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, Kings County (Pamela L. Fisher, J.), entered June 17, 2011. The order, insofar as appealed from, denied plaintiff’s motion for summary judgment.

ORDERED that the order, insofar as appealed from, is reversed, with $30 costs, plaintiff’s motion for summary judgment is granted, and the matter is remitted to the Civil Court for a calculation of statutory interest and an assessment of attorney’s fees.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from so much of an order of the Civil Court as denied plaintiff’s motion for summary judgment.

A no-fault provider establishes its prima facie case “by proof of the submission to the defendant of a claim form, proof of the fact and the amount of the loss sustained, and proof either that the defendant had failed to pay or deny the claim within the requisite 30-day period, or that the defendant had issued a timely denial of claim that was conclusory, vague or without merit as [*2]a matter of law” (Ave T MPC Corp. v Auto One Ins. Co., 32 Misc 3d 128[A], 2011 NY Slip Op 51292[U], *1 [App Term, 2d, 11th & 13th Jud Dists 2011]; see Westchester Med. Ctr. v Nationwide Mut. Ins. Co., 78 AD3d 1168 [2010]).

In its motion, plaintiff established the submission of the two claim forms at issue, by annexing the denials which admitted the receipt of those claim forms (see East Acupuncture, P.C. v Electric Ins. Co., 16 Misc 3d 128[A], 2007 NY Slip Op 51281[U] [App Term, 2d & 11th Jud Dists 2007]; Oleg Barshay, D.C., P.C. v State Farm Ins. Co., 14 Misc 3d 74 [App Term, 2d & 11th Jud Dists 2006]). Contrary to defendant’s argument on appeal, plaintiff also established that the claim forms at issue were admissible for the truth of the transactions recorded therein, pursuant to CPLR 4518 (a), thereby making a prima facie showing of the fact and the amount of the loss sustained. Moreover, plaintiff demonstrated that defendant’s proffered defense of lack of medical necessity was without merit as a matter of law, in that the Civil Court had issued a prior order precluding defendant from offering any evidence in support of its claimed defense. In opposition to the motion, defendant failed to raise a triable issue of fact.

Accordingly, the order, insofar as appealed from, is reversed, plaintiff’s motion for summary judgment is granted, and the matter is remitted to the Civil Court for a calculation of statutory interest and an assessment of attorney’s fees pursuant to Insurance Law § 5106 and the regulations promulgated thereunder.

Rios, J.P., Weston and Aliotta, JJ., concur.
Decision Date: April 15, 2013

SUPREME COURT, APPELLATE TERM, FIRST DEPARTMENT

Plaintiff appeals from three orders of the Civil Court of the City of New York, Bronx County (Sharon A.M. Aarons, J.), dated July 17, 2008 (two orders) and July 18, 2008, which granted defendant’s motions for summary judgment dismissing the complaints.

Per Curiam. [*2]

Orders (Sharon A.M. Aarons, J.), dated July 17, 2008 (two orders) and July 18, 2008, consolidated for the purpose of this decision, affirmed, with $10 costs on each action.

In these three actions by the provider, plaintiff Physical Performance Testing of NY (Physical), to recover assigned first-party no-fault benefits, defendant New York Central Mutual Insurance Company (Mutual) moved for summary judgment. Civil Court granted Mutual’s motions for summary judgment dismissing Physical’s complaints, finding that Physical was unlicensed and, therefore, ineligible for reimbursement of first-party no-fault benefits. Physical appeals, as limited by its brief, and we affirm.

It is well-settled that a provider of healthcare services is not eligible for reimbursement of assigned first-party no-fault benefits “under section 5102(a)(1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York” (Insurance Department Regulations [11 NYCRR] § 65-3.16[a][12]; see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 321 [2005]). State law mandates that professional service corporations be owned and controlled only by licensed professionals (see Business Corporation Law §§ 1503[a], 1507, 1508), and that licensed professionals render the services provided by such corporations (see Business Corporation Law § 1504[a]; 11 NYCRR 65-3.16[a][6]). A professional corporation, which is actually controlled by a management company owned by unlicensed individuals in violation of the Business Corporation Law, is not entitled to be reimbursed for no-fault benefits (see One Beacon Ins. Group, LLC v Midland Med. Care, P.C., 54 AD3d 738, 740 [2008]).

The Court of Appeals has held that the Superintendent of Insurance promulgated 11 NYCRR 65-3.16(a)(12) so as to “exclud[e] from the meaning of basic economic loss’ payments made tounlicensed or fraudulently licensed providers, thus rendering them ineligible for reimbursement” (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d at 320; see Allstate Ins. Co. v Belt Parkway Imaging, P.C., 33 AD3d 407, 408 [2006]).

Applying these principles to the matter at bar, Mutual has made a prima facie showing of entitlement to summary judgment dismissing the complaints by demonstrating that the services rendered by Physical are not reimbursable expenses under the No-Fault Law. In opposition, Physical failed to raise a triable issue of fact with respect to its claims because they were not performed by a medical professional corporation, or a licensed health provider.

We have examined Physical’s remaining contentions, and to the extent they are preserved for appellate review, find them to be without merit.

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.
Decision Date: April 11, 2013

[*1]

Second Department, April 10, 2013

Sound Shore Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 30 Misc 3d 131(A), 2011 NY Slip Op 50033(U), reversed.

APPEARANCES OF COUNSEL

Joseph Henig, P.C., Bellmore, for appellant.

Michael S. Nightingale, Glen Cove (Bryan G. Melnick of counsel), for respondent.

{**106 AD3d at 158} OPINION OF THE COURT

Austin, J.

On this appeal, we are asked to determine whether a no-fault UB-04 form is the functional equivalent of a no-fault New York State Form N-F 5 (hereinafter N-F 5 form), the receipt of which triggers the 30-day period in which a no-fault insurer is required to pay or deny a claim for no-fault benefits or request further verification. For the following reasons, we answer in the negative and reverse the order of the Appellate Term of the Supreme Court for the Ninth and Tenth Judicial Districts (hereinafter the Appellate Term).

Barbara Kocourek was involved in a motor vehicle accident on October 30, 2008. At the time of the accident, the defendant, New York Central Mutual Fire Insurance Company (hereinafter New York Central), was Kocourek’s motor vehicle insurance carrier. Kocourek’s New York Central policy included the New York State mandated personal injury protection endorsement.

After the accident, Kocourek sought treatment for her injuries from the plaintiff Sound Shore Medical Center (hereinafter Sound Shore) between November 7, 2008, and November 12, 2008. Kocourek assigned her no-fault benefits to Sound Shore.{**106 AD3d at 159}

On November 24, 2008, New York Central received a UB-04 form from Sound Shore. Kocourek was identified as the patient and Sound Shore as the medical provider.^[FN1] According to the UB-04 form, which was generated on November 19, 2008, Sound Shore had provided $13,053.02 in services to Kocourek for treatment rendered from November 7, 2008, through [*2]November 12, 2008. The remarks section of the form stated “NO FAULT INSURANCE,” with New York Central’s name and address. The UB-04 form was not accompanied by an N-F 5 form, or any other documentation.^[FN2]

In response to Sound Shore’s submission of the UB-04 form, New York Central issued what it considered the first of two successive “requests for verification” on November 26, 2008. In its November 26, 2008, request, New York Central noted that “consideration” of this no-fault claim had been “delayed” because it was, inter alia, “[a]waiting application for NF benefits from patient” and “need[ed] a valid DRG code.”^[FN3]

On December 22, 2008, New York Central received an N-F 5 form, dated December 17, 2008, which had been prepared by an “authorized representative” of Sound Shore. The N-F 5 form was accompanied by a second UB-04 form which contained a notation that the UB-04 form was not a “no-fault bill” and referred to the N-F 5 form as “the authorized no-fault bill.” According to the N-F 5 form, Sound Shore was owed a total of $4,834.95 for services rendered to Kocourek. Along with the N-F 5 and UB-04 forms, Sound Shore also sent New York Central a “DRG Master Output Report” detailing how the total bill of $4,834.95 was calculated using the no-fault regular DRG rate, and an assignment of benefits form indicating that Kocourek executed the assignment on November 12, 2008. The assignment of benefits form was not signed by Kocourek, and indicated that Kocourek’s signature was “on file.”

New York Central’s receipt of the N-F 5 form prompted it to issue what it considered to be its second request for verification, dated December 31, 2008. In its December 31, 2008, request for{**106 AD3d at 160} verification, New York Central sought the admitting narratives, pertinent lab tests and/or X-ray results, discharge summary, and an assignment of benefits executed by Kocourek. All of these items had been previously requested by New York Central in its November 26, 2008, correspondence to Sound Shore. In its December 31, 2008 request, New York Central also asked for the EKG report and an explanation of the relationship between the motor vehicle accident and the treatment rendered. Further, it advised Sound Shore that the unsigned assignment form provided was not acceptable pursuant to the New York State insurance regulations.

Although Sound Shore did not respond to the December 31, 2008, request for verification, New York Central took no further action. It did not deny Sound Shore’s claim nor did it send any additional request for verification.

Sound Shore subsequently commenced this action against New York Central in the District Court, Nassau County, to recover no-fault medical payments. As its first cause of action, it sought no-fault medical payments totalling $4,834.95 for services it rendered to Kocourek.^[FN4] As an affirmative defense, New York Central asserted, inter alia, that this action was premature due to its “outstanding requests for verification” to which Sound Shore never responded.

New York Central moved for summary judgment dismissing the first cause of action. It argued that Sound Shore’s action was premature since Sound Shore failed to respond to its initial November 26, 2008, request for verification and its December 31, 2008, follow-up request for verification by not providing the admitting narratives, lab tests/X-ray results, discharge summary, and EKG report. Consequently, New York Central argued that the time for it to either pay the claim or issue a denial was tolled indefinitely.

Sound Shore cross-moved for summary judgment in its favor on the first cause of action, contending that it never actually billed New York Central until the N-F 5 form was sent on December 17, 2008. It argued, inter alia, that as a result, New York Central’s November 26, 2008, request for verification was a nullity since it predated the N-F 5 form, which was received by New York Central on December 22, 2008. Thus, Sound Shore maintained that there was no toll in effect, [*3]and that New York{**106 AD3d at 161} Central was now precluded from interposing a defense to the first cause of action.

The District Court denied New York Central’s motion for summary judgment dismissing the first cause of action and granted Sound Shore’s cross motion for summary judgment in its favor on that same cause of action. The District Court found that Sound Shore had established its prima facie entitlement to summary judgment in its favor by demonstrating that it submitted a claim for no-fault benefits to New York Central setting forth the amount it was owed and proof that New York Central failed to timely pay. The District Court also found that New York Central failed to raise a triable issue of fact in response to Sound Shore’s establishment of its entitlement to judgment as a matter of law, or to meet its burden in proving that it mailed timely requests for verification, to which responses remained outstanding.

New York Central appealed the order of the District Court to the Appellate Term. The Appellate Term reversed the order of the District Court, granted New York Central’s motion for summary judgment dismissing the first cause of action and denied Sound Shore’s cross motion (30 Misc 3d 131[A], 2011 NY Slip Op 50033[U] [2011]). The Appellate Term found that New York Central had made a timely request for verification and a timely follow-up request to which Sound Shore failed to respond. As a result, the Appellate Term determined that New York Central’s time to respond to Sound Shore’s claim had been tolled. The Appellate Term’s conclusion relied on its determination that the initial UB-04 form served by Sound Shore upon New York Central was the “functional equivalent” of an N-F 5 form. This Court granted Sound Shore’s motion for leave to appeal.

On appeal, Sound Shore argues that the UB-04 form is not a prescribed claim form under the no-fault regulations, but is, instead, used in determining treatment and diagnosis. It maintains that an N-F 5 form, as prescribed by the no-fault regulations, is the authorized claim form for hospitals and medical providers filing first party claims as the assignees of insured patients (see 11 NYCRR 65-3.4 [c] [6]). Sound Shore contends that a UB-04 form does not contain substantially the same information as an N-F 5 form, and that the information which is not included in the UB-04 form is essential to a no-fault claim. Sound Shore maintains that, as a result, the UB-04 form was not the “functional equivalent” of an N-F 5 form and, thus, New York Central’s December 31, 2008, request for verification{**106 AD3d at 162} was a first request and not a follow-up request. Therefore, it asserts that New York Central’s time to pay or deny its claim was not tolled.

New York Central argues that since it sent a request for verification in response to the November 24, 2008, UB-04 form sent by Sound Shore, its December 31, 2008, request was the second of two successive requests for verification, so it had no duty to make any further follow-up requests for verification. Since Sound Shore did not respond to either request, New York Central contends that its time to act was tolled. We hold that the UB-04 form sent by Sound Shore is not the “functional equivalent” of an N-F 5 form. Accordingly, we reverse.

Pursuant to the regulations promulgated by the Superintendent of Insurance to implement the No-Fault Law (Insurance Law art 51), an injured party, or that person’s assignee, must submit a written notice of claim to an insurer no later than 45 days after services are rendered (11 NYCRR 65-2.4). The written notice required to obtain first party benefits “shall be deemed to be satisfied by the insurer’s receipt of a completed prescribed application for motor vehicle no-fault benefits (NYS Form N-F 2) . . . or by the insurer’s receipt of a completed hospital facility form (NYS Form N-F 5)” (11 NYCRR 65-3.3 [d]). “[P]roof of claim . . . shall include verification of all of the relevant information requested” (11 NYCRR 65-3.8 [a] [1]). “An insurer must accept proof of claim submitted on a form other than a prescribed form if it contains substantially the same information as the prescribed form” (11 NYCRR 65-3.5 [f]). However, 11 NYCRR 65-3.5 (g) provides that

“[I]n lieu of a prescribed application for motor vehicle no-fault benefits submitted by an applicant [NYS Form N-F 2] and a verification of hospital treatment (NYS form NF-4), an insurer shall accept a completed hospital facility form (NYS form NF-5) (or an NF-5 and uniform billing form [UBF-1] which together supply all the information requested by the NF-5) submitted by a provider of health services with respect to the claim of such provider.”

Within 30 calendar days after receipt of the proof of claim for no-fault benefits, an insurer can either pay the claim, in whole or in part, deny it, or seek verification of it (see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [c]). A no-fault insurance carrier waives its defenses, other than those based on the complete absence of coverage (e.g., a defense to the effect that it never{**106 AD3d at 163} wrote a [*4]policy for the claimant), if it fails to deny a no-fault claim, or seek verification, within 30 calendar days after having received proof of claim (see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [a] [1]; [c]; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 279 [1997]).

When a no-fault claim has been assigned to a hospital or medical provider and the hospital or medical provider sends an N-F 5 form to the no-fault insurer, the no-fault insurer’s receipt of an N-F 5 form triggers the running of the 30-day period within which the insurer has a duty to pay or to deny the claim, or to seek verification of it (Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]). Subsequent to the receipt of the N-F 5 form, if the insurer requires any additional information to evaluate the proof of claim, such request for verification must be made within 15 business days of the receipt of the N-F 5 form in order to toll the 30-day period (see 11 NYCRR 65-3.5 [b]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 317). Where there is a timely original request for verification, but no response to the request for verification is received within 30 calendar days thereafter, or the response to the original request for verification is incomplete, then the insurer, within 10 calendar days after the expiration of that 30-day period, must follow up with a second request for verification (see 11 NYCRR 65-3.6 [b]). If there is no response to the second, or follow-up, request for verification, the time in which the insurer must decide whether to pay or deny the claim is indefinitely tolled (Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 317; see also Infinity Health Prods., Ltd. v Eveready Ins. Co., 67 AD3d 862, 864-865 [2009]). Thus, when a no-fault medical service provider fails to respond to the requests for verification, the 30 days in which to pay or deny the claim is tolled and does not begin to run (see Mount Sinai Hosp. v Chubb Group of Ins. Cos., 43 AD3d 889, 890 [2007]; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 570 [2004]; New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699, 700 [2001]). Accordingly, any claim for payment by the medical service provider after two timely requests for verification have been sent by the insurer subsequent to its receipt of an N-F 5 form from the medical service provider is premature, if the provider has not responded to the requests (see Mount Sinai Hosp. v Chubb Group of Ins. Cos., 43 AD3d at 890; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d at 570). Nothing in the rules requires a second follow-up, that is, a third request for verification.{**106 AD3d at 164}

However, a request for verification that precedes a no-fault insurer’s receipt of the prescribed N-F 5 claim form does not trigger the tolling of the 30-day period within which an insurer must determine whether to pay or deny such a claim (see Westchester Med. Ctr. v GMAC Ins. Co. Online, Inc., 80 AD3d 603, 604 [2011]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 17 [1999]). The “UBF-1” form referred to in 11 NYCRR 65-3.5 (g) is the predecessor of the current “UB-04” form. Under 11 NYCRR 65-3.5 (g), a UBF-1/UB-04 form together with an N-F 5 form must be accepted by a no-fault insurer. The regulation does not state that a UBF-1/UB-04 form alone must be treated as the “functional equivalent” of an N-F 5 form. Further, the UB-04 form sent by Sound Shore to New York Central differed from the N-F 5 form Sound Shore eventually submitted to New York Central in that the UB-04 form did not include the policy number, a description of the accident, or the admitting and discharge diagnosis, and the amount charged was $13,053.02 rather than $4,834.95. Accordingly, we do not agree with the Appellate Term’s conclusion that a UB-04 form is the “functional equivalent” of an N-F 5 form (see 11 NYCRR 65-3.5 [f]). The only effective request for verification was therefore the one issued by New York Central on December 31, 2008, some six business days after its receipt of Sound Shore’s N-F 5 form on December 22, 2008 (see 11 NYCRR 65-3.5 [b]).

We note that the issuance of the request for verification on December 31, 2008, by New York Central resulted in an initial toll of the 30-day period within which to pay or deny the claim (see New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699, 700-701 [2001]). When Sound Shore failed to respond to New York Central’s December 31, 2008, request for verification by January 30, 2009, New York Central had until February 9, 2009, to issue a follow-up request for verification in order to invoke the protection of the indefinite tolling of its time to pay or deny the claim (see 11 NYCRR 65-3.6 [b]; Presbyterian Hosp. in City of N.Y. v Aetna Cas. & Sur. Co., 233 AD2d 431 [1996]). Thereafter, no further request for verification was issued by New York Central.

Since the initial toll of the 30-day period following Sound Shore’s submission of the N-F 5 form to New York Central had expired by the time this action was commenced, the first cause of action was not premature. Thus, Sound Shore established its prima facie entitlement to judgment as a matter of law with respect to the first cause of action by demonstrating that the necessary{**106 AD3d at 165} billing documents were mailed to, and received by, New York Central and that payment of no-fault benefits [*5]was overdue (see New York Hosp. Med. Ctr. of Queens v Country Wide Ins. Co., 82 AD3d 723, 723 [2011]; Westchester Med. Ctr. v GMAC Ins. Co. Online, Inc., 80 AD3d 603, 604 [2011]).

In opposition, New York Central failed to raise a triable issue of fact as to whether it timely denied Sound Shore’s claim. New York Central failed to submit any evidence that it mailed a second or follow-up request for verification at the end of the 30-day period subsequent to mailing the initial request for verification on December 31, 2008, which would have tolled its time to pay no-fault benefits to Sound Shore (see Westchester Med. Ctr. v GMAC Ins. Co. Online, Inc., 80 AD3d at 604). For this same reason, New York Central failed to meet its prima facie burden on its own motion for summary judgment (see id.).

Accordingly, the order dated January 10, 2011, is reversed, on the law, and the order of the District Court, Nassau County, dated August 31, 2009, is reinstated.

Angiolillo, J.P., Dickerson and Cohen, JJ., concur.

Ordered that the order dated January 10, 2011, is reversed, on the law, with costs, and the order of the District Court, Nassau County, dated August 31, 2009, is reinstated.

Footnotes

Footnote 1: The UB-04 form is a universal billing form developed by, among others, the National Uniform Billing Committee, which was formed in 1975 by the American Hospital Association.

Footnote 2: The N-F 5 form is published by the New York State Department of Financial Services in 11 NYCRR Appendix 13.

Footnote 3: DRG is an abbreviation for diagnosis related group. DRG is a system used to classify patients into groups based on criteria such as principal diagnosis, treatment given, age, gender, etc. Each patient in a DRG is expected to utilize similar medical resources.

Footnote 4: The second cause of action, which sought to recover unrelated no-fault medical payments, was settled pursuant to stipulation dated March 20, 2009.

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, Kings County (Carolyn E. Wade, J.), entered May 2, 2011. The order denied defendant’s motion for summary judgment dismissing the complaint and granted plaintiff’s cross motion for summary judgment.

ORDERED that the order is reversed, with $30 costs, and defendant’s motion for summary judgment dismissing the complaint and plaintiff’s cross motion for summary judgment are remitted to the Civil Court for a new determination after final resolution of a prompt application to the Workers’ Compensation Board to determine the parties’ rights under the Workers’ Compensation Law. In the event plaintiff fails to file proof with the Civil Court of such application within 90 days of the date of this decision and order, the Civil Court shall grant defendant’s motion for summary judgment dismissing the complaint and deny plaintiff’s cross motion for summary judgment unless plaintiff shows good cause why the complaint should not be dismissed. [*2]

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint based upon plaintiff’s assignors’ alleged eligibility for workers’ compensation benefits, and plaintiff cross-moved for summary judgment. The Civil Court denied defendant’s motion, on the ground that defendant had failed to proffer evidence in admissible form in support of its defense, and granted plaintiff’s cross motion.

Defendant proffered sufficient evidence in admissible form of the alleged facts which gave rise to its contention that there was an issue as to whether plaintiff’s assignors had been acting as employees at the time of the accident, and that therefore workers’ compensation benefits might be available (see e.g. Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 34 Misc 3d 133[A], 2011 NY Slip Op 52371[U] [App Term, 2d, 11th & 13th Jud Dists 2011]; D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 29 Misc 3d 128[A], 2010 NY Slip Op 51738[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; Response Equip., Inc. v American Tr. Ins. Co., 15 Misc 3d 145[A], 2007 NY Slip Op 51176[U] [App Term, 2d & 11th Jud Dists 2007]; cf. Westchester Med. Ctr. v American Tr. Ins. Co., 60 AD3d 848 [2009]). This issue must be resolved in the first instance by the Workers’ Compensation Board (Board) (see O’Rourke v Long, 41 NY2d 219, 225 [1976]; see also Dunn v American Tr. Ins. Co., 71 AD3d 629 [2010]; Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 34 Misc 3d 133[A], 2011 NY Slip Op 52371[U]; D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 29 Misc 3d 128[A], 2010 NY Slip Op 51738[U]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U]; Response Equip., Inc. v American Tr. Ins. Co., 15 Misc 3d 145[A], 2007 NY Slip Op 51176[U]).

Accordingly, defendant’s motion and plaintiff’s cross motion should not have been determined. Instead, the Civil Court should decide the motions after final Board resolution. A prompt application to the Board, as set forth above, is required in order to determine the parties’ rights under the Workers’ Compensation Law (see Dunn v American Tr. Ins. Co., 71 AD3d 629; LMK Psychological Serv., P.C. v American Tr. Ins. Co., 64 AD3d 752 [2009]).

Rios, J.P., Pesce and Aliotta, JJ., concur.
Decision Date: April 08, 2013

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 (Barry A. Schwartz, J.), entered May 2, 2011. The order granted defendant’s motion to stay the action pending a determination of the Workers’ Compensation Board of the parties’ rights under the Workers’ Compensation Law.

ORDERED that the order is affirmed, with $25 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 granted defendant’s motion to stay the action pending a determination of the Workers’ Compensation Board of the parties’ rights under the Workers’ Compensation Law.

We agree with the Civil Court that defendant proffered sufficient evidence in admissible form of the alleged facts which gave rise to its contention that there was an issue as to whether plaintiff’s assignor had been acting as an employee at the time of the accident, and that therefore workers’ compensation benefits might be available (see e.g. Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 34 Misc 3d 133[A], 2011 NY Slip Op 52371[U] [App Term, 2d, 11th & 13th Jud Dists 2011]; D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 29 Misc 3d 128[A], [*2]2010 NY Slip Op 51738[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; Response Equip., Inc. v American Tr. Ins. Co., 15 Misc 3d 145[A], 2007 NY Slip Op 51176[U] [App Term, 2d & 11th Jud Dists 2007]; cf. Westchester Med. Ctr. v American Tr. Ins. Co., 60 AD3d 848 [2009]). This issue must be resolved in the first instance by the Workers’ Compensation Board (Board) (see O’Rourke v Long, 41 NY2d 219, 225 [1976]; see also Dunn v American Tr. Ins. Co., 71 AD3d 629 [2010]; Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 34 Misc 3d 133[A], 2011 NY Slip Op 52371[U]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U]; Response Equip., Inc. v American Tr. Ins. Co., 15 Misc 3d 145[A], 2007 NY Slip Op 51176[U]).

In view of the foregoing, the Civil Court properly granted defendant’s motion for a stay pending the Board’s determination of the parties’ rights under the Workers’ Compensation Law (see Dunn v American Tr. Ins. Co., 71 AD3d 629; LMK Psychological Serv., P.C. v American Tr. Ins. Co., 64 AD3d 752 [2009]; see also Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 34 Misc 3d 133[A], 2011 NY Slip Op 52371[U] [holding, among other things, that in the event plaintiff failed to file proof with the motion court of an application to the Workers’ Compensation Board within 90 days of the date of the Appellate Term’s decision and order, defendant’s cross motion for summary judgment would be granted unless plaintiff could show good cause why the complaint should not be dismissed]; D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 29 Misc 3d 128[A], 2010 NY Slip Op 51738[U] [same]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U] [same]).

Accordingly, the order of the Civil Court is affirmed.

Rios, J.P., Pesce and Aliotta, JJ., concur.
Decision Date: April 08, 2013

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 (Maureen A. Healy, J.), entered February 3, 2011. The order granted defendant’s motion to stay the action pending a determination by the Workers’ Compensation Board of the parties’ rights under the Workers’ Compensation Law.

ORDERED that the order is affirmed, with $25 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 granted defendant’s motion to stay the action pending a determination by the Workers’ Compensation Board of the parties’ rights under the Workers’ Compensation Law.

We find that defendant’s proof, including the police accident report, was sufficient to raise a question of fact as to whether plaintiff’s assignor had been acting as an employee at the time of the accident, which issue must be resolved by the Workers’ Compensation Board (O’Rourke v Long, 41 NY2d 219, 224 [1976]; Matter of Pilku v 24535 Owners Corp., 19 AD3d [*2]722, 723 [2005]; Santigate v Linsalata, 304 AD2d 639, 640 [2003]; Response Equip., Inc. v American Tr. Ins. Co., 15 Misc 3d 145[A], 2007 NY Slip Op 51176[U] [App Term, 2d & 11th Jud Dists 2007]; see also D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 29 Misc 3d 128[A], 2010 NY Slip Op 51738[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U] [App Term, 2d, 11th & 13th Jud Dists 2010]). Plaintiff’s remaining contention lacks merit.

Accordingly, the order is affirmed.

Pesce, P.J., Weston and Rios, JJ., concur.
Decision Date: April 04, 2013

—[*1] Law Office of Brian D. Richardson, Albany (James D. Taylor of counsel), for appellant.

Law Offices of Craig Meyerson, Latham (Craig Meyerson of counsel), for respondent.

Egan Jr., J. Appeals (1) from an order of the Supreme Court (Platkin, J.), entered February 1, 2012 in Albany County, which, among other things, granted plaintiff’s motion for a turnover order, and (2) from an order of said court, entered March 6, 2012 in Albany County, which ordered defendant to pay $5,254.02 to satisfy a judgment in favor of plaintiff.

This appeal has its genesis in defendant’s attempt to recoup $825.55 to which it claims entitlement as a credit against a judgment entered in favor of plaintiff. By way of background, plaintiff provided psychological services to certain of defendant’s insureds who had suffered injuries arising out of no-fault automobile accidents and, in May 2009, plaintiff commenced this action against defendant seeking reimbursement for those services. Following joinder of issue, various motions ensued and, in February 2011, Supreme Court, among other things, granted plaintiff partial summary judgment and entered a judgment in favor of plaintiff for $80,187.27, plus interest, counsel fees and costs. There is no indication in the record that defendant appealed from the order awarding partial summary judgment to plaintiff, moved for reconsideration thereof or sought to vacate the resulting judgment. Instead, defendant only partially satisfied the judgment, contending that it was entitled to various credits against the sum due and owing.

Faced with defendant’s refusal to tender the full amount due, plaintiff thereafter moved for—insofar as is relevant here—a turnover order pursuant to CPLR 5225 seeking to recover the [*2]outstanding balance. Defendant opposed the requested relief, contending that it had paid the judgment in full, and submitted checks purportedly reflecting payments made on the outstanding claims. By order entered February 1, 2012, Supreme Court granted plaintiff the requested relief, suggesting that defendant’s proffer of the canceled checks was untimely and, in any event, finding such proof to be insufficient to demonstrate full satisfaction of the judgment. Thereafter, by order entered March 6, 2012, Supreme Court awarded plaintiff $5,254.02, representing the outstanding amount due and owing in full satisfaction of the prior judgment. Defendant now appeals, contending that it is entitled to a credit of $825.55 for payments previously made.^[FN1]

We affirm. Initially, we reject defendant’s assertion that Supreme Court erred in summarily granting plaintiff’s application. A summary judgment analysis may be employed where, as here, a party is seeking a turnover order pursuant to CPLR 5225 (a) (cf. Matter of Centerpointe Corporate Park Partnership 350 v MONY, 96 AD3d 1401, 1402 [2012], lv dismissed 19 NY3d 1097 [2012]; Matter of TNT Petroleum, Inc. v Sea Petroleum, Inc., 72 AD3d 694, 695 [2010]; Estate of Giustino v Estate of DelPizzo, 21 AD3d 523, 523 [2005]), and plaintiff made a prima facie showing that—at that point in time—the underlying judgment had not been paid in full. Although defendant tendered various canceled checks in opposition to plaintiff’s application and the record indeed reflects a history of partial payments, we agree with Supreme Court that defendant’s submissions in this regard failed to correlate with the dates or amounts of the outstanding claims at issue and, for that reason, were insufficient to raise a question of fact as to its satisfaction of the judgment. Accordingly, Supreme Court properly granted plaintiff’s request for a turnover order and directed that defendant pay plaintiff $5,254.02 in full satisfaction of the underlying judgment.

We also are persuaded that defendant’s pursuit of this appeal is frivolous within the meaning of 22 NYCRR 130-1.1 (c) (2) and, therefore, plaintiff is entitled to an award of reasonable counsel fees incurred in responding thereto.^[FN2] To our analysis, once plaintiff was awarded partial summary judgment in February 2011 and secured a judgment in its favor, defendant had several permissible options, such as appealing the underlying order and judgment or paying—in full—the amount awarded to plaintiff. Instead, defendant continued to dispute the sum due by delaying payment, thereby compelling plaintiff to move for the turnover order and, ultimately, to expend resources responding to the instant appeal seeking $825.55. Such conduct, in our view, warrants an award of reasonable counsel fees incurred in responding to this appeal, and this matter is remitted to Supreme Court for a determination of the amount of such fees (see Matter of Manufacturers & Traders Trust Co. v Myers, 38 AD3d 965, 966 [2007], appeal dismissed 8 NY3d 1019 [2007]; Hansen v Werther, 2 AD3d 923, 924 [2003]). Defendant’s remaining arguments, to the extent not specifically addressed, have been considered and found to be lacking in merit. [*3]

Peters, P.J., Spain and Garry, JJ., concur. Ordered that the orders are affirmed, with costs, plaintiff’s request for counsel fees granted and matter remitted to the Supreme Court for a determination of the amount of reasonable counsel fees incurred in responding to this appeal.

Footnotes

Footnote 1: In the interim, according to plaintiff, defendant satisfied the underlying judgment.

Footnote 2: Plaintiff’s request in this regard, which is set forth in its appellate brief, “constitute[s] sufficient notice [to defendant] that such relief would be considered” (Matter of Levin v Axelrod, 168 AD2d 178, 181 [1991]; see Hansen v Werther, 2 AD3d 923, 924 [2003]).

Civil Court of the City of New York, Kings County

053664/11

Attorneys for Plaintiff:

Bruno, Gerbino & Soriano, LLP

445 Broad Hollow Road, Suite 220

Melville, New York 11747

Defendant Pro-Se:

Natural Healing Acupuncture, P.C.

P.O. Box 350-076

Brooklyn, NY 11235

Katherine A. Levine, J.

Recitation, as required by CPLR 2219(a), of the papers considered in the review of this motion

PapersNumbered

Notice of Motion and Affidavits Annexed………….. ………………………………………………1

Notice of Cross-Motion and Affidavits Annexed.. ……………………………………………….

Answering Affidavits………………………………………………………………………………………….

Replying Affidavit of defendant………………………………………………………………………….

Exhibits……………………………………………………………………………………………… …………….

Other: ………………………………………………………………………………………………………………

Upon the foregoing cited papers, the Decision/Order on this Motion is as follows:

Petitioner Allstate Insurance Company (“petitioner” or “Allstate”) moves pursuant to CPLR §7511 to vacate the master arbitrator’s award dated July 1, 2011 for $927.99. Petitioner challenges the master arbitrator’s confirmation of the original arbitrator’s decision on the grounds that it is “arbitrary, capricious and contrary to well-settled law.” [*2]

Pursuant to Insurance Law ｧ5106, entitled “Fair Claims Settlement,” the master arbitrator has the authority to review an arbitrator’s award and vacate or modify it “in accordance with simplified procedures to be promulgated or approved by the superintendent.” These procedures are contained in 11 NYCRR 65-4.10(a) and include (1) any ground provided in article 75 of the CPLR, except CPLR 7511(b)(1)(iv) and (4) that an award rendered was incorrect as a matter of law, with the exclusion of procedural or factual errors committed in the arbitration. See Petrowsky v. Allstate Ins. Co., 54 NY2d 207, 210 (1981).

CPLR ｧ7511(b) provides that an award may be vacated if the court finds that the rights of a party were prejudiced by (i) corruption, fraud or misconduct in procuring the award, (ii) the arbitrator’s partiality, or (iii) an arbitrator exceeded his power or so imperfectly executed it that a final and definite award upon the subject matter submitted was not made. The master arbitrator’s power to review an arbitrator’s award is therefore broader than the parameters contained in CPLR article 75. See Petrofsky v. Allstate, supra at 210.

Arbitrations held pursuant to Insurance Law ｧ5106 are classified as compulsory because insurers are required to submit no-fault claims to binding arbitration at the option of the claimant. State Farm Mutual Automobile Ins. Co. v. Kissena Medical Imaging, PC, 2009 NY Slip Op 52094(U), 25 Misc 3d 1214(A)(Sup. Ct., Nassau Co. 2009) citing Nyack Hosp. v. GEICO., 139 AD2d 515, 516 (2nd Dept. 1988). In cases of compulsory arbitration, judicial review under CPLR article 75 is broad and imports the “arbitrary and capricious” standard included in Article 78 proceedings. Petrofsky, supra at 211.

The award must be in accord with due process and supported by adequate evidence in the record. Santer v. Bd. of Educ., East Meadow U. F. S. D, 101 AD3d 1026, 1027 (2nd Dept. 2012) citing Motor Veh. Mfrs. Assn. of U.S. v State of New York, 75 NY2d 175, 186 (1990). Due process of law requires that the arbitrator’s determination have a basis not only in his good faith, but in the law and record. Santer, supra at 1027 citing Mt. St. Mary’s Hosp. of Niagara Falls v Catherwood, 26 NY2d 493, 507 (1970). Furthermore, the standard is whether the award was supported by a reasonable hypothesis’ and was not contrary to what could be fairly described as settled law. Mtr of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214, 224 (1996); Metropolitan Radiological Imaging, P.C. v. Country-Wide Ins. Co., 2008 NY Slip Op 50539(U), 19 Misc 3d 130(A)(App. Term, 2nd Dept. 2008) citing Mtr of State Farm Mut. Auto. Ins. Co. v Lumbermens Mut. Cas. Co., 18 AD3d 762, 763 (2nd Dept. 2005). These standards govern both a master arbitrator’s review of the original arbitration award and the court’s review of the master arbitrator’s award. Petrofsky, surpa at 211.

The issue before the original arbitrator was which fee schedule should apply in the absence of a discrete Workers’ Compensation Fee Schedule applicable to licensed acupuncturists. Petitioner contended that licensed acupuncturists are entitled to be paid at the same fee schedule rates as medical doctors certified in acupuncture. The original arbitrator looked to the proposed amendment to 11 NYCRR ｧ68, which would permit licensed acupuncturists to charge the same fee that licensed physicians certified to perform acupuncture were permitted to charge. The Regulatory Impact Statement accompanying the proposed amendment reasoned that the higher fee should govern since acupuncturists may only bill for acupuncture treatment, while [*3]chiropractors and medical doctors certified in acupuncture may bill for acupuncture along with their primary service. The arbitrator therefore found that “fairness dictates that licensed chiropractors [or acupuncturists] be reimbursed at the higher medical fee schedule rate.”

The arbitrator failed to mention, much less follow the Appellate Term’s decision in Great Wall Acupuncture v. GEICO Gen. Ins. Co., 16 Misc 3d 23 (App. Term, 2nd Dept. 2007), which addressed the issue and applied the fee schedule for licensed chiropractors to acupuncture services provided by licensed acupuncturists. In Great Wall, the Appellate Term analogized licensed chiropractors to licensed acupuncturists based on the similar training they underwent for licensure in order to perform acupuncture services, while contrasting them to physicians, who only had to obtain certification in order to perform acupuncture. The Appellate Term further noted the Department of Insurance’s lack of “specific guidance as to which particular fee schedule should be applied to a licensed acupuncturist performing acupuncture,” and urged it to do so. Great Wall, supra at 24.

Although acknowledging Great Wall, supra, and the fact that the proposed legislation to increase the reimbursement rates for both chiropractors and acupuncturists was still pending, the master arbitrator confirmed the award. The master arbitrator found that Allstate impermissibly sought to have him conduct a de novo review, and that the lower arbitrator’s award had “a plausible basis in the evidence presented” and thus conformed to applicable law.

This Court does not understand the reasoning behind the master arbitrator’s award. Allstate did not seek a de novo or a factual review, as prohibited by Petrofsky, supra. Rather, petitioner argued that the decision was arbitrary and capricious and contrary to well settled law. This Court cannot countenance an award which finds that proposed or pending legislation trumps well established precedent, i.e. Great Wall, supra. Therefore, the award is vacated and the Court directs that the arbitrator calculate the fees owed to respondent in accordance with the fee schedule for licensed chiropractors who perform acupuncture.

The foregoing constitutes the Decision and Order of the Court.

Dated: April 3, 2013__________________________

Katherine A. LevineJudge, Civil Court

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, Kings County (Carolyn E. Wade, J.), entered May 4, 2011. The order, insofar as appealed from as limited by the brief, denied the branches of defendant’s motion seeking summary judgment dismissing the complaint or, in the alternative, an order compelling plaintiff to appear for an examination before trial and granted the branch of plaintiff’s cross motion seeking a finding, pursuant to CPLR 3212 (g), that plaintiff had established its prima facie case.

ORDERED that the order, insofar as appealed from, is modified by providing that the branch of defendant’s motion seeking to compel plaintiff to appear for an
examination before trial is granted and the examination shall be held within 60 days of
the date of this decision and order, at such time and place to be specified in a written notice by defendant of not less than 10 days, or at such other time and place as the parties may agree upon; as so modified, the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint or, in the alternative, for a finding, pursuant to CPLR 3212 (g), that “the dated correspondence are timely, valid and that these facts [*2]have been proved prima facie,” and for an order compelling plaintiff to appear for an examination before trial (EBT). Plaintiff cross-moved for summary judgment or, in the alternative, for a finding, pursuant to CPLR 3212 (g), that plaintiff had established its prima facie case. The Civil Court “granted” both motions to the extent of finding that the “only issues remaining for trial related to the medical necessity of the services provided and . . . if the billing was in accordance with the New York State Workers’ Compensation Fee Schedule.” Defendant appeals, as limited by its brief, from so much of the order of the Civil Court as denied the branches of defendant’s motion seeking summary judgment dismissing the complaint or, in the alternative, an order compelling plaintiff to appear for an EBT and granted the branch of plaintiff’s cross motion seeking a finding, pursuant to CPLR 3212 (g), that plaintiff had established its prima facie case.

Plaintiff submitted an affirmation by its treating physician which was sufficient to raise triable issues of fact as to the medical necessity of the services rendered (see Alur Med. Supply, Inc. v GEICO Ins. Co., 31 Misc 3d 126[A], 2011 NY Slip Op 50438[U] [App Term, 2d, 11th & 13th Jud Dists 2011]), and as to whether the fees charged were in accordance with the Workers’ Compensation fee schedule. Consequently, the branch of defendant’s motion seeking summary judgment was properly denied. However, the branch of defendant’s motion seeking an order compelling plaintiff to appear for an EBT should have been granted (see CPLR 3101 [a]). Defendant’s moving papers established that defendant had served plaintiff with a notice for an EBT, which examination was material and necessary to defendant’s defense.

With respect to the Civil Court’s finding, pursuant to CPLR 3212 (g), that plaintiff had established its prima facie case, we conclude, contrary to defendant’s contention, that the affidavit by plaintiff’s billing and collection department administrator was sufficient to establish that the claim forms annexed to plaintiff’s cross motion were admissible as proof of the acts, transactions, occurrences, or events recorded therein, pursuant to CPLR 4518 (a) (see Matter of Carothers v GEICO Indem. Co., 79 AD3d 864 [2010]; Art of Healing Medicine, P .C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]).

Accordingly, the order, insofar as appealed from, is modified by providing that the branch of defendant’s motion seeking to compel plaintiff to appear for an EBT is granted upon the terms set forth above.

Pesce, P.J., Rios and Solomon, JJ., concur.
Decision Date: March 29, 2013

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, Kings County (Johnny Lee Baynes, J.), entered April 27, 2011. The order denied the branches of defendant’s motion seeking leave to renew and reargue defendant’s opposition to plaintiff’s motion for summary judgment.

ORDERED that the appeal from so much of the order as denied the branch of defendant’s motion seeking leave to reargue its opposition to plaintiff’s motion for summary judgment is dismissed as no appeal lies from an order denying reargument; and it is further,

ORDERED that the order, insofar as reviewed, is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. When defendant attempted to file opposing papers almost two months after their stipulated due date, the Civil Court (Carolyn E. Wade, J.) rejected defendant’s papers and, by order entered June 11, 2010, granted plaintiff’s motion on default. Thereafter, defendant moved pursuant to CPLR 2221 (d) and (e), for leave to “renew and reargue” its [*2]opposition to plaintiff’s prior motion for summary judgment and, upon renewal and reargument, to deny plaintiff’s motion. Defendant’s motion also sought to vacate the June 11, 2010 order pursuant to CPLR 5015 (a) (1). By order entered April 27, 2011, the Civil Court (Johnny Lee Baynes, J.) denied the branches of defendant’s motion seeking leave to renew and reargue. The order did not address the branch of defendant’s motion seeking to vacate the June 11, 2010 order.

The appeal from so much of the order as denied the branch of defendant’s motion seeking leave to “reargue” must be dismissed, as no appeal lies from an order denying reargument (see Barrafato v Franzitta, 308 AD2d 468 [2003]).

The denial of the branch of defendant’s motion seeking leave to “renew” its “opposition” to plaintiff’s motion for summary judgment was proper since defendant had defaulted in opposing plaintiff’s motion and, thus, defendant’s remedy was to seek to vacate the default order. Finally, the branch of plaintiff’s motion seeking, pursuant to CPLR 5015 (a) (1), to vacate the June 11, 2010 order was not addressed in the order appealed from and, therefore, remains pending and undecided (see Creese v Long Is. Light. Co., 98 AD3d 708, 711 [2012]; Katz v Katz, 68 AD2d 536 [1979]).

Accordingly, the order, insofar as reviewed, is affirmed.
Rios, J.P., Pesce and Aliotta, JJ., concur.
Decision Date: March 29, 2013