[*1]

District Court of Nassau County, Third District, March 1, 2017

APPEARANCES OF COUNSEL

Law Offices of Peter C. Merani, New York City, for defendant.

Israel, Israel & Purdy, LLP, Great Neck, for plaintiff.

{**55 Misc 3d at 795}The plaintiff commenced this action to recover no-fault benefits for medical services provided to its assignor, Adam Rivera-Martinez, arising out of a motor vehicle accident on August 22, 2011.

The plaintiff served the summons and complaint in April of 2012 and an answer was filed in May of 2012. After a notice of trial was filed on May 23, 2012, the matter was sent to arbitration before Frank Lattanzio, Esq. Both sides were represented by counsel at the March 12, 2014 hearing, after which the arbitrator found in favor of the plaintiff in the amount of $3,723.72. The defendant, by its then counsel (the Law Offices of Robert P. Tusa), demanded a trial de novo. On March 11, 2015, this matter came on for trial. The court found in favor of the plaintiff in the amount of $3,723.72 plus statutory interest, costs and attorney’s fees. On July 29, 2015, judgment was entered in the sum of $7,784.06, which included statutory interest and attorney’s fees, along with costs and disbursements.

After the judgment was entered, the Law Offices of Peter C. Merani served an amended answer dated October 28, 2015. Initially, the amended answer was rejected by plaintiff’s counsel, as the Law Offices of Peter C. Merani was not the attorney of record for the defendant. In November of 2015, the Law Offices of Peter C. Merani was substituted as counsel for the defendant, but plaintiff’s counsel again rejected the defendant’s answer, as the time within which to file and serve an amended answer had expired (see CPLR 3025).

At bar is the defendant’s motion for a protective order pursuant to CPLR 5240, staying the sale of defendant’s property pending the resolution of the instant application; an order pursuant to CPLR 5019 and 5240, modifying the judgment to reflect that the policy of insurance has been exhausted and that nothing more is owed to the claimant; an order compelling the plaintiff to execute and file a full satisfaction of judgment pursuant to CPLR 5020; and an order pursuant to CPLR 5021, directing the Clerk of the Court to make an entry that the judgment has been partially satisfied. Said motion is determined as follows.

Defense counsel maintains that the underlying insurance policy has been exhausted and that the plaintiff is attempting to execute on a judgment for a sum which is in excess of the policy limits. Counsel states that it is well settled that “where, as here, an insurer has paid the full monetary limits set forth in the policy, its duties under the contract of insurance cease” {**55 Misc 3d at 796}(Presbyterian Hosp. in City of N.Y. v Liberty Mut. Ins. Co., 216 AD2d 448, 448 [2d Dept 1995]; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 571 [2004]; Hospital for Joint Diseases v Hertz Corp., 22 AD3d 724, 725 [2d Dept 2005]).

In support of its motion, defendant has submitted an affidavit by Kristina Cunningham, defendant’s claim representative assigned to this case (notice of motion, exhibit A). In her affidavit, Ms. Cunningham maintains that she has personal knowledge of the defendant’s practices and procedures and the governing no-fault procedures. She specifically addresses the issue that the plaintiff’s assignor was a pedestrian and that “[t]he relevant policy of insurance provided pedestrians, such as the injured/assignor ADAM RIVERA-MARTINEZ, with $50,000 of Personal Injury Protection benefits” (exhibit A ¶ 29). She states the dates on which checks were issued, and avers that as of May 16, 2014, $76,304.79 was paid by the defendant for medical bills. All but one of the checks (in the amount of $1,136.83) listed in this affidavit were issued before the time the defendant filed its answer. Exhibit A-2 of Ms. Cunningham’s affidavit consists of copies of the cashed checks which the defendant has paid out under the policy. As such, the affiant posits that the defendant has already paid more than what is owed to the claimant.

In further support of its motion to modify the judgment, the defendant relies upon Hospital for Joint Diseases v Hertz Corp. (22 AD3d 724 [2005]), in which the Appellate Division, Second Department, modified the judgment after the plaintiff had been awarded summary judgment and judgment had been entered. The Appellate Court held “[that] the defendants were not collaterally estopped from raising the issue of whether the limits of the policy were exhausted, as the defendants were not . . . afforded a full and fair opportunity to contest that issue” (Hospital for Joint Diseases at 725-726).

Five years later, in St. Barnabas Hosp. v Country Wide Ins. Co. (79 AD3d 732, 733 [2d Dept 2010]), the Second Department again held that after the plaintiff was awarded summary judgment in a no-fault action, the defendant was not collaterally estopped from seeking to modify the amount of the judgment based upon its contention that the policy limits had been exhausted. The Court reasoned that the only issues raised in the motion for summary judgment were the questions of whether the defendant had failed to pay or deny the relevant claim within the statutory time frame, and whether the defendant had received verification on that claim.{**55 Misc 3d at 797}

Hence, defense counsel contends that an insurance company is not required to pay no-fault benefits beyond the policy limits, even if the issue is raised after judgment is entered. In this case, counsel argues that since the defendant has paid the applicable policy limits, it is not required to pay this judgment, which should be modified to zero, to reflect that the policy has been exhausted. Further, the defendant’s attorney maintains that the plaintiff should be required to file a satisfaction of judgment.

In opposition, the plaintiff points out that the defendant’s own exhibits establish that it was aware of the amount of money left on the policy as of the time of trial. Counsel asserts that the defendant then had a full and fair opportunity to raise the defense that the subject policy limit had been exhausted, but failed to do so at trial. Therefore, counsel maintains that the defendant’s motion should be denied in all respects.

A review of the defendant’s answer reveals that one of the defenses included in the “ELEVENTH AFFIRMATIVE DEFENSE” is that the policy provisions have been exhausted. “A party shall plead all matters which if not pleaded would be likely to take the adverse party by surprise or would raise issues of fact not appearing on the face of a prior pleading” (CPLR 3018 [b]). Showing that the policy limits have been exhausted is not a requisite part of plaintiff’s case; it is the defendant’s burden to plead and then prove this affirmative defense.

In the cases relied upon by the defendant, summary judgment had been granted without the insurance company having had a full and fair opportunity to contest the policy limitations. However, the case at bar does not involve summary judgment. In fact, no such motion was ever made in the instant matter. To the contrary, the defendant pleaded the affirmative defense of exhaustion of the policy limits in its answer. On March 11, 2015, the defendant then proceeded to trial and wholly failed to raise and/or present evidence of the subject defense, notwithstanding having had the opportunity to do so. This is despite the fact that as is evident from the affidavit of Kristina Cunningham, the defendant was aware, over three years prior to trial, that the policy limits had been exceeded. Indeed, the policy limits had been exhausted months before the defendant’s service of its answer.{**55 Misc 3d at 798}

On this record, the defendant’s motion is denied, in its entirety.

[*1]

Israel Israel & Purdy, LLP, Great Neck, NY (Justin Skaferowsky of counsel), for appellant.

Printz & Goldstein, Woodbury, NY (Lawrence J. Chanice of counsel), for respondent.

Motion by the appellant for leave to reargue an appeal from so much of an order and judgment (one paper) of the Supreme Court, Nassau County (Feinman, J.), entered March 3, 2015, as denied that branch of its cross petition which was for an award of an additional attorney’s fee pursuant to Insurance Department Regulations (11 NYCRR) § 65-4.10 (j) (4), which was determined by decision and order of this Court dated May 18, 2016, or for leave to appeal to the Court of Appeals from the decision and order of this Court.

Upon the papers filed in support of the motion and the papers filed in opposition thereto, it is,

Ordered that the branch of the motion which is for leave to appeal to the Court of Appeals is denied; and it is further,

Ordered that the branch of the motion which is for leave to reargue is granted, and, upon reargument, the decision and order of this Court dated May 18, 2016 (Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 139 AD3d 947 [2016]), is recalled and vacated, and the following decision and order is substituted therefor:

In a proceeding pursuant to CPLR article 75 to vacate a master arbitration award dated August 4, 2014, AAAMG Leasing Corp., as assignee of Dawn Channer, appeals from so much of an order and judgment (one paper) of the Supreme Court, Nassau County (Feinman, J.), entered March 3, 2015, as denied that branch of its cross petition which was for an award of an additional attorney’s fee pursuant to Insurance Department Regulations (11 NYCRR) § 65-4.10 (j) (4).

Ordered that the order and judgment is reversed insofar as appealed from, on the law and in the exercise of discretion, with costs, and that branch of the cross petition of AAAMG Leasing Corp., as assignee of Dawn Channer, which was for an award of an additional attorney’s fee pursuant to Insurance Department Regulations (11 NYCRR) § 65-4.10 (j) (4) is granted, and the matter is remitted to the Supreme Court, Nassau County, for a determination of the amount of the additional attorney’s fee.

[*2] AAAMG Leasing Corp., as assignee of Dawn Channer (hereinafter the appellant), is a medical provider which made a claim for no-fault benefits from the petitioner insurance carrier. The petitioner denied the claim, stating that the supplies provided were not medically necessary.

The appellant sought arbitration of the claim, and in an award dated April 28, 2014, the arbitrator awarded the appellant the sum of $3,870.45, plus interest, and an attorney’s fee in the sum of $850.

The petitioner sought review of the arbitrator’s award by a master arbitrator. In a determination dated August 4, 2014, the master arbitrator affirmed the original arbitration award, and awarded an additional attorney’s fee in the sum of $650 pursuant to Insurance Department Regulations (11 NYCRR) § 65-4.10 (j) (2) (i), which the master arbitrator stated was the maximum allowable fee.

The petitioner then commenced the instant proceeding pursuant to CPLR article 75 to vacate the master arbitration award dated August 4, 2014. The appellant cross-petitioned to confirm the arbitration award, and sought an additional attorney’s fee pursuant to Insurance Department Regulations (11 NYCRR) § 65-4.10 (j) (4). The petitioner opposed that demand for relief. In the alternative, the petitioner stated that the appellant’s fee should be limited to $650.

In the order and judgment appealed from, the Supreme Court confirmed the arbitration award. That branch of the cross petition which was for an award of an additional attorney’s fee was denied without comment. The appeal is limited to so much of the order and judgment as denied that branch of the cross petition which was for an award of an additional attorney’s fee.

The general rule is that in proceedings involving arbitration, as in other litigation, an attorney’s fee is not recoverable unless provided for by agreement or statute (see Myron Assoc. v Obstfeld, 224 AD2d 504 [1996]). Pursuant to Insurance Law § 5106 (a), if a valid claim or portion of a claim for no-fault benefits is overdue, “the claimant shall also be entitled to recover his attorney’s reasonable fee, for services necessarily performed in connection with securing payment of the overdue claim, subject to [the] limitations promulgated by the superintendent in regulations.” As applicable here, the superintendent’s regulations provide that an attorney’s fee for services rendered in connection with “a court appeal from a master arbitration award . . . shall be fixed by the court adjudicating the matter” (Insurance Department Regulations [11 NYCRR] § 65-4.10 [j] [4]). The term “court appeal” applies to a proceeding such as this, taken pursuant to CPLR article 75 to vacate or confirm a master arbitration award (see Matter of Hempstead Gen. Hosp. v National Grange Mut. Ins. Co., 179 AD2d 645 [1992]).

Here, the appellant sought an attorney’s fee for services rendered in connection with the court proceedings on the petition to vacate the master arbitrator’s award and the cross petition to confirm the award. The Supreme Court denied the requested relief without stating the basis for that determination. To the extent the court denied relief on the ground that it lacked authority to award an additional attorney’s fee, the court erred. To the extent the court denied relief on the merits, the basis for that determination is not evident from the record. Accordingly, the matter must be remitted to the Supreme Court, Nassau County, for a determination of the amount of the additional attorney’s fee to which the appellant is entitled, stating the evidentiary basis for the award. We note that the court shall not consider any time spent by the appellant’s attorney in applying for and substantiating his fee, as the appellant is not entitled to a “fee upon a fee” (Matter of Hempstead Gen. Hosp. v National Grange Mut. Ins. Co., 179 AD2d at 646). Leventhal, J.P., Hall, Hinds-Radix and LaSalle, JJ., concur.

Decided on February 27, 2017

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Suffolk County, Third District

(C. Stephen Hackeling, J.), dated February 19, 2015. The order granted defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the District Court which granted defendant’s motion for summary judgment dismissing the complaint on the ground that plaintiff had failed to appear at duly scheduled examinations under oath (EUOs).

Plaintiff’s sole argument on appeal is that defendant failed to prove plaintiff’s nonappearances. An appearance at an EUO is a condition precedent to an insurer’s liability on a policy (see 11 NYCRR 65-1.1; Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). In support of its motion for summary judgment, defendant submitted an affirmation from the attorney who had been responsible for conducting the EUOs at issue. The affirmation established, based on the attorney’s personal knowledge, that plaintiff had failed to appear for either of the duly scheduled EUOs (see Stephen Fogel Psychological, P.C., 35 AD3d at 722; Olmeur Med., P.C. v Nationwide Gen. Ins. Co., 41 Misc 3d 143[A], 2013 NY Slip Op 52031[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2013]).

Accordingly, the order is affirmed.

Marano, P.J., Garguilo and Brands, JJ., concur.

[*1]

Jaffe & Koumourdas, LLP, New York (Jean H. Kang of counsel), for appellant.

Frank S. Patruno Law Offices P.C., Montgomery (Frank S. Patruno of counsel), for respondent.

Order and judgment (one paper), Supreme Court, New York County (Manuel J. Mendez, J), entered August 11, 2015, denying the unopposed petition to vacate a master arbitration award, dated March 17, 2015, which affirmed an arbitrator’s award that had granted respondent no-fault insurance benefits, unanimously reversed, on the law, without costs, the petition granted, and the award vacated. The Clerk is directed to enter judgment accordingly.

The master arbitrator’s award was arbitrary because it irrationally ignored petitioner’s uncontroverted evidence establishing that the assignor failed to appear at the three scheduled examinations under oath (cf. Hertz Corp. v Active Care Med. Supply Corp., 124 AD3d 411 [1st Dept 2015]; Easy Care Acupuncture P.C. v Praetorian Ins. Co., 49 Misc 3d 137[A], 2015 NY Slip Op 51524[U] [App Term, 1st Dept 2015]). Concur—Friedman, J.P., Richter, Kapnick and Kahn, JJ.

Decided on February 15, 2017

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Suffolk County, Third District (C. Stephen Hackeling, J.), dated September 16, 2015. The order granted defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the District Court which granted defendant’s motion for summary judgment dismissing the complaint on the ground that plaintiff had failed to provide requested verification.

For the reasons stated in Advantage Radiology P.C., as Assignee of Sofia Dana v Nationwide Mut. Ins. Co. (___ Misc 3d ___, 2017 NY Slip Op ____ [appeal No. 2015-2123 S C], decided herewith), the order is affirmed.

Marano, P.J., Garguilo and Brands, JJ., concur.

[*1]

Supreme Court, Appellate Term, Second Department, 9th and 10th Judicial Districts, February 15, 2017

APPEARANCES OF COUNSEL

Gabriel & Shapiro LLC, Wantagh (Jason Moroff and Steven F. Palumbo of counsel), for appellant.

Gialleonardo, McDonald & Turchetti, New York City (Kevon Lewis of counsel), for respondent.

Ordered that the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the District Court which granted defendant’s motion for summary judgment dismissing the complaint on the ground that plaintiff had failed to provide requested verification.

It is undisputed that, during claims processing, plaintiff’s attorney sent defendant a letter requesting that “all other communications relating to this claim” be sent to plaintiff’s attorney. Defendant timely mailed verification and follow-up verification requests to plaintiff but did not send these requests to plaintiff’s attorney. On appeal, plaintiff argues that, pursuant to 11 NYCRR 65-3.6 (b), upon sending the follow-up verification request to plaintiff, defendant was required to send plaintiff’s attorney a delay letter. In the alternative, plaintiff contends that, in accordance with the letter received from plaintiff’s counsel, defendant was obligated to send the initial and follow-up verification requests to plaintiff’s counsel. Plaintiff maintains that since defendant failed to do so, defendant is not entitled to summary judgment.

Plaintiff’s contention that, pursuant to 11 NYCRR 65-3.6 (b), upon sending the follow-up verification request to plaintiff, defendant was required to send plaintiff’s attorney a delay letter lacks merit, as there is no such requirement, where, as here, the party from whom the verification is sought is the plaintiff,{**55 Misc 3d at 93} rather than another person or entity (see GNK Med. Supply, Inc. v Tri-State Consumer Ins. Co., 37 Misc 3d 138[A], 2012 NY Slip Op 52195[U] [App Term, 1st Dept 2012]; Doshi Diagnostic Imaging Servs. v State Farm Ins. Co., 16 Misc 3d 42, 44 [App Term, 2d Dept, 9th & 10th Jud Dists 2007]).

To the extent plaintiff contends that, in accordance with the letter received from plaintiff’s counsel, defendant was obligated to send the initial and follow-up verification requests to plaintiff’s counsel, we disagree. Insurers are obligated to comply with the no-fault regulations, which require that both the initial and follow-up verification requests be sent to the party from whom the verification is sought (see 11 NYCRR 65-3.5 [b]; 65-3.6 [b]) and, thus, defendant cannot be penalized for sending the verification requests to plaintiff notwithstanding the request from plaintiff’s counsel (cf. St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338 [2002]; New York Hosp. Med. Ctr. of Queens v State Farm Mut. Auto. Ins. Co., 293 AD2d 588 [2002]). In addition, we note that if plaintiff was confused as to why the requests were sent to it or whether it needed to respond to the requests, “[a]ny confusion on the part of the plaintiff . . . should have been addressed by further communication, not inaction” (Westchester County Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 262 AD2d 553, 555 [1999]).

In light of the foregoing, we find no basis to disturb the order of the District Court.

Accordingly, the order is affirmed.

Marano, P.J., Garguilo and Brands, JJ., concur.

[*1]

Stern & Montana, LLP, New York, NY (Richard Montana of counsel), for appellant.

In an action for a judgment declaring, inter alia, that the plaintiff is not obligated to reimburse certain no-fault medical payments with respect to a motor vehicle collision that occurred on September 11, 2011, the plaintiff appeals from an order of the Supreme Court, Kings County (Ruchelsman, J.), dated January 9, 2014, which denied its unopposed motion pursuant to CPLR 3215 for leave to enter a judgment against the defendants Sharine Carrier, Roland Sebastian-Hall, Enis Sebastian, Jennine Eastmond, Active Care Medical Supply Corp., Amy M. Kott, MT, Graham Wellness Medical, P.C., Heel to Toe Foot Center, LLC, Immediate Imaging, P.C., Jing Luo Acupuncture, P.C., Precision Medical Diagnostics of NY, P.C., and Ultra Ortho Products, Inc., upon their failure to appear or answer the complaint.

Ordered that the order is reversed, on the law, without costs or disbursements, and the plaintiff’s motion pursuant to CPLR 3215 for leave to enter a judgment against the defendants Sharine Carrier, Roland Sebastian-Hall, Enis Sebastian, Jennine Eastmond, Active Care Medical Supply Corp., Amy M. Kott, MT, Graham Wellness Medical, P.C., Heel to Toe Foot Center, LLC, Immediate Imaging, P.C., Jing Luo Acupuncture, P.C., Precision Medical Diagnostics of NY, P.C., and Ultra Ortho Products, Inc., declaring that (a) a motor vehicle collision that occurred on September 11, 2011, was an excluded act and all claims arising from that accident are excluded under the terms and conditions of an automobile liability insurance policy issued to the defendant Enis Sebastian, and (b) the plaintiff is not obligated to reimburse certain no-fault medical payments, defend and indemnify the defendant Enis Sebastian against any third-party claims, or provide coverage for any uninsured or underinsured motorist claims with respect to the subject motor vehicle collision is granted.

On September 11, 2011, the defendants Sharine Carrier, Roland Sebastian-Hall, and Jennine Eastmond (hereinafter collectively the claimants) allegedly were injured when their vehicle was sideswiped by a U-Haul truck. After the accident the claimants sought medical treatment from, among others, the defendants Active Care Medical Supply Corp., Graham Wellness Medical, P.C., Heel to Toe Foot Center, LLC, Immediate Imaging, P.C., Jing Luo Acupuncture, P.C., Precision Medical Diagnostics of NY, P.C., and Ultra Ortho Products, Inc. (hereinafter collectively the corporate medical providers), and the defendant Amy M. Kott, MT. Thereafter, the corporate medical providers and Kott sought reimbursement of no-fault benefits under an automobile liability insurance policy issued to the defendant Enis Sebastian by the plaintiff, Allstate Property & Casualty Insurance Company, the insurer of the claimants’ vehicle. On November 21, 2012, the plaintiff commenced this action for a judgment declaring, inter alia, that it is not obligated to reimburse the [*2]no-fault medical payments made by the medical providers with respect to the subject motor vehicle collision. The individual defendants were served pursuant to CPLR 308 (4) and the corporate medical providers were served via the secretary of state. On December 20, 2012 the plaintiff served the corporate medical providers with an additional copy of the summons and complaint pursuant to CPLR 3215 (g) (4). After the individual defendants and the corporate medical providers failed to appear or answer, the plaintiff moved by notice of motion dated August 13, 2013, for leave to enter a default judgment against them. The Supreme Court denied the unopposed motion.

On a motion for leave to enter a default judgment under CPLR 3215, a plaintiff must submit proof of service of the summons and the complaint, the facts constituting the causes of action, and the defendant’s default (see CPLR 3215 [f]; Roy v 81E98th KH Gym, LLC, 142 AD3d 985 [2016]; Gershman v Ahmad, 131 AD3d 1104, 1105 [2015]; Dupps v Betancourt, 99 AD3d 855, 855 [2012]; Atlantic Cas. Ins. Co. v RJNJ Servs., Inc., 89 AD3d 649, 651 [2011]). Here, the plaintiff provided copies of the affidavits of service, a complaint verified by the plaintiff’s authorized agent, an affidavit of merit, documentary evidence, and proof that the individual defendants and the corporate medical providers had defaulted in answering the complaint. The plaintiff’s proof was sufficient to establish a viable cause of action (see Woodson v Mendon Leasing Corp., 100 NY2d 62, 70 [2003]). Accordingly, the plaintiff’s unopposed motion for leave to enter a default judgment against the individual defendants and the corporate medical providers should have been granted. Rivera, J.P., Dillon, Chambers and Hinds-Radix, JJ., concur.

Decided on February 8, 2017

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

Appeal from an order of the Civil Court of the City of New York, Queens County (Larry Love, J.), entered June 29, 2015. The order denied plaintiff’s motion for summary judgment and granted defendant’s cross motion for summary judgment dismissing the complaint.

ORDERED that the order is modified by providing that defendant’s cross motion for summary judgment dismissing the complaint is denied; as so modified, the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the Civil Court which denied plaintiff’s motion for summary judgment and granted defendant’s cross motion for summary judgment dismissing the complaint.

For the reasons stated in Island Life Chiropractic Pain Care, PLLC v Country Wide Ins. Co. (53 Misc 3d 131[A], 2016 NY Slip Op 51378[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]), the order is modified by providing that defendant’s cross motion for summary judgment dismissing the complaint is denied.

Weston, J.P., Aliotta and Elliot, JJ., concur.