[*1]

Civil Court of the City of New York, Kings County, May 29, 2010

APPEARANCES OF COUNSEL

Law Offices of Daniel J. Tucker, New York City (Peter Coates of counsel), for defendant. Law Offices of Melissa Betancourt, P.C., Brooklyn (Aaron Cargain of counsel), for plaintiff.

{**28 Misc 3d at 828} OPINION OF THE COURT

Sylvia G. Ash, J.

In an action seeking payment of first-party no-fault benefits, defendant moves to reargue the court’s decision dated October 9, 2009, wherein the court found that defendant’s denial of plaintiff’s claim was untimely.

The court found that defendant’s follow-up verification request was two days late, thus reducing its denial time to 28 days (see Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294 [2007]), which made its denial in this case late by one day. Defendant contends that the court erred in its finding that its follow-up verification request was sent two days late rather than one day late. Defendant argues that Presidents’ Day is a legal holiday and should not have been included in computing the timeliness of defendant’s denial.

In an action to obtain payment of first-party no-fault benefits, 11 NYCRR 65-3.8 provides that a no-fault insurance carrier has 30 days from the date of receipt of the claim to pay or deny a claim in whole or in part. However, the insurance carrier’s time to pay or deny a claim is extended by making a timely demand for verification. (See Infinity Health Prods., Ltd. v Eveready Ins. Co., 67 AD3d 862 [2d Dept 2009].) A claim does not have to be paid or denied until the insurance carrier has been provided with all timely demanded verification. (See New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568 [2d Dept 2004]; Mount Sinai Hosp. v Chubb Group of Ins. Cos., 43 AD3d 889 [2d Dept 2007].) Pursuant to 11 NYCRR 65-3.5 (b) the insurance company must request additional verification within 15 business days of the [*2]receipt of the prescribed verification forms. However, an untimely verification request will reduce the 30 calendar days wherein a claim must be denied or paid upon receipt of the requested information. (11 NYCRR 65-3.8 [j].)

The court notes that the rule specifically states business days rather than calendar days. However, the statute does not define either term. Traditionally the law has recognized the difference between a calendar day and business day (see Miuccio v Puppy City, Inc., 22 Misc 3d 1132[A], 2009 NY Slip Op 50404[U] [2009]). A calendar day is defined as a Sunday or any day of the week specifically mentioned (see General Construction Law § 19). Therefore, even a holiday would be considered a calendar day. Generally, when an act must be done within a given number of days, and the last day falls on a holiday, the time is extended{**28 Misc 3d at 829} to the next business day (see General Construction Law § 20). However, when an act must be done within a given number of “calendar” days weekends and legal holidays are not excluded in the calculation thereof.

The General Construction Law does not contain a definition of business days. In examining how the term is defined in different statutes, it generally means any calendar day except Sunday and any legal holiday (see Miuccio v Puppy City, Inc., supra). However, this definition comes into conflict with the way most courts define business days when it comes to no-fault cases, where Saturday, Sunday and holidays have generally been excluded.

Here, if the rule called for 15 calendar days, Presidents’ Day as an intervening holiday would not be excluded in calculating defendant’s verification request (General Construction Law § 20). However, since the rule specifically states that such request must be submitted within 15 business days, it appears that the legislature’s intent was to at least exclude legal holidays in calculating the number of days required to submit additional verification requests.

In the case at bar, plaintiff submitted its claim to the defendant on February 5, 2007. The court, in computing the time defendant was required to request additional verification, hereby defines business day to mean any calendar day excluding Saturday, Sunday and legal holidays. Therefore, the court agrees with the defendant that Presidents’ Day, being a legal holiday, should have been excluded in computing the time for the verification request, and as such, its request was one day late not two days late.

Accordingly, defendant’s motion to reargue and vacate the court’s order dated October 9, 2009, is hereby granted to the extent that the parties’ summary judgment motions are denied, and this matter is set down for trial on the sole issue of medical necessity.

APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT

Defendant appeals from an order of the Civil Court of the City of New York, New York County (Joan M. Kenney, J.), entered August 31, 2009, which denied its motion for summary judgment dismissing the complaint.

Per Curiam.

Order (Joan M. Kenney, J.), entered August 31, 2009, reversed, with $10 costs, defendant’s motion granted and complaint dismissed. The Clerk is directed to enter judgment accordingly.

As Civil Court correctly concluded, defendant made a prima facie showing both that two separate requests for an independent medical examination (“IME”) of plaintiff’s assignor were duly mailed to the assignor and that the assignor failed to appear for the examination on either of the dates scheduled pursuant to the requests. In opposition, plaintiff failed to raise a triable issue. Therefore, defendant was entitled to summary judgment dismissing the complaint (see Inwood Hill Med., P.C. v General Assur. Co., 10 Misc 3d 18 [2005]; see also Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]).

We note that, contrary to Civil Court’s determination, defendant was not required to produce the applicable automobile insurance policy in order to establish that the mandatory personal injury endorsement included an IME provision (see 11 NYCRR 65-1.1),since the policy “shall be construed as if such provision[] [was] embodied therein” (Insurance Law § 5103[h]).
THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT. [*2]D
ecision Date: May 24, 2010

APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT

Plaintiffs appeal from an order of the Civil Court of the City of New York, New York County (Arlene P. Bluth, J.), dated June 4, 2008, which denied their motion for summary judgment on the complaint.

Per Curiam.

Order (Arlene P. Bluth, J.), dated June 4, 2008, modified to (1) grant summary judgment to plaintiff Carnegie Hill Orthopedic Services, P.C., on the second and third causes of action seeking the principal sum of $9,118.76, and the Clerk is directed to judgment accordingly; and (2) grant partial summary judgment to plaintiffs on the issue of liability as to their first cause of action, and the matter remanded for apportionment between plaintiffs of the damages thereon; and, as so modified, order affirmed, with $10 costs.

Plaintiffs established their entitlement to partial summary judgment on the issue of liability on the first cause of action, which seeks recovery of overdue assigned first-party no-fault benefits in the principal amount of $3,050.74 (see Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]). Additionally, plaintiff Carnegie Hill Orthopedic Services, P.C., (Carnegie) established its prima facie entitlement to judgment as a matter of law on the second and third causes of action, which seek recovery of overdue assigned first-party no-fault benefits in the principal sum of $9,118.76. Defendant’s submissions before Civil Court established its receipt of the respective claims (see Fair Price Med. Supply, Inc. v St. Paul Travelers Ins. Co., 16 Misc 3d 8 [2007]; Devonshire Surgical Facility v GEICO, 16 Misc 3d 130[A], 2007 NY Slip Op 51308[U][2007]), and defendant did not dispute that $9,118.76 remained overdue on the claims of Carnegie upon which the second and third causes of action are based. In opposition, defendant, which failed to timely deny any of the claims (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]; New York & Presbyt. Hosp. v Progressive Cas. Ins., 5 AD3d 568 [2004]) and was precluded under a so-ordered stipulation from offering certain evidence at trial based on its failure to respond to plaintiffs’ interrogatories (see Wilson v Galicia Contr. & [*2]Restoration Corp., 10 NY3d 828, 830 [2008]), failed to raise any triable issue.

Although defendant does not dispute the total amount overdue on the first cause of action, we remand the matter to Civil Court for an apportionment of the amount owed to each respective plaintiff on that cause of action, since plaintiffs failed to establish such apportionment in their motion papers.
THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.
Decision Date: May 17, 2010

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, Kings County (Peter Paul Sweeney, J.), entered April 23, 2009. The order denied plaintiff’s motion for leave to enter a default judgment.

ORDERED that the order is modified by providing that plaintiff’s motion is denied with leave to renew upon proper papers; as so modified, the order is affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for leave to enter a default judgment based upon defendant’s failure to appear or answer the complaint or, in the alternative, for an order finding for all purposes in the action that plaintiff had established a prima facie case. The motion was unopposed. The Civil Court denied the motion, and this appeal by plaintiff ensued.

In support of its motion, plaintiff proffered neither an affidavit nor a verified complaint by a party with personal knowledge setting forth the factual basis for the claim, as is required by CPLR 3215 (f). Rather, plaintiff submitted a complaint verified by counsel, who did not demonstrate personal knowledge of the facts, and an affidavit of the president of a third-party billing company, which affidavit did not establish that the documents annexed to plaintiff’s motion were admissible pursuant to CPLR 4518 (see Art of Healing Medicine, P.C. v Travelers [*2]Home & Mar. Ins. Co., 55 AD3d 644 [2008]; Andrew Carothers, M.D., P.C. v Geico Indem. Co., 24 Misc 3d 19 [App Term, 2d, 11th & 13th Jud Dists 2009]; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]).

Since plaintiff’s motion papers did not demonstrate a prima facie entitlement to judgment as a matter of law, the Civil Court properly denied the motion (see All Mental Care Medicine, P.C. v Allstate Ins. Co., 15 Misc 3d 129[A], 2007 NY Slip Op 50612[U] [App Term, 2d & 11th Jud Dists 2007]). Furthermore, plaintiff is not entitled to the alternative relief it sought, a finding for all purposes in the action that it had established its prima facie case (see e.g. B.Y., M.D., P.C. v Government Empls. Ins. Co., 26 Misc 3d 95 [App Term, 9th & 10th Jud Dists 2010]). However, in the circumstances presented, we modify the order to provide that plaintiff’s motion is denied with leave to renew upon proper papers.

Weston, J.P., Rios and Steinhardt, JJ., concur.
Decision Date: May 13, 2010

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 March 17, 2009, deemed from a judgment of the same court entered April 6, 2009 (see CPLR 5501 [c]). The judgment, entered pursuant to the March 17, 2009 order granting plaintiff’s motion for summary judgment and denying defendant’s cross motion for summary judgment, awarded plaintiff the principal sum of $479.50.

ORDERED that the judgment is reversed without costs, the order entered March 17, 2009 is vacated, plaintiff’s motion for summary judgment is denied, and defendant’s cross motion for summary judgment dismissing the complaint is granted without prejudice to plaintiff’s commencement of a new action.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant opposed the motion and cross-moved for summary judgment dismissing the complaint on the ground that the action was premature because it was commenced before defendant had received responses to its outstanding verification requests. By order entered March 17, 2009, the Civil Court granted plaintiff’s motion and denied defendant’s cross motion. Defendant’s appeal from that order is deemed to be from the judgment which was [*2]subsequently entered (see CPLR 5501 [c]).

The affidavit of defendant’s claims representative established that defendant had timely mailed its request and follow-up request for verification to plaintiff (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 18 [App Term, 2d & 11th Jud Dists 2007]) and that plaintiff had failed to provide the requested verification. In opposition to defendant’s cross motion, plaintiff did not demonstrate that it had provided defendant, prior to the commencement of the action, with the requested verification. Consequently, under the circumstances presented, the 30-day period within which defendant was required to pay or deny the claims did not commence 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]; Vista Surgical Supplies, Inc. v General Assur. Co., 12 Misc 3d 129[A], 2006 NY Slip Op 51034[U] [App Term, 2d & 11th Jud Dists 2006]), and plaintiff’s action is premature (Hospital for Joint Diseases v New York Cent. Mut. Fire Ins. Co., 44 AD3d 903 [2007]). We do not reach any other issue.

Accordingly, the judgment is reversed, the order entered March 17, 2009 is vacated, plaintiff’s motion for summary judgment is denied, and defendant’s cross motion for summary judgment dismissing the complaint is granted without prejudice to plaintiff’s commencement of a new action.

Weston, J.P., Rios and Steinhardt, JJ., concur.
Decision Date: May 13, 2010

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 March 18, 2009, deemed from a judgment of the same court entered April 2, 2009 (see CPLR 5501 [c]). The judgment, entered pursuant to the March 18, 2009 order denying defendant’s motion for summary judgment dismissing the complaint and granting plaintiff’s cross motion for summary judgment, awarded plaintiff the principal sum of $4,250.90.

ORDERED that the judgment is reversed without costs, the order entered March 18, 2009 is vacated, defendant’s motion for summary judgment dismissing the complaint is granted and plaintiff’s cross motion for summary judgment is denied.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint on the ground that plaintiff’s treatments were not medically necessary, and plaintiff cross-moved for summary judgment. The Civil Court denied defendant’s motion and granted plaintiff’s cross motion. This appeal by defendant ensued. A judgment was subsequently entered, from which the appeal is deemed to be taken (see CPLR 5501 [c]).

The affidavit submitted by defendant’s senior litigation examiner sufficiently established [*2]that the denial of claim forms at issue were timely mailed pursuant to defendant’s standard office practice or procedure (see 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]). The sworn peer review report and the sworn independent medical examination report by defendant’s chiropractors provided a factual basis and medical rationale for their determination that the treatments at issue were not medically necessary (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]). Consequently, defendant’s moving papers made a prima facie showing that defendant was entitled to judgment as a matter of law and shifted the burden to plaintiff to raise a triable issue of fact.

The affidavit submitted by plaintiff in opposition to defendant’s motion was insufficient to raise a triable issue of fact, as it merely consisted of a conclusory statement by the affiant, the doctor who had provided the treatments, that he reaffirmed his opinion that the disputed services were medically necessary. The affiant did not refer to, or discuss, the determination of defendant’s chiropractors. Consequently, plaintiff failed to demonstrate the existence of an issue of fact with respect to medical necessity (see Pan Chiropractic, P.C. v Mercury Ins. Co., 24 Misc 3d 136[A], 2009 NY Slip Op 51495[U] [App Term, 2d, 11th & 13th Jud Dists 2009]), and defendant’s motion for summary judgment should have been granted.

Accordingly, the judgment is reversed, the order entered March 18, 2009 is vacated, defendant’s motion for summary judgment dismissing the complaint is granted and plaintiff’s cross motion for summary judgment is denied.

Weston, J.P., Rios and Steinhardt, JJ., concur.
Decision Date: May 13, 2010

—[*1] Lawrence L. Kaye, P.C., Brooklyn, N.Y., for appellant.

Martin, Fallon & MullÉ, Huntington, N.Y. (Richard C. MullÉ of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an arbitration award dated October 29, 2008, as modified December 1, 2008, the petitioner appeals from a judgment of the Supreme Court, Suffolk County (Cohen, J.), entered July 9, 2009, which, upon a decision of the same court dated May 13, 2009, denied the petition and dismissed the proceeding.

Ordered that the judgment is modified, on the law, by adding thereto a provision pursuant to CPLR 7511 (e) confirming the award dated October 29, 2008, as modified December 1, 2008; as so modified, the judgment is affirmed, with costs payable by the petitioner.

“Consistent with the public policy in favor of arbitration, the grounds specified in CPLR 7511 for vacating or modifying a no-fault arbitration award are few in number and narrowly applied” (Matter of Mercury Cas. Co. v Healthmakers Med. Group, P.C., 67 AD3d 1017, 1017 [2009]). “An arbitration award can be vacated by a court pursuant to CPLR 7511 (b) on only three narrow grounds: if it is clearly violative of a strong public policy, if it is totally or completely irrational, or if it manifestly exceeds a specific, enumerated limitation on the arbitrator’s power” (Matter of Erin Constr. & Dev. Co., Inc. v Meltzer, 58 AD3d 729, 729 [2009]; see Matter of United Fedn. of Teachers, Local 2, AFT, AFL-CIO v Board of Educ. of City School Dist. of City of N.Y., 1 NY3d 72, 79 [2003]; Matter of Board of Educ. of Arlington Cent. School Dist. v Arlington Teachers Assn., 78 NY2d 33, 37 [1991]; Cifuentes v Rose & Thistle, Ltd., 32 AD3d 816 [2006]; Matter of Rockland County Bd. of Coop. Educ. Servs. v BOCES Staff Assn., 308 AD2d 452, 453 [2003]). “An award is irrational if there is ‘no proof whatever to justify the award’ ” (Matter of Erin Constr. & Dev. Co., Inc. v Meltzer, 58 AD3d at 730, quoting Matter of Peckerman v D & D Assoc., 165 AD2d 289, 296 [1991]). “Even if the arbitrators misapply substantive rules of law or make an error of fact, unless one of the three narrow grounds applies in the particular case, the award will not be vacated” (Matter of Erin Constr. & Dev. Co., Inc. v Meltzer, 58 AD3d at 730; see Wien & Malkin LLP v Helmsley-Spear, Inc., 6 NY3d 471 [2006]; Matter of Silverman [Benmor Coats], 61 NY2d 299, 308 [1984]; Matter of Sprinzen [Nomberg], 46 NY2d 623, 629 [1979]; Cifuentes v Rose & Thistle, Ltd., 32 AD3d at 816). “An arbitrator is not bound by principles of substantive law or rules of evidence, and may do justice and apply his or her own sense of law and equity to the facts as he or she finds them to be” (Matter of Erin Constr. & Dev. Co., Inc. v Meltzer, 58 AD3d at 730; see Matter of Silverman [Benmor Coats], [*2]61 NY2d at 308).

Here, the petitioner failed to demonstrate the existence of any of the statutory grounds for vacating the arbitrator’s award. Contrary to the petitioner’s contention, the arbitrator’s award, as modified, finds evidentiary support in the record and was rationally based (see Matter of American Express Prop. Cas. Co. v Vinci, 63 AD3d 1055, 1055 [2009]; Matter of Mangano v United States Fire Ins. Co., 55 AD3d 916, 917 [2008]). In addition, even if the arbitrator failed to consider specified evidence, vacatur of the award would not be warranted (see Matter of American Express Prop. Cas. Co. v Vinci, 63 AD3d at 1056; see also Montanez v New York City Hous. Auth., 52 AD3d 338, 339 [2008]).

Upon denying a motion to vacate or modify an arbitration award, the court must confirm the award (see CPLR 7511 [e]; Matter of Mercury Cas. Co. v Healthmakers Med. Group, P.C., 67 AD3d at 1017-1018). Thus, given this Court’s affirmance of the Supreme Court’s denial of the petition to vacate or modify the award, the award must be confirmed (see CPLR 7511 [e]). Covello, J.P., Santucci, Angiolillo and Dickerson, JJ., concur.

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 February 10, 2009, deemed, in part, from a judgment of the same court entered April 22, 2009 (see CPLR 5501 [c]). The judgment, entered pursuant to so much of the February 10, 2009 order as granted plaintiff’s motion for summary judgment to the extent of awarding plaintiff summary judgment on its first cause of action, awarded plaintiff the principal sum of $85. The order, insofar as appealed from, denied so much of defendant’s cross motion as sought summary judgment dismissing plaintiff’s third cause of action.

ORDERED that the judgment is affirmed without costs; and it is further,

ORDERED that the order, insofar as appealed from, is reversed without costs and so much of defendant’s cross motion as sought summary judgment dismissing plaintiff’s third cause of action is granted.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment and defendant cross-moved for summary judgment dismissing the complaint or, in the alternative, for an order, pursuant to CPLR 3212 (g), finding that defendant had established the timely mailing of its denial of claim forms. Insofar as is relevant to this appeal, the Civil Court granted plaintiff’s motion for summary judgment to the extent of [*2]awarding plaintiff summary judgment on its first
cause of action and denied so much of defendant’s cross motion as sought summary judgment dismissing plaintiff’s third cause of action. Defendant’s appeal ensued. A judgment subsequently was entered upon the first cause of action. The appeal from the order is deemed, in part, to be taken from the judgment (see CPLR 5501 [c]).

On appeal, defendant’s sole contention with respect to plaintiff’s prima facie case is that the affidavit of plaintiff’s billing manager failed to establish that the documents annexed to plaintiff’s motion for summary judgment were admissible as business records. Upon our review of the record, we find that the affidavit was sufficient to establish that the documents annexed to plaintiff’s moving papers were admissible pursuant to CPLR 4518 (see Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]). The affidavit of defendant’s claims division employee, submitted in opposition to plaintiff’s motion for summary judgment, failed to address plaintiff’s first cause of action. Accordingly, defendant failed to raise a triable issue of fact with regard to said cause of action, and the judgment is affirmed.

With respect to plaintiff’s third cause of action, defendant established that it had timely denied the claim at issue on the ground that the services provided were not medically necessary (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]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]). In support of its cross motion for summary judgment, defendant submitted, among other things, an affirmed peer review report which set forth a factual basis and medical rationale for the opinion that there was a lack of medical necessity for the services for which payment was sought in the third cause of action (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]). Plaintiff failed to rebut defendant’s evidence of the lack of medical necessity for these services. Consequently, defendant established its prima facie entitlement to summary judgment with respect to plaintiff’s third cause of action, and plaintiff failed to raise a triable issue of fact with respect to this cause of action. Accordingly, so much of defendant’s cross motion as sought summary judgment dismissing plaintiff’s third cause of action is granted.

Pesce, P.J., Weston and Steinhardt, JJ., concur.
Decision Date: May 10, 2010

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

Appeal from an amended order of the District Court of Nassau County, First District (Andrew M. Engel, J.), dated July 17, 2008. The amended order granted plaintiff’s motion for summary judgment.

ORDERED that the amended order is reversed without costs and plaintiff’s motion for summary judgment is denied.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment, and defendant opposed the motion on the ground that the services provided were not medically necessary. The District Court granted plaintiff’s motion, and this appeal ensued.

While defendant argues that the affidavit of plaintiff’s billing collection supervisor was insufficient to establish plaintiff’s prima facie case, we do not pass on the propriety of the determination of the District Court with respect thereto as defendant raises this issue for the first time on appeal (see Westchester Neurodiagnostic, P.C. v Allstate Ins. Co., 24 Misc 3d 133[A], 2009 NY Slip Op 51385[U] [App Term, 9th & 10th Jud Dists 2009]; Nyack Hosp. v New York Cent. Mut. Fire Ins. Co., 21 Misc 3d 133[A], 2008 NY Slip Op 52184[U] [App Term, 9th & 10th Jud Dists 2008]; 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]). [*2]

In support of its motion, plaintiff submitted defendant’s affirmed peer review reports and argued that plaintiff was entitled to summary judgment because the peer review reports did not adequately set forth a medical justification to support the peer review doctor’s conclusions that the services at issue were not medically necessary. In opposition to plaintiff’s motion, defendant established that its denial of claim forms, which relied upon the peer review reports, were timely (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]). Contrary to the conclusion of the District Court, we find that the peer review reports set forth a sufficient factual basis and medical rationale to demonstrate the existence of an issue of fact as to medical necessity (see B.Y., M.D., P.C. v Progressive Cas. Ins. Co., 26 Misc 3d 135[A], 2010 NY Slip Op 50144[U] [App Term, 9th & 10th Jud Dists 2010]; see also A.B. Med. Servs., PLLC v Country-Wide Ins. Co., 23 Misc 3d 140[A], 2009 NY Slip Op 51016[U] [App Term, 9th & 10th Jud Dists 2009]). Accordingly, plaintiff’s motion for summary judgment should have been denied (see Zuckerman v City of New York, 49 NY2d 557 [1980]).

Tanenbaum, J.P., Molia and Iannacci, JJ., concur.
Decision Date: May 10, 2010

Civil Court of the City of New York, Kings County

042765/08

Plaintiff:

Max Valerio, Esq.

Gary Tsirelman, P.C.

55 Washington Street, Suite 606

Brooklyn, New York 11201

Defendant:

Dominick Dale, Esq.

Law Offices of Teresa M. Spina

170 Froehlich Farm Boulevard

Woodbury, New York 11797

Pamela L. Fisher, J.

Plaintiff, Beal-Medea Products, Inc., assignee of Michael Perez, instituted this action to recover first party no-fault benefits from Defendant GEICO. A trial was held before this Court on March 29, 2010 and April 5, 2010. After considering and evaluating the trial evidence and upon weighing and assessing the credibility of the witnesses, the Court makes the following findings of fact and conclusions of law.

The parties stipulated that Plaintiff established its prima facie case, that Defendant established timely denials, and that the sole issue for trial was medical necessity. The parties also stipulated to the admission of the bills and denials. It is Defendant’s burden at trial to show that the supplies provided to Plaintiff’s assignor were medically unnecessary. See Amaze Med. Supply, Inc. v. Eagle Ins. Co., 2003 NY Slip Op 51701U (NY App. Term 2003). To meet its burden, at a minimum, Defendant must establish a factual basis and medical rationale for its asserted lack of medical necessity, which is supported by evidence of the generally accepted medical/professional [*2]practices. See Nir v. Allstate Ins. Co., 2005 NY Slip Op 25090 (NY Civ. Ct. 2005).

At trial, Defendant called Dr. Michael Jacobs to testify regarding the peer review report of Dr. Andrew Miller. Plaintiff objected on hearsay grounds to Dr. Jacob’s testimony because he was not the author of the original peer report. The Court now turns to the question of whether it is permissible for a substitute doctor to testify.

The Appellate Term First and Second Department have held that a substitute peer doctor is permitted to testify as the witness is subject to full cross-examination, however they have limited the substitute peer’s testimony to the basis for denial as set forth in the original peer review report. Bronx Expert Radiology, P.C. v. New York Cent. Mut. Fire Ins. Co., 2009 NY Slip Op 51475U, 1 (NY App. Term 2009). See also Home Care Orthos. Med. Supply v. American Mfrs. Mut. Ins. Co., 14 Misc 3d 139(A) (2007); Spruce Med. and Diagnostic, P.C. v Lumbermen’s Mut. Cas. Co., 15 Misc 3d 143A(2007). Bronx Expert did not limit its holding to cases where documents are in evidence. When the parties have stipulated that either the peer report or the underlying medical records are admitted into evidence applying the Bronx Expert standard is clear. However when the parties have not stipulated documents into evidence the Court must determine to what extent may the witness rely on out-of-court documents without violating the hearsay rule. See Progressive Med., Inc. v Allstate Ins. Co., 2010 NY Slip Op 50219U (NY App. Term 2010).

In SK Med. Servs., P.C. v. New York Cent. Mut. Fire Ins. Co., 2006 NY Slip Op 26227, 1 (NY Civ. Ct. 2006), a lower court case decided before Bronx Expert, the parties stipulated that the peer report was in evidence and the court held that the substitute peer was permitted to testify. The substitute peer was limited to testifying to the facts and opinions contained in the peer review report. Id. The decision was based on the rationale that an insurer may not assert new grounds for its refusal to pay a claim and must adhere to the defense as stated in its denial. Id. Permitting a substitute peer to testify does not violate these principles as long as the substitute peer doctor is limited to the basis for the denial as set forth in the original peer report. Id. As the parties stipulated the peer into evidence, SK Medical did not address the evidentiary concerns associated with admitting the peer report or underlying medical records into evidence when a substitute peer testifies. When documents are not in evidence, the Plaintiff will inevitably object to the testimony of the peer or substitute peer on hearsay grounds. Bronx Expert does not expound upon hearsay concerns. Instead the case states that Defendant’s expert is not precluded from testifying because his opinion may have been based, at least in part, on his review of the assignor’s medical records prepared by plaintiff. See Bronx Expert.

In IAV Med. Supply, Inc. v Progressive Ins. Co., 2010 NY Slip Op 50433U, 5 (NY Civ. Ct. Mar. 15, 2010), the Court relied on the standard set forth in Bronx Expert, and held that a substitute peer doctor was permitted to testify when there were no documents in evidence because the witness would be subject to cross-examination and his testimony would be limited to the original peer review reports. IAV Medical allowed the testimony by relying on the fact that the peer reports had been submitted to the Plaintiff prior to trial as part of a summary judgment motion and expert disclosure, however the court did not address hearsay concerns.When the peer report and/or underlying medical records have not been stipulated into evidence, Defendant must overcome Plaintiff’s hearsay exception in order to elicit testimony from the expert witness. In this instance, the Court may rely on the framework laid by Wagman. Wagman v. Bradshaw, 292 AD2d 84, 85 (NY App. Div. 2d Dep’t 2002). In Wagman, the Appellate Division [*3]held that an expert witness may testify when he or she relied upon inadmissible out-of-court material to formulate an opinion provided: (1) it is of a kind accepted in the profession as reliable as a basis in forming a professional opinion, and (2) there is evidence presented establishing the reliability of the out-of-court material referred to by the witness. Id. See also Hambsch v New York City Tr. Auth., 63 NY2d 723); Supple Mind Acupuncture, P.C. v. State Farm Ins. Co., 2008 NY Slip Op 51856U (NY App. Term 2008). Under the purview of Wagman, it follows that a peer doctor as well as a substitute peer doctor would be permitted to testify as long as the witness is able to satisfy the two prong Wagman test. The testimony of the peer and substitute peer are deemed permissible because of an exception to the hearsay rule. Namely their testimony is deemed permissible when they have established the reliability of the out of court documents relied upon. It is a contradiction to permit the peer doctor to testify based on an exception to the hearsay rule and in turn prohibit a substitute peer from testifying. Both the peer and substitute peer are relying on out of court documents which fall under a hearsay exception. Generally, litigants can satisfy the first prong of Wagman, however establishing the second prong is more difficult.

Courts have held that Plaintiff invariably can not rebuff the reliability of the out of courts documents relied upon by an expert when the out of court documents consist of documents that plaintiff or assignor have prepared. See Andrew Carothers, M.D. (Martinez) v. GEICO, 2008 NY Slip Op 50456[U], 18 Misc 3d 1147[A], 859 NYS2d 892 (Civil Ct., Kings Co. 2008); Home Care Ortho. Med. Supply Inc., v. American MFRS. Mut. Ins. Co., 2007 NY Slip Op 50302[U], 14 Misc 3d 139[A], 836 NYS2d 499 (App. Term, 1st Dept. 2007); Primary Psychiatric Health, P.C., v. State Farm Mutual, 2007 NY Slip Op 50583[U], 15 Misc 3d 1111[A], 839 NYS2d 436 (Civil Ct., Kings Co. 2007). In Popular Imaging, P.C. v State Farm Ins. Co., 2009 NY Slip Op 52355U (NY Civ. Ct. 2009), a peer doctor was permitted to testify with respect to a peer report and underlying medical records which were not in evidence. The Court found that the peer doctor satisfied the Wagman two prong test for permitting expert testimony based upon out of court documents. Id. The Court held that a Plaintiff invariably can not rebuff the permissibility of the expert testimony on reliability grounds when those documents are Plaintiff’s or assignor’s documents.

In PLP Acupuncture, P.C. v. Progressive Cas. Ins. Co., 2009 NY Slip Op 50491U, 1-2 (NY App. Term 2009), the Court permitted a substitute peer doctor to testify. The Court applied the Wagman test and held that the substitute peer could rely upon out of court documents in forming his opinion as long as the substitute peer offers proof of the reliability of the out of court documents. Id. The Court further held that as some of the medical reports relied upon by defendant’s acupuncturist in his peer review report were prepared by plaintiff, plaintiff could not challenge the reliability of its own medical records and reports. Id.

In Dilon Med. Supply Corp. v. New York Cent. Mut. Ins. Co., 2007 NY Slip Op 52454U, 2 (NY App. Term 2007), the Appellate Term reversed a lower court which precluded a substitute doctor from testifying. The Court held that since defendant sought to call a medical expert witness who was available for cross-examination, and his testimony as to the lack of medical necessity of plaintiff’s services would be limited to the basis for the denials as set forth in the original peer review reports, the expert witness should have been permitted to testify. Id.

Applying this standard to the case at hand, the Court will permit the substitute peer doctor to testify and limit his testimony to the basis for denial as set forth in the original peer review. Plaintiff objected to Dr. Jacob’s testimony based upon hearsay grounds. The Court of Appeals has [*4]held that an expert witness may testify that he or she relied upon specific, inadmissible out-of-court material to formulate an opinion provided: (1) it is of a kind accepted in the profession as reliable as a basis in forming a professional opinion and (2) there is evidence presented establishing the reliability of the out-of-court material referred to by the witness. See Wagman. Dr. Jacobs testified that the out-of-court documents he relied upon were professionally reliable, however he did not present evidence establishing the reliability of the out-of-court material. Therefore, Defendant failed to demonstrate either that the testimony did not rely on out-of-court documents for the truth of the matters stated herein, or that the documents were being relied upon for their truth but fell within an exception to the rule against hearsay. See Progressive Med., Inc. v Allstate Ins. Co., 2010 NY Slip Op 50219U (NY App. Term 2010). Accordingly, Dr. Jacobs’ testimony is stricken and the Court finds that Defendant did not establish a factual basis and medical rationale for its asserted lack of medical necessity.

Judgement in favor of Plaintiff in the amount of $563.04, plus costs, disbursements, statutory interest and statutory attorneys fees. This constitutes the decision and order of the Court.

May 6, 2010

Pamela L. Fisher

Judge, Civil Court