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

Appeal from an order of the District Court of Nassau County, First District (Michael A. Ciaffa, J.), entered August 2, 2011. The order denied defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order is reversed, without costs, and defendant’s 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 from an order of the District Court which denied defendant’s motion for summary judgment dismissing the complaint.

In support of its motion, defendant submitted an affidavit by its litigation examiner which established that defendant had timely mailed a request and follow-up request for verification (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]), and that the requested verification had not been provided. Since plaintiff has not rebutted defendant’s prima facie [*2]showing that defendant’s initial request and follow-up request for verification were timely mailed and that plaintiff failed to respond to the requests, defendant established that its time to pay or deny the claim had been tolled. Consequently, defendant’s motion for summary judgment dismissing the complaint, on the ground that the action was premature, should have been granted (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]; Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492 [2005]; Mary Immaculate Hosp. v New York Cent. Mut. Fire Ins. Co., 21 Misc 3d 130[A], 2008 NY Slip Op 52046[U] [App Term, 9th & 10th Jud Dists 2008]).

Contrary to plaintiff’s argument, plaintiff did not prove that defendant had issued a denial in response to the bill at issue. The denial attached to plaintiff’s opposition was a general denial, not a specific denial, as it did not set forth an amount of the bill, or the date of the bill, or who had rendered services, or what those services were. Moreover, the denial lists Candice Vernon as the applicant for benefits, not plaintiff, and explicitly states that the applicant is not an assignee.

Accordingly, the order is reversed, and defendant’s motion for summary judgment dismissing the complaint is granted.

LaSalle, J.P., Molia and Iannacci, JJ., concur.
Decision Date: December 07, 2012

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

Appeal from an order of the District Court of Nassau County, Third District (Michael A. Ciaffa, J.), dated August 1, 2011. The order granted defendant’s motion for, in effect, summary judgment dismissing the complaint.

ORDERED that the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, the District Court, by order dated December 10, 2010, stayed the action and required plaintiff to file proof, within 90 days of the date of the order, that its assignor had filed an application with the Workers’ Compensation Board for a determination of the parties’ rights under the Workers’ Compensation Law. The order further provided that, in the event plaintiff failed to do so, defendant’s motion for summary judgment dismissing the complaint would be granted unless plaintiff showed good cause why the complaint should not be dismissed.

Thereafter, defendant moved for, in effect, summary judgment dismissing the complaint, asserting that plaintiff had failed to comply with the prior order. As plaintiff failed to demonstrate in opposition to defendant’s instant motion that its assignor had made such an application, and did not show good cause why the complaint should not be dismissed, the District [*2]Court properly granted defendant’s motion for, in effect, summary judgment dismissing the complaint (see A.B. Med. Servs., PLLC v American Tr. Ins. Co., 35 Misc 3d 134[A], 2012 NY Slip Op 50764[U] [App Term, 9th & 10th Jud Dists 2012]). Accordingly, the order is affirmed.

LaSalle, J.P., Molia and Iannacci, JJ., concur.
Decision Date: December 07, 2012

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.), dated February 18, 2011. The order, insofar as appealed from, denied defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order, insofar as appealed from, is reversed, without costs, and defendant’s motion for summary judgment dismissing the complaint is granted.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint. Although the Civil Court denied defendant’s unopposed motion, it held that the only issue to be resolved at trial was whether defendant had issued the denial of claim form in duplicate.

Contrary to the finding of the Civil Court, the affidavit submitted by defendant in support of its motion established that the denial of claim had been issued in duplicate (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]). Since the Civil Court found that defendant is otherwise entitled to judgment, and as plaintiff cannot be heard to challenge that finding in light of plaintiff’s failure to oppose defendant’s motion for summary judgment dismissing the complaint, defendant’s motion is granted (see Delta [*2]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 motion for summary judgment dismissing the complaint is granted.

Rios, J.P., Aliotta and Solomon, JJ., concur.
Decision Date: December 07, 2012

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 (Katherine A. Levine, J.), dated October 15, 2010. The order, insofar as appealed from, denied defendant’s motion for summary judgment dismissing the complaint.

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

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint. The Civil Court denied defendant’s motion, finding, among other things, that defendant had established its prima facie case and that the “matter shall proceed to trial on the issue of medical necessity.”

In support of its motion, defendant submitted, among other things, affirmed peer review reports and an independent medical examination report, which set forth factual bases and medical rationales for the reviewers’ determinations that there was a lack of medical necessity for the services rendered. In opposition to the motion, plaintiff failed to rebut the conclusions set forth in defendant’s reports. In view of the foregoing, and as plaintiff has not challenged the Civil Court’s finding, in effect, that defendant is otherwise entitled to judgment, the order, insofar as appealed from, is reversed and defendant’s motion for summary judgment dismissing the [*2]complaint is 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]).

Rios, J.P., Aliotta and Solomon, JJ., concur.
Decision Date: December 07, 2012

Supreme Court, Kings County

21836/11

Plaintiff Attorney: Lester Herzog, 1729 E. 15th Street, Brooklyn, NY 11229

Defendant Attorney: Smith Mezure Director Wilkins Young & Yagerman, PC, 111 John Street, New York, NY 10038

David Schmidt, J.

The following papers numbered 1 to 11 read on these motions:

Papers Numbered

Notice of Motion/Order to Show Cause/

Petition/Cross Motion and

Affidavits (Affirmations) Annexed1-2, 3-4, 5-6

Opposing Affidavits (Affirmations)7-9

Reply Affidavits (Affirmations)10-11

Affidavit (Affirmation)

Other Papers

Upon the foregoing papers in this action seeking supplementary uninsured/underinsured motorist (SUM) coverage under a policy of insurance issued by defendant Geico General Insurance Company (Geico or defendant), plaintiffs Sarah H. Orman and Gidon Orman (plaintiffs) move, pursuant to CPLR 3211 (b), to dismiss four of Geico’s affirmative defenses. By order to show cause, Geico moves to vacate plaintiffs’ note of issue and [*2]certificate of readiness, and to strike this matter from the trial calendar. Geico separately cross-moves, pursuant to CPLR 3211 (a) (7),

to dismiss plaintiffs’ second cause of action alleging that it breached its implied covenant of good faith and fair dealing.

Background

Plaintiff Sarah Orman (plaintiff) was involved in a car accident which took place on October 23, 2007 in Woodmere, New York. While plaintiff was making a left turn, plaintiffs’ vehicle was struck in the rear by the vehicle owned and operated by Maximino Luna. According to the police report and the deposition testimony of plaintiff in the underlying action (Orman v Luna, Index No. 12108/09), Mr. Luna attempted to stop before the collision but was unable to do so. At the time of the accident, Mr. Luna had an Allstate automobile insurance policy with limits of $25,000 per person and $50,000 per accident. Plaintiffs held a policy with Geico which included SUM coverage with $50,000/$100,000 policy limits. It is not disputed that plaintiff is a “covered person” under the terms of the policy.

In August, 2008, Geico was awarded 100% in arbitration and plaintiffs’ deductible of $500 was refunded to them.

In October, 2009, plaintiffs sent Geico a formal notice of their intention to make a claim, with accompanying correspondence. Geico acknowledged receipt of the claim by letter dated November 5, 2009, and advised plaintiffs to notify it if they received a policy limit settlement offer from Allstate that was less than their “UIM” limit. Plaintiffs’ counsel advised Geico, by letter dated November 13, 2009, that Allstate had not yet tendered its policy and that the underlying action was being litigated, although it had not been placed on the trial calender.

On October 6, 2010, plaintiff was deposed in the underlying action.

In March, 2011, Allstate advised plaintiffs’ counsel that it was offering the $25,000 policy limits for settlement of the bodily injury claim for plaintiff as a result of the accident.

By letter dated June 20, 2011, plaintiffs’ counsel advised Geico that Allstate had tendered its policy of $25,000. In addition, counsel attached a copy of Allstate’s tender, a copy of the declaration pages of the policy and an affidavit of “no excess” coverage, signed by Mr. Luna. Counsel also requested Geico’s permission, in writing, to accept Allstate’s tender.

By letter dated June 21, 2011, plaintiffs’ counsel provided Geico with a package of medicals, photos and other documents, and again requested Geico’s permission to accept Allstate’s tender.

By letter dated June 23, 2011, Geico advised plaintiffs’ counsel that “you have GEICO’s permission to settle your client’s Bodily Injury claim with the adverse tort carrier, Allstate, insurer of Maximino Luna.” Geico also advised plaintiffs’ counsel that in order to evaluate an underinsured motorist bodily injury claim, it required “medical specials” documenting plaintiff’s injuries and a written authorization to obtain a copy of plaintiff’s no-fault file.

By letter dated June 25, 2011, Allstate advised plaintiff and her attorney that a settlement check was issued to plaintiff in the amount of $25,000.

On August 30, 2011, referring to his August 15, 2011 conversation with Geico’s claims examiner, plaintiffs’ counsel advised Geico that plaintiffs would not accept anything less than [*3]the full $25,000 SUM coverage limits; that as of that date, Geico had not contacted him; and that he was in the process of drafting pleadings to commence a direct action against Geico. Counsel also stated that plaintiffs would be including a cause of action for bad faith, “in view of the fact that Geico refused to pay $25,000, where the economic damages alone, exceed one million dollars – without even considering the personal injuries and pain and suffering.”

By letter dated September 15, 2011, Geico advised plaintiffs’ counsel that plaintiffs’ SUM policy limit was $50,000/$100,000; that it was “always willing to negotiate any claim in good faith;” and that, based upon alleged economic damages, it requested all medical authorizations, MRI films, the no-fault file and employment records so that it could properly evaluate plaintiffs’ claim. Geico further stated that it would contact counsel upon completion of its review.

By letter dated September 26, 2011, plaintiffs’ counsel again advised Geico that plaintiffs would not accept anything less than the full $25,000 SUM coverage limits, and that in response, “[the claims examiner] … stated that Geico, at present, is unwilling to tender same.” Plaintiffs’ counsel further stated that in view of the above, he enclosed six authorizations and informed Geico that an action against Geico had been commenced.^[FN1]

On that same date, (September 26, 2011) plaintiff commenced this action, alleging a cause of action for breach of contract, a cause of action alleging bad faith, and a cause of action for loss of consortioum. As relevant here, the second cause of action states:

“That defendant’s refusal and/or neglect to pay its policy limits when requested to do so, was not made in good faith in view of all relevant circumstances.

That in refusing and/or neglecting to pay its policy limits, defendants considered only its own interests, without also taking into consideration the interests of its insured.

That the defendant’s refusal and/or neglect to pay plaintiff amounted to gross disregard for its insured’s interests; by failing to place the interests of its insured on equal footing with its own interests.”

Plaintiffs’ seek $100,000 in damages each for the first and second causes of action, and unspecified damages for the third cause of action.

On October 25, 2011, Geico answered the complaint and asserted various affirmative defenses including, as relevant here, that plaintiff did not sustain serious injury or non-economic loss under Insurance Law §§ 5102 and 5014.

Subsequently, plaintiffs move to dismiss four of Geico’s affirmative defenses, plaintiff cross-moved to dismiss Geico’s serious injury affirmative defense, and Geico moved to vacate the note of issue and certificate of readiness. [*4]

Discussion

Plaintiffs move, pursuant to CPLR 3211 (b), to dismiss four of defendant’s affirmative defenses. “A party may move for judgment dismissing one or more defenses, on the ground that a defense is not stated or has no merit” (Mazzei v Kyriacou, 98 AD3d 1088, 1088-1089 [2012], quoting CPLR 3211 [b]). “When moving to dismiss or strike an affirmative defense, the plaintiff bears the burden of demonstrating that the affirmative defense is without merit as a matter of law” (id., [internal quotation marks and citations omitted]). “In reviewing a motion to dismiss an affirmative defense, the court must liberally construe the pleadings in favor of the party asserting the defense and give that party the benefit of every reasonable inference” (id., [internal quotation marks and citations omitted]). “However, where affirmative defenses merely plead conclusions of law without any supporting facts,’ the affirmative defenses should be dismissed pursuant to CPLR 3211 (b)” (Bank of Am., N.A. v 414 Midland Ave. Assoc., LLC, 78 AD3d 746, 750 [2010], quoting Fireman’s Fund Ins. Co. v Farrell, 57 AD3d 721, 723 [2008]).

Here, with respect to defendant’s second affirmative defense, plaintiffs have established that they obtained personal jurisdiction over defendant through documentary evidence. In this regard, plaintiffs have annexed the proof of service, a fee receipt and an acknowledgment from the New York State Insurance Department, confirming that defendant was served with the plaintiffs’ summons and verified complaint on September 27, 2011 pursuant to Insurance Law § 1212. Further, defendant does not oppose this branch of plaintiffs’ motion.

With respect to defendant’s seventh affirmative defense – that plaintiffs’ failed to properly notify defendant of their intent to make an “UM/UIM claim” – as indicated above, plaintiffs sent a Notice of Intention to Make Claim and accompanying correspondence to defendant by letter dated November 30, 2009. Thus, plaintiffs have sustained their burden of demonstrating that this defense is without merit as a matter law because it does not apply under the factual circumstances of this case (Tenore v Kantrowitz, Goldhamer & Graifman, P.C., 76 AD3d 556, 557-558 [2010]). Moreover, defendant does not oppose this branch of plaintiffs’ motion.

Based upon the foregoing, these branches of plaintiffs’ motion to dismiss defendant’s second and seventh affirmative defenses are granted.

As to that branch of plaintiffs’ motion to dismiss defendant’s sixth affirmative defense – asserting that plaintiffs failed to meet conditions precedent to warrant “UM/UIM” benefits – plaintiffs argue that defendant fails to elaborate which conditions precedent they failed to meet. In particular, plaintiffs contend that they fulfilled the three condition precedents necessary to receive UIM/SUM benefits, namely: (1) they sent defendant a Notice of Intention to Make a Claim, (2) defendant admitted exhaustion of Mr. Luna’s policy limits, and (3) that in its June 23, 2011 letter, defendant granted plaintiffs permission to settle with Allstate for its policy limits, set forth two requirements to pursue the underinsured claim, and never stated that plaintiffs failed to meet any conditions precedent.

In opposition to this branch of plaintiffs’ motion, defendant argues that it did not admit [*5]that Mr. Luna’s policy limits were exhausted, but only conceded that Allstate tendered an insurance policy with limits of $25,000 to the plaintiffs.^[FN2] Specifically, defendant argues that there “may have been other applicable insurance policies that plaintiff did not attempt to reach,” and essentially argues that the “affidavit of excess” signed by Mr. Luna is incompetent because it does not reference the accident date and makes “sweeping statements with nothing to support the claims.” Further, defendant asserts that it should be given the opportunity “to explore whether Mr. Luna had other applicable insurance at the time of the accident [and that] [] [i]f so, plaintiff would have failed to meet a pre-condition of bringing this supplementary underinsured motorist claim.”

As plaintiffs’ state in their reply, defendant’s contention that Mr. Luna may have additional coverage is speculative. Moreover, defendant does not dispute that it had the opportunity to determine whether Mr. Luna had any applicable insurance at the time of the accident. Further, defendant has failed to demonstrate that Mr. Luna’s sworn affidavit of excess is incompetent. As noted above, Mr. Luna affirmed that he was not covered under another applicable insurance policy. Although his affidavit does not contain the date of the accident, it contains his policy number, which corresponds to the policy number on the copy of his policy/declaration pages showing the coverages that were on the policy at the time of loss of “10[-]23[-]2007,” as affirmed by an Allstate Claim Support representative in a notarized statement (Plaintiff’s Notice of Motion, Exh. G).

In addition, Mr. Luna’s affidavit was provided to defendant by plaintiffs’ counsel on June 20, 2011 – before defendant gave plaintiffs permission to settle plaintiff’s bodily injury claim with Allstate – which contains the name of the underlying action as well as the claim number for the accident. Finally, as noted immediately above, defendant gave plaintiffs permission to settle with Allstate, and the record does not indicate that defendant advised plaintiffs at any time that it failed to comply with any conditions precedent. Where, as here, an affirmative defense merely pleads conclusions of law without any supporting facts, it should be dismissed.Based on the foregoing, this branch of plaintiffs’ motion to dismiss defendant’s sixth affirmative defense is granted.

Plaintiffs also move to dismiss defendant’s third affirmative defense that plaintiffs did not sustain a serious injury under Insurance Law § 5102 or sustain economic loss under Insurance Law § 5104. Plaintiffs argue that the serious injury threshold does not apply in this action for two reasons. First, plaintiffs contend that is not an action “against another covered person,” since Geico, the defendant, does not qualify as a “covered person” under Insurance Law § 5012 (j). In this regard, section j of Insurance Law § 5102, entitled “Definitions,” provides that:

” Covered person’ means any pedestrian injured through the use or operation of, or any owner, operator or occupant of, a motor vehicle which has in effect the financial security required by article six or eight of the vehicle and traffic law or which is referred to in subdivision two of section three hundred twenty-one of such law; or any other person entitled to first party benefits.” [*6]

Second, plaintiffs assert that this is not an action for “personal injuries” to which the “serious injury” threshold requirement applies under Insurance Law § 5104 (a); rather it is a breach of contract action in which the serious injury threshold is not applicable. Stated otherwise, plaintiff argues that she is not alleging that defendant was negligent in the use or operation of a motor vehicle; rather she contends that this action relates strictly to defendant’s contractual liability based on its “SUM/UIM endorsements.” In this regard, Insurance Law § 5104 (a), entitled “Causes of action for personal injury,” provides, in pertinent part, that:

“(a) Notwithstanding any other law, in any action by or on behalf of a covered person against another covered person for personal injuries arising out of negligence in the use or operation of a motor vehicle in this state, there shall be no right of recovery for non-economic loss, except in the case of a serious injury, or for basic economic loss…” (emphasis added).

Despite the foregoing arguments, plaintiffs concede that “[f]or the sake of full disclosure . . . in Raffellini (v State Farm Mutual Automobile Insurance, 9 NY3d 196 [2007]), the Court of Appeals sided with the Fourth Department (against the Second Department) and found that the serious injury’ [no] [f]ault threshold does apply in the SUM/UIM context.” Nevertheless, plaintiffs go on to state that Raffellini “was strictly predicated on the proper interpretation of two implicitly contradictory provisions of Insurance Law § 3420, that the court “did not consider [their] legal arguments predicated on §§ 5102 and 5104,” and “[t]herefore, notwithstanding the holding in Raffellini, the courts are not foreclosed from considering the same issue on alternate grounds.”

Plaintiffs also contend that even assuming that they are required to demonstrate that they sustained serious injury in order to obtain their SUM coverage, they have already done so do by demonstrating that they sustained over a million dollars in economic damages,^[FN3] and that plaintiff has a “medically determined injury or impairment” which prevented her from “performing substantially all of the material acts that constituted her usual and customary daily activities for not less than ninety days during the one hundred eighty days immediately following the accident.”

This branch of the plaintiffs’ motion must be denied. In Raffellini (9 NY3d at 205), the Court of Appeals held that in an action by an insured against its insurer for supplementary uninsured/underinsured motorist coverage, the plaintiff must prove that he or she sustained a serious injury. The court held that Insurance Law § 3420 (f) (2), which “addresses additional optional personal injury coverage that can be purchased by a policyholder [i.e. SUM coverage],” is an extension of Insurance Law § 3420 (f) (1), the statute which “mandates that insurers provide uninsured motorist coverage in every New York motor vehicle liability policy,” and which conditions payment of mandatory uninsured motorist benefits on a finding that the insured suffered a serious injury as defined in Insurance Law § 5102 (d) (emphasis added) (id. at 200). Thus, the court ruled that the serious injury exclusion of Insurance Law § 3420 (f) (1) applies to supplementary benefits (Insurance Law [*7]§ 3420 [f] [2]), and that therefore an insured must prove serious injury in order to receive supplementary benefits (id. at 204).

Plaintiffs nevertheless argue that the Court of Appeals in Raffellini did not consider their arguments under Insurance Law § 5104 and 5012 (j), and thus may consider them now. This argument must be rejected. As an initial matter, these arguments were raised before the Supreme Court and the Appellate Division, Second Department. Although these courts granted plaintiffs’ motion to strike the insurance company’s serious injury defense, in part, on these grounds, the Court of Appeals came to the opposite conclusion based upon the same facts.

Moreover, the claim that the Court of Appeals did not consider plaintiffs’ arguments under Insurance Law §§ 5104 (a) and 5102 (d) must be rejected since the court relied upon Insurance Law § 5104 in coming to its conclusion. Specifically, the court was unpersuaded that the placement of the serious injury exclusion in Insurance Law § 3420 (f) (1) but not in 3420 (f) (2) reflected a “legislative determination to restrict the serious injury exclusion to mandatory benefits.” In this regard, the court held that:

“such a distinction would not be consistent with the policy underlying supplementary benefits, which are designed to give insureds the same level of protection that would have been available to others under the policy if the insureds were the tortfeasors who caused personal injuries. When an insured injures someone in a motor vehicle accident, the injured party is subject to the serious injury requirement in the No-Fault Law and cannot sue for noneconomic loss unless the serious injury threshold is met (see Insurance Law § 5104 [a]). Since the purpose of supplementary coverage is to extend to the insured the same level of coverage provided to an injured third party under the policy, the insured must also meet the serious injury requirement before entitlement to supplementary benefits. If this were not the case, the insured would receive coverage more comprehensive than that available to a third party injured by the insured (emphasis added).

It is evident from the facts of this case that the application of the serious injury exclusion is consistent with the policy supporting supplementary benefits. Here, plaintiff received payment for his basic economic loss through no-fault benefits. When he sued the negligent party who caused the collision, he was seeking recovery for noneconomic loss. Having obtained the $ 25,000 limit of coverage from the negligent driver’s insurer, he then sought additional noneconomic loss damages under the SUM endorsement to his State Farm insurance policy. Since a third party injured as a result of plaintiff’s negligence would have had to demonstrate serious injury to obtain noneconomic loss damages under plaintiff’s policy, it follows that plaintiff himself must prove serious injury to recover under his SUM endorsement—as Regulation 35-D requires. State Farm is therefore entitled to pursue its serious injury defense” (Raffellini, 9 NY3d at 205).

In any event, based upon the precedent of Raffellini, this court may not entertain plaintiffs’ arguments since, as indicated above, the Court of Appeals has conclusively held that an insurer is entitled to pursue a serious injury defense when sued by its insured for supplementary underinsured motorist benefits. Accordingly, this branch of plaintiffs’ motion [*8]to dismiss defendant’s third affirmative defense is denied.

Cross Motion of Defendant

Defendant cross-moves to dismiss plaintiffs’ second cause of action alleging a breach of the implied covenant of good faith and fair dealing. Defendant argues that plaintiffs cannot recover damages premised upon this cause of action because they have not pled and cannot prove the necessary allegations for bad faith. Defendant also contends that this cause of action seeks punitive damages, which are not available because breach of the implied covenant of good faith and fair dealing is not an independent tort, and because plaintiffs have not alleged that its conduct was egregious and that it was directed toward the public generally (New York Univ. v Cont’l Ins. Co., 87 NY2d 308, 316 [1995]).

In opposition, plaintiffs argue that although this state has not explicitly recognized a bad faith cause of action against a SUM insurer by its insured, the law with respect to SUM coverage is evolving in this state; that defendant has incorrectly characterized this cause of action as one solely for punitive damages so that it could argue that such a claim is not actionable; and that their complaint explicitly alleges “bad faith” as a separate cause of action.

In reply, defendant argues that plaintiffs rely upon the very case law that it had already distinguished in its cross motion; that, contrary to plaintiffs’ claim, it has cited a case which has rejected the application of general principles relating to a bad faith claim in a SUM context (Grinshpun v Travelers Cas. Co. of Conn., 23 Misc 3d 1111A, 2009 NY Slip Op 50706[U] [2009]); and that plaintiffs have conceded that they are seeking punitive damages because their counsel asserts that it is necessary to warn insurance carriers of the potential for “severe consequences” if they do not immediately tender their full SUM coverage upon request.

“In determining a motion to dismiss a cause of action pursuant to CPLR 3211 (a) (7) . . . the pleading is afforded a liberal construction, the facts alleged are accepted as true, and the proponent of the pleading is accorded the benefit of every favorable inference” (J & D Evans Constr. Corp. v Iannucci, 84 AD3d 1171, 1171 [2011]). However, “bare legal conclusions as well as factual claims flatly contradicted by the record are not entitled to any such consideration” (Lutz v Caracappa, 35 AD3d 673, 674 [2006]). Moreover, “[i]f the facts as alleged do not fit within any cognizable legal theory, the cause of action must be dismissed” (Meltzer v Meltzer, 41 AD3d 558, 558 [2007]).

“Implicit in every contract is a covenant of good faith and fair dealing” (Elmhurst Dairy, Inc. v Bartlett Dairy, Inc., 97 AD3d 781, 784 [2012]). “This covenant embraces a pledge that neither party shall do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract” (511 W. 232nd Owners Corp. v Jennifer Realty Co., 98 NY2d 144, 153 [2002] [internal quotation marks and citations omitted]). Further, “[w]hile the duties of good faith and fair dealing do not imply obligations inconsistent with other terms of the contractual relationship, they do encompass any promises which a reasonable person in the position of the promisee would be justified in understanding were included” (id.).

“[C]onsequential damages resulting from a breach of the covenant of good faith and fair dealing may be asserted in an insurance contract context, so long as the damages were [*9] “within the contemplation of the parties as the probable result of a breach at the time of or prior to contracting'”‘(Panasia Estates, Inc. v Hudson Ins. Co., 10 NY3d 200, 203 [2008], quoting Bi-Econony Mkt., Inc. v Harleysville Ins. Co. of N.Y, 10 NY3d 187, 192 [2008], quoting Kenford Co. v County of Erie, 73 NY2d 312, 319 [1989]; see also Stein, LLC v Lawyers Tit. Ins. Corp.,AD3d, 2012 NY Slip Op 7291, *2 [2d Dept 2012]; Hoffman v Unionmutual Stock Life Ins. Co. of NY, 51 AD3d 633, 634 [2d Dept 2008]; Meegan v Progressive Ins. Co., 43 AD3d 182, 186-187 [4th Dept 2007]; Acquista v NY Life Ins. Co., 285 AD2d 73, 80 [1st Dept 2001]; TADCO Constr. Corp. v Allstate Ins. Co., 2011 NY Slip Op 33621[U], *5 [2011]). “Courts also look at what liability the defendant fairly may be supposed to have assumed consciously, or to have warranted the plaintiff reasonably to suppose that it assumed, when the contract was made…'” (TADCO Constr. Corp., 2011 NY Slip Op 33621 [U], *5, quoting Kenford Co., Inc., 73 NY2d at 319). In addition, “[t]he nature, purpose and particular circumstances of the contract are some of the factors to be considered in determining what was in the reasonable contemplation of the parties at the time of the execution of the contract” (id., citing Rose Lee Mfg., Inc. v Chemical Bank, 186 AD2d 548, 551 [1992]). Finally, “[p]roof of consequential damages cannot be speculative or conjectural” (id., citing Ashland Mgt. Inc. v Janien, 82 NY2d 395, 403 [1993]).

Here, plaintiffs’ second cause of action seeks damages for defendant’s alleged bad faith in refusing to pay its policy limits when requested to do so, which “amounted to gross disregard for [their] . . . interests.” However, the cause of action fails to state a viable claim for breach of the covenant of good faith and fair dealing. As an initial matter, as indicated above, defendant’s assertion of a serious injury defense does not constitute bad fath. In any event, plaintiffs fail to allege that the damages they allegedly sustained were contemplated by the parties “as the probable result of a breach at the time of or prior to contracting” (Panasia Estates, Inc., 10 NY3d at 203 [internal quotation marks omitted]), nor does the record reflect that such consequential damages were reasonably contemplated by the parties (see Third Equities Corp. v Commonwealth Land Tit. Ins. Co., 2010 NY Slip Op 33462 [U], *15 [2010]). In addition, plaintiffs do not make this claim in their verified bill of particulars nor do they make this argument in opposition to defendant’s cross motion.

Further, extra-contractual damages have been awarded in cases involving insurance contracts different than the type of insurance contract involved here. For example, Bi-Economy involved a policy that included business interruption insurance which was designed to ensure that the insured had the financial support necessary to sustain its business operation in the event disaster occurred. The court held that plaintiff was entitled to extra contractual damages as a result of the defendant’s bad faith handling of plaintiff’s claim (failing to promptly adjust and pay the loss, resulting in the collapse of the business), because “the very purpose of business interruption coverage would have made [the insurer] aware that if it breached its obligations under the contract to investigate in good faith and pay covered claims it would have to respond in damages to [the insured] for the loss of its business as a result of the breach” (Bi-Economy, 10 NY3d at 195). Similarly, PanasiaEstates, Inc. involved a commercial property insurance policy covering damage to property while undergoing renovation. Rain had entered into the insured’s building resulting in extensive damage, the insurer did not investigate until several weeks later, and then denied the claim [*10]three months afterward. The court held that the insured’s claim for consequential damages based upon the insurer’s alleged failure to promptly investigate the claim was viable because such a claim could be asserted in an insurance context so long as the damages were contemplated by the parties as a probable result of the breach when they entered into the contract (see also Rodriguez v Allstate Ins. Co., 33 Misc 3d 827, 831 [Sup Ct, Kings County, 2011] [plaintiff-insured’s claim for consequential damages, namely car payments she made on a car that she was unable to use but for the defendant insurer’s alleged breach of contract, was a foreseeable consequenceof defendant’s alleged breach of contract];Carden v Allstate Ins. Co., 30 Misc 3d 479, 482 [2010] [under “Deluxe Homeowner’s Policy,” plaintiffs submitted evidence in admissible form that they suffered damages due to the delay in reconstruction of house because of defendant’s bad faith delay in settling their claim – after fire to house and damage to roof, mold developed, and plaintiffs were forced to remain out of dwelling and incur living expenses]; Handy & Harman v American International Group, Inc., 2008 NY Slip Op 32366 [U], *11 [2008] [plaintiff insured sufficiently alleged a claim for consequential damages for breach of the covenant of good faith based on insurer’s alleged failure to fully investigate its claims where purpose of environmental pollution liability policy was to “protect [the insured] from the calamity of unforseen and monumental environmental clean-up costs, and avert risk with regard to such costs and liabilities”]). Thus, in light of the nature of the contract involved here – an automobile liability insurance policy -it cannot reasonably be argued that plaintiffs contemplated receiving consequential damages as a result of defendant’s breach of its implied covenant of good faith and fair dealing

Finally, plaintiffs do not allege that they suffered any damages as a consequence of defendant’s alleged bad faith refusal to pay their claims (Grinshpun, 2009 NY Slip Op 50706[U],*4). In this regard, plaintiffs do not claim that defendant’s refusal to pay them their SUM benefits required them to incur any extra-contractual damages or prevented them from paying for needed medical and/or other living expenses. Thus, this cause of action merely alleges a denial of benefits promised under a policy of insurance (cf. Acquista, 285 AD2d at 80). As such, it is duplicative of plaintiffs’ first cause of action for breach of contract (see Jackson v AXA Equitable Life Ins. Co., 2011 NY Slip Op 32461[U], *3 [2011] [plaintiff’s third cause of action for breach of the covenant of good faith and fair dealing under a disability insurance policy duplicates plaintiff’s breach of contract claim; both claims arise from a dispute over the policy’s obligations and defendants’ satisfaction of them];Authelet v Nationwide Mutual Insurance Company, 2008 NY Slip Op 32929 [U], *3-4 [2008] [the plaintiff-insured’s cause of action alleging breach of the implied covenant of good faith and fair dealing under a homeowner’s policy pled the same conduct which was the predicate of breach of contract cause of action, i.e. the insurer’s failure to pay the full amount of the insured’s claim, and thus was duplicative of insured’s breach of contract claim]). Based upon the foregoing, plaintiffs’ second cause of action fails to state a claim for breach of the implied covenant of good faith and fair dealing. Accordingly, defendant’s motion to dismiss this cause of action is granted.

Defendant moves by order to show cause to vacate the note of issue and certificate of [*11]readiness and to strike this matter from the trial calendar. In support of its motion, defendant argues, among other things, that this action is in its inception, that only preliminary documentary discovery has been exchanged, that there have been no depositions, court conferences, or an independent medical examination of the plaintiff; and that further discovery with respect to plaintiffs’ claim for lost wages is required.

In opposition, plaintiffs assert, among other things, that discovery has already been conducted in the underlying action by Allstate and that additional discovery would be redundant.

In view of the court’s determination denying plaintiffs’ motion to dismiss defendant’s serious injury affirmative defense – requiring further discovery of plaintiffs’ injuries (alleged to be both continuing and permanent) – and in light of the fact that further discovery is required to address the issues set forth by defendant above, the court grants defendant’s motion only to the extent of directing that discovery will continue and that defendant will be permitted to move for summary judgment within 60 days after discovery is complete.

In sum, plaintiffs’ motion to dismiss defendant’s second, sixth, and seventh affirmative defenses is granted, and the motion is otherwise denied. Defendant’s cross motion to dismiss plaintiffs’ second cause of action is granted. Defendant’s application to vacate the note of issue and certificate of readiness is granted only to the extent of directing discovery to continue and to permit defendant to move for summary judgment within 60 days after discovery is complete.

This constitutes the decision and order of the court.

E N T E R

J. S. C.

Footnotes

Footnote 1:Plaintiffs’ counsel represents that “[a]ccording to the GEICO adjustor, there was a determination’ made by the carrier that the claim did not meet the No Fault threshold, and that the claim was probably not even worth $ 25G, and that ALLSTATE had overpaid” (Aff. in Opposition to Defendant’s Cross Motion to Dismiss Plaintiffs’ Second Cause of Action, ¶ 7).

Footnote 2:As indicated above, defendant advised plaintiffs’ counsel that plaintiffs “have GEICO’s permission to settle your client’s Bodily Injury claim with the adverse tort carrier.”

Footnote 3:Plaintiffs have annexed an “Analysis of Economic Loss” prepared by Leonard R. Freifelder, Ph.D., dated January 11, 2010, indicating that plaintiff’s total loss of earnings for the rest of her work life expectancy is $1,095,454 (Plaintiffs’ Notice of Motion, Exh. F).

SUPREME COURT, APPELLATE TERM, FIRST DEPARTMENT

Defendant appeals from an order of the Civil Court of the City of New York, New York County (Manuel J. Mendez, J.), entered February 25, 2011, which denied its motion for summary judgment dismissing the complaint.

Per Curiam.

Order (Manuel J. Mendez, J.), entered February 25, 2011, reversed, with $10 costs, motion granted and complaint dismissed. The Clerk is directed to enter judgment accordingly.

In this action to recover first-party no-fault benefits, the evidentiary proof submitted by defendant-insurer was sufficient to establish, prima facie, that its initial and follow-up verification letters were timely and properly mailed to the plaintiff medical provider’s attorney (see Nassau Ins. Co. v Murray, 46 NY2d 828, 829 [1978]; LMK Psychological Servs., P.C. v Liberty Mut. Ins. Co., 30 AD3d 727, 728 [2006]; Badio v Liberty Mut. Fire Ins. Co., 12 AD3d 229 [2004]), as authorized by plaintiff’s counsel’s prior correspondence to defendant (see St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338, 339-340 [2002]; New York Hosp. Med. Ctr. of Queens v State Farm Mut. Auto. Ins. Co., 293 AD2d 588, 590-591 [2002]). It being undisputed that plaintiff failed to respond to these verification requests, defendant established entitlement to summary judgment dismissing the claim as premature (see St. Vincent Med. Care, P.C. v Country Wide Ins. Co., 80 AD3d 599, 600 [2011]).

In opposition, plaintiff’s attorney’s conclusory denial of receipt of the verification letters was insufficient to raise a triable issue (see Nassau Ins. Co. v Murray, 46 NY2d 828, 829-830 [1978]; Pardo v Central Coop. Ins. Co., 223 AD2d 832, 833 [1996]). We also reject plaintiff’s claim that 11 NYCRR 65-3.6(b) required defendant to issue a delay letter to both plaintiff and its attorney, since that requirement applies only in circumstances, not here present, where information is sought from a party other than the applicant (see Doshi Diagnostic Imaging Servs. v State Farm Ins. Co., 16 Misc 3d 42 [2007]).

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.
Decision Date: November 30, 2012

SUPREME COURT, APPELLATE TERM, FIRST DEPARTMENT

Defendant appeals from an order of the Civil Court of the City of New York, New York County (Ann E. O’Shea, J.), dated September 8, 2011, which denied its motion for summary judgment dismissing the complaint and granted plaintiff’s cross motion for summary judgment.

Per Curiam.

Order (Ann E. O’Shea, J.), dated September 8, 2011, reversed, without costs, plaintiff’s cross motion denied and defendant’s motion for summary judgment dismissing the complaint granted. The Clerk is directed to enter judgment accordingly.

It being undisputed on this record that plaintiff failed to respond to the defendant insurer’s verification requests, defendant established its prima facie entitlement to summary judgment dismissing the underlying first-party no-fault claims as premature (see St. Vincent Med. Care, P.C. v. Country Wide Ins. Co., 80 AD3d 599, 600 [2011]). That defendant requested verification after the 15-day period (11 NYCRR 65-3.5[b]), but before the 30-day claim denial window expired, did not render its requests invalid, but merely reduced the 30-day time period for payment or denial of the claim (see 11 NYCRR 65-3.8[j]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 318 [2007]; Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294, 300 [2007]).

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.
Decision Date: November 28, 2012

District Court of Nassau County, First District

CV-012361-12

Fred J. Hirsh, J.

Defendant State Farm Mutual Automobile Ins. Co., (“State Farm”)moves for summary judgment dismissing this action. Plaintiff Advanced Neurological Care, P.C. (“Advanced”) opposes the motion and cross-moves for summary judgment.

BACKGROUND

This motion raises issues regarding what is an appropriate and sufficient affidavit to establish mailing of verification requests.

Advanced commenced this action seeking to recover first party no-fault benefits for MRI’s it performed on Daisha Sylvester on January 17, 2012 and other treatment provided on January 24, 2012.

Advanced mailed the claims for the services proved on both dates to State Farm at a post office box in Ballston Spa, New York. State Farm acknowledges receipt of the claim relating to the testing provided by Advanced on January 24, 2012 at its Ballston Spa office on February 6, 2012. State Farm acknowledges receipt of the claim for the services provided on January 17, 2012 at its Ballston Spa office on February 9, 2012.

Precisely what happened to the claim after it was received by State Farm in Ballston Spa is not clear.

Laura Brooks (“Brooks”), a State Farm Claims Representative sent a verification request to Advanced dated February 24, 2012 seeking a letter of medical necessity for the MRI. This verification request relates to the MRIs performed on Sylvester by Advanced on January 24, 2012. The letter does not indicate which State Farm office at which it was prepared and mailed. The return address on the letter is “State Farm Claims, P.O. Box 106107, Atlanta, Georgia 30348-6107.”

Brooks sent a follow-up verification request dated March 1, 2012 again seeking a letter of medical necessity for the MRIs. This request has the aforementioned Atlanta, Georgia return address.

State Farm sent a second verification request to Advanced dated March 1, 2012 over the signature of Jessalie Smith (“Smith”), Claim Processor advising Advanced the processing of the claim was being delayed because State Farm had not yet received an [*2]Application for No-Fault Benefits from Sylvester and requesting Advanced provide State Farm with handwritten/typed office notes. This verification request relates to the treatment provided to Sylvester by Advanced on January 17, 2012. The record does not reflect which State Farm office in which Jessalie Smith works. The return address on this letter is “State Farm Claims, P. O. Box 106017, Atlanta, Georgia 30348-6107”.

Smith sent a “Second Request” to Advanced dated April 9, 2012 again requesting Advanced’s handwritten/typed office notes and advising Advanced the it had not yet received an Application for No-Fault Benefits from the Sylvester. This letter also reflects the Atlanta, Georgia address.

The affidavit made in support of the motion attesting to the practices and procedures of State Farm regarding the preparation and mailing of the verification requests is made by Monique Rivas (“Rivas”). Rivas avers she is employed by State Farm as a No-Fault Claims Representative. Rivas states this claim has been assigned to State Farm’s Lakeville, New York office.^[FN1] Rivas affidavit does not state which State Farm office she worked at when the claim was received or the verification requests were prepared or mailed. Rivas affidavit does not state which State Farm office prepared and mailed the verification requests.

Rivas states the February 24, 2012 verification request would have been mailed on that day. Rivas avers since State Farm did not receive a response to its February 24, 2012 letter, Brooks issued a second request for this information six (6) days later by Brooks, March 1, 2012 letter.^[FN2]

Rivas avers that Smith’s March 1, 2012 verification request would have been mailed that date. Rivas avers since Advanced did not respond to Smith’s March 1, 2012 verification request, Smith issued her follow up letter of April 9, 2012. Rivas avers the April 9, 2012 letter would have been mailed that day.

Rivas does not indicate in which State Farm office Brooks or Smith work or the basis of her familiarity with the practices and procedures of that office for preparing, addressing and mailing verification requests. In fact, Rivas affidavit does not truly discuss State Farms procedures for preparing, addressing and/or mailing verification requests. Rivas affidavit primarily address State Farm’s practices and procedures used to prepare, address and mail denials.

State Farm supplements the Rivas affidavit with an affidavit of George Perry, a Claims Support Supervisor in State Farm’s Ballston Spa office. His affidavit also [*3]primarily addresses State Farm’s procedures for preparing, addressing and mailing Denials of Claims, the NF-10. His affidavit states the same procedures used to prepare, issue, address and mail an NF-10 is used for all other correspondence issued by State Farm in connection with no-fault claims including verification requests almost as an afterthought,

Perry’s affidavit does not state in which State Farm office Brooks and/or Smith work, where the verification requests they issued prepared, addressed and/or mailed and if the procedures in that office are the same as those described by Perry for documents prepared, addressed and/or mailed from State Farm’s Ballston Spa office.

Advanced cross-moves for summary judgment on the grounds State Farm did not pay or deny the claim within 30 days of submission. Advanced submits affidavits from Enrique Escala attesting to the mailing of the claim for $1758.38 on February 1, 2012. In addition to submitting the No-Fault Claim Form, Advanced also sent a copy of the MRI reports for the MRIs of the left shoulder and cervical spine and the required assignment.

Advanced submits an affidavit from Kerin Hausknecht, M.D. establishing the claims forms and other documents submitted in connection with the claim are records and documents prepared in the regular course of Advanced’s business. Dr. Hausknecht asserts the claims were neither paid nor denied. Payments of the claims is now overdue.

In opposition to defendant’s motion for summary judgment, plaintiff submits an affidavit from Maureen Cronin. Her affidavit states Advanced’s claim was submitted to State Farm by Israel, Israel & Purdy, LLP, plaintiff’s attorney. The claim is accompanied by a letter advising State Farm any requests for verification including requests for medical records should be should be forwarded to Israel, Israel & Purdy, LLP who will make arrangements for providing the requested verification. Cronin’s affidavit describes her office practices and procedures for processing and responding to verification requests received in connection with no-fault claims. She states a review of the office file establishes Israel, Israel & Purdy, LLP never received the verification requests alleged to have been mailed by State Farm.

State Farm did not pay or deny the Advanced claims. State Farm moves for summary judgment on the grounds the claims are premature because its time to pay or deny the claims has not yet begun to run because Advanced has not responded to the verification requests.

Advanced moves for summary judgment on the grounds it timely submitted the claim and the claim was not paid or denied within 30 days of submission.

DISCUSSION

An insurer has 15 business days form receipt of a claim to request additional verification of a claim. 11 NYCRR 65-3.5(b). If the material or documentation sought by way of verification is not provided to the insurer within 30 calendar days of the original request, “…the insurer, shall, within 10 calendar days, follow up with the party from whom verification was requested.” 11 NYCRR 65-3.6(b).

An insurer’s time to pay or deny a claim it tolled or extended until it receives all timely and properly requested verification. Hospital for Joint Disease v. New York Central Mutual Fire Ins. Co., 44 AD3d 903 (2nd Dept. 2007); and 11 NYCRR 65-3.5(c); [*4]and 11 NYCRR 65-3.8(a)(1). An insurer does not have to pay or deny a claim until it receives all timely requested verification. St. Barnabas Hosp. v. American Transit Ins. Co., 57 AD3d 517 (2nd Dept. 2008); Mount Sinai Hosp. v. Chubb Group of Insurance Companies, 43 AD3d 899 (2nd Dept. 2007); and New York & Presbyterian Hosp. v. Progressive Cas. Ins. Co., 5 AD3d 569 (2nd Dept. 2004): and 11 NYCRR 65-3.5(c).

Even though State Farm did not comply with the provisions relating to follow-up verification in regard to the verification requests prepared by Laura Brooks, Advanced failure to respond to the original verification request would ordinarily result in the court dismissing the action as premature. St. Vincent’s Medical Care, P.C. v. Country Wide Insurance Co., 80 AD3d 599 (2nd Dept. 2011); and Infinity Health Products, Ltd. v Eveready Ins. Co., 67 AD3d 862 (2nd Dept. 2009).

In order to obtain summary judgment, the insurer must establish timely mailing of a properly addressed verification request. Timely mailing can be established by submitting an affidavit or affidavits from the claims representatives and insurance company employees who actually prepared and mailed the verification request. South Nassau Orthopedic Surgery and Sports Medicine, P.C. v. Auto One Ins. Co., 32 Misc 3d 129(A) (App.Term 2nd, 11th & 13th Jud. Dists.); Friendly Physicians, P.C. v. Geico Ins. Co., 29 Misc 3d 128(A) (App.Term 2nd, 11th & 13th Jud. Dists. 2010); and Points of Health Acupuncture, P.C. v. Geico Ins. Co., 25 Misc 3d 140(A) (App.Term 2nd , 11th & 13th Jud. Dists. 2009). In this case, State Farm has not submitted an affidavit from either Laura Brooks or Jessalie Smith attesting to the preparation of the verification requests or affidavits from anyone attesting to the actual mailing of those requests.

Timely mailing can also be established by an affidavit from an employee with knowledge of the party’s standard office practices and procedures designed to ensure the items were properly addressed and timely mailed. St. Vincent’s Hosp. of Richmond v. Government Empls. Ins. Co., 50 AD3d 1123, 1124 (2nd Dept. 2008).

While the Appellate Term has frequently and repeatedly cited St. Vincent’s, there is little in the Appellate Term’s decisions indicating precisely who can or should be making the affidavit and what information must be contained in the affidavit establishing the verification request has been timely prepared. properly addressed and timely mailed. In almost all instances, the decisions of the Appellate Term on the issue of mailing simply state the affidavit attesting to the insurer’s practices and procedures was sufficient to demonstrate the verification request or denial was properly addressed and timely mailed. See, e.g. Khodadadi v. Clarendon Ins. Co., 37 Misc 3d 130(A) (App.Term 9th & 10th Jud. Dists. 2012); Brownsville Advanced Medical, P.C. v. Kemper Independence Ins. Co., 36 Misc 3d 146(A) (App.Term 9th & 10th Jud. Dists. 2012); All County, LLC v. Unitrin Advantage Ins. Co., 31 Misc 3d 134(A) (App.Term 9th & 10th Jud Dists. 2011); Crescent Radiology, PLLC v. American Transit Ins. Co., 31 Misc 3d 134(A) (App. Term 9th & 10th Jud. Dists. 2011); Elmont Open MRI & Diagnostic Radiology, P.C. v. Travelers Indemnity Co., 30 Misc 3d 126(A), (App. Term 9th & 10th Jud. Dists. 2010).

If the person making the affidavit attesting to the timely mailing of the verification request is not the person who actually prepared, addressed and mailed the verification request, that person attesting to the insurer’s mailing practices and procedures must establish a familiarity with the practices and procedures used in the office in which the [*5]verification notice was generated, the standard office practices and procedures used for mailing the notice from the office at which it was generated including how the mail was picked up during the work day, when the mail would be delivered to or picked up by the Postal Service and what steps would be taken if the letter was returned as undeliverable. Lenox Hill Radiology, P.C. v. Tri-State Consumer Insurance Co., 31 Misc 3d 13 (App.Term 1st Dept. 2010); See also, Orthotech Express Corp. v. MVAIC, 37 Misc 3d 128(A) (App.Term 1st Dept. 2012).

In this case, neither the Rivas nor Perry affidavits establish at which State Farm office the verification requests were generate or mailed. Neither Rivas nor Perry aver to having personal knowledge regarding the preparation, addressing or mailing of these verification requests. Rivas and Perry work in different offices State Farm offices several hundred miles apart. Neither of their affidavits explain why the verification requests have an Atlanta, Georgia return address. Neither appear to work for State Farm in the office that prepared the verification notices or are personally familiar with the practices and procedures in place in the office at which these notices were mailed for ensuring the notices were properly addressed and properly mailed. In the absence of proof establish a familiarity with the practices and procedures employed by the office generating and mailing the verification request, summary judgment the affidavits are insufficient to establish “…designed to ensure that items were properly addressed and mailed (citations omitted)”. St. Vincent’s Hosp. of Richmond v. Government Empls. Insurance Co., supra at 1124; and Orthotech Express Corp. v. MVAIC, supra.

If a claimant fails to respond to the original verification request within 30 calendar days after the original request, the insurer must send out a follow up request within10 calendar days. 11 NYCRR 65-3.6(b). The follow up request must advise the claimant and the claimant’s attorney of the reasons why payment of the claim is being delayed by identifying the in writing the missing verification. Id. State Farm knew the Advanced was represented by an attorney. Brooks follow up letter does not indicate is was sent to Advanced’s attorney.

Smith’s follow up letter indicates a copy was mailed to Israel, Israel & Purdy.

The Cronin affidavit submitted by Advanced raises questions of fact regarding the mailing of this follow up verification request. Cronin’s affidavit establishes her offices practices and procedures for receiving, processing and responding to verification requests. She further states that based upon her review of the office records, her office never received Smith’s follow up verification request.

Mere denial of receipt of a verification request is insufficient to overcome the presumption of mailing. Darlington Medical Diagnostics, P.C. v. Praetorian Ins. Co., 32 Misc 3d 142(A) (App.Term 1st Dept. 2011); and Pomona Medical Diagnostics, P.C. v. Travelers Ins. Co., 31 Misc 3d 127(A) (App.Term 2nd, 11th & 13th Jud. Dists. 2011). However, if an insurer can establish through an affidavit of any employee attesting to the insurer’s practices and procedures for processing and timely mailing verification requests or denials, a provider should be able to establish non-receipt of a verification request by providing an affidavit detailing the providers practices and procedures for receiving, acknowledging receipt and responding to verification requests. See, St. Vincent’s Hosp. of Richmond v. Government Empls. Ins. Co., supra.

Brooks was advised by the letter transmitting the claim verification requests [*6]should be sent to Israel, Israel & Purdy. Despite being so advised, Brooks and State Farm did not send the original verification request to Israel, Israel & Purdy. Brooks March 1, 2012 follow-up verification request is not addressed to or copied to Israel, Israel & Purdy. Therefore, questions of fact exist as to whether the verification requests were properly addressed.

Smith also was or should have known verification requests were to be mailed to Israel, Israel & Purdy in addition to the provider. Despite this, the original verification request was sent only to Advanced. While Smith’s follow-up verification request was mailed to the provider and copied to Israel, Israel & Purdy, Cronin’s affidavit detailing Israel, Israel & Purdy’s practices and procedures for receiving, logging-in and responding to verification requests raises questions of fact regarding whether the follow-up verification request was properly addressed and timely mailed to the parties required by the regulations. See, 11 NYCRR 65-3.6(b).

The court also notes State Farm offers no explanation for why the claim was being handled by two different claims representatives in the same office or why the first verification request did not advise Advanced Sylvester had not filed an application for no-fault benefits while the later verification request does.

Since questions of fact exist regarding whether the verification requests and follow-up verification requests were properly addressed and timely mailed, defendant’s motion for summary judgment is denied.

Plaintiff has established a prima facie entitlement to judgment as a matter of law. The affidavits submitted by plaintiff coupled with State Farms acknowledgment of the receipt of claims within 45 days of the date the service were provided are sufficient to establish timely submissions of the claim. A.B. Medical Services PLLC v. Utica Mut. Ins. Co., 10 Misc 3d 50 (App.Term 2nd & 11th Jud. Dists. 2005); and 11 NYCRR 65-1.1. The Hausknecht affidavit establishes the documents submitted in support of the claim were business records of Advanced. Art of Healing Medicine, P.C. v. Travelers Home & Mar. Ins. Co., 55 AD3d 644 (2nd Dept. 2008); Bath Medical Supply, Inc. v. Utica Mutual Ins. Co., 23 Misc 3d 141(A) (App. Term, 2nd, 11th and 13th Jud. Dists. 2009); and Bajaj v. General Assurance Co., 18 Misc 3d 25 (App.Term 2nd & 11th Jud. Dists. 2007). The claims were not paid or denied within 30 days of receipt. 11 NYCRR 65-3.8(a).

Since questions of fact exist regarding whether State Farm timely mailed, properly addressed verification requests and follow-up verification requests, the court cannot grant plaintiff’s cross-motion for summary judgment, As discussed above, if the court were to ultimately find the verification requests were properly addressed and timely mailed, the action would be dismissed as premature.

For the foregoing reasons, defendant’s motion and plaintiff’s cross-motion are denied.

SO ORDERED:

Hon. Fred J. Hirsh

District Court Judge [*7]

Dated: November 26, 2012

cc:Israel, Israel & Purdy, LLP

Robert T. Lau & Associates

Footnotes

Footnote 1:Lakeville, New York is located in Livingston County. The court may take judicial notice of location of communities. Prince, Richardson On Evidence 11th Ed. §2-204(a) (Farrell 1995). Even though Lakeville, New York is located in Livingston County, Rivas affidavit is notarized by a notary qualified Nassau County.

Footnote 2:February 24, 2012 was a Friday. If the letter was mailed on Friday, it is unlikely the letter was received by Advanced until the next business day, Monday February 27th. Even if Advanced had received and mailed out a response, it is unlikely the response would have been received and processed by State Farm by the time it sent out the follow-up, second request on March 1, 2012.

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, deemed from a judgment of the same court entered May 26, 2011 (see CPLR 5512 [a]). The judgment, entered pursuant to the May 2, 2011 order granting plaintiff’s motion for summary judgment and denying defendant’s cross motion for summary judgment dismissing the complaint, awarded plaintiff the principal sum of $3,236.

ORDERED that the judgment is reversed, with $30 costs, the order entered May 2, 2011 is vacated, plaintiff’s motion for summary judgment is denied 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 from an order of the Civil Court entered May 2, 2011 which granted plaintiff’s motion for summary judgment and denied defendant’s cross motion for summary judgment dismissing the complaint. Defendant’s appeal is deemed to be from the judgment entered pursuant to the order (see CPLR 5512 [a]).

The affidavit of defendant’s no-fault claims examiner established that defendant had timely mailed its verification requests and follow-up verification requests (see St. Vincent’s [*2]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 demonstrated that it had not received all of the verification requested, and plaintiff did not demonstrate that such verification had been provided to defendant prior to the commencement of the action. Consequently, the 30-day period within which defendant was required to pay or deny the claims did not begin to run (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]; 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]; D & R Med. Supply v. American Tr. Ins. Co., 32 Misc 3d 144[A], 2011 NY Slip Op 51727[U] [App Term, 2d, 11th & 13th Jud Dists 2011]), and plaintiff’s action is premature.

Accordingly, the judgment is reversed, the order entered May 2, 2011 is vacated, plaintiff’s motion for summary judgment is denied and defendant’s cross motion for summary judgment dismissing the complaint is granted.

Rios, J.P., Aliotta and Solomon, JJ., concur.
Decision Date: November 26, 2012

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 (Peter Paul Sweeney, J.), entered January 12, 2011. The order granted defendant’s motion for leave to reargue its prior cross motion for summary judgment dismissing the complaint and, upon reargument, vacated the prior order and granted defendant’s cross motion for summary judgment.

ORDERED that the order is affirmed, with $25 costs. In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant cross-moved for summary judgment dismissing the complaint, arguing that plaintiff was not entitled to receive no-fault benefits since plaintiff had failed to respond to its verification requests. By order dated March 4, 2010, the Civil Court denied both motions, and found that plaintiff had “established [its] prima facie case” and that defendant had “established its proper and timely mailing of its denials.” Thereafter, defendant moved for leave to reargue its cross motion for summary judgment. The Civil Court granted leave to reargue and, upon reargument, granted defendant summary judgment dismissing the complaint, finding that since plaintiff had [*2]not responded to defendant’s verification requests, defendant “does not have to pay or deny a claim until it has received all relevant verification [and, therefore,] the within action was prematurely commenced.”

The affidavit submitted by defendant in support of its cross motion established that defendant had timely mailed its requests and follow-up requests for verification (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 demonstrated that it had not received the requested verification, and plaintiff did not show that such verification had been provided to defendant prior to the commencement of the action. Consequently, the 30-day period within which defendant was required to pay or deny the claims did not begin to run (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]; 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]; D & R Med. Supply v American Tr. Ins. Co., 32 Misc 3d 144[A], 2011 NY Slip Op 51727[U] [App Term, 2d, 11th & 13th Jud Dists 2011]). As a result, defendant established its entitlement to summary judgment dismissing the complaint.

Accordingly, the order is affirmed.

Rios, J.P., Aliotta and Solomon, JJ., concur.
Decision Date: November 26, 2012