—[*1] Carman, Callahan & Ingham, L.L.P., Farmingdale (Michael F. Ingham of counsel), for appellant.

Gregory J. Allen, State Insurance Fund, Liverpool (Susan B. Marris of counsel), for respondent.

Spain, J. Appeal from an order of the Supreme Court (Egan, Jr., J.), entered February 6, 2008 in Albany County, which denied petitioner’s application pursuant to CPLR 7511 to vacate an arbitration award.

On July 12, 2004, Michael Chesebro was driving in the Village of Baldwinsville, Onondaga County when his vehicle was struck in the rear by Deborah Redden,^[FN1] who was operating a 1999 Dodge minivan owned by her employer, Julie J. Taddeo, the owner of Affordable Wheelchair Transportation. Chesebro was injured. Petitioner insured the minivan, which was registered as a [*2]passenger vehicle but bore livery license plates belonging to a commercial vehicle, a 1998 Dodge minivan also owned by Taddeo, which was insured by another carrier. It is uncontested that on this day Redden was using the passenger vehicle bearing the livery plates to transport passengers for Taddeo’s business.

After paying workers’ compensation benefits to Chesebro, respondent filed an application (a PIP form) for arbitration with the New York Personal Injury Subrogation Arbitration Forum, seeking intercompany reimbursement of those paid benefits ($50,000) from petitioner pursuant to the loss transfer provisions of Insurance Law § 5105 (a). Petitioner submitted a PIP form denying the claim, asserting that its insured’s passenger vehicle was her personal vehicle and not used primarily for the transportation of persons or property, as required by Insurance Law § 5105 (a). After limited documentary evidence was submitted,^[FN2] the arbitrator determined that respondent was entitled to reimbursement from petitioner. Petitioner then commenced this proceeding to vacate the arbitration award, which Supreme Court denied, and petitioner now appeals.

As relevant here, Insurance Law § 5105 (a) provides that an insurer liable for first party benefits or a workers’ compensation carrier that pays benefits in lieu of first party benefits, which another insurer would otherwise be obligated to pay but for the No-Fault Law, has a right to recover “only if at least one of the motor vehicles involved [weighs] more than [6,500 pounds] unloaded or is . . . used principally for the transportation of persons or property for hire” (emphasis added). The latter alternate requirements have been recognized to be “condition[s] precedent to ultimate recovery” (Matter of Progressive Cas. Ins. Co. v New York State Ins. Fund, 47 AD3d 633, 634 [2008]), and were added by amendment in 1977 “to limit the right of insurance carriers to recover first-party payments” (Matter of State Farm Mut. Auto. Ins. Co. v Aetna Cas. & Sur. Co., 132 AD2d 930, 931 [1987], affd 71 NY2d 1013 [1988]). Respondent, as the applicant seeking reimbursement, bore the burden of proof to show entitlement to recover benefits paid^[FN3] (see e.g. Matter of Hanover Ins. Co. v State Farm Mut. Auto. Ins. Co., 226 AD2d 533, 534 [1996]; Matter of Eveready Ins. Co. v Lumberman’s Mut. Cas. Co., 201 AD2d 649, 649 [1994]; Republic Claims Serv. Co. v Allstate Ins. Co., 160 AD2d 925, 926 [1990]). Insurance Law § 5105 (b) “provides that mandatory arbitration is the sole remedy regarding disputes between insurers over responsibility for payment of first-party benefits” (State Farm Mut. Auto. Ins. Co. v Nationwide Mut. Ins. Co., 150 AD2d 976, 977[*3][1989]).

Here, the record is devoid of evidence establishing the “principal use” of the passenger vehicle insured by petitioner. No proof established when the livery plates were put on the passenger vehicle, or if this plate-switching or use of the passenger vehicle to transport persons or property for hire occurred on any occasions other than the date of the accident, i.e., if it was Taddeo’s or Redden’s practice to use this passenger vehicle “for hire.” Petitioner did not submit an affidavit from its insured and none of the documentary evidence established that the “principal use” of the vehicle it insured was other than its registered status as a passenger vehicle (compare Victoria Ins. Co. v Utica Mut. Ins. Co., 8 AD3d 87, 87 [2004]), i.e., the only evidence is that on the day of this accident, the passenger vehicle was being used “for hire,” bearing livery plates from another vehicle.

Where, as here, the parties are obligated by statutory mandate to submit their dispute to arbitration (see Insurance Law § 5105 [b]), the arbitrator’s determination is subject to “closer judicial scrutiny” than with voluntary arbitration (Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214, 223 [1996]). “To be upheld, an award in a compulsory arbitration proceeding must have evidentiary support and cannot be arbitrary and capricious” (id. [citations omitted]; see Matter of Utica Mut. Ins. Co. [Selective Ins. Co. of Am.], 27 AD3d 990, 992 [2006]). On this record, there is no evidentiary support or rational basis for the arbitrator’s determination that petitioner’s insured passenger vehicle was used “principally . . . for hire” as required for respondent to obtain reimbursement under Insurance Law § 5105 (a) (see Matter of Progressive Cas. Ins. Co. v New York State Ins. Fund, 47 AD3d at 634; Matter of Allstate Ins. Co. v American Arbitration Assn., 26 AD3d 374, 374 [2006]; Matter of Kemper Ins. Co. v Westport Ins. Co., 9 AD3d 431, 432 [2004]). To the extent that the arbitrator granted respondent’s application based upon its finding that petitioner’s insured passenger vehicle was “at the time” being used as a vehicle for hire, such a conclusion is inadequate to support the award and is “in disregard of the standard prescribed by the legislature” (Mount St. Mary’s Hosp. of Niagara Falls v Catherwood, 26 NY2d 493, 506 [1970]), i.e., that one of the vehicles be used “principally . . . for hire” (Insurance Law § 5105 [a] [emphasis added]). The arbitration award should, therefore, be vacated.

Further, respondent relies heavily on petitioner’s failure to produce evidence presumably within its possession or reach regarding the principal use of its insured’s vehicle. However, the record does not reflect that respondent availed itself of any of the avenues for discovery, such as requesting a hearing at which witnesses could be called (see CPLR 7506 [c]), asking the arbitrator to issue subpoenas to procure documentary evidence (see CPLR 7505; see also Alexander, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR 7505, at 682-683 [1998]) or, as a last resort, applying to the court for an order directing disclosure in aid of arbitration upon a showing of extraordinary circumstances (see CPLR 3102 [c]; see also Siegel, NY Prac § 597, at 1052-1054 [4th ed]; Matter of Goldsborough v New York State Dept. of Correctional Servs., 217 AD2d 546, 547 [1995], appeal dismissed 86 NY2d 834 [1995]). While “[u]nder the CPLR, arbiters do not have the power to direct the parties to engage in disclosure proceedings” (De Sapio v Kohlmeyer, 35 NY2d 402, 406 [1974]; see Matter of Goldsborough v New York State Dept. of Correctional Servs., 217 AD2d at 547), avenues of disclosure were clearly available (see Siegel, NY Prac § 597, at 1052-1054 [4th ed]).

Mercure, J.P., Carpinello, Kane and Kavanagh, JJ., concur. Ordered the order is reversed, on the law, without costs, petitioner’s application granted and arbitration award vacated.

Footnotes

Footnote 1: Chesebro’s vehicle then struck the vehicle in front of him.

Footnote 2: Respondent’s proof included the accident report, Department of Motor Vehicles records, claim payment data sheets, copies of bills paid, and workers’ compensation award decisions. Petitioner submitted the Department of Motor Vehicles records, pictures of the vehicles and insurance documents.

Footnote 3: We do not agree with the arbitrator’s conclusion that petitioner’s position, that its insured vehicle was not used “principally . . . for hire,” is an affirmative defense. Rather, the principal use of the vehicle is a threshold part of respondent’s required showing, as the applicant seeking reimbursement under Insurance Law § 5105 (a) (see CPLR 3018; cf. Matter of State Farm Mut. Auto. Ins. Co. v City of Yonkers, 21 AD3d 1110, 1111 [2005]).

Nassau Dist Ct

C572/07

REPRESENTATION:

Law Office of Amos Weinberg, 49 Somerset Drive South, Great Neck, NY 10020-1821, Attorney for Plaintiff

Law Office of Teresa M. Spina, 88 Froehlich Farm Blvd., Suite 202, Woodbury, NY 11797

Robert A. Bruno, J.

The motion by plaintiff pursuant to CPLR §3212 for summary judgment for the relief demanded in the complaint is denied. As to the claims for $604.24 for services rendered on May 16, 2006, and all claims from June 1, 2006 onward (the last six claims), summary judgment is granted to the defendant and the complaint is dismissed as to those claims.

This is an action by plaintiff, a former medical services provider, to recover no-fault benefits from the defendant arising out of an automobile accident on April 16, 2006 in which plaintiff’s assignor, one David Ruiz, was allegedly injured. Plaintiff seeks summary judgment regarding $182.37 – $114.33 for services rendered on April 21, 2006; $268.18 – 215.26 for services rendered on April 25-28, 2006; $154.30 – $114.33 for services rendered on May 16, 2006; $407.17 – $114.33 for services rendered on April 28, 2006; $604.24 for services May 16, 2006; $407.17 – $114.33 for services rendered on May 26, 2006; $1,546.20 for services rendered on June 28, 2006; $1,573.24 for services rendered on June 28, 2006; $188.16 for services rendered on June 1-30, 2006; $71.06 for services rendered on July 7, 2006; $407.17 for services rendered on June 30, 2006; and $188.16 for services rendered on July 6-31, 2006.

It is well settled that summary judgment is a drastic remedy which should not be granted where there is any doubt about the existence of a triable issue of fact (Bhatti v. Roche, 140 AD2d 660). It is nevertheless an appropriate tool to weed out meritless claims and defenses(Lewis v. Desmond, 187 AD2d 797; Gray v. Bankers Trust Co. of Albany, N. A., 82 AD2d 168). Generally speaking, to obtain summary judgment, it is necessary that the movant establish its claim or defense by the tender of evidentiary proof in admissible form sufficient to warrant the court, as a matter of law, in directing judgment in its favor (CPLR §3212[b]). The burden then shifts to the non-moving party. To defeat the motion for summary judgment, the opposing party must come forward with evidence in admissible form to demonstrate the existence of a material issue of fact requiring a trial (CPLR §3212, subd [b]) (see also GTF Marketing, Inc. v. Colonial Aluminum Sales, Inc., 66 NY2d 965; Zuckerman v. City of New York, 49 NY2d 557). [*2]However, a movant’s failure to make such a prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers (Alvarez v. Prospect Hospital, 68 NY2d 32).

A no-fault claim is overdue if it is not paid or denied within thirty [30] days of receipt (see Insurance Law §5106[a]; 11 NYCRR 65-3.8[a][1] & [c]) unless, within fifteen [15] business days of receipt of the claim, the insurer requests additional verification (see 11 NYCRR 65-3.5[b]). In addition, it is well settled that an insurer is not obligated to pay or deny a claim until it has received verification of all relevant information requested (see 11 NYCRR 65-3.8[b][3];. Central Suffolk Hosp. v. New York Central mutual Fire Insurance Company, 24 AD3d 492; Hospital for Joint Diseases v. State Farm Mutual Automobile Insurance Company, 8 AD3d 533; St. Vincent’s Hospital of Richmond v. American Transit Insurance Company, 299 AD2d 338).

The Court finds that the plaintiff has failed to make out a prima facie case for judgment as to the first six dates of service listed above. To the extent that the Safir affidavit is silent as to the date the various claims herein were mailed to the defendant, defendant’s denial of claim forms (annexed to the Safir affidavit as Exhibits B) indicate the dates on which the claims were received, and adequately establish that plaintiff sent, and that defendant received, these claims (see Ultra Diagnostics Imaging v Liberty Mutual Ins. Co., 9 Misc 3d 97, 98 [App Term, 2d Dept 2005]). These same documents however also demonstrate that each of the first six claims was partially paid and partially denied, except for the fifth claim for $604.24 for services rendered on May 16, 2006, which was fully denied based upon a peer review, within thirty (30) days of their receipt. The affidavits in opposition of Megan Wolfe and Cindy Herdter, Geico claims representatives, dated August 21, 2007, confirm these facts.

As to the timely partial denials based upon a dispute as to the proper fee schedule, the first, second, third, fourth, and sixth above listed claims, a question of fact exists as to the proper fee to be charged and paid. Accordingly, summary judgment is denied as to these claims.

The plaintiff has failed to reply with medical evidence regarding the fifth claim, denied in full based upon a peer review report, and summary judgment is therefore granted to the defendant as to that claim.

As to the last six claims submitted for the period June 1, 2006 and thereafter (claims 7-12), the evidence demonstrates that timely first and second requests for verification were mailed to the plaintiff and received. These were never fully responded to. In addition, and for the reasons set forth below, defendant has demonstrated its right to summary judgment as to these claims.

11 NYCRR 65-3.8(f) provides:

An insurer shall be entitled to receive proper proof of claim and a failure to observe any of the time frames specified in this section shall not prevent an insurer from requiring proper proof of claim. [*3]

The proof of claim to which the defendant is entitled includes any requested EUO. (11 NYCRR 65-3.8[a][1]). Even a late request for additional verification is not invalid, but merely shortens the time within which the claim must be denied once the requested verification is received and the toll created by the verification request is lifted (Nyack Hosp. v. General Motors Acceptance Corp., 27 AD3d 96). An insurer is under no obligation to deny a claim before the requested verification is received (Central Suffolk Hosp. v. New York Cent. Mutual Fire Insurance Company, 24 AD3d 492), and its time to pay or deny a claim does not begin to run again until its receipt of the requested verification (Nyack Hospital v. Progressive Casualty Insurance Company, 296 AD2d 482).

As to the last six claims for services which are the subject of this summary judgment motion, the above mentioned affidavits of Megan Wolfe and Cindy Herdter, sworn to on August 21, 2007, and attached to the moving papers together with other documents, including the denials issued herein, also satisfy the business record exception to the hearsay rule and establishes that timely verification requests and delay letters were mailed to plaintiff and received by it which tolled the running of the thirty day period in which an insurer must normally pay or deny a claim (11 NYCRR 65-3.8[a][1]), and that timely requests for an Examination Under Oath (EUO) were made as to each of the last six claims herein. The provider was first requested to appear at the offices of counsel for the defendant in Woodbury, New York on October 4, 2006 to be examined with respect to 21 separate patients, including Mr. Ruiz.

On September 28, 2006, Dr. Braver wrote to counsel for the defendant, allegedly agreeing to appear for an EUO, but with conditions, including that the appearance be adjourned to a Friday and that the examination be conducted in Brooklyn. He further demanded that he be provided a list of questions, that he be paid an attendance fee of $1,400 per day, and that he testify on 21 separate days, a separate day for each patient. He did not object to the date, other than it was not a Friday, and did not appear on October 4, 2006. On October 3, 2006 the defendant wrote to plaintiff setting forth, as per plaintiff’s request, a new date, Friday, October 20, 2006, and agreeing to hold the examination in Brooklyn, but requesting that the one day examination cover each of the patients with pending claims. On October 10, 2006, the plaintiff again wrote to the defendant’s counsel, insisting that he be paid $1,400 per day and that he testify as to no more than one patient per day. He did not appear on October 20, 2006. Finally, on December 12, 2006, counsel for the defendant wrote to the plaintiff requesting that he select a single convenient date in January, 2007 on which to testify as to each pending claim. On January 10, 2007, plaintiff allegedly wrote to the defendant, allegedly agreeing to appear for the requested EUO, but still refusing to appear for a global examination. Defendant claims not to have received this letter, and on February 21 and 22, 2007, defendant denied each of these six claims, citing the doctor’s conviction and license suspension, and his failure to submit to an EUO.

The no-fault claimant is required to cooperate in good faith with the insurer in the investigation of its claim (Dilon Medical Supply Corp. v. Travelers Ins. Co., 7 Misc 3d 927). This the plaintiff has utterly failed to do. While on the surface appearing to agree to appear for an EUO, the plaintiff imposed such an absurd condition, namely that he be paid $1,400.00 twenty-one (21) separate times to appear on twenty-one (21) separate days, for an examination which defendant was prepared to complete in a single day. This would have necessitated the [*4]defendant spending $29,400.00 to obtain the verification information to which it was legally entitled. Nothing in the regulations permit the imposition of such a condition upon an insurer and the Court finds that Dr. Braver’s conduct was nothing more than an arrogant and transparent attempt to deprive the defendant of the information to which it was entitled. Such conduct constituted a refusal to provide appropriate verification information and accordingly the defendant’s time within which to pay or deny the claim never ran out (Nyack Hospital v. Progressive Casualty Insurance Company, supra ; Westchester Medical Center v. Mercury Cas. Co., —- NYS2d ——, 2008 WL 2939450 June 27, 2008). The last six claims were therefore not overdue and plaintiff’s action is premature as to them. Accordingly, the Court concludes that defendant is entitled to summary judgment as a matter of law and the complaint is dismissed as to the last six claims listed above.

Were the court not dismissing these six claims on that basis, plaintiff’s motion would nevertheless be denied. Defendant also alleges, and plaintiff does not deny, that discovery is not complete in that it served various disclosure demands upon the plaintiff together with its answer to the complaint, which demands have never been responded to. This court agrees with the holding in Ostia Medical, PC. v. Government Employees Ins. Co., 1 Misc 3d 907(A) wherein that court held:

“…there is no discovery prohibition if litigation is chosen by a medical provider to recover no-fault benefits. Once again, the Court must state that the plaintiff elected to proceed by way of litigation in the Nassau County District Court and thus, it must comply with the discovery procedures set forth in the CPLR and the UDCA (see, UDCA §1101[a]; CPLR §3101; see also Albatros Medical P.C. v. GEICO, supra ).”

In order to defeat a motion for summary judgment on the ground that discovery is not complete, the movant must show that further discovery may raise triable issues of fact(LMK Psychological Services, P.C. v. Liberty Mut. Ins., 30 AD3d 727). Although not necessary to the determination of the plaintiff’s motion, defendant here has met that burden. The plaintiff has not yet been fully examined concerning his refusal to submit to an EUO. In addition, the affidavit submitted in support of plaintiff’s motion, regarding the plaintiff’s billing and mailing procedures, is provided by the very same person who plaintiff alleged, as part of his defense at his license suspension hearing, was responsible for the billing “errors” for which he was prosecuted. This would obviously be fertile ground for examination as well. Therefore, if the Court were not granting the defendant summary judgment, it would nevertheless deny plaintiff’s motion pursuant to CPLR §3212(f), grant the defendant’s motion pursuant to CPLR §3126, and dismiss the action unless plaintiff provided all outstanding discovery and submitted to an examination before trial within 30 days of the date of this decision.

Accordingly, the fifth and the last six claims herein (claims 7-12) are dismissed. Summary judgment is denied as to the first, second, third, fourth, and sixth claims herein.

The foregoing constitutes the decision and order of the Court.

SO ORDERED: [*5]

__________________________________

DISTRICT COURT JUDGE

Dated: November 24, 2008

cc: Law Office of Amos Weinberg

Law Office of Teresa M. Spina

Supreme Court, Queens County

13672/07

Orin R. Kitzes, J.

The following papers numbered 1 to 11 read on this motion by plaintiff for an order pursuant to CPLR 3212 granting plaintiff partial summary judgment in its favor and against defendants on the first, second, third, fifth, sixth, seventh, eighth, ninth, and tenth causes of action for a money judgment in the amount of sixty one thousand two hundred seventy five dollars and seven cents with interest from the respective reimbursement dates; and cross-motion by defendants for an order pursuant to CPLR 3212 granting defendants ASTORIA MEDICAL SERVICES PC, NORTHERN MEDICAL SERVICES PC., PRECISE MEDICAL DIAGNOSTICS PC, and NY MEDICAL & DIAGNOSTIC PC summary judgment in their favor and dismissing the complaint as against defendants ASTORIA MEDICAL SERVICES PC, NORTHERN MEDICAL SERVICES PC., PRECISE MEDICAL DIAGNOSTICS PC, and NY MEDICAL & DIAGNOSTIC PC; and for an order pursuant to CPLR 3124 directing plaintiff to respond to defendants’ written interrogatories, notice for discovery and inspection, and to produce a witness for deposition.

Upon the foregoing papers it is ordered that the motions are decided as follows:

This action seeks recoupment of payments made by Utica National Insurance Group (“Utica”) to defendant Arthur Luban M.D. (“Luban”) and the defendant professional corporations ostensibly owned by Luban. (the “Defendant Entities”). The payments made by Utica were made pursuant to New York’s No-fault law for treatment and services allegedly provided by Luban and the Defendant Entities to automobile accident victims covered under the No-fault provisions of [*2]Utica automobile liability insurance policies. According to plaintiff, Arthur Luban M.D. and the defendant entities were not eligible to receive the No-fault payments they took from Plaintiff Utica National Insurance Group under section 5102(a)(1) of the Insurance Law, because the Defendants did not meet the New York State licensing requirements of Section 1503(a) of New York Business Corporation Law which requires that only persons licensed to practice medicine may own and control a medical professional corporation. Plaintiff claims that it paid bills and invoices from Providian Medical P.C. in the amount of $29,998.12, from Harbor Medical Diagnostic P.C. in the amount of $2,647, Valiant Medical Services in the amount of $4,321.06, Vital Medical Care in the amount of $23,308.75 and Bay Medical Services in the amount of $1,000. These were entities which operated in Queens and Kings County as professional service corporations ostensibly owned and controlled by Arthur Luban and allegedly established to provide medical goods and services to, among others, New York patients injured in automobile accidents.

Plaintiff has now moved for partial summary judgment to recover the $61,275.07 it paid directly to these entities for medical services, with interest from the respective reimbursement dates. Defendants have opposed this motion. It is axiomatic that the Summary Judgment remedy is drastic and harsh and should be used sparingly. The motion is granted only when a party establishes, on papers alone, that there are no material issues and the facts presented require judgment in its favor. It must also be clear that the other side’s papers do not suggest any issue exists. Moreover, on this motion, the court’s duty is not to resolve issues of fact or determine matters of credibility but merely to determine whether such issues exist. See, Barr v. County of Albany, 50 NY2d 247 (1980); Miceli v. Purex, 84 AD2d 562 (2d Dept. 1981); Bronson v March, 127 AD2d 810 (2d Dept. 1987.) Finally, as stated by the court in Daliendo v Johnson, 147 AD2d 312,317 (2d Dept. 1989), “Where the court entertains any doubt as to whether a triable issue of fact exists, summary judgment should be denied.”

In support of its motion, plaintiff has submitted a series of Consent and Decree Orders defendant Luban, who was registered as the sole owner and shareholder of the Defendant entities, entered into with the New York Department of Health, State Board for Professional Misconduct. In sworn filings, defendant Luban admitted that he did not in fact control the defendant entities which were instead controlled by persons who were not licensed to practice medicine, relegating Luban to the role of owner in name only. The New York Department of Health, State Board for Professional Misconduct concluded, and Luban in his admissions acknowledged, that these facts were all in contravention of Article 15 of the New York Business Corporation Law, including Section 1503(a), which requires that only persons licensed to practice medicine may own and control a medical professional corporation.

Plaintiff has also submitted a copy of the Uni Claims Payment History of Utica National Insurance Group and the Affidavit of Utica SIU Investigator Wendy Tiffin. This evidence show that plaintiff has paid certain of the Luban entities $61,275.07 since the April 4th, 2002 enactment of 11 NYCRR § 65-3.16(a)(12).

Defendants claim that plaintiff’s submissions have not established that any of the Defendant entities was fraudulently incorporated and that consequently, plaintiff’s motion should be denied. Defendants point out that neither plaintiff’s counsel nor Wendy Tiffin, Plaintiff’s Special Investigative Unit Investigator, has any personal knowledge of any relevant facts. [*3]Furthermore, defendants claim that the Consent Agreements and Orders do not support plaintiff’s claims. According to defendants, the Consent Agreements, executed by Dr. Luban as the sole shareholder of the P.C.s, state that the Respondents do not contest the allegations and specifications in the statements of charges. However, the Respondents did not admit anything, in fact, defendants point out that at paragraph E in the Factual Allegations in the Statements of Charges sets forth that persons who were not licensed to practice medicine were instrumental in controlling the Respondents, including, but not limited to, “hiring and supervising professional staff, accessing bank accounts, disbursing funds, and otherwise handling banking and financial affairs.” Defendants claim that these admissions do not rise to the level of control by unlicensed persons that would invalidate payments to Defendant entities.

Defendants also point out that in the matters of the seven entities whose Certificates of Incorporation were revoked on consent, the Consent Agreements And Orders specifically provide: “…that pursuant to Article 10 of the Business Corporation Law, the Respondent will be permitted to wind up all of its affairs, including, but not limited to, collection of outstanding accounts receivable, notwithstanding this revocation…”. According to defendants, this indicates that the State Board for Professional Medical Conduct agreed that these seven (7) P.C.s could continue to collect outstanding receivables. Apparently, arguing that these receivables included money paid by plaintiff. Defendants also claim that plaintiff’s submission of the Uni-Claims Payment History is deficient in that it does not even identify the patients-assignors, nor any other details, i.e., the treating doctor, services performed, nor that payments were made on dates which the defendant entities were in violation of the ownership rules.

Provisions of the no-fault law require insurers to reimburse patients or their medical provider assignees for “basic economic loss” (Insurance Law § 5102[a][1]). A provider of healthcare services is not eligible for reimbursement, however, “if the provider fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York” (11 NYCRR 65-3.16[a][12]). The Court of Appeals has interpreted 11 NYCRR 65-3.16(a)(12) to allow insurance carriers to withhold reimbursement for no-fault claims from fraudulently licensed medical corporations and to “look beyond the face of licensing documents to identify willful and material failure to abide by state and local law” State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 (2005.) State law mandates that professional service corporations be owned and controlled only by licensed professionals (see Business Corporation Law §§ 1503[a]; 1507, 1508), and that licensed professionals render the services provided by such corporations (see Business Corporation Law § 1504[a]).

In State Farm Mut. Auto. Ins. Co. v Mallela, supra, the court found that the complaint did not clearly indicate, one way or the other, whether plaintiff had paid money to defendants after the amended regulation took effect. As such, the Court declined to consider whether State Farm could recover money already paid out under theories of fraud or unjust enrichment. This Court is presented with a complaint that clearly seeks to recover money paid to defendants who had failed to meet the applicable state licensing requirements, which prohibit non-physicians from owning or controlling medical service corporations. This Court finds that, under the reasoning of State Farm Mut. Auto. Ins. Co. v Mallela, supra, and its progeny, [see First Help Acupuncture P.C. v State Farm Ins. Co., 12 Misc 3d 130(A),(2006); see also Allstate Ins. Co. v Belt Parkway Imaging, P.C., 33 AD3d 407 (2006); see generally Metroscan Imaging P.C. v GEICO Ins. Co., [*4]13 Misc 3d 35,(2006.)] and the applicable state regulations, it is appropriate to allow the insurance carrier to recover money already paid out to ineligible recipients.

Here, the evidence presented by the plaintiff established, prima facie, its entitlement to summary judgment on its first, second, third, fifth, sixth, seventh, eighth, ninth, and tenth causes, as those actions relate to defendants Providian Medical P.C., Harbor Medical Diagnostic P.C., Valiant Medical Services, Vital Medical Care, and Bay Medical Services. Plaintiff has established that these defendants violated 11 NYCRR § 65-3.16(a)(12) by receiving money from plaintiff when they were ineligible for reimbursement from plaintiff for No-fault benefits. Plaintiff has failed to show any proof that the other defendants received such payments or controlled defendants Providian Medical P.C., Harbor Medical Diagnostic P.C., Valiant Medical Services, Vital Medical Care, and Bay Medical Services. Consequently only defendants Providian Medical P.C., Harbor Medical Diagnostic P.C., Valiant Medical Services, Vital Medical Care, and Bay Medical Services are obligated in damages to plaintiff for payments of $61,275.07 issued to these defendants subsequent to April 4th, 2002.

Contrary to defendants claim, Dr. Luban signed numerous Consent and Decree Orders, that established he was in violation of New York Education Law Section 6530(12) and of Article 15 of the New York Business Corporation Law, including Section 1503(a), which requires that only persons licensed to practice medicine may own and control a medical professional corporation. Whether Dr. Luban had actual intent to defraud at the time of incorporation is immaterial to the issue of whether the defendants were entitled to reimbursement where non-physicians were in control of and running the entities thus failing meet the state licensing requirements. All that must be established is that Dr. Luban was not in control of the Professional Corporation at the time the services were rendered. The consent decrees establish this lack of control. Furthermore, the references in the consent decrees to defendants’ being able to wind up and collect receivables are not an indication that the entities could collect for medical services. Clearly these entities could have been owed money for other than prohibited work and the decrees afforded the opportunity to collect for such work, while closing down pursuant to the Consent Decrees. Consequently, defendants Providian Medical P.C., Harbor Medical Diagnostic P.C., Valiant Medical Services, Vital Medical Care, and Bay Medical Services. were not entitled to reimbursement for the services rendered and are obligated to repay plaintiff for the amounts paid. Accordingly, the plaintiff’s motion for partial summary judgment is granted to the extent that judgment on its first, second, third, fifth, sixth, seventh, eighth, ninth, and tenth causes in favor of plaintiff and against defendants Providian Medical P.C., Harbor Medical Diagnostic P.C., Valiant Medical Services, Vital Medical Care, and Bay Medical Services is granted. State Farm Mut. Auto. Ins. Co. v Mallela, supra. The action shall proceed on the remaining causes of action.

Based on the above, the branch of the cross-motion by defendants for an order pursuant to CPLR 3212 granting defendants ASTORIA MEDICAL SERVICES PC, NORTHERN MEDICAL SERVICES PC., PRECISE MEDICAL DIAGNOSTICS PC, and NY MEDICAL & DIAGNOSTIC PC summary judgment in their favor and dismissing the complaint as against defendants ASTORIA MEDICAL SERVICES PC, NORTHERN MEDICAL SERVICES PC., PRECISE MEDICAL DIAGNOSTICS PC, and NY MEDICAL & DIAGNOSTIC PC, is granted to the extent that the first, second, third, fifth, [*5]sixth, seventh, eighth, ninth, and tenth causes are dismissed as against these defendants. The branch of the defendants motion seeking discovery is granted. Discovery shall proceed regarding the remaining causes of action. Plaintiff shall respond to defendants’ written interrogatories, notice for discovery and inspection, and to produce a witness for deposition. The court notes that it was not presented with any basis to deny the motion for summary judgment in order for this discovery to be completed. CPLR 3212 (f).

Dated: November 24, 2008…………………………………………..

Orin R. Kitzes, J.S.C.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Joseph J. Esposito, J.), entered May 23, 2007. The order, inter alia, granted the motion by defendant Shauky M. Musa-Obregon to vacate a default judgment entered April 7, 2005 insofar as it was against him.

Order reversed without costs, motion by defendant Shauky M. Musa-Obregon to vacate the default judgment insofar as it was against him denied and default judgment against him reinstated.

Plaintiff commenced this action to recover payments of uninsured and basic no-fault benefits on behalf of its subrogor, who allegedly sustained serious injuries in a motor vehicle accident on October 21, 2002. After plaintiff was awarded a default judgment on April 7, 2005, defendant Shauky M. Musa-Obregon (defendant) moved to vacate so much of the judgment as was against him on the ground that he was not served. The parties entered into a so-ordered stipulation which provided that the default judgment was vacated and defendant’s affidavit in support of his motion would constitute his answer to the complaint. After another default by defendant, an inquest was held and the default judgment was reinstated against him. Defendant moved to vacate the default judgment on the ground of excusable default, submitting in support of his motion an affirmation from his attorney and various exhibits annexed thereto. Plaintiff [*2]opposed the motion, arguing, inter alia, that defendant failed to explain why he did not appear for trial. The court below granted defendant’s motion. Plaintiff’s appeal ensued.

In order to vacate a default judgment under CPLR 5015 (a), the defaulting party must demonstrate a reasonable excuse for his default as well as a meritorious defense to the action (see Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138 [1986]; Mora v Scarpitta, 52 AD3d 663 [2008]; Montague v Rivera, 50 AD3d 656 [2008]). In the present case, since defendant’s attorney failed to allege personal knowledge of the facts asserted, his affirmation is of no probative value (see Warrington v Ryder Truck Rental, Inc., 35 AD3d 455, 456 [2006]; V.S. Med. Servs., P.C. v New York Cent. Mut. Ins. Co., 20 Misc 3d 134[A], 2008 NY Slip Op 51473[U] [App Term, 2d & 11th Jud Dists 2008]). Consequently, defendant failed to establish a reasonable excuse for his default and his motion to vacate the default judgment should have been denied.

Weston Patterson, J.P., Golia and Steinhardt, JJ., concur.
Decision Date: November 21, 2008

—[*1] Basch & Keegan, L.L.P., Kingston (Derek J. Spada of counsel), for appellant.

Finder & Cuomo, L.L.P., New York City (Paul L. Meli of counsel), for respondent.

Spain, J. Appeal from an order of the Supreme Court (Czajka, J.), entered January 8, 2007 in Columbia County, which, among other things, denied plaintiff’s motion for summary judgment.

The facts are undisputed. On May 29, 2005, plaintiff was a passenger in a car driven by his friend and owned by plaintiff’s mother. They stopped for gas and, while plaintiff was pumping gasoline, the gas pump nozzle popped out of the car’s fuel tank, causing some gasoline to spill on the ground and, unbeknownst to him, on his clothing. Plaintiff then entered the gas station store to purchase a pack of cigarettes. Shortly after leaving the gas station in the vehicle, plaintiff attempted to light a cigarette, causing the gasoline on his clothing to ignite. As a result, he suffered severe burns to the right side of his body, right arm and leg.

Defendant denied plaintiff’s claim for no-fault insurance benefits on the ground that his injuries did not arise out of the use or operation of a motor vehicle (see Insurance Law § 5102 [b]; § 5103 [a] [1]). Plaintiff then commenced the instant action in Supreme Court seeking to recover no-fault insurance benefits. After discovery was completed, plaintiff moved for summary judgment on the issue of his entitlement to no-fault insurance benefits and defendant cross-moved for a declaratory judgment that defendant has no obligation to plaintiff. Supreme Court granted defendant’s cross motion and denied plaintiff’s motion. Plaintiff now appeals.

No-fault insurance benefits are payable only if a person’s injury “aris[es] out of the use [*2]or operation of a motor vehicle” (Insurance Law § 5102 [b]; see § 5103 [a] [1]). Inasmuch as “[t]he vehicle must be a proximate cause of the injury before the absolute liability imposed by the statute arises” (Walton v Lumbermens Mut. Cas. Co., 88 NY2d 211, 215 [1996]), we agree with Supreme Court’s conclusion that plaintiff’s injuries—sustained when he attempted to light a cigarette, igniting gasoline that he had spilled on his clothing—did not arise out of the use of the vehicle. Indeed, plaintiff’s injuries would have occurred even if he had never reentered the vehicle and his friend had driven away (see Sullivan v Barry Scott Agency, Inc., 23 AD3d 889, 890 [2005]; cf. Matter of Farm Family Cas. Ins. Co. [Trapani], 301 AD2d 740, 741-742 [2003]). Thus, although plaintiff’s injuries occurred while he was inside the moving vehicle, because “the vehicle itself was not a cause of the damage,” he is not entitled to no-fault benefits (Walton v Lumbermens Mut. Cas. Co., 88 NY2d at 215; see Sullivan v Barry Scott Agency, Inc., 23 AD3d at 890, Sochinski v Bankers & Shippers Ins. Co., 221 AD2d 889 [1995]).

Mercure, J.P., Peters, Malone Jr. and Stein, JJ., concur. Ordered that the order is affirmed, with costs.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Diane A. Lebedeff, J.), entered August 28, 2007, deemed from a judgment of said court entered September 26, 2007 (see CPLR 5512 [a]; Neuman v Otto, 114 AD2d 791 [1985]). The judgment, entered pursuant to the August 28, 2007 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $740.25.

Judgment affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment, asserting, among other things, that defendant had failed to timely deny the claim. The court granted plaintiff’s motion, holding that the statutory time period in which defendant had to pay or deny the claim was not tolled because defendant’s follow-up verification request letter was premature. The instant appeal by defendant ensued.

Since defendant raises no issue on appeal with respect to plaintiff’s establishment of its prima facie entitlement to summary judgment, we do not pass on the propriety of the determination of the court below with respect thereto.

In opposition to plaintiff’s motion, defendant argued that the statutory time period in which it had to pay or deny the claim was tolled due to the assignor’s delay in appearing for an examination under oath (EUO). However, contrary to defendant’s contention, the September 19, 2006 letter did not constitute a proper request for verification since it neither demanded nor required a response (see New York & Presbyt. Hosp. v Eagle Ins. Co., 17 AD3d 646 [2005]; Englinton Med. P.C. v MVAIC, 14 Misc 3d 135[A], 2007 NY Slip Op 50164[U] [App Term, 2d [*2]& 11th Jud Dists 2007]). Consequently, the 30-day claim determination period (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [c]) was not tolled, and defendant’s denial of claim form was untimely. As a result, defendant was precluded from raising most defenses, including its proffered defense of lack of medical necessity (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]). Accordingly, the judgment is affirmed.

In view of the foregoing, we pass on no other issue.

Pesce, P.J., Weston Patterson and Rios, JJ., concur.
Decision Date: November 05, 2008

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Dolores L. Waltrous, J.), entered May 3, 2007. The order, insofar as appealed from as limited by the brief, denied plaintiff’s motion for a protective order and granted defendant’s cross motion to strike the complaint or, in the alternative, to compel discovery, to the extent of directing plaintiff to comply with all outstanding discovery demands and to appear for an examination before trial.

Order, insofar as appealed from, modified by providing that defendant’s cross motion is granted only to the extent of compelling plaintiff to produce the documents requested in the first, eighth through fourteenth, sixteenth and eighteenth numbered paragraphs of defendant’s demand for discovery and inspection within 60 days of the date of the order entered hereon and that, within 30 days after such production, plaintiff shall appear for an examination before trial; as so modified, affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, defendant served plaintiff with combined discovery demands, including a demand for discovery and inspection and a notice of examination before trial (EBT). Subsequently, plaintiff moved, inter alia, for a protective order, and defendant cross-moved to strike the complaint or, in the alternative, to compel plaintiff to appear for an EBT and to produce the documents requested in its demand for discovery and inspection. The court below denied plaintiff’s motion for a [*2]protective order and granted defendant’s cross motion to the extent of directing plaintiff to comply with all outstanding discovery demands and to appear for an EBT. This appeal by plaintiff ensued.

Since plaintiff failed to challenge the propriety of defendant’s demand for discovery and inspection within the time prescribed by CPLR 3122, it is obligated to produce the information sought therein except as to matters which are privileged or palpably improper (see Fausto v County of Nassau, 17 AD3d 520 [2005]; Garcia v Jomber Realty, 264 AD2d 809 [1999]; Great Wall Acupuncture v State Farm Mut. Auto. Ins. Co., 20 Misc 3d 136[A], 2008 NY Slip Op 51529[U] [App Term, 2d & 11th Jud Dists 2008]; A.B. Med. Servs. PLLC v Utica Mut. Ins. Co., 11 Misc 3d 71 [App Term, 2d & 11th Jud Dists 2006]). In the absence of any claim of privilege, the only issue for this court’s review is whether defendant’s requests for documents in said demand were palpably improper (see Saratoga Harness Racing v Roemer, 274 AD2d 887 [2000]).

Where a discovery demand concerns matters relating to a defense which a defendant is precluded from raising, it is palpably improper, notwithstanding the fact that the plaintiff did not specifically object thereto (see A.B. Med. Servs. PLLC, 11 Misc 3d 71). As defendant did not establish that it timely denied plaintiff’s claims, to the extent defendant seeks discovery in support of its defense of lack of medical necessity, discovery of such precluded matter is palpably improper (see id.).

In State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005]), the Court of Appeals held that an insurer may withhold payment to a medical services provider if the provider is fraudulently incorporated, without regard to whether the medical services were unnecessary or improper. In the instant case, the record reveals that defendant set forth detailed and specific reasons for believing that plaintiff may be ineligible to recover no-fault benefits as a fraudulently incorporated professional service corporation, a defense which is not precluded (see Midborough Acupuncture, P.C. v State Farm Ins. Co., Misc 3d , 2008 NY Slip Op 28291 [App Term, 2d & 11th Jud Dists 2008]). To the extent that defendant seeks production of, inter alia, plaintiff’s certificate of incorporation, management documents, and medical licenses of plaintiff’s shareholders, such discovery is material and necessary to defendant’s contention that plaintiff is ineligible for reimbursement of no-fault benefits (see CPLR 3101 [a]; One Beacon Ins. Group, LLC v Midland Med. Care, P.C., AD3d [2d Dept, Sept. 9, 2008]; Great Wall Acupuncture, 20 Misc 3d 136[A], 2008 NY Slip Op 51529[U]). Accordingly, defendant is entitled to production of the documents sought in paragraphs 1, 8 through 14, 16 and 18 of defendant’s demand for discovery and inspection.

With respect to that portion of the order which directed plaintiff to appear for an EBT, plaintiff has failed to assert any viable reason for its contention that said EBT should not be held. Since defendant’s defense to this action is based upon plaintiff’s alleged ineligibility to recover reimbursement of assigned no-fault benefits (see Mallela, 4 NY3d 313), it is entitled to such EBT (see CPLR 3101 [a]).

Pesce, P.J., Weston Patterson and Rios, JJ., concur.
Decision Date: November 05, 2008

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Nassau County, First District (Gary Franklin Knobel, J.), dated March 1, 2007. The order granted plaintiff’s motion for summary judgment and denied defendant’s cross motion for summary judgment.

Order affirmed without costs.

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. The court below granted plaintiff’s motion and denied defendant’s cross motion. The instant appeal by defendant ensued.

On appeal, defendant contends that the affidavit by the biller employed by a third party, submitted in support of plaintiff’s motion, failed to lay a proper foundation for the documents annexed to the moving papers and that, as a result, plaintiff failed to establish a prima facie case (see 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]; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]). We decline to consider this argument since it is raised for the first time on appeal and is therefore unpreserved (cf. Bath Med. Supply, Inc. v Deerbrook Ins. Co., 14 Misc 3d 135[A], 2007 NY Slip Op 50179[U] [App Term, 2d & 11th Jud Dists 2007]). Accordingly, we do not pass upon the propriety of the determination of [*2]the court below with respect to plaintiff’s establishment of its prima facie case.

In opposition to plaintiff’s motion and in support of its cross motion seeking summary judgment dismissing the complaint as premature on the ground that plaintiff had failed to respond to its verification requests (see Westchester Med. Ctr. v Countrywide Ins. Co., 45 AD3d 676 [2007]), defendant argued that notwithstanding the fact that it had received plaintiff’s hospital facility form (NYS Form NF-5), verification was still outstanding because it had received neither an application for motor vehicle no-fault benefits nor a completed assignment of benefits form. Contrary to defendant’s contention, an insurer must accept a completed hospital facility form submitted by a provider of health services in lieu of a prescribed application for motor vehicle no-fault benefits (see Insurance Department Regulations [11 NYCRR] § 65-3.5 [g]; see also Nyack Hosp. v Encompass Ins. Co., 23 AD3d 535, 536 [2005]; Nyack Hosp. v Allstate Ins. Co., 13 Misc 3d 139[A], 2006 NY Slip Op 52233[U] [App Term, 9th & 10th Jud Dists 2006]). Moreover, defendant admitted having received the hospital facility form (which included an assignment) on October 6, 2005, and did not request verification of the assignment until December 23, 2005. Accordingly, defendant failed to establish that it timely requested verification with respect to the assignment (see Westchester Med. Ctr. v Countrywide Ins. Co., 45 AD3d 676 [2007], supra), and consequently failed to demonstrate its entitlement to verification of the assignment (id.).

Since defendant failed to raise a triable issue of fact in opposition to plaintiff’s motion for summary judgment and failed to set forth a prima facie case with respect to its cross motion for summary judgment, the court below properly granted plaintiff’s motion and denied defendant’s cross motion. The order is therefore affirmed.

Rudolph, P.J., McCabe and Tanenbaum, JJ., concur.
Decision Date: November 05, 2008

[*1]

Civil Court of the City of New York, Kings County, November 5, 2008

APPEARANCES OF COUNSEL

Bruno Gerbino & Soriano, LLP, Melville, for defendant. Gary Tsirelman P.C., Brooklyn, for plaintiff.

{**22 Misc 3d at 724} OPINION OF THE COURT

George J. Silver, J.

In this action to recover first-party no-fault benefits, interest and attorney’s fees pursuant to New York’s Insurance Law and no-fault regulations, defendant Utica Mutual Insurance Company moves, pursuant to CPLR 3212, for an order granting it summary judgment dismissing plaintiff Allstate Social Work and Psychological Services, PLLC’s complaint on the ground that plaintiff’s assignors failed to appear for properly scheduled independent medical examinations (hereinafter IMEs) and examinations under oath (hereinafter EUOs) and thus failed to comply with conditions precedent of the insurance policy.

Chad LaPlate, defendant’s no-fault specialist, avers that defendant’s Special Investigative Unit (hereinafter SIU) investigated the motor vehicle accident that allegedly occurred on May 23, 2003 and which gave rise to the instant claims. As a result of that investigation, defendant’s SIU determined that the alleged loss was the result of an intentional act and that material misrepresentations had been made in the presentation of the claims. Defendant thereafter assigned the claims to Hudson Valley Medical Consultants (hereinafter HVMC) for the scheduling of IMEs of plaintiff’s assignors. Jennifer Harvey, an employee of HVMC, avers that HVMC is an entity that is involved in the scheduling of IMEs on behalf of insurance companies. According to Ms. Harvey, HVMC acts as an intermediary between the insurance company and the examining physician, dentist or psychologist by scheduling IME appointments and then securing the IME report from the examining doctor. Ms. Harvey avers that the psychological IMEs of the assignors were scheduled with Moses Weksler, Ph.D., for August 27, 2003. The letters scheduling the IMEs were prepared and signed by Ms. Harvey and mailed on August 15, 2003. Ms. Harvey states that it is HVMC’s procedure to have an employee prepare and print the IME scheduling letter and the address label for each scheduled IME. The employee ensures that the address label is correct, places the scheduling letter in the envelope, affixes the address label to the envelope and applies the proper postage. The envelopes containing the scheduling letters are placed in an official postal repository on a daily basis. Helen Sickler, the office manager for Moses Weksler, Ph.D., states in her affidavit that neither assignor appeared at Dr. Weksler’s Brooklyn office on August 27, 2003 and that the assignors’ nonappearances were reported to HVMC. On August 28, 2007, Ms. Harvey{**22 Misc 3d at 725} scheduled a second IME for both assignors to be held on September 11, 2003, again at Dr. Weksler’s Brooklyn office. According to Ms. Sickler, both assignors again failed to appear at Dr. Weksler’s office. On October 9, 2003 defendant issued two denials, one for each assignor, denying plaintiff’s claims due to the failure of the assignors to appear for the two scheduled psychological IMEs.

Defendant thereafter retained the law firm of Bruno, Gerbino & Soriano, LLP to schedule and conduct EUOs of defendant’s insured, the driver of the motor vehicle and the assignors. According to defendant’s attorney, EUOs were duly scheduled for October 7, 2003, October 10, 2003, October 28, 2003 and December 23, 2003. The assignors failed to attend the EUOs and on January 29, 2004 defendant issued a second set of denials based upon the assignors’ nonappearances.

In opposition, plaintiff argues that defendant has failed to establish that the assignors violated the policy conditions by failing to appear for the psychological IMEs because, under the express unambiguous terms of the insurance contract, the assignors were only obligated to submit to a medical examination by a physician. Plaintiff contends that licensed psychologists like Dr. Weksler are not physicians as the term is defined by the Education Law, therefore the assignors’ failure to appear for the scheduled IMEs was not a violation of the insurance policy and defendant’s denial of plaintiff’s claims was improper. Plaintiff raises no issue as to the sufficiency of defendant’s proof that the IME request letters were mailed by HVMC in accordance with a standard office practice and procedure and in accordance with the time periods delineated in the no-fault regulations. Nor does plaintiff challenge the sufficiency of defendant’s proof of the assignors’ nonappearances at the IMEs.

Plaintiff further contends that the EUO scheduling letters dated September 30, 2003, October 1, 2003 and October 13, 2003 are defective on their face because they failed to inform the assignors that they would be reimbursed for any loss of earnings or reasonable transportation expenses incurred in complying with the requests. Plaintiff also argues that the December 10, 2003 EUO scheduling letter is defective because the defendant improperly scheduled the EUOs to be held in Melville, New York, which plaintiff argues was not reasonably convenient to the assignors who reside in Brooklyn. In the alternative, plaintiff argues that if the language of the December 10, 2003 EUO scheduling letter is sufficient, the letter should{**22 Misc 3d at 726} be treated as a first request for additional verification. Since defendant failed to issue a follow-up request to the December 10, 2003 scheduling letter, plaintiff contends, defendant failed to comply with the follow-up verification requirements outlined in the regulations. Finally, plaintiff informs the court that it did not cross-move for summary judgment “due to insufficient time to file the motion”^[FN1] but nevertheless requests that the court search the record and grant summary judgment in its favor.

Defendant argues in reply that this court previously denied plaintiff’s motion for summary judgment. Defendant also concedes that Dr. Weksler is not a physician as defined by the Education Law but argues that the endorsement’s definition of “medical expense” includes all professional health services, not only medical services provided by physicians. Since the legislature included medical expenses for all professional health services as part of covered basic economic loss, defendant reasons, it also intended to permit any health care provider to perform IMEs.

Analysis

“Pursuant to Insurance Law § 5103 (d), the Legislature empowered the Superintendent of Insurance to promulgate regulations establishing minimum benefit standards for policies of insurance providing coverage for the payment of first-party benefits and to set standards for the payment of first-party benefits by self-insurers. Pursuant to this authority, the Superintendent promulgated Insurance Department Regulations (11 NYCRR) § 65-1.1, which sets forth the basic form of the ‘Mandatory Personal Injury Protection Endorsement’ which must be included in every owner’s policy of liability insurance issued on a motor vehicle in this state” (Alleviation Supplies Inc. v Enterprise Rent-A-Car, 12 Misc 3d 787, 790 [Civ Ct, Richmond County 2006]).

The mandatory personal injury protection endorsement (hereinafter endorsement) provides, in pertinent part, that the “eligible injured person shall submit to medical examination by physicians selected by, or acceptable to, the Company, when, and as often as, the Company may reasonably require” (11 NYCRR 65-1.1 [d] [Conditions] [Proof of Claim; Medical, Work Loss, and{**22 Misc 3d at 727} Other Necessary Expenses]).^[FN2] The appearance of the insured for IMEs at any time is a condition precedent to the insurer’s liability on the policy (Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2d Dept 2006]). The term physician is not defined in the endorsement but the Education Law provides that “[o]nly a person licensed or otherwise authorized under this article shall practice medicine or use the title ‘physician’ ” (Education Law § 6522). Defendant concedes in its reply that a licensed psychologist such as Dr. Weksler is not a physician. The question then is may any health provider perform an IME of an eligible injured person or, as the endorsement appears to require, only a physician?

Though there appears to be no case law addressing the point, in an opinion letter dated March 12, 2004, the State Insurance Department answered the following question:

“When a No-Fault eligible person is being treated by a chiropractor and the person’s insurer has requested a medical examination (‘IME’) of that person in order to evaluate the medical necessity of the chiropractic services performed, must the medical examination be performed by a chiropractor, or may it be performed by a medical doctor?” (2004 Ops Gen Counsel NY Ins Dept No. 04-03-10.)

In holding that an “insurer’s medical examination of an eligible injured person to evaluate the medical necessity of health services provided by a chiropractor may be performed by a medical doctor, and need not be performed by a licensed chiropractor” (id.) the Insurance Department stated “[t]here is no requirement in the regulation that a claim denial must be based upon a medical examination conducted by a health provider of the same speciality area as the treating health provider” (id.). Implicit in the Insurance Department’s interpretation, which is entitled to great deference unless it is “irrational or unreasonable” (Matter of John Paterno, Inc. v Curiale, 88 NY2d 328, 333 [1996], quoting Matter of New York Pub. Interest Research Group v New York State Dept. of Ins., 66 NY2d 444, 448 [1985]; cf. Matter of Gaines v New York State Div. of Hous. & Community Renewal, 90 NY2d 545, 548-549 [1997]), is that an independent medical examination of an eligible injured person may be performed either by a physician, as the term is defined in the Education Law and used in the endorsement, or by any other{**22 Misc 3d at 728} licensed health provider selected by or acceptable to the insurer. It is for the court or an arbitrator to “consider the qualifications of the health provider performing the IME in determining the validity of a claim denial” (2004 Ops Gen Counsel NY Ins Dept No. 04-03-10). A contrary conclusion would frustrate the core objective of the no-fault scheme by limiting the universe of health providers who could perform IMEs, thereby delaying the processing of no-fault claims (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]).

The affidavits submitted by defendant are sufficient to establish that defendant’s initial IME requests, its follow-up IME requests and its denial of claim were mailed pursuant to a standard office practice and procedure, and that the assignors failed to appear for the IMEs (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]; Post Traumatic Med. Care, P.C. v Progressive Cas. Ins. Co., 21 Misc 3d 128[A], 2008 NY Slip Op 51954[U] [App Term, 2d & 11th Jud Dists 2008]). The court, therefore, need not address plaintiff’s arguments concerning the sufficiency of defendant’s EUO requests.

Accordingly, it is hereby ordered that defendant’s motion for summary judgment dismissing plaintiff’s complaint is granted.

Footnotes

Footnote 1: See attorney’s affirmation in opposition.

Footnote 2: Since the endorsement is promulgated by the Superintendent of Insurance, and is not drafted by the insurer, plaintiff’s argument that any ambiguity in the endorsement must be construed against the insurer is incorrect.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Kathy J. King, J.), entered May 18, 2007. The order denied plaintiff’s motion for summary judgment.

Order affirmed without costs.
In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. In opposition, defendant argued that there was an issue of fact as to medical necessity. The court below denied plaintiff’s motion on the grounds that it failed to prove its prima facie entitlement to summary judgment inasmuch as plaintiff failed to prove that the claim forms were submitted to defendant and because the supporting affidavit did not establish that it was based upon the affiant’s personal knowledge of plaintiff’s standard office practices and procedures. The instant appeal by plaintiff ensued.

A provider generally establishes its prima facie entitlement to summary judgment by proof of the submission of a statutory claim form, 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 the instant case, any deficiency in plaintiff’s moving papers regarding proof of mailing of the claim forms was cured by defendant’s claim denial forms, and the affidavit of defendant’s claims representative in which receipt of the claims in question was conceded (see East Acupuncture, P.C. v Electric Ins. Co., 16 Misc 3d 128[A], 2007 NY Slip Op 51281[U] [App Term, 2d & 11th Jud Dists 2007]; Oleg [*2]Barshay, D.C., P.C. v State Farm Ins. Co., 14 Misc 3d 74 [App Term, 2d & 11th Jud Dists 2006]). In addition, a review of the record indicates that plaintiff’s affidavit sufficed to establish that the annexed claim forms constituted evidence in admissible form (see CPLR 4518; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]). Consequently, the record establishes plaintiff’s prima facie entitlement to summary judgment.

Contrary to plaintiff’s contention, defendant, through the submission of the affidavit of its claims representative and the affirmed peer review, established that plaintiff’s claims were properly and timely denied based upon a lack of medical necessity (see A.B. Med. Servs., PLLC v Liberty Mut. Ins. Co., 39 AD3d 779 [2007]; 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]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]). Accordingly, the order denying plaintiff’s motion for summary judgment is affirmed, albeit on other grounds.

Pesce, P.J., Weston Patterson and Rios, JJ., concur.
Decision Date: October 31, 2008