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 August 1, 2008. The order denied plaintiff’s motion for summary judgment.

ORDERED that the order is affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the Civil Court which denied plaintiff’s motion for summary judgment on the ground that defendant’s opposition to the motion had raised a triable issue of fact as to medical necessity.

Contrary to plaintiff’s contention on appeal, the doctor performing the peer review did not conclude that he had insufficient information upon which to base a conclusion. Instead, the affirmed report raised a triable issue of fact because “the report clearly indicates that the pertinent [treating] physician’s reports and other documentation had been requested and provided for the purpose of conducting a peer review, and the conclusion of lack of medical necessity is based on the peer reviewer’s opinion, in effect, that there was no substantiation in the reports and documents reviewed of medical necessity for the [services] provided” (Amaze Med. Supply Inc. v Travelers Prop. Cas. Corp., 7 Misc 3d 128[A], 2005 NY Slip Op 50452[U] [App Term, 2d & 11th Jud Dists 2005]). Accordingly, plaintiff’s motion for summary judgment was properly denied.

We decline defendant’s request that we search the record and grant defendant summary [*2]judgment (see e.g. New York Univ. Hosp. Rusk Inst. v Government Empls. Inc. Co., 39 AD3d 832 [2007]).

Pesce, P.J., Weston and Rios, JJ., concur.
Decision Date: October 23, 2009

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, Richmond County (Katherine A. Levine, J.), entered July 3, 2008. 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 moved for summary judgment dismissing the complaint based upon plaintiff’s assignor’s failure to appear for independent medical examinations (IMEs). The Civil Court denied defendant’s unopposed motion on the ground that defendant had failed “to show [that] the IME notices were mailed to [the] claimant.”

In support of its motion, defendant submitted the affidavit of a manager employed by the independent medical review service retained by defendant to schedule and conduct IMEs, which affidavit sufficiently set forth the standard office practice and procedure for the generation and mailing of IME notices designed to ensure that said notices were properly addressed and mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; cf. Top Choice Med., P.C. v New York Cent. Mut. Fire Ins. Co., 22 Misc 3d 133[A], 2009 NY Slip Op 50230[U] [App Term, 2d, 11th & 13th Jud Dists 2009]). The affirmations and affidavits of the medical professionals who were to perform the IMEs established that plaintiff’s assignor failed to [*2]appear for said IMEs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]; Tuncel v Progressive Cas. Ins. Co., 21 Misc 3d 143[A], 2008 NY Slip Op 52455[U] [App Term, 2d & 11th Jud Dists 2008]). Consequently, defendant’s unopposed motion for summary judgment dismissing the complaint should have been granted.

Pesce, P.J., Weston and Rios, JJ., concur.
Decision Date: October 23, 2009

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 (Carolyn E. Wade, J.), entered September 30, 2008, deemed from a judgment of the same court entered November 10, 2008 (see CPLR 5512 [a]). The judgment, entered pursuant to the September 30, 2008 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $2,693.12.

ORDERED that the judgment is reversed without costs, the order granting plaintiff’s motion for summary judgment is vacated 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. In opposition to the motion, defendant argued, based upon an affirmed peer review report, that the MRIs were not medically necessary. By order dated September 30, 2008, the Civil Court granted plaintiff’s motion for summary judgment. After judgment was entered on November 10, 2008, defendant filed a notice of appeal from the September 30, 2008 order. We deem the appeal to be from the judgment (see CPLR 5512 [a]).

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. We disagree because the affidavit was sufficient to comply with 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]). As a result, the burden shifted to defendant to demonstrate the existence of a triable issue of fact (Zuckerman v City of New York, 49 NY2d 557 [1980]).

In opposition to plaintiff’s motion, defendant established that it had timely denied plaintiff’s claims based upon an affirmed peer review report setting forth a factual basis and medical rationale for the doctor’s opinion that the services provided to plaintiff’s assignor were not medically necessary (see New York Univ. Hosp. Rusk Inst. v Government Empls. Ins. Co., 39 AD3d 832 [2007]; Quality Health Prods., P.C. v Progressive Ins. Co., 20 Misc 3d 143[A], 2008 NY Slip Op 51757[U] [App Term, 2d & 11th Jud Dists 2008]). As a result, defendant [*2]proffered sufficient evidence in admissible form to demonstrate the existence of a triable issue of fact as to medical necessity (see Velen Med. Supply, Inc. v GEICO Ins. Co., 23 Misc 3d 132[A], 2009 NY Slip Op 50735[U] [App Term, 2d, 11th & 13th Jud Dists 2009]).

To the extent defendant asks this court to search the record and grant it summary judgment, we decline to do so (see e.g. New York Univ. Hosp. Rusk Inst., 39 AD3d 832).

Pesce, P.J., Golia and Steinhardt, JJ., concur.
Decision Date: October 13, 2009

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 August 13, 2008. The order denied plaintiff’s motion to restore the case to the trial calendar.

ORDERED that the order is affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, the parties consented to have the case marked off the trial calendar in March 2007. In August 2008, plaintiff moved to restore the case. The Civil Court denied plaintiff’s motion “with leave to renew upon a proper showing/reasonable excuse as to why plaintiff did not move to restore within one year of the case being marked off the trial calendar.” The instant appeal by plaintiff ensued.

An action that has been marked off the trial calendar, whether by consent of the parties or stricken by the court, which is not restored to the calendar within one year, may only be restored thereafter if the plaintiff demonstrates, inter alia, a meritorious cause of action and a reasonable excuse for the delay in moving to restore the case (see Kaufman v Bauer, 8 Misc 3d 60 [App Term, 1st Dept 2005], revd on other grounds 36 AD3d 481 [2007]; see generally Uniform Rules for Trial Courts [22 NYCRR] § 208.14 [c]; Goldstein v Block, 7 AD3d 669 [2004]). Herein, plaintiff failed to satisfy the foregoing requirements. Accordingly, the order is affirmed.

Pesce, P.J., Golia and Steinhardt, JJ., concur.
Decision Date: October 13, 2009

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 (Thomas D. Raffaele, J.), dated June 20, 2008. The order denied plaintiff’s motion for summary judgment.

ORDERED that the order is affirmed without costs.

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 equipment provided to plaintiff’s assignors was not medically
necessary. The Civil Court denied plaintiff’s motion, finding that there was a triable issue regarding medical necessity. The instant appeal by plaintiff ensued.

Contrary to defendant’s contention, the affidavits of plaintiff’s president, who was also plaintiff’s custodian of records, were sufficient to establish that the documents annexed to plaintiff’s motion papers constituted evidence in admissible form 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]). As defendant concedes, any deficiency in plaintiff’s moving papers regarding proof of mailing of the claim forms was cured by defendant’s claim denial forms acknowledging receipt of the claim forms (see Oleg Barshay, D.C., P.C. v State Farm Ins. Co., 14 Misc 3d 74 [App Term, 2d & 11th Jud Dists 2006]). Accordingly, plaintiff made a prima facie showing of its entitlement to summary judgment by proof that it submitted the statutory claim forms, setting forth the fact and the amount of the loss sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]).

In opposition to plaintiff’s motion, defendant established that it had timely denied the claims in question based upon affirmed peer review reports setting forth a factual basis and medical rationale for the doctor’s opinion that the supplies provided to plaintiff’s assignors were [*2]not medically necessary (see New York Univ. Hosp. Rusk Inst. v Government Empls. Ins. Co., 39 AD3d 832 [2007]; Quality Health Prods., P.C. v Progressive Ins. Co., 20 Misc 3d 143[A], 2008 NY Slip Op 51757[U] [App Term, 2d & 11th Jud Dists 2008]). As a result, defendant proffered sufficient evidence in admissible form to demonstrate the existence of a triable issue of fact as to medical necessity (see Velen Med. Supply, Inc. v GEICO Ins. Co., 23 Misc 3d 132[A], 2009 NY Slip Op 50735[U] [App Term, 2d, 11th & 13th Jud Dists 2009]).

Plaintiff’s contention that the peer review reports did not constitute evidence in admissible form was waived since said argument is raised for the first time on appeal (see Dowling v Mosey, 32 AD3d 1190 [2006]; Velen Med. Supply, Inc., 23 Misc 3d 132[A], 2009 NY Slip Op 50735[U]; Alur Med. Supply, Inc. v Geico Ins. Co., 20 Misc 3d 145[A], 2008 NY Slip Op 51867[U] [App Term, 2d & 11th Jud Dists 2008]).

To the extent defendant asks this court to search the record and grant it summary judgment dismissing the complaint, we decline to do so (see e.g. New York Univ. Hosp. Rusk Inst., 39 AD3d 832).

Pesce, P.J., Golia and Steinhardt, JJ., concur.
Decision Date: October 13, 2009

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 (Rhonda E. Fischer, J.), entered August 11, 2008. The order denied plaintiffs’ motion for summary judgment and granted defendant’s cross motion for summary judgment dismissing the complaint.

ORDERED that the order is affirmed without costs.

In this action by providers to recover assigned first-party no-fault benefits, plaintiffs moved for summary judgment. Defendant opposed plaintiffs’ motion and cross-moved for summary judgment on the ground that plaintiffs’ assignor failed to appear for scheduled examinations under oath (EUOs). The District Court denied plaintiffs’ motion for summary judgment and granted defendant’s cross motion.

On appeal, plaintiffs argue that they made a prima facie showing of their entitlement to summary judgment, and that defendant was not entitled to summary judgment because, among other things, defendant failed to prove that it mailed the EUO notices. We disagree.

Contrary to plaintiffs’ contention, defendant established both that the EUO notices were mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]) and that the assignor failed to appear (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). Consequently, in light of the foregoing and the fact that plaintiffs’ further [*2]contentions that the EUO notices were defective and that an EUO was not necessary lack merit, defendant’s cross motion for summary judgment was properly granted (W & Z Acupuncture, P.C. v Amex Assur. Co., 24 Misc 3d 142[A], 2009 NY Slip Op 51732[U] [App Term, 2d, 11th & 13th Jud Dists 2009]).

Even were we to find otherwise, plaintiffs’ motion for summary judgment was properly denied because plaintiffs failed to make a prima facie showing of their entitlement to summary judgment since the affidavit submitted by plaintiffs’ billing manager failed to establish that the documents annexed to plaintiffs’ moving papers were admissible pursuant to CPLR 4518 (see Alvarez v Prospect Hosp., 68 NY2d 320 [1986]; Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]; Fortune Med., P.C. v Allstate Ins. Co., 14 Misc 3d 136[A], 2007 NY Slip Op 50243[U] [App Term, 9th & 10th Jud Dists 2007]).

Molia, J.P., Nicolai and Tanenbaum, JJ., concur.
Decision Date: October 06, 2009

—[*1] Law Office of J. Michael Hayes, Buffalo (J. Michael Hayes of counsel), for plaintiff-appellant.

Law Office of Daniel R. Archilla, Buffalo (David H. Frech of counsel), for defendant-respondent.

Appeal from an order of the Supreme Court, Erie County (John A. Michalek, J.), entered July 25, 2008. The order denied plaintiff’s motion for summary judgment and granted defendant’s motion to sever the causes of action.

It is hereby ordered that the order so appealed from is unanimously affirmed without costs.

Memorandum: Plaintiff, as assignee of 14 patients to whom it provided radiological services, commenced this action seeking to recover no-fault benefits pursuant to the contract between each patient and defendant insurer. We conclude that Supreme Court properly denied plaintiff’s motion for summary judgment on the amended complaint. Although plaintiff made a prima facie showing of entitlement to judgment as a matter of law by submitting evidence that the prescribed statutory billing forms were received by defendant and that defendant’s payment of no-fault benefits to plaintiff was overdue (see A.B. Med. Servs., PLLC v Liberty Mut. Ins. Co., 39 AD3d 779, 780 [2007]; LMK Psychological Servs., P.C. v Liberty Mut. Ins. Co., 30 AD3d 727, 728 [2006]), defendant raised a triable issue of fact by submitting its denial of claim forms setting forth that the services for which plaintiff sought to recover no-fault benefits were not medically necessary (see Countrywide Ins. Co. v 563 Grand Med., P.C., 50 AD3d 313, 314 [2008]; A.B. Med. Servs., PLLC, 39 AD3d at 780-781). Contrary to plaintiff’s contention, defendant is not precluded from denying the claims after the services were rendered on the ground of lack of medical necessity. Plaintiff’s assignors were entitled only to reimbursement for medically “necessary” expenses (Insurance Law § 5102 [a] [1]; see 11 NYCRR 65-1.1 [d]), and plaintiff assignee is subject to that lack of medical necessity defense (see Long Is. Radiology v Allstate Ins. Co., 36 AD3d 763, 765 [2007]).

Contrary to plaintiff’s further contention, the court did not abuse its discretion in granting defendant’s motion to sever the 14 causes of action. “The decision whether to grant severance ‘rests soundly in the discretion of the trial court and, on appeal, will be affirmed absent a demonstration of abuse of discretion or prejudice to a substantial right’ ” (Rapini v New Plan Excel Realty Trust, Inc., 8 AD3d 1013, 1014 [2004]; see Soule v Norton, 299 AD2d 827, 828 [2002]). [*2]Although this action was commenced “by a single assignee against a single insurer and all [causes of action] allege the erroneous nonpayment of no-fault benefits . . . , they arise from [14] different automobile accidents on various dates in which the [14] unrelated assignors suffered diverse injuries and required different medical treatment” (Poole v Allstate Ins. Co., 20 AD3d 518, 519 [2005]). Present—Scudder, P.J., Hurlbutt, Martoche, Smith and Centra, JJ.

Civ Ct, Richmond County

Index No.: 21379/07

Counsel for Defendant:

Gina M. DiGaudio, Esq.

GULLO & ASSOCIATES, LLP

520 86TH Street

Brooklyn, New York 11209

718-238-9555

Counsel for Plaintiff:

Joaquin J. Lopez, Esq.

BAKER, SANDERS, BARSHAY, GROSSMAN, FASS, MUHLSTOCK & NEUWIRTH

150 Herricks Road

Mineola, NY 11501

516-741-4799

Katherine A. Levine, J.

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

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

Plaintiff Administrative Assets (“plaintiff” or “Assets”), a medical service provider, commenced this action, pursuant to the No-Fault Law, to recover payments from defendant Zurich American Transit Insurance Company (“defendant” or “Zurich”) for services plaintiff rendered to its assignor Frank Saccente (“assignor” or “Saccente”) as a result of the injuries that he sustained in an automobile accident.

Defendant moves to dismiss the action on the ground that the assignor is entitled to Workers Compensation because the assignor was an employee who was injured on the job while working, thus granting the Workers Compensation Board (“Board”) primary jurisdiction over issues of coverage. In support of its motion, defendant presented the affidavit of its no fault specialist – Mr. Herbert – who, in a conclusory fashion, described how defendant ” obtained documents from the Workers’ Compensation Board which revealed that the assignor was injured in the course of employment.” Specifically, attached to his affidavit is an “Employer’s Report of Work-Related

Accident”(“Employer’s Report”) filled out by a third party – the assignor’s employer.

Plaintiff asserts that a no-fault insurer asserting a defense that workers compensation is primary must establish, as a threshold matter, that the claimant was employed at the time of the underlying motor vehicle accident. Plaintiff asserts that defendant failed to submit any admissible evidence on this point that the claims specialist’s affidavit is insufficient to lay a foundation to admit a hearsay document (the Employer’s Report) into evidence. Specifically, under Dan Medical P.C. v. NY Central Mutual Fire, Ins.,14 Misc 3d 44 (App. Term, 2d Dept. 2006), the claims specialist failed to demonstrate that he possessed sufficient personal knowledge of defendant’s business offices practices and procedures so as to lay the foundation for the [*2]admission of the assignor’s Employer’s Report.

The Court finds that the Employer’s Report is inadmissable, since defendant has failed to lay a foundation establishing that this Report, which was prepared by a third party – the assignor’s employer – is a business record of defendant. As such, the information contained in the report is inadmissable hearsay.

In the leading case of People v. Kennedy, 68 NY2d 569 (1986), the Court addressed several issues relating to the hearsay exception to business records contained in CPLR 4518(a). This provision provides that “[t]he term business includes a business, profession, occupation and calling of every kind.” The business records exception “grew out of considerations of necessity and trustworthiness – the necessity for alternatives to permit large and small business to prove debts by their records of account, and the unusual degree of trustworthiness and reliability of such records owing to the fact that they were kept regularly, systematically, routinely and contemporaneously.” Id at 579 citing 5 Wigmore, Evidence, §§ 1421-22, 1546. “The essence of the business records exception …is that records systematically made for the conduct of a business …are inherently highly trustworthy because they are routine reflections of day-to-day operations and because the entrant’s obligation is to have them truthful and accurate for purposes of the conduct of the enterprise.” 68 NY2d at 579.

The foundation requirements of CPLR 4518, which incorporate these common law precepts,

mandate that the proponent establish that the writing was made in the regular course of business, i.e. that the writing reflects a routine, regularly conducted business activity; that it was the regular course of business to make the writing; and that the writing was made at or about the time of the transaction; and that the writing was made at or about the time of the transaction.” Id at 580. See, Lenox Hill Radiology P.C. (Sardar) v. American Transit Ins CO., 2008 NY Slip Op. 50330U, 18 Misc 3d 1136A (Civil Ct., NY Co. 2008). In Aram Barbikian v. Nikki Midtown LLC, 60 AD3d 470, 471-72 (1st Dept. 2009), for example, the court held that the bookkeeper’s affidavit did not lay the foundation

necessary for the admissibility of purported employment records and a computer printout submitted to show where the employees were on the date of the attack. The bookkeeper did not state that she was in charge of employment or employment records or otherwise have firsthand knowledge of the plaintiff.

Similarly, here, the affidavit of John Herbert does not specify defendant’s regular business procedures for obtaining information regarding an assignor’s employment status vis a vis workers compensation, and defendant clearly does not have personal knowledge much less any knowledge as to how the third party – the assignor’s employer – filled out the Employer’s [*3]Report or submitted it to the Workers Compensation Board. The affidavit is silent as to whether either it was either defendant’s or the third party employer’s business duty to record the act, transaction or occurrence sought to be admitted.

As such, the third party report may not be considered in this summary judgment motion and the defendant therefore cannot show, in its papers that there is potential merit’ to its claim that [the assignor] was employed at the time of the accident so as to trigger a determination by the Workers’ Compensation Board. Lenox Hill Radiology, supra citing A.B. Medical Serv. PLLC v. American Transit Ins. Co., 8 Misc 3d 127A, 801 NYS2d 776 (App. Term, 2d Dept. 2005 ). In light of the inadmissibility of this record, this court finds that defendant has not submitted sufficient evidence that the assignor was employed at the time of the accident, that workers compensation is primary, and that the issue of coverage must first be presented to the Workers Compensation Board. See, Arvatz v.v. Empire Mut. Ins. Co., 171 AD2d 262, 268 (1st Dept. 1991); Lenox Hill Radiology, supra .

As defendant’s motion for summary judgment is denied, this case shall proceed to trial.

The foregoing constitutes the decision and order of the court.

Dated:October 1, 2009

Staten Island, NYHON. KATHERINE A. LEVINE

Judge, Civil Court

ASN by _______ on ____________

A P P E A R A N C E S

Counsel for Defendant:

Gina M. DiGaudio, Esq.

GULLO & ASSOCIATES, LLP

520 86TH Street

Brooklyn, New York 11209

718-238-9555

Counsel for Plaintiff:

Joaquin J. Lopez, Esq.

BAKER, SANDERS, BARSHAY, GROSSMAN, FASS, MUHLSTOCK & NEUWIRTH

150 Herricks Road

Mineola, NY 11501

516-741-4799

[*1]

District Court of Nassau County, First District, September 28, 2009

APPEARANCES OF COUNSEL

Law Offices of Nancy S. Kinden for plaintiff.

{**25 Misc 3d at 1020} OPINION OF THE COURT

Fred J. Hirsh, J.

Plaintiff moves for leave to enter a default judgment.

Background

This case presents the issue of whether a no-fault insurance carrier that has paid no-fault benefits can sue a provider to recover no-fault benefits paid on a fraudulent claim.

Andrey Armstrong was injured in an automobile accident on September 5, 2008.

On October 4, 2008 and October 9, 2008, Alev Medical Supply, Inc. purportedly provided medical supplies to Armstrong. Armstrong assigned his right to no-fault benefits for these items to Alev.

Alev submitted the bills for these medical supplies to the plaintiff Lincoln General Insurance Company. Lincoln provided no-fault insurance benefits for Armstrong for claims arising out of Armstrong’s September 5, 2008 motor vehicle accident.

Lincoln received the bills from Alev on November 10, 2008.

Lincoln paid the bills in part and denied the bill in part on December 4, 2008. Lincoln issued checks to Alev for the portions of the bills it paid and issued denials for the balance of the bills. Lincoln denied a portion of the bills on the grounds the charges for the medical supplies and equipment were not in accordance with the no-fault payment schedule (11 NYCRR part 68).

Alev received and deposited the checks issued in payment of the claims.

On December 18, 2008, Armstrong testified at an examination under oath (11 NYCRR 65-1.1 [d]) that he never received any of the equipment Alev claims it provided to him, for which Alev billed Lincoln and for which Lincoln paid.

Lincoln commenced this action seeking to recover the money it paid to Alev on the claim.

Alev has defaulted in the action. Lincoln now moves for leave to enter a default [*2]judgment.

Discussion

An insurer has 30 days from receipt of a no-fault claim to pay or deny the claim. (Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312 [2007]; Kingsbrook Jewish Med. Ctr. v{**25 Misc 3d at 1021} Allstate Ins. Co., 61 AD3d 13 [2d Dept 2009]; 11 NYCRR 65-3.8 [a] [1].)

An insurer’s time to pay or deny a claim is tolled or extended if the insurer timely requests verification and/or upon receipt of the verification, timely requests additional verification of the claim. (St. Barnabas Hosp. v American Tr. Ins. Co., 57 AD3d 517 [2d Dept 2008]; Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492 [2d Dept 2005], lv denied 7 NY3d 704 [2006].)^[FN1] When an insurer timely requests additional verification, the 30-day period in which to pay or deny the claim is tolled pending receipt of the additional verification. (Kingsbrook Jewish Med. Ctr. v Allstate Ins. Co., supra; Montefiore Med. Ctr. v Government Empls. Ins. Co., 34 AD3d 771 [2d Dept 2006].)

Lincoln did not request verification of the claim submitted by Alev.

With limited exceptions, none of which are relevant to this case, an insurer is precluded from raising defenses including fraud not asserted in a timely denial. (Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556 [2008]; Hospital for Joint Diseases v Travelers Prop.{**25 Misc 3d at 1022} Cas. Ins. Co., supra; Careplus Med. Supply, Inc. v Selective Ins. Co. of Am., 25 Misc 3d 48 [App Term, 9th & 10th Jud Dists 2009].)

Lincoln could have denied the claim on the grounds it was fraudulent. (Fair Price Med. Supply Corp. v Travelers Indem. Co., supra.) Lincoln did not. It paid the claim in part and denied the claim in part. The denial of the claim was based not upon fraud but upon the charges not being in accordance with the no-fault payment schedule.

The purpose of the No-Fault Law is “to ensure prompt compensation for losses incurred by accident victims without regard to fault or negligence, to reduce the burden on the courts and to provide substantial premium savings to New York motorists.” (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854, 860 [2003]; see Fair Price Med. Supply Corp. v Travelers Indem. Co., supra; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., supra.) An insurer can contest an illegitimate or fraudulent claim, but it must do so within the strict time periods and processes established by the No-Fault Law and regulations. (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274 [1997].)

The core objective of the No-Fault Law and regulations is “to provide a tightly [*3]timed process of claim, disputation and payment.” (Id. at 281; see LMK Psychological Servs., P.C. v State Farm Mut. Auto. Ins. Co., 12 NY3d 217 [2009].)

Permitting Lincoln to recover in this action would allow an insurer to avoid or evade the time restrictions of the No-Fault Law and regulations by paying and then investigating a claim and suing to recover the previously paid benefits if the investigation reveals the claim was fraudulent. To permit this would subvert the entire no-fault system which establishes strict time limits by which an insurer must process, dispute and pay a claim.

The No-Fault Law and regulations require insurers to promptly investigate and pay claims. The regulations provide insurers with the verification process in order to obtain additional information designed to ferret out illegitimate or fraudulent claims.

While the 30-day period plus any applicable tolls for paying or denying a claim may be “too short a time frame in which to detect billing fraud, any change is up to the Legislature.” (Fair Price Med. Supply Corp. v Travelers Indem. Co. at 565.)

All bases that an insurer has for denying a no-fault claim, except for specific and limited exceptions, must be raised in a timely denial.^[FN2] The only way an insurer can avoid paying a fraudulent no-fault claim is to deny the claim as fraudulent in a timely denial and to assert and prove the defense at trial. (Id.; Lenox Hill Radiology & MIA, P.C. v Global Liberty Ins. Co. of N.Y., 24 Misc 3d 1225[A], 2009 NY Slip Op 51620[U] [Civ Ct, Richmond County 2009].){**25 Misc 3d at 1023}

One of the elements of an application for leave to enter a default judgment is proof of a cause of action against the defendant. (Francisco v Soto, 286 AD2d 573 [1st Dept 2001]; Joosten v Gale, 129 AD2d 531 [1st Dept 1987]; Siegel, NY Prac § 295 [4th ed].) Lincoln’s complaint fails to state a claim upon which relief can be granted.

Nothing in this decision precludes Lincoln from reporting this apparent insurance fraud (Penal Law art 176) to the appropriate law enforcement authorities or from obtaining restitution should Alev be prosecuted and found guilty of insurance fraud in connection with this claim. (Penal Law § 60.27.)

For the foregoing reasons, plaintiff’s motion for leave to enter a default judgment is denied. The action is dismissed.

Footnotes

Footnote 1: An insurer that seeks additional information about a claim can obtain verification by sending the claimant a request for verification within 10 business days of receipt of the claim. (11 NYCRR 65-3.5 [a].) Upon receipt of the initial verification, an insurer can seek additional information or proof regarding the claim by sending the claimant a request for additional verification within 15 business days of receipt of the prescribed verification forms. (11 NYCRR 65-3.5 [b].)

Footnote 2: An insurer is not precluded from raising the defenses of no coverage (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]) fraudulent incorporation (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]), and staged accident (Central Gen. Hosp. v Chubb Group of Ins. Cos., supra; Matter of Allstate Ins. Co. v Massre, 14 AD3d 610 [2d Dept 2005]; V.S. Med. Servs., P.C. v Allstate Ins. Co., 11 Misc 3d 334 [Civ Ct, Kings County 2006]) if such defenses are not asserted in a timely denial. Although generally not considered a defense not subject to preclusion if not asserted in a timely denial, an insurer cannot be required to pay more than the no-fault policy limits. (Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533 [2d Dept 2004].)

[*1]

County Court, Erie County, September 24, 2009

APPEARANCES OF COUNSEL

O’Brien Boyd, P.C., Williamsville (Daniel K. Morris of counsel), for plaintiffs-appellants. Mura & Storm, PLLC, Buffalo (Brian C. Clark of counsel), for defendants-respondents.

{**26 Misc 3d at 483} OPINION OF THE COURT

Michael Pietruszka, J.

The plaintiffs-appellants (hereinafter appellants) appeal from orders of the Buffalo City Court (Ogden, J.) granted October 20, 2008 (No. E14033/2008) and October 27, 2008 (No. E12518/2008). Both the appellants and defendants-respondents (hereinafter respondents) submitted briefs and waived oral argument.

Procedural History

This appeal consolidated the two above-captioned actions for the purpose of review as both involve a common question of law.

The underlying actions concern the recovery of money damages. The appellants are health care providers who provided medical care to various patients. These patients are all insureds of the respondents. The respondents provide no-fault insurance coverage in the City of Buffalo and throughout New York State. The respondents denied these patients’ first-party no-fault insurance claims. The claims of the patients were thereafter assigned to the appellants.

The appellants commenced these actions by serving Buffalo City Court summonses and complaints on the New York State Superintendent of Insurance at the New York State Department of Insurance’s Albany offices under the authority of Insurance Law § 1212. On September 29, 2008 Judge Ogden ruled from the bench granting the respondents’ motions and both cases were dismissed for lack of personal service. The Buffalo City Court reduced its decisions to writing in orders granted October 20, 2008 (No. E14033/2008) and October 27, 2008 (No. E12518/2008).{**26 Misc 3d at 484}

Arguments

The appellants argue that the respondents were properly served through the New York State Insurance Department in Albany. Their position is based upon Insurance Law § 1212. The appellants, therefore, contend that the Buffalo City Court rulings should be reversed.

The respondents contend that Judge Ogden’s orders should be affirmed. They argue that the complaints of the appellants should be dismissed because the method of service used did not confer personal jurisdiction over the respondents upon the Buffalo City Court. Their argument is based upon article VI, § 1 (c) of the New York State Constitution which states, in pertinent part: “The legislature may provide that processes, warrants and other mandates . . . of town, village and city courts outside the city of New York may be served and executed in any part of the county in which such courts are located or in any part of any adjoining county.” The respondents argue that Buffalo City Court process was served on the parties in Albany, outside Erie County and its adjoining counties. The respondents, therefore, contend that the Buffalo City Court ruling should be affirmed.

Decision

The issue before this court is whether service of a Buffalo City Court summons and complaint upon the New York State Superintendent of Insurance in Albany provides the Buffalo City Court with personal jurisdiction over the respondent insurance companies. [*2]

Insurance Law § 1212 (b) states, in pertinent part: “Service of process upon any such insurer in any proceeding in any court of competent jurisdiction may be made by serving the superintendent” and that such “[s]ervice of process so made shall be deemed to have been made within the territorial jurisdiction of any{**26 Misc 3d at 485} court in this state.”

In order for an insurance company to be authorized to do business in New York State, a power of attorney must be filed in the office of the Superintendent of Insurance. The filing of the power of attorney subjects the insurance company, as well as its property within the State of New York, to the jurisdiction of New York State courts. (Morgan v Mutual Benefit Life Ins. Co., 119 App Div 645 [1907].) This particular statute, which provides for service of process upon the Superintendent of Insurance, was intended to provide an avenue to serve a foreign insurance company within the territorial jurisdiction of any court of the State of New York regardless of capacity or geographical limitation.

While these actions appear to tread dangerously near state constitutional questions, they are, in reality, contractual matters. Pohlers v Exeter Mfg. Co. (293 NY 274 [1944]) most closely correlates to the issues of these cases. As in the cases before this court, the defendant in Pohlers was a foreign corporation which had expressly consented to service beyond the court’s jurisdictional limitations as a requirement for operating in New York State. Also, from a practical standpoint, in both these cases, as well as in Pohlers, the courts presiding over the original claims were acting within their “competent jurisdiction” because the underlying causes of action arose within the Buffalo and New York City limits, respectively.

As a matter of law, Pohlers ruled that

“[o]rdinarily a court can acquire jurisdiction of the person of a defendant only by service of process within the jurisdiction of the court; but that rule does not apply where the defendant ‘has agreed in advance to accept, or does in fact accept, some other form of service as sufficient.’ ” (Id. at 279.)

The court in Pohlers further noted that valid consent can also be exacted by the State (id. at 280). A parallel argument was also made in Jackson v National Grange Mut. Liab. Co. (274 App Div 330 [1948]), which states that serving the Superintendent of Insurance constitutes service within the territorial jurisdiction of any and all courts of the state, regardless of their limitation or general jurisdiction, including a justice court.

There is no question that the respondents are required to file a power of attorney with the Superintendent of Insurance in order to do business within the geographical limits of New York State. Pursuant to this power of attorney, the Superintendent is authorized to accept service of process for any cause of action which originates out of a contract formed within New York State.

It is clear, pursuant to both Pohlers and Insurance Law § 1212, that the respondents have already consented to acceptance of service of process by the Superintendent of Insurance by filing the power of attorney. Without such previous consent, it would be impossible for the respondents to be doing business in New York in the first place. In essence, the state constitutional right under article VI, § 1 (c) has been contractually waived by executing the power of attorney in favor of the Superintendent{**26 Misc 3d at 486} of Insurance. It should be noted that a constitutional right can be waived through the language of a contract as evidenced by the signing of a jury waiver form, which relinquishes the right to a trial by jury.

Finally, the underlying cause for these consolidated actions involves the collection of no-fault insurance claims. The basis for such a claim has been made possible by the Insurance Law. From a policy standpoint, the benefit of the statute and the opportunity to bring [*3]an insurance claim to court reflect back to the authority of the state legislature and the practical application of Insurance Law § 1212. To allow article VI, § 1 (c) to take precedence in this service of process matter would nullify the acts of the state legislature and the provisions of Insurance Law § 1212, could affect due process rights of the parties and could deny a meritorious claimant’s rightful day in court. Also, it is a well-established rule of statutory construction that where a general provision is at odds with a provision that specifically, by its terms, applies to a particular situation, the more specific provision should be applied.

Therefore, having reviewed and considered the record on appeal and the briefs of both parties, and due deliberation having been had thereon, this court finds that the respondents were properly served, consistent with Insurance Law § 1212 and, therefore, the respondents’ motions to dismiss were improperly granted by Judge Ogden on September 29, 2008.

Accordingly, the orders of Buffalo City Court (Ogden, J.) dated October 20, 2008 (No. E14033/2008) and October 27, 2008 (No. E12518/2008) are hereby reversed and the matters remanded to Buffalo City Court for further proceedings not inconsistent with this decision.