored by another physician approved by OPMC, and any such order shall be kept confidential. However, this provision is inapplicable. Scheer entered into a consent agreement and order in which he did not contest the charge of fraudulent practice of medicine brought against him and he agreed to a penalty of a 12-month suspension of his license to practice medicine, a stay of the suspension, and, pursuant to Public Health Law § 230-a (penalties for professional misconduct), a 60-month term of probation, of which a monitor of his practice was only one condition. Moreover, the consent agreement and order states expressly that it shall be a public document.

Defendant also argues that plaintiffs had no independent right to determine whether Scheer was in compliance with the consent agreement and order and that any determination by them of noncompliance would not render him “unlicensed” to practice medicine. This argument is unavailing. The consent agreement and order provides that any medical practice in violation of the term permitting Scheer to practice only when monitored “shall constitute the unauthorized practice of medicine.” An unlicensed health care provider is ineligible to receive no-fault reimbursement (11 NYCRR 65-3.16 [a] [12]), and an insurer may make a good faith determination that a medical provider assignee seeking no-fault benefits is ineligible to receive such benefits (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 322 [2005]).

Defendant waived the defenses of res judicata and award and arbitration (CPLR 3211 [e]; see Mayers v D’Agostino, 58 NY2d 696 [1982]). While the arbitral awards in its favor were not [*2]issued until after it had filed its answer in this action, there is no indication on the record before us that defendant ever moved to amend its answer to assert either of those defenses. Concur—Tom, J.P., Manzanet-Daniels, Mazzarelli, Oing and Singh, JJ. [Prior Case History: 50 Misc 3d 712.]

Decided on October 20, 2017

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

HUCV 2206-16
James F. Matthews, J.

Upon the following papers numbered 1 to 21 read on this petition for an order vacating the decision in part of a master arbitrator; by Notice of Petition /Order to Show Cause and supporting papers 1-3, ; Notice of Cross Motion and supporting papers ; Answering Affidavits and supporting papers 10,11 ; Replying Affidavits and supporting papers18,21 ; Filed papers ; Other exhibits: 4-9,12-17,19,20 ; (and after hearing counsel in support of and opposed to the motion), it is

ORDERED that the petition to vacate the part of the award and remand rendered by a Master Arbitrator’s decision dated June 27, 2016, which vacated the lower Arbitrator’s award dated March 8, 2016 for $4,329.19 to petitioner, and then remanded the matter to lower arbitration for consideration of respondent’s Mallela defense of fraudulent incorporation, is granted. That part of the award of the Master Arbitrator dated June 27, 2016, which vacated the lower Arbitrator’s award of $4,329.19 to petitioner, and then remanded the matter to arbitration for consideration of respondent’s Mallela defense, is vacated; and it is further

ORDERED that the remaining part of the award rendered by the Master Arbitrator’s decision dated June 27, 2016, which confirmed the decision of the lower Arbitrator dated March 8, 2016, is confirmed.

Petitioner asks the Court to vacate that part of the award of a Master Arbitrator dated June 27, 2016, which vacated the lower Arbitrator’s award of $4,329.19 to petitioner, and then remanded the matter to lower arbitration for consideration of whether respondent’s Mallela defense of fraudulent incorporation (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]) was appropriate.

The respondent opposes the relief sought by petitioner, and requests that the Master Arbitrator’s award dated June 27, 2016, be confirmed.

The lower arbitration decision dated March 8, 2016, awarded the sum of $4,329.19 to petitioner, based upon a finding that mailing requests for two Examinations Under Oath [*2](“EUO’s”) set for June 24, 2015 and July 16, 2015, respectively, were ignored and unattended by petitioner, but the mailing requests were nonetheless facially untimely, in that the first EUO scheduling request was mailed four and one-half (4 1/2) years after the claim was submitted, thereby rendering the EUO requests a nullity, as related to the billing at issue, and rendering all other issues moot. The lower arbitration also found respondent failed to persuasively support their fee schedule defense and awarded the disputed sum of $4,329.19 to petitioner.

The Master Arbitrator’s decision dated June 27, 2016 leaves only a single issue for determination by the Court: respondent contends the lower arbitrator’s decision did not render a determination concerning respondent’s Mallela defense of fraudulent incorporation, which issue it asserts was raised before the arbitrator and was not precluded due to time constraints.

The Master Arbitrator found that the decision of the lower arbitrator was imperfectly rendered pursuant to CPLR 7511(b) (1)(iii) and 11 NYCRR 65-4.5(s), based upon the lack of a specific determination addressing respondent’s Mallela defense of fraudulent incorporation. It therefore vacated the award of $4,329.19 to petitioner, and remanded the matter back to arbitration for consideration of the Mallela contentions concerning fraudulent incorporation.

Petitioner contends that both the lower arbitration and the Master Arbitration found the EUO scheduling notices to be untimely, thereby precluding respondent’s fee schedule defense due to failure of a timely denial of the claim.

In addition, petitioner asserts that the lower arbitration decision included the statement that “all other issues are moot,” thereby including sufficient language to satisfy respondent’s Mallela contentions. Petitioner argues that respondent failed to provide its Mallela contentions with any type of factual allegations, which is why the lower arbitration decision was written in the manner provided. Respondent’s mere cite to Mallela contentions without factual support is legally insufficient (see generally Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 2016 NY Slip Op 37157 [NY Supp 2016] [wherein the Court focused on petitioner’ belief that respondent may have been ineligible for benefits as an unlawfully incorporated professional corporation, but “petitioner nowhere specifies how respondent failed to meet that burden at the arbitration”]).

The Master Arbitrator’s decision implies that the lower arbitrator was obligated to disclose the basis for its decision, which is why the matter was remanded to lower arbitration for further consideration on the Mallela contentions. However, in actuality, an arbitrator is not obligated to reveal the basis for its award (see Hausknecht v Comprehensive Med. Care of New York, P.C., 24 AD3d 778 [2nd Dept 2005]; Matter of Nationwide Mut. Ins. Co. v Steiner, 227 AD2d 563 [2nd Dept 1996]).

The standard of review for an arbitration award is limited to a determination of whether the award was arbitrary, capricious or incorrect as a matter of law. A master arbitrator’s powers in reviewing an initial arbitrator’s decision are limited to the grounds stated in CPLR 7511, and additionally, under insurance regulations, is limited to whether the initial arbitrator ruled on factual and procedural issues in a manner that was arbitrary, capricious, irrational or without a plausible basis (see Matter of Petrofsky v Allstate Ins. Co., 54 NY2d 207, 211 [1981]; In the Matter of Allstate Ins. Co. v Keegan, 201 AD2d 724 [2nd Dept 1994]).

If a challenge is based upon a factual error in the arbitration, “the master arbitrator must uphold the determination if it has a rational basis” (see In the Matter of Richardson v Prudential Prop. & Cas. Ins. Co., 230 Ad2d 861 [2nd Dept 1996]). Moreover, an arbitrator’s award must be upheld “when the arbitrator ‘offer[s] even a barely colorable justification for the outcome [*3]reached'” (see In the Matter of Susan D. Settenbrino. P.C. v Barroga-Hayes, 89 AD3d 1094, 1095 [2nd Dept 2011]). Indeed, for an award to be irrational, there must be “no proof whatsoever to justify the award” (see In the Matter of Gaymon v MTA Bus Co., 117 AD3d 735, 736 [2nd Dept 2014]; In the Matter of Susan D. Settenbrino. P.C. v Barroga-Hayes, supra ). Moreover, “an arbitrator is not bound by principles of substantive law or rules of evidence, and may do justice and apply his or her own sense of law and equity to the facts as he or she finds them to be” (Id. at 1095).

Here, the Court finds that the petition before the Court is timely (see CPLR 7511[a]). Furthermore, the Court finds that the record demonstrates there was a rational basis for the initial arbitrator’s decision and the award dated March 8, 2016 was justified. It was supported by sufficient evidence in the record, and was not arbitrary, capricious, irrational or incorrect as a matter of law.

The Court further finds that the Master Arbitration award dated June 27, 2016, prejudiced petitioner by exceeding its powers (see CPLR 7511[b][1][iii]), and is irrational (see Matter of Falzone [New York Cent. Mut. Fire Ins. Co.], 15 NY3d 530 [2010]). Therefore, the petition is granted, to the extent that the part of the award of the Master Arbitrator dated June 27, 2016, which vacated the lower Arbitrator’s award of $4,329.19 to petitioner, and then remanded the matter to arbitration for consideration of respondent’s Mallela defense, is vacated.

The remaining part of the award rendered by the Master Arbitrator’s decision dated June 27, 2016, which confirmed the decision of the lower Arbitrator dated March 8, 2016, is hereby confirmed (see CPLR 7511[e]).

The foregoing constitutes the decision and order of this Court.

Dated: October 16, 2017
J.D.C.

Law Offices of Ilona Finkelshteyn, P.C. (Ilona Finkelshteyn, Esq.), for appellant. McDonnell, Adels & Klestzick, PLLC, for respondent (no brief filed).

Appeal from an order of the Civil Court of the City of New York, Queens County (Terrence C. O’Connor, J.), entered September 9, 2015. The order, insofar as appealed from as limited by the brief, sua sponte, awarded defense counsel costs in the sum of $1,000 and imposed upon plaintiff’s counsel sanctions in the sum of $2,500.

ORDERED that, on the court’s own motion, the notice of appeal from so much of the order as, sua sponte, awarded defense counsel costs in the sum of $1,000 and imposed upon plaintiff’s counsel sanctions in the sum of $2,500 is deemed an application for leave to appeal from that portion of the order, and leave to appeal is granted (see CCA 1702 [c]); and it is further,

ORDERED that the order, insofar as appealed from, is reversed, without costs, and so much of the order as, sua sponte, awarded defense counsel costs in the sum of $1,000 and imposed upon plaintiff’s counsel sanctions in the sum of $2,500 is vacated.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved to strike the action from the trial calendar and vacate the notice of trial, or, in the alternative, to dismiss the complaint. The Civil Court, in an order entered September 9, 2015, granted the branches of defendant’s motion seeking to strike the action from the trial calendar and vacate the notice of trial, and denied the branch of the motion seeking to dismiss the complaint. The court also, sua sponte, awarded defense counsel costs in the sum of $1,000 and imposed [*2]upon plaintiff’s counsel sanctions in the sum of $2,500. Plaintiff appeals from so much of the order as awarded costs to defense counsel and imposed sanctions upon plaintiff’s counsel.

A court’s sua sponte award of costs to, or imposition of sanctions against, a party or an attorney may be made only “after a reasonable opportunity to be heard” (22 NYCRR 130-1.1 [d]; see Hester v Hester, 121 AD3d 645 [2014]; Matter of Ariola v Delaura, 51 AD3d 1389 [2008]; Hines v RAP Realty Corp., 254 AD2d 330, 331 [1998]; see also Deeb v Tougher Indus., 216 AD2d 667, 668 [1995]). As the Civil Court failed to provide such an opportunity, the order, insofar as appealed from, is reversed, and so much of the order as awarded costs in the sum of $1,000 to defense counsel and imposed sanctions in the sum of $2,500 upon plaintiff’s counsel, pursuant to 22 NYCRR 130-1.1, is vacated (see Hester v Hester, 121 AD3d 645).

WESTON, J.P., ALIOTTA and ELLIOT, JJ., concur.

Zara Javakov, P.C. (Zara Javakov, Esq.), for appellant. McDonnell & Adels, P.C. (Erik Kallhovd, Esq.), for respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Ingrid Joseph, J.), entered October 22, 2013. The order, insofar as appealed from as limited by the brief, upon reargument, in effect, vacated so much of the determination in an order of the same court dated August 17, 2012 as denied the branch of defendant’s prior motion seeking to compel plaintiff Jamhil Medical, P.C. to appear for an examination before trial, and thereupon directed plaintiff Jamhil Medical, P.C. to “re-submit complete responses and objections, if any, to defendant’s interrogatories” within 45 days of receipt of the order with notice of entry, which defendant was directed to serve along with a copy of its interrogatories and a notice of an examination before trial.

ORDERED that the order, insofar as appealed from, is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, defendant served Jamhil Medical, P.C. (plaintiff) with, among other things, a notice of an examination before trial (EBT), a demand for interrogatories and a notice to produce. By order dated August 9, 2011, the Civil Court (Dawn Jimenez Salta, J.) ordered plaintiff to “provide verified written responses within 60 days.” By order dated August 17, 2012, insofar as is relevant to this appeal, the Civil Court (Ingrid Joseph, J.) granted the branch of defendant’s subsequent motion seeking to dismiss pursuant to CPLR 3126 or to compel disclosure, including an EBT, “to the extent that Plaintiff is ordered, pursuant to CPLR 3124, to re-submit written answers and objections, if any, [*2]to Defendant’s interrogatories, signed or verified under oath by an officer, director, member, agent or employee of plaintiff . . . having the information,” and denied the branch of defendant’s motion seeking to compel plaintiff to appear for an EBT.

Defendant then moved for leave to reargue, asserting, insofar as is relevant to this appeal, that it was entitled to an EBT as well as responses to its discovery demands. Upon granting leave to reargue, the Civil Court (Ingrid Joseph, J.), by order entered October 22, 2013, in effect vacated so much of the August 17, 2012 order as denied the branch of defendant’s prior motion seeking to compel plaintiff to appear for an EBT, and thereupon directed plaintiff to “re-submit complete responses and objections, if any, to defendant’s interrogatories” within 45 days of receipt of the order with notice of entry, which defendant was directed to serve along with a copy of its interrogatories and a notice of an EBT.

Plaintiff’s appellate argument is concerned with the subject matter of defendant’s notice to produce, which is not mentioned in the order appealed from, and is irrelevant to defendant’s interrogatories, to which the order directs plaintiff to respond. Plaintiff does not make any specific argument on appeal regarding the EBT or the interrogatories.

Accordingly, the order, insofar as appealed from, is affirmed.

PESCE, P.J., WESTON and ELLIOT, JJ., concur.

Decided on September 22, 2017

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Decided on September 22, 2017

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Decided on September 22, 2017

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS