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

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 (Sylvia G. Ash, J.), entered December 15, 2009. The order, insofar as appealed from as limited by the brief, denied defendant’s cross motion for summary judgment dismissing the complaint.

ORDERED that the order, insofar as appealed from, is reversed, with $30 costs, and defendant’s cross motion for summary judgment dismissing the complaint is granted.

In this action by a provider to recover assigned first-party no-fault benefits, defendant appeals, as limited by its brief, from so much of an order of the Civil Court as denied its cross motion for summary judgment dismissing the complaint.

In support of its cross motion, defendant established that its denial of claim forms and verification requests had been timely mailed (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]). Defendant also demonstrated that, with respect to plaintiff’s third cause of action, plaintiff had failed to respond to defendant’s verification requests. In opposition to the cross motion, plaintiff did not show that it had sent information responsive to defendant’s requests. Consequently, defendant was entitled to [*2]summary judgment dismissing plaintiff’s third cause of action as premature (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]; Hospital for Joint Diseases v New York Cent. Mut. Fire Ins. Co., 44 AD3d 903 [2007]; Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492 [2005]; Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533 [2004]).

Defendant submitted, among other things, affirmed peer review reports which set forth the factual basis and medical rationale for the doctor’s determination that there was a lack of medical necessity for the services at issue in plaintiff’s first, second and fourth causes of action. The affidavit by plaintiff’s treating doctor submitted in opposition to the cross motion failed to meaningfully rebut the conclusions set forth in the peer review reports (see Innovative Chiropractic, P.C. v Mercury Ins. Co., 25 Misc 3d 137[A], 2009 NY Slip Op 52321[U] [App Term, 2d, 11th & 13th Jud Dists 2009]; Pan Chiropractic, P.C. v Mercury Ins. Co., 24 Misc 3d 136[A], 2009 NY Slip Op 51495[U] [App Term, 2d, 11th & 13th Jud Dists 2009]). As a result, the branch of defendant’s cross motion seeking summary judgment dismissing plaintiff’s first, second and fourth causes of action should have been granted (see Delta Diagnostic Radiology, P.C. v Integon Natl. Ins. Co., 24 Misc 3d 136[A], 2009 NY Slip Op 51502[U] [App Term, 2d, 11th & 13th Jud Dists 2009]; Delta Diagnostic Radiology, P.C. v American Tr. Ins. Co., 18 Misc 3d 128[A], 2007 NY Slip Op 52455[U] [App Term, 2d & 11th Jud Dists 2007]; A. Khodadadi Radiology, P.C. v NY Cent. Mut. Fire Ins. Co., 16 Misc 3d 131[A], 2007 NY Slip Op 51342[U] [App Term, 2d & 11th Jud Dists 2007]).

Accordingly, the order, insofar as appealed from, is reversed, and defendant’s cross motion for summary judgment dismissing the complaint is granted.

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

[*1]

Supreme Court, Kings County, March 29, 2013

APPEARANCES OF COUNSEL

McDonnell & Adels, PLLC, Garden City (Evan W. Klestzick of counsel), for plaintiff. Gary Tsirelman, P.C., Brooklyn (Sarah A. Adam of counsel), for Utopia Equipment, Inc., defendant.

{**40 Misc 3d at 173} OPINION OF THE COURT

Wayne P. Saitta, J.

Plaintiff, Lancer Insurance Company, moves this court for an order pursuant to CPLR 3212 for summary judgment against the insured participant defendants and for a default judgment against defendants Juana Torres and Catherine Duran.

Plaintiff’s motion is denied for the reasons set forth below.

Plaintiff brings this motion seeking a default judgment in its declaratory action against Torres and Duran, stating that a motor vehicle accident of June 5, 2010 (the accident), was staged, and that plaintiff has no obligation to provide no-fault coverage or indemnity or defense to any of the participants named in its declaratory action. The motion also seeks dismissal of the counterclaims of defendant Utopia Equipment for no-fault benefits as assignee of the named defendants and seeking attorneys’ fees for the cost of defending this action.

Plaintiff brought this declaratory action and effectuated service against all of the defendants with the exceptions of Torres and Duran. Plaintiff was granted a default judgment as against each defendant except Torres and Duran.

Plaintiff thereafter obtained an order to serve Torres and Duran by publication on November 15, 2011. Plaintiff served defendants by publication but neither defendant has appeared or answered.

The November 15, 2011 order also granted a judgment against the defaulting defendants declaring that the accident of June 5, 2010 was an intentional and uncovered event, and that Lancer had no duty to afford any insurance coverage to those defendants.

The declaratory judgment was not granted as to defendants Torres and Duran. The [*2]order made no determinations as to Utopia’s rights under the policy by the purported assignments of Torres and Duran.

Plaintiff submits the affidavit of a supervisor for Lancer, Jim Dunn, in support of its motion. Dunn states his opinion is based in part on the depositions of several defendants and the police accident report. However, since Dunn does not reference the{**40 Misc 3d at 174} sources of his information, it is unclear where he obtained certain of his facts as they are not found in the depositions or the police report annexed to the plaintiff’s motion.

Dunn alleges that Marleny Reyes contacted D. Wiltshire Stretch Limo Inc. for a ride to an event. The limo, driven by Leslie Lezea, picked up Reyes and two other female passengers at 141st Street and Cyprus Avenue, Bronx, New York. Dunn states the passengers directed Lezea to take them to a liquor store and then to return to 141st and Cyprus to pick up four more passengers. They then directed Lezea to take a particular route to a location in Manhattan for a birthday party. While en route, at approximately Cyprus and 135th Street, the limo was struck by a minivan. Plaintiff alleges a minivan intentionally sideswiped the limo.

Plaintiff argues that because the passengers in the limo were all intoxicated when they entered the limo, they cannot testify about any fact related to the loss. Plaintiff alleges that although the passengers did not know one another, they all sought the same treatment at the same facilities. The police officer who reported to the scene stated that he “concludes accident is suspicious and injuries questionable.”

Plaintiff argues that evidence gathered in that investigation supports the fact that the accident was staged. Among the facts it argues are indicia of fraud are that Laura Ezequiel purchased the minivan a month prior to the loss for $800, she obtained insurance on it but did not know from whom she purchased the vehicle, that she was out of work and had to borrow money to purchase the vehicle, and that she changed her cell phone number after the accident and did not remember it. Plaintiff also argues that similarities between the passengers in the limo and Ezequiel support its position that the accident was staged, including the fact that they are all Honduranian. Plaintiff also points out that Ezequiel was going drinking that day, and that the passengers in the limo were drunk.

Plaintiff argues that it is entitled to a declaratory judgment that the accident of June 5, 2010 was intentionally staged and therefore an uncovered event and it owes no coverage, indemnification or defense to any party to this action.

Plaintiff argues that Utopia’s counterclaims for no-fault benefits assigned to it by Torres and Duran should be dismissed as the accident was staged and thus an uncovered event. Plaintiff argues that Utopia’s claims for attorneys’ fees should be denied for the additional reasons that it is premature and{**40 Misc 3d at 175} that neither it nor its assignors were named insureds on the policy.

Utopia argues that it is an assignee of the two injured defendants who remain in the case, Torres and Duran, and that Utopia is entitled to their no-fault medical benefits as it provided medical equipment to the defendants in reliance on the understanding that Utopia would be compensated for its services under the terms of the policy issued by Lancer.

Utopia argues that the order granting a declaratory judgment against defaulting defendants does not extinguish Utopia’s claims.

[*3]Default Judgment against Torres and Duran

Plaintiff argues that it is entitled to a default judgment against defendants Torres and Duran as they were served by publication but failed to answer or appear in this action.

Plaintiff’s motion for a default judgment against defendants Torres and Duran must be denied as the order which permitted service by publication did not comply with the provisions of CPLR 316 (a). CPLR 316 (a) specifically requires that the order designate the publications most likely to give notice to the person to be served.

Since the November 15, 2011 order did not specify the publications in which the notice was to be published, it was necessary for plaintiff to obtain a further order of the court designating the publications to be used. The service made without first having the court designate the publications to be used was improper and insufficient to obtain jurisdiction over the defendants. Having failed to obtain jurisdiction over Torres and Duran, plaintiff is not entitled to a default judgment against them.

Declaratory Judgment

That part of plaintiff’s motion seeking a declaratory judgment against the defendants that the accident of June 5, 2010 was intentionally staged must also be denied.

Even accepting all the facts asserted by plaintiff as true, at best they provide some circumstantial evidence that a fraud might have occurred.

The allegations that the defendants were drunk and that they were Hondurans are of no probative value. The allegation that certain of the passengers did not know other passengers in the limousine is open to a variety of different interpretations. The allegation that the passengers all treated at the same facility after the accident is merely some circumstantial evidence that{**40 Misc 3d at 176} could, together with other evidence, support an inference that the accident was staged.

Dunn’s affidavit, submitted by Lancer, is not based on personal knowledge but refers to findings from an investigation allegedly conducted by Esurance, the insurer of the minivan that struck the limousine. However, the report of the investigation by Esurance is not admissible and Lancer does not submit any admissible evidence to support Esurance’s findings. There is no affidavit from any person with knowledge as to any investigation or the findings which resulted.

Dunn states in his affidavit that “CLINTON PLACE MEDICAL, PC referred the insured passengers to their attorneys.” He then cites the depositions of Reyes, Bernardez, Saravia, Guity and Mariano. In fact, only Bernardez and Mariano in their depositions stated that they were referred to their attorneys by Clinton. Reyes testified someone who she did not identify gave her a card for an attorney and Saravia and Guity were not asked, nor did they mention, being referred to an attorney.

Dunn also states that the insured passengers were provided transportation to the clinic for treatment, and cites the depositions of Reyes, Bernardez, Saravia, Guity and Mariano. While Bernardez, Guity and Mariano acknowledged this to be true, neither Reyes nor Saravia was asked or commented about transportation.

Dunn further states that none of the same passengers was ever given the results of their MRIs. Both Reyes and Bernardez state they did not receive MRI results. Saravia’s testimony is unclear, and neither Guity nor Mariano were asked if they received MRI results. [*4]

Circumstantial evidence may permit a finding of negligence, but only when the proof is so convincing and the response to that proof results in an inescapable finding of negligence. (Simmons v Neuman, 50 AD3d 666, 667 [2d Dept 2008].)

At best plaintiff makes out a circumstantial case from which a reasonable jury could infer either that this was or that this was not a staged accident. The circumstantial evidence presented in the moving papers is not sufficient to meet the burden for summary judgment.

Assignment of Torres’ and Duran’s Rights

As passengers in the vehicle insured by Lancer, Torres and Duran have a right to first-party benefits from Lancer, which they also had the right to assign. An accident victim may assign{**40 Misc 3d at 177} his or her no-fault claim to a medical provider who has provided a medical service (see 11 NYCRR 65-3.11). Lancer has not contested the validity of the assignment. In this case it is clear that Lancer was aware of the assignment as it joined Utopia as a defendant.

An assignee “stands in the shoes” of an assignor. (Long Is. Radiology v Allstate Ins. Co., 36 AD3d 763, 765 [2d Dept 2007].) Where there is a valid assignment of a claim, the assignor is divested of all control and right to the cause of action. The assignee is the proper party in interest and has the right to commence and prosecute an action in its own name without joining the assignor as a necessary party. (Cardtronics, LP v St. Nicholas Beverage Discount Ctr., Inc., 8 AD3d 419 [2d Dept 2004].)

An assignee is bound by the acts of the assignor which occur prior to the assignment, but not those which occur after the assignment. (Gramatan Home Invs. Corp. v Lopez, 46 NY2d 481 [1979].)

Utopia was assigned the right to payment from the insureds prior to Lancer’s initiation of the declaratory action and therefore the rights assigned to Utopia would be unaffected in the event that Torres and Duran should default, as any default would be subsequent to the assignment of the rights.

Right to Recover Attorneys’ Fees

An insured is entitled to recover legal expenses incurred in defending a declaratory judgment brought as a result of an insurer’s disclaimer. (Fischer v Michigan Millers Mut. Ins. Co., 103 Misc 2d 508 [1st Dept 1980]; Mighty Midgets v Centennial Ins. Co., 47 NY2d 12 [1979]; see also Glens Falls Ins. Co. v United States Fire Ins. Co., 41 AD2d 869, 870 [1973].)

Utopia is entitled to the same rights that Duran and Torres would have been entitled to if they defended against Lancer’s declaratory judgment and prevailed.

As a preliminary matter, the fact that Lancer denied coverage for what it asserts is fraud does not affect Utopia’s right to attorneys’ fees should it successfully defend against the declaratory judgment action. If the defense were successful, it would necessarily mean there was no finding that the accident was staged.

Also, while Utopia is not entitled to attorneys’ fees unless it is successful in the declaratory judgment action, it is not premature for Utopia to seek attorneys’ fees as a counterclaim in the same action. The counterclaims would only be awarded in the event Utopia defeats the declaratory judgment action.{**40 Misc 3d at 178} [*5]

An insured is entitled to recover the expenses of defending a declaratory judgment action brought as a result of an insurer’s breach of its obligation to defend a tort action. (Johnson v General Mut. Ins. Co., 24 NY2d 42 [1969]; Mighty Midgets v Centennial Ins. Co., 47 NY2d 12 [1979].) The courts have generally related the right to recover to the breach of the insurance contract, specifically, a provision to provide a defense. The Court of Appeals in Mighty Midgets v Centennial, noted that when a party is cast in a defensive posture, “an insurer’s responsibility to defend reaches the defense of any actions arising out of the occurrence,” including declaratory judgments to deny coverage. (47 NY2d at 21.)

The cases dealing with the right to attorneys’ fees for successfully defending a declaratory judgment action by an insurer all involve insureds who were defendants in personal injury actions. There appear to be no reported decisions involving attorneys’ fees for successfully defending against a declaratory judgment action to deny first-party benefits under no fault.

The right to attorneys’ fees when an insured has been cast in a defensive posture by the legal steps taken by the insurer to free itself from its obligations under the policy arise from the provision in the policy to provide defense to the insured. “[T]he right to such recovery is derived exclusively from the contractual relationship between the insured and the insurer.” (Fischer v Michigan Millers Mut. Ins. Co., 103 Misc 2d 508, 511 [1st Dept 1980].)

Insurance Law § 5103 (a) (3) provides that any New York resident who does not otherwise have coverage for first-party benefits “is entitled to first party benefits” through the liability policy of the insured. The statute does not provide that such residents are deemed insureds under the policy.

Since the Insurance Law does not deem passengers insureds, the question is whether the policy, by its terms, makes the passengers insureds, and therefore entitled to defense, including attorneys’ fees under the policy. In some policies, the definition of “persons insured” may include persons in addition to the named insured or policyholder, such as those operating the vehicle with the permission of the named insured. (Fischer v Michigan Millers Mut. Ins. Co., 103 Misc 2d 508 [1st Dept 1980].) Whether passengers are deemed “persons insured” depends on the specific terms of the policy.

Even if the passengers are deemed insureds under the policy, they would only be entitled to attorneys’ fees for defending this{**40 Misc 3d at 179} action if the policy required the insurer to provide them with defense, as well as indemnity. If the policy entitled them to indemnification for losses incurred only, they would not be entitled to attorneys’ fees for defending a declaratory judgment action. If passengers are deemed insureds and if they are entitled to defense and indemnification, the scope of the duty to defend and whether it would extend to the defense of a declaratory judgment would be determined by the terms of the policy, specifically the provision to defend.

A provision that the insurer would provide defense for all actions arising from an occurrence would include defense of declaratory judgment actions. However, a more restrictive defense clause which, for example, limited defense to personal injury actions or third-party actions might not.

Since the policy was not provided to the court, it cannot be determined at this time whether Utopia’s defense of this action would be covered under the terms of the policy. Therefore, that part of the motion to dismiss Utopia’s counterclaims for attorneys’ fees for [*6]defending this action must be denied.

Wherefore, plaintiff’s motion for a default judgment against defendants Torres and Duran, for summary judgment on its claim for a declaratory judgment, and for dismissal of Utopia’s counterclaims is denied.

[*1]

Civil Court of the City of New York, Queens County, March 28, 2013

APPEARANCES OF COUNSEL

McDonnell & Adels P.L.L.C., Garden City, for defendant. Tsirelman & Valerio, P.C., Long Island City (Max Valerio of counsel), for plaintiff.

{**39 Misc 3d at 829} OPINION OF THE COURT

James E. d’Auguste, J.

The motion by defendant State Farm Mutual Automobile Insurance Company to reargue is granted to the extent that the{**39 Misc 3d at 830} court reconsiders its earlier determination granting plaintiff Lotus Acupuncture P.C. summary judgment and upon reconsideration adheres to its original determination.

The facts of the case are not in dispute: State Farm sent an initial and follow-up request for an examination under oath (EUO) that were not complied with by Lotus. The sole legal issue is whether the insurer’s follow-up request was timely. The resolution of this issue rests on an analysis of two regulations, 11 NYCRR 65-3.6 and 65-3.8. The first regulation, 11 NYCRR 65-3.6, requires that the follow-up request be mailed within 10 calendar days. The regulation also references a 30-day outside deadline for the submission of verification material. The second regulation, 11 NYCRR 65-3.8, provides that an EUO verification request is completed on the day it is scheduled to occur. The court interpreted the regulations as measuring the accrual date for sending the follow-up request from the defaulted EUO appearance, also known as a “no show” in no-fault parlance. In so ruling, the court found that the 30-day deadline addresses the submission of documents as opposed to a verification request seeking a personal appearance on a specific date. State Farm requests that the court reconsider its determination and supports its application by submitting decisions by several judges of coordinate jurisdiction that decided the issue to the contrary, albeit without any explanation for their determination.

In the absence of appellate guidance, the court invited the Superintendent of the New York State Department of Financial Services’ amicus curiae opinion on the question of “whether [the above referenced regulations], when read together, require[ ] an insurer to send follow up verification [*2]requests within 10 calendar days of a defaulted examination under oath or from the expiration of 30 days from the original requests irrespective of the date the examination under oath appearance was scheduled.” (See order dated Aug. 13, 2012 [d’Auguste, J.].)

On December 3, 2012, the court received correspondence from Martha A. Lees, Esq., General Counsel for Insurance at the Department of Financial Services, attaching an earlier opinion letter setting forth the Superintendent’s continuing position for “when an insurer should send a follow-up verification request after a ‘no-show’ for an examination under oath.” The Superintendent’s position, as originally set forth in a December 22,{**39 Misc 3d at 831} 2006 opinion of the New York State Insurance Department,^[FN*] is that

“[w]hen an EUO is required and the party required to appear fails to attend a scheduled EUO, the insurer must meet [its] obligations under N.Y. Comp Codes R. & Regs. tit 11, § 65-3.6(b) and within 10 calendar days, contact the party from whom verification (the EUO) has been requested and not been provided, i.e. non-attendance at the scheduled EUO, in order to afford the party a second opportunity to attend an EUO.” (Ops Gen Counsel NY Ins Dept No. 06-12-16 [Dec. 2006].)

The Superintendent’s opinion, which is entitled to great deference, firmly supports the court’s original conclusion that a follow-up EUO notice must be sent within 10 calendar days of the missed EUO. Moreover, legal commentary on the subject agrees with the reasonableness of the Superintendent’s regulatory interpretation. (See Larry Rogak, Judge Asks State for No-Fault Clarification, The Rogak Report: Insurance Law Digest [Aug. 23, 2012] [“logic and reason would seem to dictate that the measuring point is the date of the no-show”].)

The court is granting reargument as it considered the additional input from the Department of Financial Services. Upon reargument, the court adheres to its original determination that the 10-calendar-day deadline for sending a follow-up verification request is measured from the date the initial EUO is missed. As State Farm’s follow-up request was untimely, Lotus was properly granted summary judgment.

Footnotes

Footnote *: In October 2011, the Insurance Department merged with the Banking Department to create a newly-formed Department of Financial Services.

Civil Court of the City of New York, Kings County

CV-100846/2006

Attorney for Plaintiff:

Stefan Belinfanti

Gary Tsirelman, P.C.

65 Jay Street, 3rd Floor

Brooklyn, NY 11201

Attorney for Defendant:

Dominick Dale

Korshin & Weldon, Esqs.

170 Froehlich Farm Boulevard

Woodbury, New York 11797

Ingrid Joseph, J.

Plaintiff AR Medical Rehabilitation, P.C. (referred to interchangeably as “plaintiff” or “AR Medical Rehabilitation”) initiated this action against defendant Geico General Ins. Co. (“defendant”) to recover assigned first party no fault benefits for services provided to assignors Celeste Russell, Robin Williams, and Edwina McDonald. This court conducted a bench trial on January 14, 2013, wherein the parties were represented by counsel.

Prior to commencement of the trial the defendant made an oral motion in limine to preclude Alexander Rozenberg, M.D. (“Dr. Rozenberg”) from testifying and to dismiss the case based upon its contention that the instant action raises Mallela issues pursuant to State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]. The defendant claimed Dr. Rozenberg conspired with two individuals, Inna Polack and Alexander Polack (collectively, the “Polacks”), to fraudulently incorporate multiple medical professional service corporations, including AR Medical Rehabilitation. The defendant indicated that Dr. Rozenberg operated as the straw man for the illegal companies but the Polacks, who are lay persons and unauthorized to collect no fault benefits under New York law, actually owned the businesses. The defendant posited that there were prior rulings [*2]from different court proceedings that when taken together support its position.

The defendant presented the court and plaintiff’s counsel with two decisions that were rendered at various stages of a RICO (Racketeer and Influenced Corrupt Organizations Act) action, wherein Allstate Insurance Company sued the Polacks, Dr. Rozenberg, two other individuals, three medical management companies (Mighty Management Group Inc., Mighty Management LLC, and Blue Wave Management), the plaintiff in this action, AR Medical Rehabilitation, and two other professional medical companies (AR Medical Art, P.C. and Yonkers Medical Art, P.C.). The documents submitted consisted of a decision rendered by United States District Court Judge Arthur Spatt (“Judge Spatt”) (Allstate Insurance Company v Rozenberg, 590 F Supp 2d 384 [ED NY 2008]) and a Report and Recommendation prepared by Magistrate Judge Boyle (“Magistrate Boyle”) (Allstate Insurance Company v Polack, 2012 WL 4489282 [ED NY 2012]) (collectively, “RICO action”) (defendant’s exhibits A and B, respectively). The defendant also submitted two decisions from the Supreme Court, Kings County, Criminal Term (People v Rozenberg, 21 Misc 3d 235, 862 NYS2d 895 [Sup Ct, Kings County 2008] and People v Rozenberg, Sup Ct, Kings County, April 24, 2009, McKay, J., Indictment No. 5545-06) as well as the Determination and Order from a hearing conducted by the State of New York Department of Health Board for Professional Medical Conduct (Matter of Alexander Rozenberg, BPMC No.10-271, December 17, 2010) (defendant’s exhibits C-E, respectively). The defendant indicated that each proceeding evinced the same operative fact pattern of insurance fraud involving Dr. Rozenberg and AR Medical Rehabilitation.

Plaintiff’s attorney countered that the cases were not dispositive on the issue of whether AR Medical Rehabilitation can pursue no fault benefits in a civil action, because none of the cases resulted in a determination that the company is a Mallela corporation. Plaintiff also argued that Judge Spatt’s 2008 decision should not be considered with respect to the in limine issue since that decision addressed only whether certain causes of action should be dismissed. Additionally, plaintiff pointed out that Magistrate Boyle’s report and recommendation was not binding, because there was no proof that it had been adopted by Judge Spatt.

The defendant, with the plaintiff’s consent and the court’s permission, was given an extension of time to produce Judge Spatt’s decision adopting the recommendations of Magistrate Boyle. On the day of trial, the court reserved decision on the in limine issue and permitted plaintiff to call Dr. Rozenberg as a witness with the understanding that such testimony would be stricken and a verdict rendered in favor of the defendant if the court later determined, based on the documents submitted, that in limine relief is warranted. Subsequently, on January 19, 2013, the defendant submitted a third case (Allstate Insurance Company v Polack, US Dist Ct, SD NY, 08-CV-565, Spatt, J., 2012) from the RICO action.

The court is being asked to determine whether the defendant’s motion in limine should be granted, or, if in limine relief is not warranted, whether the plaintiff met its prima facie case of entitlement to no fault benefits at trial?

After carefully reviewing the documents submitted, the court finds that the defendant has failed to demonstrate entitlement to the relief sought in its in limine application. While the decisions submitted are replete with discussion about an alleged conspiracy to defraud New York’s No Fault regime, they are devoid of any finding that Dr. Rozenberg was a participant, or that AR Medical Rehabilitation was the fruit of a fraudulent scheme. Judge Spatt’s 2008 decision addresses two motions to dismiss for failure to state a cause of action that were made by Dr. Rozenberg and other defendants in that case. Judge Spatt discussed the allegations contained in Allstate’s complaint but did not reach a conclusion as to whether AR Medical Rehabilitation was an illegally formed [*3]company, nor did he render a decision concerning Dr. Rozenberg’s involvement in the alleged illegal activity. Thus, there are no findings of fact or even an adverse inference that can be drawn from that decision that would have a binding effect on Dr. Rozenberg or the plaintiff in this case.

The defendant’s reliance on Magistrate Boyle’s report and recommendation and Judge Spatt’s 2012 decision adopting that report is misplaced. Allstate moved for default judgment in the RICO action against some of the defendants, and Judge Spatt referred the matter to Magistrate Boyle to report and recommend a decision on the motion. Magistrate Boyle referenced Dr. Rozenberg and AR Medical Rehabilitation in his analysis but stated clearly at the outset of the report, that Allstate voluntarily dismissed the action against Dr. Rozenberg and AR Medical Rehabilitation (Allstate Insurance Company v Polack, 2012 WL 4489282 [ED NY 2012]). Consequently, there were no recommendations that would have an effect on any of the issues central to this trial, because neither Magistrate Boyle in his report, nor Judge Spatt in his order adopting that report (Allstate Insurance Company v Polack, US Dist Ct, SD NY, 08 Civ 565, Spatt, J., 2012) addressed the issue of Dr. Rozenberg or the corporate structure of AR Medical Rehabilitation on the merits.

Additionally, the criminal case and Determination and Order of the State Board for Professional Medical Conduct (“BPMC”) run counter to the defendant’s argument. In the criminal matter Dr. Rozenberg was indicted on multiple counts of falsifying business records and insurance fraud but convicted only of certain charges that pertain to an assignor not named in the instant action (see People v Rozenberg, 21 Misc 3d 235, 862 NYS2d 895 [Sup Ct, Kings County 2008] and People v Rozenberg, Sup Ct, Kings County, April 24, 2009, McKay, J., Indictment No. 5545-06). In this case, the doctor testified, on direct examination, that he had been indicted on several criminal charges but stated that fifty-six (56) of the charges resulted in either a dismissal or acquittal. Dr. Rozenberg admitted that he was convicted on one count of falsifying business records and one count of insurance fraud but explained that the convictions concerned a specific patient whose “initial evaluation” had been coded and erroneously billed as a “consultation” (tr. 16-19). Dr. Rozenberg indicated that there is a $25.00 difference between the two codes and that he was found guilty of falsifying that specific business record. Subsequently, by order dated December 17, 2010, the Board for Professional Medical Conduct determined that revocation of the doctor’s license to practice medicine was the appropriate penalty for committing the aforementioned crimes. The court finds that while Dr. Rozenberg’s convictions and license revocation may have some bearing on his credibility, they do not affect his ability to testify as a prima facie witness.

The court has discussed the defendant’s substantive arguments and will now address the procedural issues attendant to this matter. Despite the defendant’s characterization of the motion as one for in limine relief, the court finds that the application amounts to a motion for summary judgment. Essentially, the defendant alleged that there were no issues of fact based upon its contention that AR Medical Rehabilitation is a Mallela corporation and its true owners, the Polacks, are unauthorized to collect no fault benefits under New York law. The underlying policy of requiring that a summary judgment motion be made within a certain period of time is to prevent the practice of delaying such motions until the eve of trial (Pallotta v Saltru Associates Joint Venture, NY, 32 Misc 3d 1208(A) [Sup Ct, Kings County 2011] citing Miceli v State Farm Mutual Automobile Ins. Co., 3 NY3d 725, 726 [2004]). For that reason, inter alia, the Appellate Division Second Department has held that a motion in limine is an inappropriate substitute for a motion for summary judgment (In re Singer, 99 AD3d 802, 803 [2d Dept 2012]; Brewi-Bijoux v City of New York, 73 AD3d 1112, 1113 [2d Dept 2010] quoting Rondout Elec. v Dover Union Free School Dist., 304 AD2d 808, 810-811 [2d Dept 2003]). Furthermore, an in limine motion is generally made [*4]within the context of a jury trial to protect against the prejudice that could result if a jury hears inadmissible, irrelevant, or inflammatory evidence (Matter of PCK Dev. Co., LLC v Assessor of Town of Ulster, 43 AD3d 539 [3d Dept 2007], and State of New York v Metz, 241 AD2d 192, 198 [1st Dept 1998]; Caster v Increda-Meal, Inc., 238 AD2d 917, 918 [4th Dept 1997], see also 4 NY Prac., Com. Litig. in New York State Courts § 38:1-8 [3d Ed.]). In a bench trial, as is the case here, there is little use for that safeguard because the trier of fact would be exposed to the objectionable evidence whether such evidence is couched in an application for in limine relief or presented via documentary or testimonial evidence at trial. Indeed, the Court of Appeals has held that a Judge is uniquely capable of distinguishing the issues and making an objective determination based upon appropriate legal criteria, despite awareness of facts which cannot properly be relied upon in making decisions (People v Moreno, 70 NY2d 403, 406 [1987]).

Based upon the preceding analyses, the defendant’s motion in limine is denied.

The court will now address whether the plaintiff proffered sufficient evidence to meet its prima facie burden. Under New York No Fault law, a plaintiff establishes its prima facie case by demonstrating that it submitted a claim form to the defendant insurer, tendering proof of the fact and amount of the loss sustained, and that payment of no-fault benefits is overdue (Insurance Law § 5106[a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2d Dept 2004]). It is well settled that the plaintiff provider must call a witness at trial that can lay the proper foundation for admission of its claim forms into evidence under the business record exception to the hearsay rule (see CPLR 4518; Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 664 [2d Dept 2008]; Bajaj v General Assur. Co., 18 Misc 3d 25, 28-29 [App Term, 2d & 11th Jud. Dists 2007]).

The court finds that Dr. Rozenberg’s testimony was insufficient to lay the foundation necessary to establish that plaintiff’s billing documents are business records. Dr. Rozenberg indicated that although Kevi Management Company (“Kevi”) was located in the same building, it was a separate entity that handled all of the collection and billing tasks for AR Medical Rehabilitation (71, 81-82). Dr. Rozenberg stated that Kevi employees generated the bills and that he would sign or stamp them, but the witness failed to adequately describe the procedure that Kevi employees followed when creating bills (tr 25-26, 71). The doctor testified that after receiving the signed or stamped bill, a Kevi employee (1) inserted bills in an envelope, (2) placed the envelopes in a plastic bag, (3) delivered the entire package to the post office for mailing, then (4) recorded the mailing of each bill in a notebook that was kept in the office (tr 24, 28).

Additionally, the doctor’s testimony was laden with inconsistencies. Dr. Rozenberg initially stated that he and the owner of the Kevi Company established the billing procedures together, but he later admitted on cross-examination that he provided no input on the process (tr 72-73). The doctor testified that he personally checked claim forms for accuracy before signing or stamping them, and he averred that there were no deviations from that practice (tr 20, 33). However, on voir dire, the witness conceded that there were exceptions to that rule when presented with a bill that was neither signed nor stamped by him (tr at 68). Dr. Rozenberg attempted to mitigate the discrepant testimony by explaining that he signed or stamped only the bills generated from services he provided and the chiropractor, physical therapist, acupuncturist, and orthopedic surgeon were responsible for signing or stamping their own bills (tr 69, 74-75). Dr. Rozenberg acknowledged that he did not check the other specialists’ bills and even answered in the affirmative when asked whether he was only concerned about his own bills (tr at 74). The doctor testified that he supervised the billing process but later acknowledged that the Kevi Company employed its own supervisors (tr at 35). At one point, Dr. Rozenberg even delineated his umbrella of responsibility from that of the billers by stating [*5]that he was responsible for ensuring the bills were correct, while Kevi employees were responsible for mailing the bills within the requisite period of time (tr at 82).

Based upon the inconsistencies and gaps in Dr. Rozenberg’s testimony and the plaintiff’s failure to produce a witness from the Kevi Company, the court finds that plaintiff failed to lay the proper foundation for admission of the documents in evidence under the business record exception to the hearsay rule (see CPLR 4518[a]; compare Art of Healing Medicine, P.C. v Travelers Home and Marine Ins. Co., 55 AD3d 644 [2d Dept 2008] and Viviane Etienne Medical Care, P.C., 31 Misc 3d 21 [2d 11 13 Jud Dists 2011] with Andrew Carothers, M.D., P.C. v Geico Indemnity Co., 79 AD3d 864 [2d Dept 2010]. Consequently, the court hereby rescinds its decision to admit plaintiff’s bills into evidence as business records on the day of trial.

Even if the documents were allowed in evidence, they would be accorded little, if any, weight, because plaintiff failed to proffer sufficient evidence to demonstrate that Dr. Rozenberg actually checked the bills for accuracy. The claim forms at issue in this case contain charges for services that run the gamut, including office visits, supplies, therapeutic exercises, and range of motion tests. Dr. Rozenberg did not testify that he provided those services, and there is conflicting testimony as to whether he supervised, signed, stamped, or checked the accuracy of bills from services rendered by other professionals in the office.

Accordingly, the court awards a verdict in favor of the defendant.

This constitutes the Decision and Order of the court.

March 27, 2013_____________________________

HON. INGRID JOSEPH

Acting Supreme Court Justice