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 (Margaret A. Pui Yee Chan, J.), entered March 25, 2008. The order granted defendant’s motion for summary judgment dismissing the complaint.

Order reversed without costs and defendant’s motion for summary judgment denied.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint. Plaintiff opposed the motion. The Civil Court granted defendant’s motion and the instant appeal by plaintiff ensued.

A review of the record indicates that the affidavit of defendant’s claims representative failed to demonstrate defendant’s prima facie entitlement to summary judgment dismissing the complaint due to a lack of medical necessity. Defendant’s supporting affidavit stated that defendant did not receive the claims at issue prior to the commencement of the action while, at the same time, stating that it received the claims on specified dates prior to the commencement of the action and thereafter timely denied same. In view of the foregoing inconsistency, defendant’s motion for summary judgment should have been denied (see Zuckerman v City of New York, 49 NY2d 557 [1980]).

In any event, as argued by plaintiff in the Civil Court and on appeal, the affirmed peer review reports defendant submitted in support of its motion for summary judgment indicate that [*2]the “signature” upon each report appears to be identical, thereby raising an issue of fact as to whether the purported signatures were in compliance with CPLR 2106 (see General Construction Law § 46; Mani Med., P.C. v Eveready Ins. Co., 18 Misc 3d 140[A], 2008 NY Slip Op 50395[U] [App Term, 2d & 11th Jud Dists 2008]; Macri v St. Agnes Cemetery, Inc., 44 Misc 2d 702 [Sup Ct, NY County 1965]). Such issue of fact may not be resolved on a motion for summary judgment (see Seoulbank, NY Agency v D & J Export & Import Corp., 270 AD2d 193 [2000]; Dyckman v Barrett, 187 AD2d 553 [1992]; Mani Med., P.C., 18 Misc 3d 140[A], 2008 NY Slip Op 50395[U]). Accordingly, the order is reversed and defendant’s motion for summary judgment is denied.

Pesce, P.J., Golia and Rios, JJ., concur.
Decision Date: May 22, 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, Kings County (Dolores L. Waltrous, J.), entered October 9, 2007, deemed from a judgment of the same court entered January 3, 2008 (CPLR 5520 [c]). The judgment, after a nonjury trial, entered pursuant to the October 9, 2007 order granting defendant’s motion pursuant to CPLR 4401 to dismiss plaintiff’s complaint for failure to prove a prima facie case, dismissed the complaint.

Judgment affirmed without costs.

At the trial in this action by a provider to recover assigned first-party no-fault benefits, plaintiff sought to admit into evidence the claim forms at issue and the assignment of benefits, as well as the denial of claim forms issued by defendant. After defendant’s objection to the admission of said documents was sustained, plaintiff orally moved for the admission into evidence of its notice to admit and defendant’s response thereto, contending that they, and defendant’s affidavit in opposition to plaintiff’s prior motion for summary judgment, which motion was withdrawn, were sufficient to establish plaintiff’s prima facie case. The court similarly sustained defendant’s objection to the admission of the foregoing documents. After plaintiff rested, the court granted defendant’s motion pursuant to CPLR 4401 for a directed verdict dismissing the complaint for failure to prove a prima facie case. The instant appeal by plaintiff ensued. A judgment was subsequently entered dismissing the complaint.

At trial, “it remained plaintiff’s burden to proffer evidence in admissible form, i.e., by [*2]introducing into evidence the claim form[s] in question by, inter alia, calling a witness to lay a foundation for the admissibility of the claim form[s] as . . . business record[s], which plaintiff failed to do. Accordingly, in light of plaintiff’s failure to establish the admissibility of its claim form[s] as . . . business record[s], plaintiff did not establish a prima facie case and defendant was entitled to judgment dismissing the complaint” (Bajaj v General Assur. Co., 18 Misc 3d 25, 28-29 [App Term, 2d & 11th Jud Dists 2007] [citation omitted]; see also Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]). Accordingly, the judgment is affirmed.

Pesce, P.J., Golia and Rios, JJ., concur.
Decision Date: May 22, 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 (Diccia T. Pineda-Kirwan, J.), entered December 19, 2005, deemed from a judgment of the same court entered April 9, 2008 (see CPLR 5512 [a]). The judgment, entered pursuant to the December 19, 2005 order granting defendant’s cross motion to strike the complaint pursuant to CPLR 3126 due to plaintiff’s failure to comply with a so-ordered stipulation, dismissed the complaint.

Judgment reversed without costs, so much of the order entered December 19, 2005 as granted defendant’s cross motion to strike the complaint pursuant to CPLR 3126 vacated and defendant’s cross motion denied.

In this action by a provider to recover assigned first-party no-fault benefits, the parties entered into a “so-ordered” stipulation in November 2003, which, insofar as is relevant, states:
“Plaintiff . . . will appear for examination before trial (EBT) on or before 60 (sixty) days from today’s date. January 16, 2004.
In the event that plaintiff fails to appear for said examination or fails to produce someone with personal knowledge as to the medical necessity of the services provided (if so required) plaintiff will be precluded from offering evidence at trial.” [*2]
Thereafter, plaintiff moved for summary judgment. Defendant opposed plaintiff’s motion and cross-moved, pursuant to CPLR 3126, for an order striking the complaint and dismissing the action with prejudice due to plaintiff’s failure to appear for an EBT on or before January 16, 2004. In opposition to defendant’s cross motion, plaintiff argued that defendant’s cross motion was untimely and that defendant failed to establish that plaintiff breached the so-ordered stipulation because defendant did not demonstrate that the EBT was ever scheduled. The Civil Court granted defendant’s cross motion, dismissed the action, and denied plaintiff’s motion as moot. Plaintiff appeals, as limited by its brief, from so much of the order as granted defendant’s cross motion. A judgment dismissing the action was subsequently entered, from which we deem the appeal (see CPLR 5512 [a]).

While defendant’s cross motion was served 16 days later than the date the court fixed for service of said cross motion, it was served more than 4 months before the motion and cross motion were returnable and plaintiff submitted papers in opposition to the cross motion. Consequently, the Civil Court did not improvidently exercise its discretion when it considered defendant’s untimely cross motion since plaintiff did not demonstrate that it suffered any prejudice as a result of defendant’s delay (see e.g. Vallorani v Kane, 20 Misc 3d 138[A], 2008 NY Slip Op 51559[U] [App Term, 2d & 11th Jud Dists 2008]).

In the case at bar, the so-ordered stipulation did not schedule plaintiff’s EBT for January 16, 2004. Rather, it directed plaintiff to appear for an EBT on or before January 16, 2004. Defendant, however, did not show that plaintiff failed to comply with the stipulation since defendant failed to establish that an EBT of plaintiff was scheduled for January 16, 2004, or any other date, for which plaintiff failed to appear. Consequently, defendant’s cross motion should have been denied. Accordingly, the judgment is reversed, and defendant’s cross motion to strike the complaint is denied.

Pesce, P.J., and Rios, J., concur.

Golia, J., dissents in a separate memorandum.

Golia, J., dissents and votes to affirm the judgment in the following memorandum.

In the first instance, it should be noted that the stipulation in question was not written in a vacuum. It was entered into by both parties, who were represented by counsel, and with the approval of the Civil Court only after plaintiff had failed to appear for a deposition on at least two prior separate occasions.

This stipulation between the parties was not only entered into with the approval of the Civil Court, but was converted into a judicial fiat upon being so ordered” by that court. It is of no less merit than any other order that was drafted and signed by a judge without any input from the parties. This so-ordered” stipulation had the full force and effect of a conditional order of preclusion (see State Farm Mut. Auto. Ins. Co. v Hertz Corp., 43 AD3d 907 [2007]). Consequently, plaintiff’s failure to comply should result in a final order of preclusion and therefore dismissal. It is important, at this juncture, to understand that defendant was presumptively entitled to a final order of preclusion at the time this stipulation was entered into. [*3]Plaintiff had already failed to appear on two different occasions to submit to a deposition. It was therefore only as a result of this so-ordered” stipulation that the court agreed to issue a conditional order of preclusion. The condition fell solely upon the plaintiff to take some action to avoid a final preclusion.

Despite this clear mandate, the majority finds that it is defendant’s obligation to establish more than the simple fact that the final date had passed and plaintiff failed to appear for a deposition, a proposition equivalent to the requirement that a plaintiff in a no-fault case need only establish that a claim was filed and remains unpaid after 30 days.

Had this plaintiff responded by asserting that it had contacted defendant in a good faith attempt to comply but was ignored or rebuffed, then defendant could not be shielded behind this conditional order of preclusion. That was not done herein, nor did plaintiff deem it necessary to inform the court that it was unable to comply with the court’s order due to the inaction of defendant. Instead, when faced with a conditional order of preclusion, plaintiff chose to do nothing at all. More than a year later, plaintiff moved for summary judgment without ever bothering to affirmatively address its violation of an existing court order.

Plaintiff’s counsel’s lackadaisical approach completely discounts his client’s failure to comply with the Civil Court’s order. Plaintiff’s counsel states that the only notation in his file is that there is no notice whatsoever from defense counsel looking for the fruits of their ebt motion victory from back in the fall of 2003.” This is indeed a rather strange notation to be contained in a file. Counsel then strikes a conciliatory note to his adversary while being dismissive of the court and its orders. He states, I respectfully submit that both of the law offices of the sides now before this court are simply too high volume, too busy, and employ too many people, to permit for the assertion of no confirmation to a phone call’ be held as violating a court order.”

If that be so, then counsel should be aware of his ethical obligation to accept only those cases for which his office is capable of providing adequate representation. In any event, I find that plaintiff’s total failure to do anything to comply with the so-ordered” stipulation is what constitutes a violation of the clear intent of that stipulation and mandates preclusion in compliance with the Civil Court’s order.
Decision Date: May 22, 2009

SUPREME COURT OF THE STATE OF NEW YORK

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

Appeal from a judgment of the Civil Court of the City of New York, Queens County (Anna Culley, J.), entered March 9, 2006. The judgment, after a nonjury trial, dismissed the complaint.

Judgment affirmed without costs.
At the trial in this action by a provider to recover assigned first-party no-fault benefits, the parties stipulated that plaintiff established its prima facie case. Plaintiff then made a motion in limine to have the court accord the December 2005 order, deciding a summary judgment motion in a prior case between the parties, collateral estoppel effect in the instant action. In the prior action, plaintiff rendered services to a different assignor for injuries he sustained in the same accident as the assignor herein, and the order found that the affidavit of defendant’s investigator was insufficient to support a founded belief that the loss did not arise out of an insured incident. In the case at bar, the Civil Court denied plaintiff’s motion.
Defendant’s sole witness at trial was its investigator, and during her testimony, plaintiff did not object to the admission into evidence of several auto claim service records, the insurance policy, claim forms, and denial of claim forms. The court found in favor of defendant and dismissed the complaint, holding that defendant “established that the assignor in this case was involved in an insurance fraud scheme with the intent to defraud the carrier for medical benefits.” The instant appeal by plaintiff ensued.
In support of its motion, plaintiff failed to show that the identical issues were decided in the prior action, and [*2]are decisive in the present action (see Luscher v Arrua, 21 AD3d 1005 [2005]). Moreover, a review of the record indicates that defendant met its burden of proving that the loss did not arise out of an insured incident. Accordingly, the Civil Court properly awarded judgment dismissing the complaint.
Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: May 22, 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 October 24, 2007, deemed from a judgment of the same court entered December 6, 2007 (see CPLR 5501 [c]). The judgment, entered pursuant to the October 24, 2007 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $1,469.34.

Judgment reversed without costs, order granting plaintiff’s motion for summary judgment vacated and plaintiff’s motion for summary judgment 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, inter alia, that the time in which it had to pay or deny the claims had been tolled due to plaintiff’s assignor’s failure to appear at scheduled examinations under oath (EUOs) and that no coverage existed for the intentional staged loss. The Civil Court granted plaintiff’s motion. The instant appeal by defendant ensued. A judgment was subsequently entered (see CPLR 5501 [c]).

In order for defendant to raise a triable issue of fact based on the assignor’s failure to appear at scheduled EUOs, defendant had to demonstrate that its initial and follow-up requests for verification were timely (see Insurance Department Regulations [11 NYCRR] §§ 65-3.5 [b]; 65-3.6 [b]) and establish, by an affidavit of one with personal knowledge, that the assignor failed to appear for the EUOs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). Since defendant failed to establish that the EUO scheduling letters were [*2]timely mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]), defendant failed to demonstrate that the 30-day claim determination period (Insurance Department Regulations [11 NYCRR] § 65-3.8) was tolled. As a result, defendant failed to establish that its denial of claim forms were timely and, thus, that it is not precluded from raising as a defense the failure of plaintiff’s assignor to appear for an EUO (see Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 282 [1997]).

However, defendant was not precluded from asserting the defense that the alleged injuries do not arise out of an insured incident (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]). Upon our review of the record, the documents submitted in opposition to plaintiff’s motion, including the affirmation of defendant’s attorney, the copies of transcripts of witness statements and testimony, as well as the affidavits of defendant’s no-fault specialist and investigator, were sufficient to demonstrate that defendant’s defense of lack of coverage was “premised on the fact or founded belief that the alleged injur[ies] do not arise out of an insured incident” (Central Gen. Hosp. at 199). Accordingly, the judgment is reversed, the order granting plaintiff’s motion for summary judgment is vacated and plaintiff’s motion for summary judgment is denied.

Golia and Steinhardt, JJ., concur.

Weston, J.P., dissents in a separate memorandum.

Weston, J.P., dissents and votes to affirm the judgment in the following memorandum.

I concur with the determination of the majority that defendant failed to establish that its denial of claim forms were timely and, thus, that it was not precluded from raising as a defense the failure of plaintiff’s assignor to appear for an examination under oath. However, defendant was not precluded from asserting the defense that
the alleged injuries do not arise out of an insured incident (see Central Gen.
Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]), and I find that the documents submitted in opposition to plaintiff’s motion were insufficient to demonstrate that defendant’s defense of lack of coverage was “premised on the fact or founded belief that the alleged injur[ies] do not arise out of an insured incident” (Central Gen. Hosp. at 199). Thus, the judgment should be affirmed.
Decision Date: May 22, 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 October 24, 2007, deemed from a judgment of the same court entered December 9, 2007 (see CPLR 5501 [c]). The judgment, entered pursuant to the October 24, 2007 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $1,218.13.

Judgment reversed without costs, order granting plaintiff’s motion for summary judgment vacated and plaintiff’s motion for summary judgment 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, inter alia, that it possessed a founded belief that the injuries allegedly sustained by plaintiff’s assignor did not arise out of an insured incident. The Civil Court granted
plaintiff’s motion. The instant appeal by defendant ensued. A judgment was subsequently entered (see CPLR 5501 [c]).

The sole issued raised on appeal is whether defendant proffered sufficient evidence to demonstrate that there was an issue of fact as to whether the injuries plaintiff’s assignor allegedly sustained arose from an insured incident (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]). Upon a review of the record, we find that the documents submitted in opposition to plaintiff’s motion, including the affirmation of defendant’s attorney, the copies of [*2]transcripts of witness statements and testimony, as well as the affidavits of defendant’s no-fault specialist and investigator, were sufficient to demonstrate that defendant’s defense of lack of coverage was “premised on the fact or founded belief that the alleged injur[ies] do[] not arise out of an insured incident” (Central Gen. Hosp. at 199). Accordingly, the judgment is reversed, the order granting plaintiff’s motion for summary judgment is vacated and plaintiff’s motion for summary judgment is denied.

Golia and Steinhardt, JJ., concur.

Weston, J.P., dissents in a separate memorandum.

Weston, J.P., dissents and votes to affirm the judgment in the following memorandum.

I find that the documents submitted in opposition to plaintiff’s motion were insufficient to demonstrate that defendant’s defense of lack of coverage was “premised on the fact or founded belief that the alleged injur[ies] do[] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]). Thus, the judgment should be affirmed.
Decision Date: May 22, 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, Kings County (Dolores L. Waltrous, J.), entered June 21, 2007. The order, insofar as appealed from, denied defendant’s motion for summary judgment.

Order, insofar as appealed from, reversed without costs, defendant’s motion for summary judgment granted and complaint dismissed.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint and plaintiff cross-moved for summary judgment. In an affidavit in support of defendant’s motion for summary judgment, an employee in defendant’s claims division stated that plaintiff billed defendant for 21 sessions of acupuncture with its licensed acupuncturist at a rate of $90 per session, for a total of $1,890. Defendant paid plaintiff for 21 sessions at a reduced rate of $29.30 per session, which, defendant claimed, was the workers’ compensation fee schedule amount payable to licensed chiropractors for similar services, for a total of $615.30. Plaintiff sought full reimbursement, or the remaining $1,274.70, contending that the amounts which it had charged were not unreasonable and were within the range of the prevailing fees in the geographic area in which plaintiff operated. Finding that triable issues of fact existed, the Civil Court denied defendant’s motion for summary judgment and plaintiff’s cross motion for summary judgment. Defendant appeals from so much of the order as denied its motion for summary judgment. [*2]

Defendant established its prima facie entitlement to summary judgment by showing that it timely mailed its denial of claim forms, which partially denied plaintiff’s claims on the ground that the fees charged by plaintiff exceeded the maximum allowance under the applicable fee schedules. Contrary to plaintiff’s contention, the affidavit submitted by defendant, from one of its employees in its claims division, sufficiently established that the denial of claim forms were timely mailed in accordance with defendant’s standard office practice and 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]). For the reasons stated in Great Wall Acupuncture v GEICO Gen. Ins. Co. (16 Misc 3d 23 [App Term, 2d & 11th Jud Dists 2007]), it was proper for defendant to use the workers’ compensation fee schedule for acupuncture services performed by chiropractors to determine the amount which plaintiff was entitled to receive for the 21 sessions (see Ava Acupuncture, P.C. v GEICO Gen. Ins. Co., 17 Misc 3d 41 [App Term, 2d & 11th Jud Dists 2007]). Consequently, defendant’s motion for summary judgment dismissing the complaint should have been granted.

Pesce, P.J., Weston and Golia, JJ., concur.
Decision Date: May 19, 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 (Andrea Phoenix, J.), entered December 10, 2007. The order denied plaintiffs’ motion for partial summary judgment.

Order modified by providing that plaintiffs’ motion for partial summary judgment is granted to the extent of awarding plaintiff A.B. Medical Services, PLLC summary judgment on its claims seeking to recover the sums of $230.10, $71.40, $361.46, $361.46, $1,546.20, $501.76, $71.06, $1,573.24 and $569.36; plaintiff Lvov Acupuncture, P.C. summary judgment on its claims seeking to recover the sums of $650.50, $248.28 and $435.98; and plaintiff RW Health Plus Chiropractic, P.C. summary judgment on its claims seeking to recover the sums of $290.64, $269.60 and $134.80, and the matter is remanded to the court below for the calculation of statutory interest and attorney’s fees thereon, and for further proceedings on all remaining claims.

In this action by providers to recover assigned first-party no-fault benefits, plaintiffs moved for partial summary judgment on various claims, and defendant opposed the motion. The court below denied plaintiffs’ motion. This appeal by plaintiffs ensued.

Since defendant did not argue in the court below that plaintiffs’ medical biller and billing manager failed to establish that he possessed personal knowledge of plaintiffs’ mailing practices and procedures so as to lay a foundation for the admission, as business records, of plaintiffs’ [*2]documents, we do not pass on the propriety of the determination of the court below with respect thereto (see 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]; 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]).

The record shows that defendant failed to pay or deny the claims by A.B. Medical Services, PLLC (A.B. Med.) seeking the sums of $230.10 and $71.40 within the 30-day prescribed period and that it also failed to establish that such period was extended by its issuance of a timely request for verification. Consequently, defendant was precluded from raising most defenses (see Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 282 [1997]), with exceptions not relevant to these claims. As a result, defendant failed to establish the existence of a triable issue of fact with respect to said claims, and A.B. Med. was entitled to summary judgment thereon.

An insurance carrier’s 30-day period in which to either pay or deny a claim may be extended where the insurer submits, within 15 business days of its receipt of the NF-3 claim form, a request for additional verification (see Insurance Department Regulations [11 NYCRR] § 65-3.5 [b]; Nyack Hosp. v General Motors Acceptance Corp., 27 AD3d 96, 100 [2005]; New York Hosp. Med. Ctr. of Queens v Country-Wide Ins. Co., 295 AD2d 583, 584-585 [2002]). “A claim need not be paid or denied until all demanded verification is provided” (New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 570 [2004]). Since the affidavit of defendant’s no-fault litigation supervisor lacks specificity to support the assertion that defendant did not receive the verification it requested, it was insufficient to establish that the verification was still outstanding and, thus, that defendant’s time to pay or deny the claims was tolled (see Westchester Med. Ctr. v Countrywide Ins. Co., 45 AD3d 676 [2007]; New York & Presbyt. Hosp. v Countrywide Ins. Co., 44 AD3d 729 [2007]; Westchester Med. Ctr. v Liberty Mut. Ins. Co., 40 AD3d 981 [2007]; cf. Westchester Med. Ctr. v Allstate Ins. Co., 53 AD3d 481 [2008]). As a result, the claims by plaintiff A.B. Med. in the sums of $361.46, $361.46, $1,546.20, $501.76, $71.06, $1,573.24 and $569.36, and the claims by plaintiff RW Health Plus Chiropractic, P.C. (RW Health) in the sums of $290.64, $269.60 and $134.80 are overdue (see Insurance Law § 5106 [a]; Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]), and A.B. Med. and RW Health are entitled to summary judgment upon said claims (see Westchester Med. Ctr., 45 AD3d 676).

Plaintiffs’ contention that defendant’s submissions from the acupuncturist who performed the peer reviews were insufficient to raise a triable issue of fact with respect to the claims submitted by Lvov Acupuncture, P.C. (Lvov) is correct. Since the acupuncturist’s peer review reports were unsworn, the reports were of no probative value (see Dowling v Mosey, 32 AD3d 1190 [2006]; Macri v St. Agnes Cemetery, 44 Misc 2d 702 [1965]). Accordingly, defendant’s submissions failed to raise a triable issue of fact as to medical necessity with respect to Lvov’s claims in the sums of $650.50, $248.28 and $435.98, and Lvov is entitled to summary judgment upon said claims.

However, contrary to plaintiffs’ contention, defendant, through the submission of the affidavit of its no-fault litigation supervisor and affirmed peer review reports established that the claims by A.B. Med. seeking the sums of $604.24 and $644.50, and by RW Health seeking the [*3]sums of $168.50 and $202.20 were properly and timely denied based upon a lack of medical necessity (see A.B. Med. Servs. PLLC v American Tr. Ins. Co., 15 Misc 3d 132[A], 2007 NY Slip Op 50680[U] [App Term, 2d & 11th Jud Dists 2007]; 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]). As a result, A.B. Med. and RW Health are not entitled to summary judgment upon said claims.

Although plaintiffs argue that defendant’s denial of a claim by A.B. Med. seeking the sum of $182.37 was untimely, plaintiffs’ exhibits included a copy of said denial of claim form, which is timely on its face and which denied the claim based upon an affirmed peer review report which was also attached to plaintiff’s moving papers. Given the affidavit of defendant’s no-fault litigation supervisor setting forth defendant’s standard office practice and procedure for the generation and mailing of defendant’s denial of claim forms (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]), plaintiff is not entitled to summary judgment upon said claim.

In view of the foregoing, plaintiffs’ motion for summary judgment is granted to the extent of awarding A.B. Med. summary judgment on its claims seeking to recover the sums of $230.10, $71.40, $361.46, $361.46, $1,546.20, $501.76, $71.06, $1,573.24 and $569.36, Lvov summary judgment on its claims seeking to recover the sums of $650.50, $248.28 and $435.98, and RW Health summary judgment on its claims seeking to recover the sums of $290.64, $269.60 and $134.80, and the matter is remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees due thereon pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder, and for all further proceedings on the remaining claims.

The decision and order of this court entered herein on November 26, 2008 (see 22 Misc 3d 132[A], 2008 NY Slip Op 52651[U] are hereby recalled and vacated (see motion decided simultaneously herewith).

Rudolph, P.J., and Molia, J., concur.

McCabe, J. taking no part.
Decision Date: May 19, 2009

[*1]

Supreme Court, Appellate Term, Second Department, May 19, 2009

APPEARANCES OF COUNSEL

Law Office of Alden Banniettis, Brooklyn (Jeff Henle of counsel), for appellant. Law Office of Karen C. Dodson, Melville (William Angstreich of counsel), for respondent.

{**24 Misc 3d at 33} OPINION OF THE COURT

Memorandum.

Judgment affirmed without costs.

Plaintiff commenced the instant action to recover $8,275.66 in first-party no-fault benefits for health care services rendered to plaintiff’s assignor. Defendant filed a notice of trial on May 6, 2005. Following two adjournments, the case was dismissed on March 13, 2006 because of plaintiff’s lack of readiness to proceed. Plaintiff’s counsel served proof of the dismissal on defendant’s attorney on August 21, 2007, with notice of its entry on March 13, 2006.

On November 6, 2007 plaintiff moved to vacate the order of dismissal and restore the matter to the trial calendar. Plaintiff’s counsel submitted an affidavit from counsel’s employee Polina Shvartsberg, who stated that she is responsible for calendaring counsel’s trial dates and that she failed to do so in this matter. Consequently, plaintiff’s counsel was unprepared for trial.

Plaintiff’s counsel also submitted an affidavit from Leonid Rosin, M.D., plaintiff’s “corporate operating officer,” who stated that he was personally familiar with plaintiff’s [*2]procedures concerning the creation and maintenance of plaintiff’s business records and that the claim forms attached to his affidavit were such records. Dr. Rosin stated, among other things, that the forms pertained to treatment rendered, that they had been made contemporaneously to such treatment, and that they had been submitted to defendant, but that no payment had been received. Based on these submissions, plaintiff maintained that it had a reasonable excuse for counsel’s failure to proceed, as well as a meritorious cause of action sufficient to vacate the default.

The Civil Court denied plaintiff’s motion, concluding that plaintiff “has failed to show a reasonable excuse for its delay, as well as a meritorious cause of action, lack of prejudice to the defendant and a lack of intent to abandon this action.” The court added that plaintiff’s motion was untimely, as the matter had been marked off the calendar for more than a year.

Plaintiff now appeals, claiming that the Civil Court should have granted its motion to vacate the default pursuant to CPLR 2005 and 5015. We affirm.

Although both defendant and the Civil Court appear to rely on Uniform Rules for the New York City Civil Court (22 NYCRR) § 208.14 (c) to support the denial of plaintiff’s motion, we conclude that this provision is inapplicable under the circumstances{**24 Misc 3d at 34} of this case. Section 208.14 (c) governs restoration of cases within one year after the action has been stricken from the calendar. Here, since the case was never stricken from the trial calendar, but rather was dismissed, section 208.14 (c) is inapplicable.

Although the Civil Court, in dismissing the case, did not specifically note a default, it is clear from the record that the case was dismissed on default. Uniform Rules for the New York City Civil Court (22 NYCRR) § 208.14 (b) provides, in relevant part, that

“[a]t any scheduled call of a calendar . . . if all parties do not appear and proceed or announce their readiness to proceed immediately . . . the judge presiding may note the default on the record and enter an order as follows: . . .

“(2) If the defendant appears but the plaintiff does not, the judge may dismiss the action . . . .”

In this case, a card attached to the notice of trial clearly states that the case was dismissed because plaintiff was not ready to proceed. Indeed, plaintiff—both in the Civil Court and on appeal—refers to the dismissal as being entered on default and maintains that its motion to vacate the default should have been granted pursuant to CPLR 5015. In these circumstances, it was incumbent upon plaintiff to demonstrate a reasonable excuse for the default and a meritorious cause of action (see CPLR 5015 [a]; Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141 [1986]). Plaintiff failed to sustain this burden.

The sole explanation offered by plaintiff for its default is that plaintiff’s counsel’s office failed to calendar the trial date. Such conclusory and factually devoid allegations are insufficient to constitute a reasonable excuse (see Juarbe v City of New York, 303 AD2d 462 [2003]). On this basis alone, plaintiff’s motion was properly denied. [*3]

Accordingly, the judgment is affirmed.

Weston, J.P., Golia and Rios, JJ., concur.

Supreme Court, Queens County

230912008

Allan B. Weiss, J.

Upon the foregoing papers it is ordered that the motion is determined as follows:

Plaintiff, a provider of automobile insurance policies which include coverage under the Comprehensive Automobile Insurance Reparations Act (the No-Fault Law) (presently codified in article 51 of the Insurance Law), commenced this action to recover damages for common-law fraud and unjust enrichment, and for a judgment declaring that the plaintiff has no obligation to pay no-fault claims submitted by the professional corporation defendants as assignees of policyholders. Plaintiff alleges, among other things, that defendant professional services corporations were fraudulently incorporated in the name of defendant Manuel Farescal, M.D., a physician, while, in fact, the professional corporations were owned, operated, and controlled by defendants Adnan Munawar and P. Clifford LoBrutto, unlicensed persons, in violation of applicable statutes and regulations. Plaintiff also alleges defendant professional corporations are not, and were not, entitled to receive such payments because they are not owned and controlled solely by a licensed medical physician and the services provided were not rendered by employees but, rather, by independent contractors in violation of state law (see State Farm Mut. Auto. Ins. Co. v Robert Mallela, 4 NY3d 313 [2005]; One Beacon Ins. Group, LLC v Midland Medical Care, P.C., 54 AD3d 738 [2008]).

In the third cause of action of the complaint, plaintiff alleges that defendants All Family and [*2]Universal billed it under the No-Fault Law for professional health services provided by independent contractors having no employment relationship with the respective defendants, and in the fourth cause of action, plaintiff alleges that defendant Painpro likewise billed it under the No-Fault Law for professional health services provided by independent contractors having no employment relationship with defendant Painpro. Plaintiff also alleges that these defendant professional corporations are not legally entitled to collect payment for no-fault benefits for professional health services not actually provided by an employee of defendants All Family, Universal and Painpro, respectively. Plaintiff further alleges that it is entitled to a declaration that it is not obligated to pay defendants All Family, Universal and Painpro no-fault benefits for charges submitted to it where professional health services were rendered by independent contractors.

The Farescal defendants and defendant P. Clifford LoBrutto each served an answer denying the material allegations of the complaint, and asserting various affirmative defenses.

It is well established that the proponent of a summary judgment motion “must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact,” (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]; Zuckerman v City of New York, 49 NY2d 557 [1980]).

To the extent the Farescal defendants move for partial summary judgment declaring that six opinion letters authored by the Insurance Department are irrational and not entitled to deference, the Farescal defendants have failed to assert any counterclaim for such affirmative relief.

Furthermore, a ruling, in the context of this case, that the opinion letters are irrational and not entitled to deference would constitute an advisory opinion. A state court lacks subject matter jurisdiction in cases when no justiciable controversy is presented (see Matter of New York State Inspection, Security & Law Enforcement Employees, Dist. Council 82, AFSCME, AFL-CIO v Cuomo, 64 NY2d 233, 241, n 3 [1984]; Morrison v Budget Rent A Car Systems, Inc., 230 AD2d 253, 258-259 [1997]). It is well settled law that “[t]he courts of New York do not issue advisory opinions for the fundamental reason that in this State [t]he giving of such opinions is not the exercise of the judicial function’ (Matter of State Indus. Commn., 224 NY 13, 16 [1918]) . . .,” (Cuomo v Long Island Light Co., 71 NY2d 349, 354 [1988]).

Any ruling by the court herein regarding the opinion letters would not be dispositive of a cause of action asserted by plaintiff (see New York Pub. Interest Research Group v Carey, 42 NY2d 527, 531 [1977]; State Farm Fire & Cas. Co. v LiMauro, 103 AD2d 514, 517-518 [1984], affd 65 NY2d 369 [1985]; see generally Joint Queensview Housing Enterprise, Inc. v Grayson, 179 AD2d 434 [1992] [advisory opinion letters did not constitute final determinations of tax liability by city for purposes of article 78 proceeding, and cooperatives were not aggrieved by advisory opinion letters so as to make controversy ripe for judicial determination]; see also Matter of New York State Assn. of Life Underwriters v New York State Banking Dept., 190 AD2d 338 [1993], affd 83 NY2d 353 [1994] [article 78 proceeding to annul opinion letters and to declare that the sale of annuities is not an “incidental power” contemplated by Banking Law § 96(1)]; cf. Medical Society of State v Serio, 100 NY2d 854 [*3][2003] [article 78 proceeding to annul regulation altering no-fault system]). Nothing about the opinion letters themselves constitutes a final determination by the State regarding the propriety of plaintiff’s actions, and the Farescal defendants are not aggrieved by their issuance. Rather, the question of whether plaintiff properly may withhold payments of no-fault benefits to defendants All Family, Universal and Painpro in instances where professional health services were rendered by independent contractors, as opposed to their employees, is one of law, which must be decided based upon interpretation of statute and regulation, and case law.

“In matters of statutory and regulatory interpretation, legislative intent is the great and controlling principle, and the proper judicial function is to discern and apply the will of the [enactors]’ (Matter of ATM One v Landaverde, 2 NY3d 472, 476-477 [2004], quoting Mowczan v Bacon, 92 NY2d 281, 285 [1998] [internal quotation marks omitted]). Legislative intent may be discerned from the face of a statute, but an apparent lack of ambiguity is rarely, if ever, conclusive . . . . Generally, inquiry must be made of the spirit and purpose of the legislation, which requires examination of the statutory context of the provision as well as its legislative history’ (Matter of Sutka v Conners, 73 NY2d 395, 403 [1989]; see Matter of ATM One v Landaverde, 2 NY3d at 477; Mowczan v Bacon, 92 NY2d at 285). Moreover, regulations . . . should be construed to avoid objectionable results’ (Matter of ATM One v Landaverde, 2 NY3d at 477)” East Acupuncture, P.C. v Allstate Ins. Co., AD3d , 873 NYS2d 335 [2009]). Such interpretation may also be informed by opinion letters regarding the interpretation of applicable regulations, issued by the agency which promulgated them, so long as the interpretation comports with the statute and is not irrational or unreasonable (see generally LMK Psychological Services, P.C. v State Farm Mut. Auto. Ins. Co., 12 NY3d 217 [2009]; Matter of Council of City of NY v. Public Service Comm., 99 NY2d 64, 74 [2002]; 90 NY2d 545, 551-552 [1997]). Thus, that branch of the motion by the Farescal defendants for partial summary judgment declaring the six opinion letters authored by the Insurance Department to be irrational and not entitled to deference is denied.

The Farescal defendants seek partial summary judgment dismissing the third and fourth causes of action on the ground they fail to state a claim. The Farescal defendants assert an insurer may not deny payment for no-fault benefits on the ground that the professional health services billed to plaintiff were performed by independent contractors. The Farescal defendants, therefore, argue plaintiff cannot obtain a judgment declaring that defendants All Family, Universal and Painpro are not entitled to collect no-fault benefits for charges submitted to it when such professional health services were rendered by independent contractors. The court notes that the Farescal defendants make no factual argument that the professional health services billed to plaintiff were performed by their employees, or that they exercised a particular level of control over the independent contractors. Their motion raises purely legal arguments regarding the propriety of plaintiff’s withholding of payments to the professional corporations based upon the rendering of services by independent contractors.

CPLR 3001, in relevant part, provides: “The supreme court may render a declaratory judgment having the effect of a final judgment as to the rights and other legal relations of the parties to a justiciable controversy whether or not further relief is or could be claimed.” “An action is [*4]justiciable when the controversy presented touches the legal relations of the parties having adverse interests from which harm is presently flowing or could flow in the future in the absence of a court determination of the parties’ rights” (Initiative For Competitive Energy v Long Is. Power Auth., 178 Misc 2d 979, 989 [1998]). “The controversy must be capable of disposition and be presented in an adversarial context with a set of concrete facts” (Goodwill Adv. Co. v State Liq. Auth., 14 AD2d 658 [1961]). The complaint herein demonstrates the existence of a controversy between the parties regarding plaintiff’s withholding of payments to defendant professional corporations to the extent the services were rendered by independent contractors, and the practical need for its resolution.

The No-Fault Law, which supplants common-law tort actions for most victims of automobile accidents with a system of no-fault insurance, has as its primary aims 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 (see Medical Society of State v Serio, 100 NY2d 854, 860 [2003]). The Superintendent has promulgated regulations implementing the No-Fault Law, currently contained in 11 NYCRR Part 65. Section 65-3.11(a) of that part (formerly section 65.15[j][1]), in relevant part, provides, “An insurer shall pay benefits for any element of loss, . . ., directly to the applicant or . . . upon assignment by the applicant . . ., shall pay benefits directly to providers of health care services . . . .”

11 NYCRR 65-3.11(a) and its precursor, 11 NYCRR 65-3.15(j)(1), have been interpreted to mean that a medical provider cannot recover assigned no-fault benefits if services were provided by an independent contractor rather than by it or its employees (see Health & Endurance Medical, P.C. v Liberty Mut. Ins. Co., 19 Misc 3d 137[A], 2008 NY Slip Op 50864(U) [NY Sup App Term, 2d and 11th Jud Dists (2008)]). In Health & Endurance, a provider sought to recover assigned first-party no-fault benefits for services which were not rendered by it or its employees, but rather by a treating provider who was an independent contractor. The Appellate Term held that the plaintiff was not a “provider” of the medical services rendered within the meaning of Insurance Department Regulations (11 NYCRR) § 65-3.11[a]), and, therefore, was not entitled to recover “direct payment” of assigned no-fault benefits from the defendant insurer. Such holding is consistent with the holdings in A.M. Medical Services, P.C. v Progressive Cas. Ins. Co., (22 Misc 3d 70, 2008 NY Slip Op 28528, [App Term, 2d, 11th and 13th Jud Dists (2008)]); Health & Endurance Med. P.C. v State Farm Mut. Auto. Ins. Co., (12 Misc 3d 134[A], 2006 NY Slip Op 51191[U] [App Term, 2d and 11th Jud Dists 2006]); Craig Antell, D.O., P.C. v New York Cent. Mut. Fire Ins. Co., (11 Misc 3d 137[A], 2006 NY Slip Op 50521[U] [App Term, 1st Dept 2006]); Rockaway Blvd. Medical P.C. v Progressive Ins., (9 Misc 3d 52, 2005 NY Slip Op 25278 [App Term, 2d Dept 2005]); A.B. Med. Servs. PLLC v Liberty Mut. Ins. Co., (9 Misc 3d 36 [App Term, 2d and 11th Jud Dists 2005]); A.B. Med. Servs. PLLC v New York Cent. Mut. Fire Ins. Co., (8 Misc 3d 132[A], 2005 NY Slip Op 51111[U] [App Term, 2d and 11th Jud Dists 2005]). These opinions of the Appellate Term are persuasive authority, and the court is convinced of their reasoning. Under such circumstances, the third and fourth causes of action asserted by plaintiff state viable claims for declaratory relief. [*5]

That branch of the motion by the Farescal defendants for summary judgment dismissing the third and fourth causes of action asserted against them is denied.

Dated: May 13, 2009

J.S.C.