SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Nassau County, Third District (Fred J. Hirsh, J.), dated September 8, 2009. The order denied plaintiff’s motion to strike defendant’s demand for a trial de novo.

ORDERED that the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, the parties stipulated, among other matters, to plaintiff’s prima facie case, defendant’s timely denial of the claim, the physician-peer reviewer’s medical qualifications, and the admissibility of the documents on which the reviewer relied. The parties participated in mandatory arbitration (see Rules of the Chief Judge [22 NYCRR] part 28), which resulted in a ruling in plaintiff’s favor, whereupon defendant served and filed a demand for a trial de novo (Rules of the Chief Judge [22 NYCRR] § 28.12 [a]). Plaintiff moved to strike the demand, arguing that defendant’s limited participation in the arbitration, which consisted of defendant’s attorney’s appearance and his offer of various documents, which were excluded upon plaintiff’s hearsay objection, amounted to a default, barring defendant from demanding a trial de novo. Defendant opposed, and the District Court denied the motion, finding that, on the facts, defendant had not defaulted. Plaintiff appeals and we affirm.

The Rules of the Chief Judge provide that a demand for a trial de novo “may be made by any party not in default” (Rules of the Chief Judge [22 NYCRR] § 28.12 [a]). A party’s failure to appear for an arbitration hearing constitutes a default (Rules of the Chief Judge [22 NYCRR] § 28.7 [a]), as does a party’s appearance by counsel who otherwise “refus[es] to participate in the hearing” (Bitzko v Gamache, 168 AD2d 888 [1990]; see also Finamore v Huntington [*2]Rehabilitation Assn., 150 AD2d 426 [1989]). However, where, as here, a party’s attorney appears at the arbitration, participates in the hearing and submits evidence which, if admissible, would have tended to rebut the plaintiff’s case, there is no default within the contemplation of the Rules of the Chief Judge merely because the arbitrator ruled the proof inadmissible (see Tripp v Reitman Blacktop, 188 Misc 2d 317 [App Term, 9th & 10th Jud Dists 2001]; San-Dar Assoc. v Adams, 167 Misc 2d 727 [App Term, 1st Dept 1996]).

Accordingly, the District Court properly denied plaintiff’s motion to strike defendant’s demand for a trial de novo.

Nicolai, P.J., Tanenbaum and LaCava, JJ., concur.
Decision Date: January 18, 2011

—[*1] McDonnell & Adels, PLLC, Garden City, N.Y. (James J. Cleary, Jr., and Jannine Gordineer of counsel), for appellant.

Joseph Henig, P.C., Bellmore, N.Y., for respondent.

In an action to recover no-fault medical payments under certain contracts of insurance, the defendant appeals from an order of the Supreme Court, Nassau County (Lally, J.), entered December 21, 2009, which denied its motion to vacate a judgment of the same court entered March 12, 2009, which, upon its failure to appear or answer the complaint, was in favor of the plaintiff and against it in the principal sum of $29,103.60, and to compel the plaintiff to accept a late answer pursuant to CPLR 3012 (d), and held in abeyance and referred for a hearing the plaintiff’s motion to hold it in contempt for failure to comply with an information subpoena dated March 30, 2009, and its cross motion to quash the information subpoena.

Ordered that the appeal from so much of the order entered December 21, 2009, as held in abeyance and referred for a hearing the plaintiff’s motion to hold the defendant in contempt for failure to comply with an information subpoena dated March 30, 2009, and the defendant’s cross motion to quash the information subpoena is dismissed; and it is further,

Ordered that the order entered December 21, 2009, is reversed insofar as reviewed, on the facts and in the exercise of discretion, the defendant’s motion to vacate the judgment entered March 12, 2009, and to compel the plaintiff to accept a late answer pursuant to CPLR 3012 (d) is granted, the judgment entered March 12, 2009, is vacated, and the answer annexed to the motion papers is deemed timely served upon the plaintiff; and it is further,

Ordered that one bill of costs is awarded to the defendant.

The order entered December 21, 2009, did not decide the plaintiff’s motion to hold the defendant in contempt for failure to comply with an information subpoena dated March 30, 2009, or the defendant’s cross motion to quash the information subpoena, but instead, held that motion and cross motion in abeyance and referred them for a hearing. Accordingly, no appeal lies as of right from that portion of the order (see CPLR 5701 [a] [2] [v]; Evan S. v Joseph R., 70 AD3d 668 [2010]; Quigley v Coco’s Water CafÉ, Inc., 43 AD3d 1132 [2007]), and we decline to grant leave.

A defendant seeking to vacate a judgment entered on default must demonstrate a [*2]reasonable excuse for its delay in appearing or answering the complaint and a potentially meritorious defense to the action (see CPLR 5015 [a] [1]; Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141 [1986]; Taddeo-Amendola v 970 Assets, LLC, 72 AD3d 677 [2010]). The defendant established through an employee’s affidavit, which attested to a clerical oversight regarding the delay in forwarding the summons and complaint to its attorney, a reasonable excuse for the short period of time following service of the complaint in which it failed either to appear or answer the complaint (see Perez v Travco Ins. Co., 44 AD3d 738 [2007]; Sound Shore Med. Ctr. v Lumbermens Mut. Cas. Co., 31 AD3d 743 [2006]). Furthermore, the defendant demonstrated that it has a potentially meritorious defense to the action. Accordingly, the Supreme Court improvidently exercised its discretion in denying the defendant’s motion to vacate its default and to compel acceptance of its answer in light of the strong public policy that actions be resolved on their merits, the brief delay involved, the defendant’s lack of willfulness, and the absence of prejudice to the plaintiff (see Perez v Travco Ins. Co., 44 AD3d 738 [2007]; New York & Presbyt. Hosp. v American Home Assur. Co., 28 AD3d 442 [2006]). Dillon, J.P., Balkin, Leventhal and Chambers, JJ., concur.

Motion by the respondent on an appeal from an order of the Supreme Court, Nassau County, entered December 21, 2009, to dismiss so much of the appeal as held in abeyance and referred for a hearing the respondent’s motion to hold the appellant in contempt for failure to comply with an information subpoena dated March 30, 2009, and the appellant’s cross motion to quash the information subpoena, on the ground that said portion of the order is not appealable as of right. By decision and order on motion of this Court dated September 1, 2010, inter alia, the motion was referred to the panel of Justices hearing the appeal for determination upon the argument or submission thereof.

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

Ordered that the motion is denied as academic in light of our determination on the appeal. Dillon, J.P., Balkin, Leventhal and Chambers, JJ., concur.

APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT

Defendant appeals from those portions of an order of the Civil Court of the City of New York, Bronx County (Elizabeth A. Taylor, J.), dated April 6, 2010, which denied its motion for summary judgment dismissing the claims of plaintiffs Spring Medical, P.C. and Right Aid Diagnostic Medicine, P.C. Per Curiam.

Order (Elizabeth A. Taylor, J.), dated April 6, 2010, insofar as appealed from, modified to grant defendant summary judgment dismissing the claims of plaintiff Spring Medical, P.C.; as modified, order affirmed, without costs.

Defendant made a prima facie showing of entitlement to judgment as a matter of law dismissing plaintiff Spring Medical, P.C.’s claims for assigned first-party no-fault benefits. Defendant established through the affidavit of its claims examiner and excerpts from the Workers’ Compensation Medical Fee Schedule, which may be judicially noticed by this Court (see Kingsbrook Jewish Med. Ctr. v Allstate Ins. Co., 61 AD3d 13, 21 [2009]), that the fees Spring charged for the medical services it rendered to the assignor exceeded the relevant rates set forth in the fee schedule. In opposition, Spring failed to raise a triable issue regarding [*2]defendant’s interpretation of the fee schedule or calculation of the applicable fees. Therefore, defendant’s motion for summary judgment dismissing Spring’s claims — which sought the difference between the amount Spring charged for the services and payments defendant made to Spring pursuant to the fee schedule — should have been granted (see Cornell Med., P.C. v Mercury Cas. Co., 24 Misc 3d 58 [2009]).

Defendant’s motion for summary judgment dismissing the claim of plaintiff Right Aid Diagnostic Medicine, P.C. based on lack of medical necessity was properly denied, since defendant did not demonstrate as a matter of law that it timely denied the claim within the statutory 30-day period (see Country-Wide Ins. Co. v Zablozki, 257 AD2d 506 [1999], lv denied 93 NY2d 809 [1999]) or that the 30-day period was tolled by a proper verification request (see Nyack Hosp. v Encompass Ins. Co., 23 AD3d 535 [2005]). We note in this connection that the reply affirmation submitted by Right Aid could not be considered for the purpose of showing a prima facie entitlement to summary judgment (see Batista v Santiago, 25 AD3d 326 [2006]).
THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.
I concur
Decision Date: January 14, 2011

—[*1] Freiberg & Peck, LLP, New York, N.Y. (Rachel N. Clark and Yilo K. Kang of counsel), for appellants.

Joseph Henig, P.C., Bellmore, N.Y., for respondent.

In an action to recover assigned first-party no-fault benefits for medical services rendered, the defendants appeal from an order of the Supreme Court, Nassau County (Palmieri, J.), entered October 15, 2009, which granted the motion of the plaintiff New York and Presbyterian Hospital for summary judgment on its second cause of action, and denied the defendants’ cross motion for summary judgment dismissing the second cause of action.

Ordered that the order is affirmed, with costs.

The plaintiff New York and Presbyterian Hospital (hereinafter the plaintiff) established, prima facie, its entitlement to judgment as a matter of law with respect to the second cause of action by demonstrating that the necessary billing documents were mailed to and received by the defendant and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [a] [1]; Westchester Med. Ctr. v Progressive Cas. Ins. Co., 51 AD3d 1014, 1017 [2008]; New York & Presbyt. Hosp. v Countrywide Ins. Co., 44 AD3d 729 [2007]; Westchester Med. Ctr. v Liberty Mut. Ins. Co., 40 AD3d 981, 981-982 [2007]).

In opposition to that prima facie showing, the defendants failed to raise a triable issue of fact as to whether they timely denied the claim. The evidence submitted by the plaintiff showed that the no-fault billing claim form was received by the defendants on May 15, 2009. The defendants submitted, inter alia, copies of letters that they sent to their insured dated April 27, 2009, and May 28, 2009, respectively, as well as copies of letters that they sent to the plaintiff on May 14, 2009, and June 15, 2009, respectively, seeking additional verification. However, the April 27, 2009, and May 14, 2009, letters were sent prior to the defendants’ receipt of the no-fault billing form, and the remaining letters were sent more than 10 days after the defendants’ receipt of that form. Consequently, those letters failed to toll the period in which the defendants were required to pay or deny the claim (see 11 NYCRR 65-3.5). In this regard, although the defendants stated, in their motion for summary judgment, that they first received the no-fault bill on May 7, 2009, or on May 9, 2009, the defendant did not establish that fact by submitting a copy of the bill [*2]received on one of those dates. Therefore, the defendants failed to submit evidence raising a triable issue of fact as to whether they timely denied the claim after issuing timely requests for additional verification (see 11 NYCRR 65-3.5; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]).

Moreover, although the defendants contend that they submitted evidence showing that the plaintiff’s assignor misrepresented his state of residence in connection with the issuance of the subject insurance policy, the defendants are precluded from asserting that defense, as a result of their untimely denial of the claim (see Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 564 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 319; Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 60 AD3d 1045, 1046-1047 [2009]).

Although the defendants contend, on appeal, that North Carolina law should apply to this action, and that New York law does not preclude them from denying coverage, they did not raise that specific argument before the Supreme Court. Consequently, that contention is not properly before this Court (see Boudreau-Grillo v Ramirez, 74 AD3d 1265, 1268 [2010]; Matter of Panetta v Carroll, 62 AD3d 1010 [2009]). Dickerson, J.P., Hall, Austin and Cohen, JJ., concur.

—[*1] Jaffe & Koumourdas, LLP, New York, N.Y. (Jean H. Kang of counsel), for appellant.

In an action to recover assigned first party no-fault medical payments under an insurance contract, the defendant appeals, by permission, as limited by its brief, from so much of an order of the Appellate Term, Second, Eleventh, and Thirteenth Judicial Districts, dated May 8, 2009, as modified a judgment of the Civil Court of the City of New York, Queens County (Lebedeff, J.), entered February 19, 2008, which, upon an order of the same court (Lebedeff, J.), dated January 23, 2008, inter alia, granting the plaintiff’s motion for summary judgment and denying its cross motion for summary judgment dismissing the complaint, is in favor of the plaintiff and against it in the principal sum of $2,856.45 only to the extent of reducing the award to the principal sum of $2,627.90.

Ordered that the order dated May 8, 2009, is reversed insofar as appealed from, on the facts and in the exercise of discretion, with costs, the judgment of the Civil Court of the City of New York, Queens County, entered February 19, 2008, is reversed, the plaintiff’s motion for summary judgment is denied, the defendant’s cross motion for summary judgment dismissing the complaint is granted, without prejudice to the commencement of a new action, and the order dated January 23, 2008, is modified accordingly.

Contrary to the conclusion of the Appellate Term, under the circumstances of this case, the defendant insurer’s submission of follow-up verification requests to the plaintiff medical provider on the 30th day after the defendant sent its initial verification requests was not premature or “without effect” (Infinity Health Prods., Ltd. v Eveready Ins. Co., 67 AD3d 862, 864 [2009]). Furthermore, since the plaintiff did not fully comply with the defendant’s verification requests, the 30-day period within which the defendant was required to pay or deny the claim did not commence to run (see 11 NYCRR 65-3.8 [a] [1]; [b] [3]; Infinity Health Prods., Ltd. v Eveready Ins. Co., 67 AD3d at 865; Westchester County Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 262 AD2d 553 [1999]). Thus, the action was commenced prematurely (see Hospital for Joint Diseases v New York Cent. Mut. Fire Ins. Co., 44 AD3d 903 [2007]; Hospital for Joint Diseases v ELRAC, Inc., 11 AD3d 432 [2004]).

Accordingly, the plaintiff’s motion for summary judgment should have been denied, and the defendant’s cross motion for summary judgment dismissing the complaint should have been granted (see [*2]Westchester County Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 262 AD2d at 553; see generally Alvarez v Prospect Hosp., 68 NY2d 320 [1986]), without prejudice to commencement of a new action. Prudenti, P.J., Angiolillo, Florio and Sgroi, JJ., concur.

—[*1] Jaffe & Koumourdas, LLP, New York, N.Y. (Jean H. Kang of counsel), for appellant.

In an action to recover assigned first-party no-fault benefits under an insurance contract, the defendant appeals, by permission, from an order of the Appellate Term, Second, Eleventh, and Thirteenth Judicial Districts, dated May 8, 2009, which affirmed an order of the Civil Court of the City of New York, Queens County (Lebedeff, J.), dated August 1, 2007, denying the defendant’s motion for summary judgment dismissing the complaint.

Ordered that the order dated May 8, 2009, is reversed, on the facts and in the exercise of discretion, with costs, the order of the Civil Court of the City of New York, Queens County, dated August 1, 2007, is reversed, and the defendant’s motion for summary judgment dismissing the complaint is granted, without prejudice to the commencement by the plaintiff of a new action.

Contrary to the conclusion of the Appellate Term, under the circumstance of this case, the defendant insurer’s submission of follow-up verification requests to the plaintiff medical provider on the 30th day after the defendant sent its initial verification requests was not premature or “without effect” (see St. Vincent Med. Care, P.C. v Country-Wide Ins. Co., 80 AD3d 599 [2011] [decided herewith]).

Accordingly, the defendant’s motion for summary judgment dismissing the complaint should have been granted. Prudenti, P.J., Angiolillo, Florio and Sgroi, JJ., concur.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Nassau County, First District (Fred J. Hirsh, J.), dated August 31, 2009. The order denied defendant’s motion for summary judgment dismissing the complaint insofar as asserted by plaintiff Sound Shore Medical Center and granted plaintiff Sound Shore Medical Center’s cross motion for summary judgment.

ORDERED that the order is reversed, without costs, defendant’s motion for summary judgment dismissing the complaint insofar as asserted by plaintiff Sound Shore Medical Center is granted and plaintiff Sound Shore Medical Center’s cross motion for summary judgment is denied.

In this action by providers to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint insofar as asserted by plaintiff Sound Shore Medical Center (plaintiff) on the ground that the action was premature because plaintiff had failed to provide requested verification documents. Plaintiff cross-moved for summary judgment. The District Court denied defendant’s motion for summary judgment and granted plaintiff’s cross motion for summary judgment. The instant appeal by defendant ensued.

Contrary to the determination of the District Court, the affidavit of defendant’s claims [*2]examiner was sufficient to establish that defendant had timely mailed the verification request and follow-up verification request in accordance with defendant’s standard office practices and procedures (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]). In addition, defendant’s moving papers established that plaintiff had failed to provide the requested verification.

In support of its cross motion and in opposition to defendant’s motion for summary judgment, plaintiff did not assert that it had never received the initial and follow-up verification requests nor did it assert that it had fully complied with these requests. Plaintiff’s attorney merely argued that since the affidavit of the hospital biller, taken together with the copy of the certified return receipt card, established that defendant had received the bill on December 22, 2008, defendant’s initial verification request, sent on November 26, 2008, pre-dated defendant’s receipt of the bill and was therefore a nullity. However, the record establishes that defendant’s initial verification request was sent to plaintiff after plaintiff had sent, and defendant had received, a UB-04 form, which specified the treatment rendered. The UB-04 form is the successor to the UB-92 form and the functional equivalent of the NF-5 form (see Insurance Department Regulations [11 NYCRR] § 65-3.5 [a], [f]). Accordingly, defendant’s initial verification request was not untimely (cf. Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11 [1999]).

Since plaintiff has not rebutted defendant’s prima facie showing that defendant’s initial request and follow-up request for verification were timely and that plaintiff failed to respond to same, defendant established that its time to pay or deny the claim was tolled. Consequently, defendant’s motion for summary judgment dismissing the complaint, on the ground that the action was premature, should have been granted (see 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]; 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]). Accordingly, the order is reversed, defendant’s motion is granted and plaintiff’s cross motion for summary judgment is denied.

Nicolai, P.J., Molia and LaCava, JJ., concur.
Decision Date: January 10, 2011

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Diane A. Lebedeff, J.), entered June 11, 2009. The order, insofar as appealed from as limited by the brief, granted the branch of defendant’s cross motion seeking to compel plaintiff to produce copies of its corporate tax returns and its tax records regarding its professional employees, and provided that the complaint would be dismissed in the event plaintiff failed to produce these documents.

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

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant cross-moved, pursuant to CPLR
3126, to dismiss the complaint due to plaintiff’s failure to provide the information requested in defendant’s interrogatories and defendant’s notice for discovery and inspection or, in the alternative, to compel plaintiff to provide such information. Plaintiff appeals, as limited by the brief, from so much of the Civil Court’s order as granted the branch of defendant’s cross motion seeking to compel plaintiff to produce copies of its corporate tax returns and its tax records regarding its professional employees, and provided that the complaint would be dismissed in the event plaintiff failed to produce these documents.

Defendant’s cross motion papers set forth detailed and specific reasons for believing that plaintiff is ineligible to recover no-fault benefits because plaintiff fails to meet applicable state and local licensing requirements (see Insurance Department Regulations [11 NYCRR] § 65-3.16 [a] [12]; State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]). As defendant’s cross motion papers were sufficient to establish that special circumstances exist which warrant [*2]disclosure of plaintiff’s corporate tax returns and its professional employees’ tax records (see CPLR 3101; One Beacon Ins. Group, LLC v Midland Med. Care, P.C., 54 AD3d 738 [2008]; Great Wall Acupuncture v State Farm Mut. Auto. Ins. Co., 20 Misc 3d 136[A], 2008 NY Slip Op 51529[U] [App Term, 2d & 11th Jud Dists 2008]; Statewide Med. Servs., P.C. v Travelers Ins. Co., 13 Misc 3d 134[A], 2006 NY Slip Op 52014[U] [App Term, 1st Dept 2006], revg 9 Misc 3d 1124[A], 2005 NY Slip Op 51773[U] [Civ Ct, Bronx County 2005]; see also Dore v Allstate Indem. Co., 264 AD2d 804 [1999]; cf. Benfeld v Fleming Props., LLC, 44 AD3d 599, 600 [2007]; Altidor v State-Wide Ins. Co., 22 AD3d 435 [2005]), the order, insofar as appealed from, is affirmed.

Golia, J.P., Pesce and Steinhardt, JJ., concur.

[*1]

Supreme Court, Appellate Term, Second Department, January 10, 2011

Lincoln Gen. Ins. Co. v Alev Med. Supply Inc., 25 Misc 3d 1019, reversed.

APPEARANCES OF COUNSEL

Rivkin Radler LLP, Uniondale (Stuart M. Bodoff of counsel), for appellant.

{**30 Misc 3d at 61} OPINION OF THE COURT

Memorandum.

Ordered that the order is reversed, without costs, the complaint is reinstated, and plaintiff’s motion for leave to enter a default judgment is granted.

Plaintiff insurer commenced this action against defendant, a provider of durable medical equipment, seeking to recover, based on a theory of unjust enrichment, $2,846.18 in assigned first-party no-fault benefits which had been paid to defendant as assignee of Andrey Armstrong on December 4, 2008. Before commencing this action, plaintiff conducted an examination under oath of defendant’s assignor on December 18, 2008, in connection with the treatment rendered to him by various health care providers, and concluded that defendant’s assignor had never been supplied with the equipment for which defendant had billed and been reimbursed. After defendant failed to appear or answer the complaint, plaintiff moved, pursuant to CPLR 3215, for leave to enter a default judgment. In support of its motion, plaintiff submitted a copy of the summons and complaint; proof of service thereof on the Secretary of State, pursuant to Business Corporation Law § 306; additional proof of service in compliance with CPLR 3215 (g) (4) (i); an affirmation of counsel; an affidavit of the no-fault supervisor of plaintiff’s managing general agent, which was responsible for processing and paying no-fault claims; and numerous exhibits. There was no opposition to the motion. The District Court denied the motion based on plaintiff’s failure to have raised the fraudulent billing issue in a timely denial of claim. The instant appeal by plaintiff ensued.

With very limited exceptions, an insurer’s failure to pay or deny a claim within the 30-day claim determination period (see Insurance Law § 5106) precludes the insurer from interposing most defenses to payment of no-fault benefits, including the fact that medical services or medical [*2]equipment billed for were never actually provided (see Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556 [2008]). If an insurer is precluded from asserting a defense due to its failure to pay or deny a claim within the 30-day claim determination period, it may not{**30 Misc 3d at 62} later seek to recover amounts it paid on the claim based on a theory of unjust enrichment (see e.g. Cornell Med., P.C. v Mercury Cas. Co., 24 Misc 3d 58 [App Term, 2d, 11th & 13th Jud Dists 2009]). However, where, as here, an insurer timely pays a claim within the 30-day claim determination period, the insurer is not foreclosed from affirmatively commencing an action to recover the amounts paid on the claim when the insurer later discovers that the claim is fraudulent (see State Farm Mut. Auto. Ins. Co. v Grafman, 655 F Supp 2d 212, 223-224 [ED NY 2009]; State Farm Mut. Auto. Ins. Co. v James M. Liguori, M.D., P.C., 589 F Supp 2d 221 [ED NY 2008]; see also Carnegie Hill Orthopedic Servs. P.C. v GEICO Ins. Co., 19 Misc 3d 1111[A], 2008 NY Slip Op 50639[U] [Sup Ct, Nassau County 2008, Austin, J.]; Progressive Northeastern Ins. Co. v Advanced Diagnostic & Treatment Med., NYLJ, Aug. 2, 2001, at 18, col 2 [Sup Ct, NY County, Gammerman, J.]). The fact that the insurer chose to pay first-party no-fault benefits within the 30-day claim determination period, at a point when the insurer had no reason to deny the claim, “cannot in any sense be taken as a concession that the claim is legitimate” (Dermatossian v New York City Tr. Auth., 67 NY2d 219, 224 [1986]). Indeed, an opinion issued by the New York State Department of Insurance specifically states that the No-Fault Law “is in no way intended and should not serve as a bar to subsequent actions by an insurer for the recovery of fraudulently obtained benefits from a claimant, where such action is authorized under the auspices of any statute or under common law” (Ops Gen Counsel NY Ins Dept [Nov. 29, 2000]). The rationale behind this interpretation is that

“payment of fraudulently obtained No-Fault benefits, without available recourse, serves to undermine and damage the integrity of the No-Fault system, which was created as a social reparations system for the benefit of consumers . . . To conclude that the No-Fault statute bars the availability of other legal remedies, where the payment of benefits [was] secured through fraudulent means, renders the public as the ultimate victim of such fraud, in the form of higher premiums based upon the resultant increased costs arising from the fraudulent actions” (id.).

Moreover, “[t]here is nothing in the legislative history or case law interpretations of the statute or in Insurance Department regulations, opinions or interpretations of the statute that supports the argument that the statute bars such actions” (id.).{**30 Misc 3d at 63}

Accordingly, contrary to the conclusion of the District Court, plaintiff is not barred from bringing this action seeking recovery of the amount it paid to defendant. As plaintiff demonstrated its compliance with CPLR 3215 (f) and (g) (4) (i), the District Court should have granted plaintiff’s motion for leave to enter a default judgment.

Tanenbaum, J.P., Molia and Iannacci, JJ., concur.

[*1]

Supreme Court, Appellate Term, Second Department, January 10, 2011

Allstate Social Work & Psychological Servs., PLLC, 22 Misc 3d 723, affirmed.

APPEARANCES OF COUNSEL

Bruno, Gerbino & Soriano, LLP, Melville (Charles W. Benton of counsel), for respondent. Gary Tsirelman, P.C., Brooklyn, for appellant.

{**30 Misc 3d at 91} OPINION OF THE COURT

Memorandum.

Ordered that the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits for psychological services rendered to its assignors, defendant moved for summary judgment dismissing the complaint based upon, among other things, the failure of plaintiff’s assignors to attend independent medical examinations (IMEs) by a psychologist, which were scheduled by Hudson Valley Medical Consultants (HVMC). The Civil Court granted defendant’s motion, and this appeal by plaintiff ensued.

It is uncontested that defendant established that the IME requests were timely mailed in accordance with HVMC’s standard office practices and procedures and that the assignors failed to appear for the IMEs (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]; Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]). However, plaintiff contends that defendant’s insurance policy, which incorporates the language of the mandatory personal injury protection endorsement (Insurance Department Regulations [11 NYCRR] § 65-1.1), requires that IMEs of eligible injured persons (EIPs) be conducted only by physicians, to the exclusion of other health care providers, even when the health services for which first-party no-fault benefits are sought were provided by nonphysicians. In rejecting [*2]plaintiff’s contention, the Civil Court relied on an opinion of the State Insurance Department, dated March 12, 2004 (see 2004 Ops Gen Counsel NY Ins Dept No. 04-03-10). We find that the Insurance Department Regulations Implementing the Comprehensive Motor Vehicle Insurance Reparations Act (11 NYCRR part 65), read as a whole, in accordance with the rules of construction, and the State Insurance Department’s opinion, to which we accord great{**30 Misc 3d at 92} deference, lead to the conclusion that the requirement that an EIP submit to medical examinations, as set forth in the mandatory personal injury protection endorsement (Insurance Department Regulations [11 NYCRR] § 65-1.1), should not be limited strictly to examinations by physicians. Thus, in the instant matter, we find that the psychologist retained by defendant could properly have conducted the IMEs of plaintiff’s assignors, who had received psychological treatment (see generally Stephen Fogel Psychological, P.C., 35 AD3d at 722; Meridian Acupuncture Care v Geico Ins. Co., 31 AD3d 509 [2006]). A contrary conclusion would frustrate the core objective of the no-fault scheme by limiting the universe of health care providers who can perform IMEs to physicians, thereby delaying the processing of no-fault claims (see also Stephen Fogel Psychological, P.C., 35 AD3d at 722). Therefore, we find that defendant properly denied plaintiff’s claims based on its assignors’ failure to satisfy a condition precedent to coverage.

Accordingly, the Civil Court’s order granting defendant’s motion for summary judgment dismissing the complaint is affirmed.

Golia, J.P., Pesce and Steinhardt, JJ., concur.