Civil Court of the City of New York, Richmond County

11810/07

Counsel for Plaintiff:

Law Offices of Emilia I. Rutigliano

2503 65th Street

Brooklyn, NY 11204

718-382-1266

Counsel for Defendant:

Jean Kang, Esq.

Jaffe & Koumourdas, LLP

40 Wall Street, 12th Floor

New York, NY 10005

212-809-7800

Katherine A. Levine, J.

Plaintiff Park Slope Medical and Surgical Supply, Inc.(“plaintiff” or “Park Slope”) brought this action to recover the sum of $817.25 with statutory interest, attorney fees, and costs for medical equipment it provided to its assignor Alicia Marsh (“Marsh”). Park Slope moves for summary judgment on the grounds that it has demonstrated a prima facie case of entitlement to payment for the medical supplies it furnished to Marsh. Defendant cross moves for summary judgment and to dismiss this action on the grounds that Park Slope failed to comply with the two verification requests it mailed on January 18, 2007 and February 17, 2007 wherein it requested the NF-3s, assignment of benefits and the initial narrative report from the referring physician.

Country-Wide states that its request for copies of the NF-3 and assignment of benefits are still outstanding and that it therefore was not required to pay the claim. The complaint should thus be dismissed because this action was prematurely filed.

Park Slope does not dispute defendant’s assertion that it never provided the above requested information, but asserts as justification that the second verification request was improper because it was made on the 30th day after the first request for verification. Plaintiff argues that Insurance Regulation 11 NYCRR Section 65-3.6 (b) bars the insurance carrier from issuing a second verification request until thirty days have elapsed from the time it made its first verification request, during which time it has received no response to its request.

Pursuant to Insurance Law § 5106(a) and 11 NYCRR 65-3.5, an insurer is required to [*2]either pay or deny a claim for no fault automobile insurance benefits within 30 days from the date an applicant supplies proof of claim or it will be precluded from offering any defenses at trial. Mt Sinai Hosp. v. Chubb Group of Ins. Cos., 43 AD3d 889-90 (2d Dept. 2007). See, Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 278 (1997). An insurer may toll the 30 day period by properly requesting verification within 15 days from the receipt of the bill (11 NYCRR 65.15(d)); Psych. & Massage Therapy Assoc., PLLC v. Progressive Casualty Ins. Co., 5 Misc 3d 723 (Civ Ct, Queens Co., 2004). If the “requested verification has not been supplied to the insurer 30 calendar days after the original receipt, the insurer shall, within 10 calendar days, follow up with the party from whom the verification was requested….” 11 NYCRR Section 65-3.6(b). “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 569, 570 (2d Dept. 2004). See Insurance Law § 5106(a); 11 NYCRR 65-3.5(c), 65-3.8(a)(1).

As is typical in the area of No-Fault Law, two diametrically opposed decisions have been rendered by the Civil Court on this issue – whether the insurer must wait until thirty days have lapsed before sending its follow-up request or be precluded from offering defenses at trial. In Psych. & Massage Therapy, supra ^[FN1] Judge Agate determined that neither case law nor statutory language required the insurer to wait thirty days before it could submit a follow-up request or be precluded from offering any defenses at trial. Id at 724. Interpreting the predecessor to Regulation 11 NYCRR § 65-3.6 (b) ^[FN2] , the court stated that “(w)hile the regulations require an insurer to submit a follow-up request within 30 days from the date of submission of the request, it does not mandate that the insurer wait 30 days before sending a follow up request. Instead, this time frame is a limit to the amount of time an insurer may wait before sending a follow up request.” Id at 724-25. The court then found that:

penalizing defendant for sending a follow-up request 25 days after its initial request is inconsistent with the goals of the No-Fault Law. The purpose of the No-Fault Law is to allow swift compensation for qualified injured persons from the insurance companies. (citation omitted). The regulations require insurers to act quickly in evaluating insured claims and to avoid prejudicial delays (citation omitted). The verification requirement exists in order for insurers to have their opportunity to promptly investigate and respond to legitimate claims, not to delay payment (citation omitted).

Psych. & Massage Therapy Assoc., PLLC, supra , p.725.

The court further noted that plaintiff’s attempt to penalize defendant for being too prompt [*3]would be totally inconsistent with defendant’s duties under the No-Fault Law to promptly respond to the insured’s claims. Id at 726.Defendant would suffer undue prejudice if a verification request was found improper as it would have to pay for a claim for which it complied with the regulations. Moreover, defendant’s early follow-up verification request did not prejudice plaintiff in any manner, as plaintiff was not under any time restraint to respond to defendant’s verification. Id. On appeal, the Appellate Term stated, without any elaboration, that: “despite defendant’s untimely denial of plaintiff’s claim for the sum of $ 1,360.48, defendant was not precluded from asserting the defense of lack of coverage” Psych. & Massage Therapy Assoc., PLLC v. Progressive Cas. Ins. Co., 2006 NY Slip Op 51351U, 12 Misc 3d 140A, 824 NYS2d 766 (App. Term, 2d Dept. 2006).

In Seaside Medical P.C. v. State Farm Mutual, 12 Misc 3d 1127, 819 NYS2d 819(Civil Ct. Richmond Cty 2006), on the other hand, Judge Sweeney credited the plaintiff’s argument that the toll to the defendant insurer’s time to pay or deny the claim was eviscerated when the defendant sent out the second verification request only 28 days after the first verification request had been mailed. After citing to a number of cases which were not on “all fours” with the instant matter because the defendants in those cases did not do any follow up after the plaintiff had failed to comply with the first verification request, Judge Sweeney noted that here the defendant did follow up but not within the 10 day period specified in 11 NYCRR 65-3.6(b). While the defendant acted “diligently,” it did not strictly adhere to the language of the regulation which was fatal since “No -Fault Regulations are in derogation of the common law and must be strictly construed.” 12 Misc 3d at 1130 citing Presbyterian Hosp. in NY. v. Aetna Cas. & Sur. Co., 233 AD2d 431, 432 (2d Dept. 1996) lv. den.. 90 NY2d 802(1997). Since defendant did not comply with the clear language of 11 NYCRR 65-3.6(b) requiring it to follow up with the plaintiff for the verification at least once during the 10 day period specified in the regulation, Judge Sweeney found that the toll “occasioned by defendant’s initial requests for verification dissipated ab initio.” Id at 1131.

While both civil courts correctly noted that no other court has directly dealt with this precise issue, the Second Department found, without any explanation, that the 30 day period in which an insurer must pay or deny a claim is tolled where there was an outstanding follow up verification request that was sent before the 30 day waiting period expired. At issue in New York & Presbyterian Hospital v. American Transit Ins. Co., 287 AD2d 699 (2d Dept. 2001) was the form of the verification letters sent by the defendant insurer, as opposed to the timeliness of the verification requests. The lower court granted summary judgment to the respondent medical provider because the defendant insurer’s request for additional information was not made on the forms prescribed by 11 NYCRR 65.15. In reversing the lower court’s grant of summary judgment, the Second Department stated that if the requested information is not received within 30 days, the insurer must send a follow up letter within 10 days thereafter. The court commented that the defendant insurer had timely requested additional verification of the claim from respondent on October 5, 1999 and when such verification was not received within 30 days, it sent a timely follow up letter dated November 1, 1999 (approximately 27 days after the first request).

In the instant matter, the follow up verification request was sent on the 30th day after the original request for verification was sent. As set forth above, Regulation 11 NYCRR 65-3.6(b) [*4]states: “if any verification has not been supplied to the insurer 30 calendar days after the original request, the insurer shall, within 10 calendar days follow up with the party from whom the verification was requested…” Does the wording of this statute mandate that the insurer wait until the 31st day before he sends the follow up request or may he send it on the 30th day? The language of NYCRR 65-3.6(b), which must be strictly construed, does not answer this question as neatly as was the case in Sea Side Medical (28 days after the initial request) or Psych. & Massage Therapy (25 days after the initial request).

Where the literal meaning of the statute is unclear, the courts may look to the legislative history of the statute or regulation, as the primary consideration of the court is to ascertain and give effect to the intention of the Legislature. Statutes, §92; Dodge v. Bd. of Educ. Schodack C.S.D., 167 Misc 2d 186 (Sup. Ct. Albany Co. 1996). In construing a statute, a court must look to its “spirit and purpose, and objectives of the enactors must be kept in mind.” Western Regional Off-Track Betting Corp. v. SEIU, 115 Misc 2d 124, 127 (Sup. Ct. Erie Co. 1982). Thus, in construing a law , a court ” will sometimes be guided more by its purpose than its phraseology, whereby a statute is not to be read with a literalness that destroys the meaning, intention, purpose or beneficial end for which the statute has been designed.” Statewide Roofing v. Eastern Suffolk Bd. of Coop. Educ. Servs., 173 Misc 2d 514 (NY Sup. Ct. 1997). See generally, McKinney’s Cons Laws of NY, Book 1, Statutes §96.

It is imperative in ruling upon No Fault insurance matters not to lose sight of the fundamental goal of the regulatory scheme, which is “designed to promote prompt payment of legitimate claims.” Nyack Hosp. v. General Motors Acceptance Corp., 8 NY3d 294, 300 (2007). As the Court of Appeals noted in Medical Society of State v. Serio, 100 NY2d 854 (2003), the most significant changes made by the Superintendent of Insurance, in adopting revised Regulation 68 (repealing and replacing the prior 11 NYCRR part 65), was a reduction in the time frames applicable to the filing of notices and proofs of claim—a consequence of the Superintendent’s determination that much of the abuse was associated with the lengthy time frames within which claims could be presented to insurers . The Superintendent also concluded that the shorter time frames would better effectuate the legislative purpose of providing prompt compensation “as the loss is incurred, while reducing rampant abuse” 100 NY2d, supra at 862.

Accordingly, a court must interpret and apply the No-Fault Regulations in a manner leading to the prompt payment of valid, documented claims. In light of the aforesaid principles of statutory construction and the purpose behind the No-Fault Regulations, this Court finds that defendant’s sending the follow up verification request on the 30th day after the original request for verification was timely and in accordance with the regulations. Since Country-Wide has established that the verification request in this action was unsatisfied, its time period to pay or deny the claim has not elapsed. See Vista Surgical Supplies, Inc. v. General Assurance Co., 12 Misc 3d 129(A), 819 NYS2d 214 (App Term, 2nd & 11th Jud Dists, 2006). Therefore, this action is premature and must be dismissed Doshi Diagnostic Imaging Services v. State Farm Insurance Co., 16 Misc 3d 42 (App Term, 2nd Dept., 2007).

Accordingly, defendant’s motion to dismiss the complaint is granted in its entirety and plaintiff’s motion for summary judgment is denied.

This constitutes the decision and order of the court.

Date: May 27, 2008

____________________________________

Hon. Katherine A. Levine

Judge, Civil Court

Staten Island, NY

Appearances

Footnotes

Footnote 1: The only difference between the instant matter and Psych & Massage Therapy, supra is that in the latter case the second verification request was sent 25 rather than 30 days after the submission of the first verification request.

Footnote 2:The pertinent regulation in effect for policies renewed prior to April 5, 2002 was 11 NYCRR 65.15(e)(2).

[*1]

Civil Court of the City of New York, Kings County, May 27, 2008

APPEARANCES OF COUNSEL

Edward Shapiro, P.C., Wantagh, for plaintiff. Freiberg & Peck, P.C., New York City, for defendant.

{**20 Misc 3d at 554} OPINION OF THE COURT

Peter P. Sweeney, J.

{**20 Misc 3d at 555}In this action to recover assigned first-party no-fault benefits, on January 31, 2008 the parties agreed to a trial on stipulated facts and to the admission into evidence of various exhibits. The question presented is whether the failure of plaintiff’s assignor to appear for an examination under oath (EUO) constituted a valid basis for denial of the claim. For the reasons that follow, the court answers this question in the negative.

Factual Background

Plaintiff All-Boro Medical Supplies, Inc. submitted a claim to defendant Progressive Northeastern Insurance Company for first-party no-fault benefits in the amount of $442.50 for durable medical equipment that it had provided to its assignor, Tony Stringer. Defendant received the claim on February 14, 2005. The motor vehicle accident in which Mr. Stringer was allegedly injured occurred on January 5, 2005.

On January 28, 2005, before it received the claim, defendant had sent Mr. Stringer a letter directing him to appear for an EUO on April 21, 2005. Mr. Stringer failed to appear for the EUO on that date. On April 22, 2005 defendant sent a second letter to Mr. Stringer, rescheduling the EUO for May 3, 2005. Again, Mr. Stringer failed to appear. On May 18, 2005 defendant denied the claim on the ground that Mr. Stringer failed to appear for the EUO.

Discussion

As a condition to coverage under the revised Personal Injury Protection Endorsement, which is required to be included in automobile insurance policies issued or renewed after April 5, 2002, “the eligible injured person . . . shall . . . as may reasonably be required submit to examinations under oath by any person named by the [insurer] and subscribe the same” (Insurance Department Regulations [11 NYCRR] § 65-1.1 [d] [Sec I, Conditions, Proof of Claim (b)]). Inasmuch as the policy period for newly issued and renewed automobile insurance policies is one year (Insurance Law § 3425 [a] [8]), it can be assumed that the automobile insurance policy applicable in this case contained the endorsement since the underlying motor vehicle accident occurred after April 2003 (see Eagle Chiropractic, P.C. v Chubb Indem. Ins. Co., 19 Misc 3d 129[A], 2008 NY Slip Op 50525[U] [App Term, 9th & 10th Jud Dists 2008]).

Another condition to coverage under the endorsement is that an “eligible injured person shall submit to medical examination{**20 Misc 3d at 556} by physicians selected by, or acceptable to, the [insurer], when, and as often as, the [insurer] may reasonably require” (11 NYCRR 65-1.1 [d] [Sec I, Conditions, Proof of Claim]). In Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co. (35 AD3d 720, 721 [2d Dept 2006]), the Court interpreted this language to mean that an insurer may require an eligible injured person to appear for a medical examination either “before the claim form is submitted or after the claim form is submitted.” The court stated that such interpretation furthers “the policies underlying no-fault insurance, including, inter alia, the expeditious processing of claims” (35 AD3d at 722 [citations omitted]). There is no reason to apply a different rule to EUOs.

The court thus finds that defendant acted within its rights under the endorsement in scheduling an EUO of Mr. Stringer before it had received the claim. Indeed, had the defendant not received the claim form on February 14, 2005, Mr. Stringer’s failure to appear for the EUO would have constituted a valid ground for denying the claim “retroactively to the date of loss” (35 AD3d at 722). While this court agrees that when an EUO is requested as additional verification of a claim, the insurer is required to schedule the EUO within the same time period as medical examinations, to wit, within 30 calendar days from the date of receipt of the prescribed verification form (see All-Boro Med. Supplies, Inc. v Progressive Northeastern Ins. Co., 17 Misc 3d 950, 952 [Civ Ct, Kings County 2007, Edwards, J.]; see also S & M Supply v State Farm Mut. Auto. Ins. Co., 4 Misc 3d 130[A], 2004 NY Slip Op 50693[U] [App Term, 9th & 10th Jud Dists 2004]), there is no such requirement for the scheduling of preclaim EUOs.

While defendant acted within its rights under the endorsement in scheduling Mr. Stringer for a preclaim EUO for April 21, 2005, once defendant received the claim from the plaintiff, the defendant was required to adhere to the statutory and regulatory scheme for the processing of no-fault claims. Thus, defendant was required to pay or deny the claim within 30 calendar days of its receipt (see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [a] [1]; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997]) or request additional verification of the claim (11 NYCRR 65-3.5). Generally, a request for additional verification of a claim must be made within 15 business days of receipt of one of the prescribed verification forms (see 11 NYCRR 65-3.5 [b]). Where an insurer makes a{**20 Misc 3d at 557} timely and proper request for additional verification, the 30-day period in which it has to either pay or deny a claim does not begin to run until all demanded verification has been provided (11 NYCRR 65-3.8 [a] [1]).

Here, while defendant had already scheduled Mr. Stringer’s EUO for April 21, 2005 before it had received the claim, if defendant insisted upon conducting the EUO before deciding whether to pay or deny the claim, it had no choice but to reschedule the EUO to a date within 30 calendar days from February 14, 2005, the date it received the claim (see All-Boro Med. Supplies, Inc., supra; S & M Supply, supra). As a matter of law, by failing to reschedule the EUO, defendant could not assert Mr. Stringer’s failure to appear for the EUO as its basis to deny the claim (see King’s Med. Supply Inc. v Kemper Auto & Home Ins. Co., 7 Misc 3d 128[A], 2005 NY Slip Op 50450[U] [App Term, 2d & 11th Jud Dists 2005]; Ocean Diagnostic Imaging P.C. v Allstate Ins. Co., 10 Misc 3d 145[A], 2006 NY Slip Op 50140[U] [App Term, 2d & 11th Jud Dists 2006]).

Since plaintiff established its entitlement to judgment as a matter of law by demonstrating that the necessary billing documents were mailed to and received by the defendant and that payment of the no-fault benefits was overdue (see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [a] [1]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742, 742-743 [2d Dept 2004]; New York & Presbyt. Hosp. v Countrywide Ins. Co., 44 AD3d 729, 730 [2d Dept 2007]) and defendant has failed to establish a viable defense to the action, it is hereby ordered that judgment be entered in favor of the plaintiff in the amount of $442.50, together with interest and attorneys fees pursuant to Insurance Law § 5106 and regulations promulgated thereunder, plus costs and disbursements.

—[*1] Joseph Henig, P.C., Bellmore, N.Y., for appellant.

D’Ambrosio & D’Ambrosio, P.C., Irvington, N.Y. (John P. D’Ambrosio of counsel), for respondent.

Motion by the respondent for leave to reargue an appeal from an order of the Supreme Court, Nassau County (Galasso, J.), dated April 5, 2007, which was determined by decision and order of this Court dated December 11, 2007, or, in the alternative, for leave to appeal to the Court of Appeals from the decision and order of this Court.

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

Ordered that the branch of the motion which is for leave to reargue is granted; and it is further,

Ordered that the motion is otherwise denied; and it is further,

Ordered that upon reargument, the decision and order of this Court dated December 11, 2007 (see Westchester Med. Ctr. v Progressive Cas. Ins. Co., 46 AD3d 675 [2007]), is recalled and vacated, and the following decision and order is substituted therefor: [*2]

In an action to recover no-fault medical payments under insurance contracts, the plaintiff appeals from an order of the Supreme Court, Nassau County (Galasso, J.), dated April 5, 2007, which denied its motion for summary judgment on its first cause of action, and conditionally granted the defendant’s cross motion for summary judgment dismissing the first cause of action. Presiding Justice Prudenti has been substituted for former Justice Goldstein (see 22 NYCRR 670.1 [c]).

Ordered that the order is modified, on the law, by deleting the provision thereof conditionally granting the defendant’s cross motion for summary judgment dismissing the first cause of action and substituting therefor a provision denying the cross motion; as so modified, the order is affirmed, without costs or disbursements.

On March 24, 2006 Michael Forthmuller was seriously injured when he lost control of his vehicle and crashed into a telephone pole. Immediately after the accident, Forthmuller was transported to Sound Shore Medical Center (hereinafter Sound Shore), where he underwent emergency surgery. Forthmuller was then transferred to the plaintiff hospital, where he remained hospitalized for approximately one month.

On or about May 4, 2006, the plaintiff, as Forthmuller’s assignor, sent the defendant, inter alia, a hospital facility form (NYS Form N-F5) seeking payment of its hospital bill. The defendant received the hospital facility form on May 8, 2006. Three days later, on May 11, 2006, the defendant sent the plaintiff a letter indicating that benefits remained delayed pending receipt of Forthmuller’s medical records, which had been previously requested. The defendant alleges that after it received the plaintiff’s medical records on May 15, 2006, it learned that Forthmuller had first been treated after the accident at Sound Shore. Accordingly, on May 20, 2006, the defendant sent Sound Shore a verification request seeking its medical records pertaining to Forthmuller’s treatment, including any blood alcohol serum toxicology test results. The defendant received Sound Shore’s medical records on June 29, 2006 and on July 12, 2006 it denied the plaintiff’s claim upon the ground that Forthmuller was driving while intoxicated at the time of the accident.

Prior to receiving the defendant’s denial of the claim, the plaintiff commenced this action seeking, in its first cause of action, to recover payment for the medical services provided to Forthmuller, as well as statutory interest and an attorney’s fee. The plaintiff thereafter moved for summary judgment on its first cause of action, contending that no-fault benefits were overdue because the defendant had failed to either pay or deny its claim within 30 days as required by Insurance Law § 5106 (a) and 11 NYCRR 65-3.2. The defendant cross-moved for summary judgment dismissing the first cause of action, arguing that the 30-day period in which to pay or deny the claim was not triggered until it received the Sound Shore records it had requested as verification. The defendant also relied upon laboratory results contained in an uncertified copy of Sound Shore’s medical records as proof that Forthmuller was legally intoxicated at the time of the accident. The Supreme Court denied the plaintiff’s motion for summary judgment, and conditionally granted the hospital’s cross motion pending receipt of “a certified toxicology report from Sound Shore.”

“When a denial of no-fault benefits rests on the statutory exclusion of intoxication pursuant to Insurance Law § 5103 (b) (2), the regulations promulgated thereunder trigger certain timing and notification requirements that extend the 30-day statutory period within which an insurer must pay or deny a claim” (Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750, 752 [2007]; see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 279 [1997]). In this regard, 11 [*3]NYCRR 65-3.8 (g) provides that “if an insurer has reason to believe that the applicant was operating a motor vehicle while intoxicated or impaired by the use of a drug, and such intoxication or impairment was a contributing cause of the automobile accident, the insurer shall be entitled to all available information relating to the applicant’s condition at the time of the accident.” This provision also states that proof of a claim shall not be complete until the information which has been requested pursuant thereto has been furnished by the insurer. Furthermore, pursuant to 11 NYCRR 65-3.5 (c), “the insurer is entitled to receive all items necessary to verify the claim directly from the parties from whom such verification was requested.”

Here, the plaintiff made a prima facie showing of its entitlement to judgment as a matter of law on its first cause of action by submitting, inter alia, the requisite no-fault billing forms, a certified mail receipt referencing the patient, a signed return receipt card also referencing the patient, and the affidavit of its biller averring that the defendant failed to either pay the bill or issue a timely denial of claim form (see Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750 [2007]; Westchester Med. Ctr. v Safeco Ins. Co. of Am., 40 AD3d 984 [2007]; New York Univ. Hosp. Rusk Inst. v Government Empls. Ins. Co., 39 AD3d 832 [2007]; New York & Presbyt. Hosp. v Travelers Prop. Cas. Ins. Co., 37 AD3d 683 [2007]). In opposition to the motion, however, the defendant raised a triable issue of fact as to whether it timely denied the claim by submitting evidence that a verification request seeking information regarding Forthmuller’s alleged intoxication was timely and properly sent to Sound Shore (see Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750 [2007]; cf. Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274 [1997]).

In addition, the defendant also raised a triable issue of fact as to whether Forthmuller was intoxicated at the time of the accident and whether his intoxication caused the accident by submission of the Sound Shore laboratory results and a police accident report. Although the South Shore records were not in admissible form because they were not certified (see CPLR 4518 [c]; see generally Abbas v Cole, 7 AD3d 649 [2004]; Jajoute v New York City Health & Hosps. Corp., 242 AD2d 674, 676 [1997]; Dudek v Sinisi, 199 AD2d 800, 801 [1993]; cf. Rodriguez v Triborough Bridge & Tunnel Auth., 276 AD2d 769, 772 [2000]; Cleary v City of New York, 234 AD2d 411 [1996]; Maxcy v County of Putnam, 178 AD2d 729, 730 [1991]; LaDuke v State Farm Ins. Co., 158 AD2d 137, 138 [1990]; Tinao v City of New York, 112 AD2d 363 [1985]), under the circumstances of this case, the Supreme Court properly considered this evidence in conjunction with the police accident report describing the circumstances of the accident, in opposition to the plaintiff’s motion (see Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750 [2007]; see generally Phillips v Kantor & Co., 31 NY2d 307 [1972]). In addition, the police accident report describing the circumstances of the accident was properly considered to the extent that it was based upon the personal observations of the police officer present at the scene and who was under a business duty to make it (see CPLR 4518 [a]; Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750 [2007]).

However, the Supreme Court should not have conditionally granted the defendant’s cross motion pending receipt of a certified toxicology report from South Shore. A blood alcohol test result, as set forth in a certified hospital record, constitutes prima facie evidence of the test result pursuant to CPLR 4518 (c) (see Rodriguez v Triborough Bridge & Tunnel Auth., 276 AD2d 769 [2000]; Martin v City of New York, 275 AD2d 351, 355 [2000]; Cleary v City of New York, 234 AD2d 411 [1996]; Maxcy v County of Putnam, 178 AD2d 729, 730 [1991]; LaDuke v State Farm Ins. Co., 158 AD2d 137, 138 [1990]; Tinao v City of New York, 112 AD2d 363 [1985]). Thus, the blood alcohol test results contained in a certified hospital record from Sound Shore would be sufficient to make a prima facie showing that Forthmuller was intoxicated at the time of the accident (see Rodriguez v Triborough Bridge & [*4]Tunnel Auth., 276 AD2d 769 [2000]). However, since the defendant also failed to make out a prima facie showing that Forthmuller’s alleged intoxication was the proximate cause of the accident (see Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750, 753-754 [2007]; Lynch v Progressive Ins. Co., 12 AD3d 570, 571 [2004]; Scahall v Unigard Ins. Co., 222 AD2d 1070, 1071 [1995]; Cernik v Sentry Ins., 131 AD2d 952, 953 [1987]), its cross motion should have been denied regardless of the sufficiency of the plaintiff’s opposition papers (see generally Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]). Prudenti, J.P., Skelos, Fisher and Dillon, JJ., concur.

—[*1] Joseph Henig, P.C., Bellmore, N.Y., for appellant-respondent.

D’Ambrosio & D’Ambrosio, P.C., Irvington, N.Y. (John P. D’Ambrosio of counsel), for respondent-appellant.

In an action to recover no-fault medical benefits under an insurance contract, the plaintiff appeals from so much of an order of the Supreme Court, Nassau County (Mahon, J.), dated July 9, 2007, as, upon, in effect, granting renewal, adhered to its original determination in a prior order dated December 12, 2006, denying the plaintiff’s motion for summary judgment on the complaint, and the defendant cross-appeals from so much of the same order as, upon, in effect, granting renewal, adhered to its original determination in the prior order denying the defendant’s cross motion for summary judgment dismissing the complaint.

Ordered that the order is affirmed insofar as appealed and cross-appealed from, without costs or disbursements.

On February 4, 2006 Esther Beaton was injured after the vehicle she was driving crashed into a tree. Beaton was transported from the accident scene to the plaintiff hospital for care of her injuries.

On April 14, 2006 the plaintiff, as Beaton’s assignor, sent the defendant, inter alia, a hospital facility form (NYS Form N-F5) seeking payment of its hospital bill. The defendant alleges that on April 25, 2006 it sent the plaintiff a verification request specifically seeking information pertaining to Beaton’s blood alcohol level at the time of the accident. Having received no response to the [*2]verification request, the defendant sent the plaintiff a follow-up verification request on May 26, 2006 again specifically seeking information pertaining to Beaton’s blood alcohol level at the time of the accident. Thereafter, on June 7, 2006, still having received no response to that request from the plaintiff, the defendant received from a police laboratory the results of a blood alcohol test indicating that Beaton was intoxicated at that time.

On June 14, 2006 the plaintiff commenced this action to recover no-fault benefits for the health services it provided to Beaton. The defendant sent the plaintiff a form dated June 15, 2006, by which it denied the claim on the ground that Beaton was driving while intoxicated at the time of the accident.

The plaintiff thereafter moved for summary judgment on the complaint, contending that no-fault benefits were overdue because the defendant failed to either pay or deny the subject claim within 30 days of receipt as required by, inter alia, Insurance Law § 5106 (a) and 11 NYCRR 65-3.8 (a) (1). The defendant cross-moved for summary judgment dismissing the complaint, arguing that the claim was timely and properly denied on the ground that Beaton was intoxicated at the time of the accident. The Supreme Court denied the motion and cross motion, and, upon, in effect, granting renewal, adhered to its original determination.

“Where a denial of no-fault benefits rests on the statutory exclusion of intoxication pursuant to Insurance Law § 5103 (b) (2), the regulations promulgated thereunder trigger certain timing and notification requirements that extend the 30-day statutory period within which an insurer must pay or deny a claim” (Westchester Med. Ctr. v Progressive Cas. Ins. Co., 46 AD3d 675, 677 [2007], quoting Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750, 753 [2007]). Specifically, 11 NYCRR 65-3.8 (g) provides that “if an insurer has reason to believe that the applicant was operating a motor vehicle while intoxicated or impaired by the use of a drug, and such intoxication or impairment was a contributing cause of the automobile accident, the insurer shall be entitled to all available information relating to the applicant’s condition at the time of the accident.” The provision further provides that “[p]roof of a claim shall not be complete until the information which has been requested, pursuant [thereto], has been furnished to the [insurer]” (11 NYCRR 65-3.8 [g]). Moreover, pursuant to 11 NYCRR 65-3.5 (c), “[t]he insurer is entitled to receive all items necessary to verify the claim directly from the parties from whom such verification was requested.”

The plaintiff’s submissions with its motion to renew did not establish, as a matter of law, that the defendant’s verification requests were untimely or improper (see Westchester Med. Ctr. v Progressive Cas. Ins. Co., 46 AD3d 675, 678 [2007]; Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750, 752-753 [2007]). Thus, upon renewal, the Supreme Court correctly adhered to its denial of the plaintiff’s motion for summary judgment on the complaint.

On its cross motion to renew, the defendant submitted Beaton’s certificate of disposition on her charge of driving while intoxicated pertaining to the accident. However, this failed to establish, as a matter of law, that Beaton’s intoxication was the cause of her accident and her resultant injuries (see Westchester Med. Ctr. v Progressive Cas. Ins. Co., 46 AD3d at 679; Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750, 753 [2007]; Cernik v Sentry Ins., 131 AD2d 952 [1987]). Thus, upon renewal, the Supreme Court also correctly adhered to its denial of the defendant’s cross motion for summary judgment dismissing the complaint. [*3]

In light of this determination, we need not reach the plaintiff’s remaining contention. Skelos, J.P., Ritter, Florio and Dickerson, JJ., concur.

[*1]

Civil Court of the City of New York, New York County, May 21, 2008

APPEARANCES OF COUNSEL

Barry & Associates, LLC, Plainview, for defendant. Baker, Sanders, Barshy, Grossman, Fass, Muhlstock & Neuwirth, Mineola, for plaintiff.

{**20 Misc 3d at 434} OPINION OF THE COURT

Arlene P. Bluth, J.

{**20 Misc 3d at 435}Defendant’s motion for summary judgment is granted and the complaint is dismissed.

Plaintiff commenced the instant action to recover first-party no-fault benefits in the amount of $2,670.39, plus statutory interest, costs and attorneys’ fees, for three MRI studies it allegedly conducted for its assignor, Nila Sokol. Two were allegedly performed on June 7, 2007 for which plaintiff billed defendant $879.72 and $912, and a third on June 12, 2007 for $878.67.

Plaintiff’s attorneys submitted each bill to defendant with a form cover letter on the attorneys’ letterhead. In that letter, the attorneys introduce themselves and state no less than three times that defendant was to deal with the attorneys from then on. (“Accordingly, please forward all future correspondence to our attention . . . Please make this payment payable to the above-referenced provider, C/O this office . . . All correspondence including payment, EOB’s, verification requests, etc. must be mailed directly to this office. Failure to do so may result in unnecessary litigation.”) The clear import of this repetitive direction—to be followed under threat of “unnecessary litigation”—is that plaintiff’s attorneys are its agents for all purposes related to the bill, and defendant must deal directly with plaintiff’s attorneys. In addition, the end of the letter contains the representation that any enclosed bills, forms, “doctor’s reports, notes and narratives were prepared solely by the above-referenced provider.” Clearly, then, the plaintiff did not submit any documents from the referring physician; there was no MRI referral form or prescription submitted with any of the bills.

The defendant’s claims examiner, Cinnamon Houston, states that defendant received the first bill (for $879.72) on June 26, 2007 and timely sent a verification request on July 10, 2007. That request was sent directly to the plaintiff’s attorneys and requested two items: a letter of medical necessity from the referring physician and a claim form with a valid provider’s signature. There can be no dispute that plaintiff’s attorneys received this request because they responded thereto by letter dated July 17, 2007. Their response, even though titled “Verification Compliance,” completely ignored the bona fide request. Instead, it said, in essence, “whatever we gave you was good enough and this provider is not giving you anything else. If you need something from someone else, go ask them. Now pay the bill.” In addition, the attorneys state: “Any further requests to this provider are deemed unnecessary and in violation{**20 Misc 3d at 436} of 11 NYCRR 65-3.2 (c).” This section states an insurer should “not demand verification of facts unless there are good reasons to do so.” (Id.) Nevertheless, Ms. Houston sent a follow-up request to plaintiff’s attorneys on August 13, 2007.

Defendant received the second bill (for $912) with the same form cover letter on June 27, 2007, and it sent a request for verification, seeking the same information as sought for the other MRI taken the same date, to plaintiff’s attorneys on July 10, 2007. There can be no dispute that plaintiff’s attorneys received this request, because they responded thereto by letter dated July 17, 2007. Their response was the same form letter referred to above, and Ms. Houston sent a follow-up request on August 10, 2007.

When defendant received the third bill, Ms. Houston timely sent a verification request. This time, plaintiff’s attorneys did not send a response and Ms. Houston sent a follow-up request on August 10, 2007.

In order to prevail on its motion for summary judgment, the movant must make a prima facie showing of entitlement to judgment as a matter of law, through admissible evidence, eliminating all material issues of fact. (Alvarez v Prospect Hosp., 68 NY2d 320 [1986].) Once the movant demonstrates entitlement to judgment, the burden shifts to the opponent to rebut that prima facie showing. (Bethlehem Steel Corp. v Solow, 51 NY2d 870, 872 [1980].) In opposing such a motion, the party must lay bare its evidentiary proof. Conclusory allegations are insufficient to defeat the motion; the opponent must produce evidentiary proof in admissible form sufficient to require a trial of material questions of fact. (Zuckerman v City of New York, 49 NY2d 557, 562 [1980].)

In deciding the motion, the court must draw all reasonable inferences in favor of the nonmoving party and must not decide credibility issues. (Dauman Displays v Masturzo, 168 AD2d 204 [1st Dept 1990], lv dismissed 77 NY2d 939 [1991].) As summary judgment is a drastic remedy which deprives a party of being heard, it should not be granted where there is any doubt as to the existence of a triable issue of fact (Chemical Bank v West 95th St. Dev. Corp., 161 AD2d 218 [1st Dept 1990]), or where the issue is even arguable or debatable (Stone v Goodson, 8 NY2d 8 [1960]).

The court finds Ms. Houston’s affidavit explaining preparation of the verification requests and the mailing procedures with respect to all of the verification requests (the initial three{**20 Misc 3d at 437} and the follow-up requests) sufficient to prove timely and proper mailings. Ms. Houston stated that she personally prepared each mailing, put each in the envelope, checked that it was properly addressed, and put it in her outgoing mail bin. She also stated that the regular office practice is that the mail person comes by at approximately 3:45 p.m. each afternoon, collects and stamps the mail, and then delivers it to the post office that day.

Although plaintiff’s opposition correctly notes that Ms. Houston did not swear that it was her duty to ensure compliance with defendant’s mailing procedures and that she did not herself drop it in the mailbox, it is enough that “the defendant submitted admissible evidence in the form of an affidavit of an employee with knowledge of the defendant’s standard office practices or procedures designed to ensure that items were properly addressed and mailed” (St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123, 1124 [2d Dept 2008], citing New York & Presbyt. Hosp. v Allstate Ins. Co., 29 AD3d 547 [2d Dept 2006], Hospital for Joint Diseases v Nationwide Mut. Ins. Co., 284 AD2d 374 [2d Dept 2001], Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2d Dept 2001], and Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d Dept 2007]). Ms. Houston’s detailed affidavit fulfills this requirement.

The verification requests were sent to the plaintiff’s law firm. A letter properly mailed is presumed to have been received. (News Syndicate Co. v Gatti Paper Stock Corp., 256 NY 211 [1931].) Although an associate of that law firm submitted an affirmation in opposition to this motion, no attempt to rebut the presumption was made; conspicuously absent from that affirmation is a simple denial of receipt of the requests for verification. In opposing a motion for summary judgment, the nonmoving party must lay bare all of the facts at its disposal regarding the issues raised in the motion. (Zuckerman v City of New York, 49 NY2d 557, 562 [1980].) It is no excuse that the opponent could have submitted such evidence but did not because the opponent believed that the movant’s papers were insufficient. (Mgrditchian v Donato, 141 AD2d 513 [2d Dept 1988].) The affirmant in opposition was in the position to, but did not even attempt to, rebut the presumption that plaintiff’s law firm received the requests for verification shortly after Ms. Houston stated that they were mailed. Therefore, there is no question of fact as to proper mailing of the verification requests.

Having determined that defendant proved its timely and proper mailing of the requests for verification, the court turns{**20 Misc 3d at 438} to the other bases for plaintiff’s opposition. Plaintiff claims that defendant failed to present a “good reason” why further verification was necessary; this court disagrees. This court does not believe that it is unreasonable to ask for a letter of medical necessity before a carrier pays more than $2,500 for three MRIs conducted during the course of one week, approximately six weeks after an alleged accident. Defendant is not required to provide a blank checkbook to plaintiff. Rather, defendant is entitled to find out whether and why each MRI was prescribed; in other words, the carrier is entitled to inquire as to the medical necessity before it pays the bills.

Plaintiff also claims defendant violated 11 NYCRR 65-3.6 (b), which provides:

“(b) Verification requests. At a minimum, if any requested verification[ ] has not been supplied to the insurer 30 calendar days after the original request, the insurer shall, within 10 calendar days, follow up with the party from whom the verification was requested, either by telephone call, properly documented in the file, or by mail. At the same time the insurer shall inform the applicant and such person’s attorney of the reason(s) why the claim is delayed by identifying in writing the missing verification and the party from whom it was requested.”

Plaintiff argues that because defendant did not send the follow-up verification requests both to it and to its attorneys, the requests are defective. This argument lacks merit.

Because the attorney’s cover letter clearly put defendant on notice that the law firm was the agent for the medical provider for all purposes with respect to the bill submitted, sending the verification request to the attorneys was the same as sending the request to the principal. As recently stated in Bauer v CS-Graces, LLC (48 AD3d 922, 924 [3d Dept 2008]): “The law is well settled that, unless obtained confidentially, ‘ “knowledge acquired by an agent acting within the scope of his [or her] agency is imputed to his [or her] principal and the latter is bound by such knowledge” ‘ (Skiff-Murray v Murray, 17 AD3d 807, 809-810 [2005], quoting Center v Hampton Affiliates, 66 NY2d 782, 784 [1985]; see Farr v Newman, 14 NY2d 183, 187 [1964]).”

Accordingly, defendant’s notice to the law firm-agent was notice to the principal-provider as a matter of law. Under the circumstances{**20 Misc 3d at 439} presented here, there was no need for the insurer to send another copy to the principal.

In addition, in interpreting 11 NYCRR 65-3.6 (b), courts have found that the additional notification to the applicant and its attorney is required when the verification is requested from a third party, not when, as here, the verification is requested from the applicant. “Where verification is sought from a party other than the applicant, the applicant is entitled to be timely informed of the nature of the verification sought and from whom it is requested when, after an initial verification request remains unsatisfied, a follow-up request is necessary” (Doshi Diagnostic Imaging Servs. v State Farm Ins. Co., 16 Misc 3d 42, 44 [App Term, 2d Dept 2007]). This court notes that this very plaintiff advanced the same arguments—that the second verification request was defective because the insurer did not send an additional notification to the attorney’s client-principal—in Lenox Hill Radiology & MIA, P.C. (Dejesus) v Progressive Cas. Ins. (Civ Ct, NY County, 2008, index No. 31019/07); there, albeit after trial, Judge Jeffrey Oing also found the argument to be without merit.

Because plaintiff failed to respond to defendant’s valid and proper verification requests, the 30-day period within which defendant had to either pay or deny the claim did not begin to run. Therefore, plaintiff’s claims for no-fault benefits are not overdue, this action is premature and must be dismissed. (See Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533, 534-535 [2d Dept 2004]; St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338, 340 [2d Dept 2002].)

For the foregoing reasons, defendant’s motion for summary judgment is granted and plaintiff’s complaint is hereby dismissed.

—[*1] Carman, Callahan & Ingham, LLP, Farmingdale, N.Y. (Michael F. Ingham and James Carman of counsel), for appellant.

Gallagher, Walker, Bianco & Plastaras, Mineola, N.Y. (Robert J. Walker and Dominic Bianco of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an arbitration award dated January 23, 2007, the petitioner appeals from an order of the Supreme Court, Nassau County (Lally, J.), dated June 15, 2007, which denied the petition.

Ordered that the order is affirmed, with costs.

On December 10, 2004, Mira Duncalf, an insured of Progressive Northern Insurance Company (hereinafter Progressive) was involved in an automobile accident with an insured of Sentry Insurance A Mutual Company (hereinafter Sentry). On or about May 16, 2005, Progressive commenced an arbitration proceeding against Sentry with Arbitrations Forum, Inc. (hereinafter the arbitrator), seeking reimbursement, through a priority-of-payment claim (hereinafter the prior claim), of the first-party benefits paid to its insured (hereinafter the prior arbitration) (see generally Insurance Law § 5105; 11 NYCRR 65-3.12 [b]; 65-4.11). In a decision and award dated July 11, 2006, the arbitrator denied the prior claim.

On or about September 19, 2006, Progressive commenced a second arbitration proceeding with the arbitrator seeking the same reimbursement, albeit through a loss-transfer claim (hereinafter [*2]the instant claim), against Sentry (hereinafter the instant arbitration). In the instant arbitration, Sentry, inter alia, raised the affirmative defense of res judicata. In a decision and award dated January 23, 2007 (hereinafter the instant award), the arbitrator denied the instant claim on that ground. Subsequently, Progressive commenced this proceeding pursuant to CPLR article 75 to vacate the instant award. The Supreme Court denied the petition. We affirm.

The arbitrator did not exceed its authority by rendering an award in favor of Sentry (see CPLR 7511 [b] [1] [iii]). It was within the arbitrator’s authority to determine the preclusive effect of the prior arbitration on the instant arbitration (see Matter of City School Dist. of City of Tonawanda v Tonawanda Educ. Assn., 63 NY2d 846, 848 [1984]; Board of Educ. of Patchogue-Medford Union Free School Dist. v Patchogue-Medford Congress of Teachers, 48 NY2d 812, 813 [1979]; Matter of Globus Coffee, LLC v SJN, Inc., 47 AD3d 713, 714 [2008]; Matter of Town of Newburgh v Civil Serv. Empls. Assn., 272 AD2d 405 [2000]; see also Matter of County of Jefferson [Jefferson County Deputy Sheriff’s Assn., Local 9100], 265 AD2d 802 [1999]; Matter of Port Auth. of N.Y. & N.J. v Office of Contract Arbitrator, 254 AD2d 194, 195 [1998]; Rabinovich v Shchegol, 251 AD2d 25 [1998]; Matter of Port Auth. of N.Y. & N.J. v Port Auth. Police Sergeants Benevolent Assn., 225 AD2d 503 [1996]; Matter of Birchwood Mgt. Corp. v Local 670, Stationary Engrs., RWDSU, AFL-CIO, 154 AD2d 531 [1989]; Vilceus v North Riv. Ins. Co., 150 AD2d 769, 770 [1989]; Matter of Resnick v Serlin, 119 AD2d 825 [1986]; Matter of Board of Educ., Florida Union Free School Dist. [Florida Teachers Assn.], 104 AD2d 411, 411-412 [1984], affd 64 NY2d 822 [1985]).

Moreover, it is clear that the instant claim made by Progressive arose out of the same transaction as the prior claim that was denied in the prior arbitration (see Matter of Hunter, 4 NY3d 260, 269 [2005]; Matter of Aetna Cas. & Sur. Co. v Bonilla, 219 AD2d 708, 708-709 [1995]; Matter of Ulster Elec. Supply Co. v Local 1430, Intl. Bhd. of Elec. Workers, 253 AD2d 765 [1998]). While Progressive now alleges different facts regarding how the accident occurred, and a different theory upon which reimbursement is sought, the instant arbitration and the instant claim involve the same accident and the same parties, while Progressive seeks reimbursement of the same payments, albeit on a different legal theory (see Matter of Hunter, 4 NY3d 260, 269 [2005]; Boronow v Boronow, 71 NY2d 284, 290 [1988]; Smith v Russell Sage Coll., 54 NY2d 185, 192-193 [1981]; Matter of Reilly v Reid, 45 NY2d 24, 29 [1978]; Marinelli Assoc. v Helmsley-Noyes Co., 265 AD2d 1, 5 [2000]).

Where, as here, the facts upon which the prior claim and the instant claim are based were related in time, space, and origin, and form a convenient trial unit, and their treatment as a unit conforms to the parties’ expectations (see Boronow v Boronow, 71 NY2d 284, 289 [1988]; Smith v Russell Sage Coll., 54 NY2d 185, 192-193 [1981]; Matter of Reilly v Reid, 45 NY2d 24 [1978]; Flushing Plumbing Supply Co., Inc. v F&T Mgt. & Parking Corp., 29 AD3d 855, 856 [2006]; Couri v Westchester Country Club, 186 AD2d 715, 716 [1992]; Matter of Bauer v Planning Bd. of Vil. of Scarsdale, 186 AD2d 129, 130 [1992]), the arbitrator’s decision to bar the instant compulsory arbitration (see Insurance Law § 5105) was neither arbitrary nor capricious and was supported by a “reasonable hypothesis” (Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214, 224 [1996]; see Matter of State Farm Mut. Auto. Ins. Co. v Lumbermens Mut. Cas. Co., 18 AD3d 762, 763 [2005]). Thus, the instant award was not subject to vacatur under CPLR 7511 (b) (1).

Progressive’s remaining contentions are without merit or need not be reached in light of our determination. Mastro, J.P., Skelos, Lifson and Leventhal, JJ., concur.

[*1]

Civil Court of the City of New York, Kings County, May 2, 2008

APPEARANCES OF COUNSEL

Rossillo & Licata, P.C., Westbury (John J. Rossillo of counsel), for defendant. Law Offices of Bruce Newborough, P.C., Brooklyn (Damin J. Toell of counsel), for plaintiff.

{**20 Misc 3d at 292} OPINION OF THE COURT

Peter P. Sweeney, J.

Plaintiff Second Medical, P.C., as assignee of Marvin Calender, commenced this action to recover assigned first-party no-fault benefits. The trial of the action took place on December 20, 2007. The only witness to testify was Inga Lev, the president of Maugust, Inc., the company that does plaintiff’s medical billing.

The issue presented is whether Ms. Lev’s testimony was sufficient to establish the admissibility of the underlying no-fault claim form, which incorporated information contained in medical records which were neither offered nor admitted in evidence and which were never shown to be admissible under any hearsay exception. The court answers this question in the negative.

Factual Background

Ms. Lev testified that once a week, someone from plaintiff’s office would deliver to her a number of patient files. Each file contained one or more medical reports which described the [*2]nature of the services that plaintiff purportedly provided to a particular patient. Each file also contained an executed assignment of benefits form and information identifying the insurer who was responsible for payment of first-party no-fault benefits.

Either Ms. Lev or one of her coworkers would prepare no-fault claim forms based upon the information contained on the documents contained in patient files and mail the claim forms to the insurers responsible for payment of the first-party no-fault benefits along with an executed assignment. Ms. Lev gave no testimony concerning the practices and procedures that plaintiff utilized in creating the documents contained in the patient files.

Ms. Lev testified that she prepared the no-fault claim form in this action pursuant to the above procedures and mailed it to the defendant with an executed assignment on November 20, 2002. She testified that as of the date of trial, the first-party no-fault benefits due and owing were not paid. In its denial of claim form, which was received in evidence, defendant acknowledged receiving the claim form on November 25, 2002. When plaintiff’s counsel offered the claim form in evidence, defendant’s counsel objected arguing that Ms. Lev failed to lay a proper foundation for its admission as a business record pursuant to CPLR 4518 (a).

Relying primarily on Pine Hollow Med., P.C. v Progressive Cas. Ins. Co. (13 Misc 3d 131[A], 2006 NY Slip Op 51870[U]{**20 Misc 3d at 293} [App Term, 2d & 11th Jud Dists 2006]), plaintiff’s counsel argued that since Ms. Lev established plaintiff had a business duty to Maugust to deliver the patient files and that Maugust routinely relied on the medical reports and other documents contained in the files and fully incorporated them into no-fault claim forms which it created in the regular course of its business, a proper foundation for the admission of the claim form as a business record was laid.

The court reserved decision on defendant’s objection. The parties thereafter submitted memorandums of law in support of their respective positions. For the reasons stated below, the court now sustains defendant’s objection.

Legal Analysis

A plaintiff provider establishes a prima facie entitlement to judgment as a matter of law “by submitting evidentiary proof that the prescribed statutory billing form had been mailed and received, and that payment of no-fault benefits was overdue” (Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742, 742-743 [2004]). It is now clear that this language should not be interpreted as dispensing with the requirement that the provider tender evidentiary proof of the transaction sued upon “in admissible form” (Bajaj v General Assur., 18 Misc 3d 25, 27-28 [App Term, 2d & 11th Jud Dists 2007]). Thus, to prevail in an action to recover first-party no-fault benefits, the provider must proffer evidence in admissible form establishing the facts asserted in the underlying no-fault claim form (see Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44, 47 [App Term, 2d & 11th Jud Dists 2006] [“(t)o the extent defendant issued denial of claim forms (NF-10s) or admitted receipt of plaintiff’s claim forms, such admissions did not concede the facts asserted in the claim forms and it remained plaintiff’s burden to proffer such evidence in admissible form, which it failed to do”]; see also Bajaj, supra; Midborough Acupuncture, P.C. v New York Cent. Mut. Fire Ins. Co., 13 Misc 3d 132[A], 2006 NY Slip Op 51879[U] [App Term, 2d & 11th Jud Dists 2006]).

Here, plaintiff attempted to prove the facts asserted in the claim form by offering it as a [*3]business record pursuant to CPLR 4518 (a). CPLR 4518 (a), which sets forth the criteria for admission under what is commonly referred to as the business record exception to the hearsay rule, provides:

“Any writing or record, whether in the form of an{**20 Misc 3d at 294} entry in a book or otherwise, made as a memorandum or record of any act, transaction, occurrence or event, shall be admissible in evidence in proof of that act, transaction, occurrence or event, if the judge finds that it was made in the regular course of any business and that it was the regular course of such business to make it, at the time of the act, transaction, occurrence or event, or within a reasonable time thereafter.”

The three foundation requirements of CPLR 4518 (a) are

“first, the record must be made in the regular course of business—reflecting a routine, regularly conducted business activity, needed and relied on in the performance of the functions of the business. Second, it must be the regular course of business to make the record—in other words, the record was made pursuant to established procedures for the routine, habitual, systematic making of such a record. Finally, the record must have been made at the time of the act, transaction, occurrence or event, or within a reasonable time thereafter, assuring that the recollection is fairly accurate and the entries routinely made” (People v Cratsley, 86 NY2d 81, 89 [1995], citing People v Kennedy, 68 NY2d 569, 579-580 [1986]).

It is well settled that in order to lay these foundational requirements, the proponent of the record must call as a witness someone with knowledge of the maker’s business practices and procedures (see e.g. Blair v Martin’s, 78 AD2d 895 [2d Dept 1980]; Sabatino v Turf House, 76 AD2d 945, 946 [3d Dept 1980]; see also Hefte v Bellin, 137 AD2d 406, 408 [1st Dept 1988]). The witness need not have made the record or even be familiar with the record (Faust v New York City Tr. Auth., 4 Misc 3d 89, 91 [App Term, 2d & 11 Jud Dists 2004]). It is not even required that the witness be a current or former employee of the business that created the record (see e.g. People v Cratsley, 86 NY2d 81 [1995]; People v Meekins, 34 AD3d 843, 845 [2d Dept 2006]; People v DiSalvo, 284 AD2d 547 [2d Dept 2001]; Plymouth Rock Fuel Corp. v Leucadia, Inc., 117 AD2d 727 [2d Dept 1986]; William Conover, Inc. v Waldorf, 251 AD2d 727 [3d Dept 1998]). However, unless the witness demonstrates some familiarity with the particular record keeping procedures of the business that created the record “such that he [can] state that the record he received was made in the regular course of [that] business, that{**20 Misc 3d at 295} it was in the regular course of [that] business to make the record and that it was made contemporaneously with [the events recorded in the record]” the record is inadmissible (People v Surdis, 275 AD2d 553, 554 [3d Dept 2000]).

Here, Ms. Lev did not demonstrate any familiarity with plaintiff’s business practices and procedures. Accordingly, she did not establish that the documents contained in Mr. Calender’s patient file were business records within the meaning of CPLR 4518 (a). Further, she did not establish the admissibility of the file documents under any other hearsay exception. Since all the documents contained in Mr. Calender’s patient file constituted inadmissible hearsay, it necessarily follows that the no-fault claim form, which incorporated these records, is also hearsay. [*4]

Plaintiff’s reliance on Pine Hollow Med., P.C. is misplaced. In Pine Hollow Med., P.C., the court stated that

“it is well-settled that where an entity ‘routinely relies upon the business records of another entity in the performance of its own business’ . . . , and ‘fully incorporate[s]’ said information into records made in the regular course of its business . . . , the subsequent record is admissible notwithstanding that the preparer lacked personal knowledge of the information’s accuracy” (13 Misc 3d 131[A], 2006 NY Slip Op 51870[U], *1-2 [2006] [citations omitted and emphasis added]).

While this is a true statement of law, it was never demonstrated in this case that the documents contained in the patient files which Ms. Lev and her coworkers routinely relied upon and fully incorporated into the no-fault claim forms qualified as business records within the meaning of CPLR 4518 (a). The root of plaintiff’s argument appears to be that the term “business records” as used in Pine Hollow Med., P.C. means any records, including records that may constitute hearsay. The premise of plaintiff’s argument is without logic or support and is belied by the cases cited in Pine Hollow Med., P.C.

In all the cases cited in Pine Hollow Med., P.C., where documents were admitted in evidence through the testimony of a witness who was neither a current nor former employee of the person or entity that created the documents, the witness had demonstrated his or her familiarity with the business practices and procedures pursuant to which the documents were created. These witnesses were therefore able to qualify the documents{**20 Misc 3d at 296} as business records. In People v Cratsley, the foundation witness testified that the IQ test report that was admitted in evidence was prepared by an independent psychologist as an initial evaluation of a client, that it was conducted in accordance with her employer’s requirements and on her employer’s behalf, that the report was prepared at the time the examination took place and that the examination was conducted to fulfil certain statutory and regulatory requirements with which she was familiar (86 NY2d at 88). In People v DiSalvo, the foundation witness testified that he was familiar with the specific business practices and procedures of the dump site facility that created the records which the court admitted in evidence (284 AD2d at 548-549). In Plymouth Rock Fuel Corp. v Leucadia, Inc., the foundation witness testified that the fuel oil delivery tickets that were admitted as evidence were prepared by contract drivers that were hired by his company who had a business duty to record certain information on the tickets, including the amount, location and date of fuel delivered (117 AD2d at 728).

Here, plaintiff laid absolutely no foundation for the admission of the documents contained in Mr. Calender’s patient file. To accept plaintiff’s interpretation of Pine Hollow Med., P.C., this court would have to conclude that these documents were admissible notwithstanding that plaintiff had never demonstrated that the informant had personal knowledge of the acts, events and occurrences that the records document and was under a business duty to report them to the entrant. This court would also have to conclude that it was not necessary for the plaintiff to demonstrate that it was within the scope of the entrant’s business duty to record the acts, transactions and occurrences and that each participant in the chain producing the records, from the initial declarant to the final entrant, was acting within the course of regular business or that the declarations contained in the records were admissible through some other hearsay exception. As stated by the Court of Appeals in Matter of Leon RR (48 NY2d 117, 122-123 [1979]): [*5]

“To constitute a business record exception to the hearsay rule, the proponent of the record must first demonstrate that it was within the scope of the entrant’s business duty to record the act, transaction or occurrence sought to be admitted. But this satisfies only half the test. In addition, each participant in the chain producing the record, from the initial declarant to the final entrant, must be acting{**20 Misc 3d at 297} within the course of regular business conduct or the declaration must meet the test of some other hearsay exception (Johnson v Lutz, 253 NY 124, 128; Toll v State of New York, 32 AD2d 47, 50). Thus, not only must the entrant be under a business duty to record the event, but the informant must be under a contemporaneous business duty to report the occurrence to the entrant as well (Richardson, Evidence [10th ed-Prince], § 299). The reason underlying the business records exception fails and, hence, the statement is inadmissible hearsay if any of the participants in the chain is acting outside the scope of a business duty (Johnson v Lutz, supra) . . .

“Unless some other hearsay exception is available (Toll v State of New York, supra), admission may only be granted where it is demonstrated that the informant has personal knowledge of the act, event or condition and he is under a business duty to report it to the entrant (Johnson v Lutz, supra; cf. Model Code of Evidence rule 514).”

In sum, since the documents contained in Mr. Calender’s patient file constituted hearsay, the no-fault claim form which was based on the information contained in these documents is also hearsay. Hearsay cannot be transformed into nonhearsay simply because a business routinely relies upon it and integrates it into its own records.

Inasmuch as plaintiff did not proffer evidence in admissible form establishing the facts asserted in the claim form, plaintiff did not make out a prima facie case.

Accordingly, it is hereby ordered that judgment be entered in favor of the defendant dismissing plaintiff’s complaint.

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 June 22, 2006. The order denied the petition to vacate the master arbitrator’s award.

Order modified by adding thereto a provision confirming the master arbitrator’s award; as so modified, affirmed without costs.

In this proceeding to vacate a master arbitrator’s award, the record reveals that the arbitrator denied petitioner’s claim for assigned first-party no-fault benefits based on a finding that the assignment of benefits was to an entity different from petitioner, and concluded that petitioner was without standing to seek reimbursement of no-fault
benefits. The master arbitrator upheld the arbitrator’s award as properly reached and supported by the evidence. In our view, the determination of the master arbitrator had a rational basis and was not arbitrary and capricious (Damadian MRI in Garden City v Windsor Group Ins., 2 Misc 3d 138[A], 2004 NY Slip Op 50262[U] [App Term, 2d & 11th Jud Dists 2004]; see Matter of Progressive Cas. Ins. Co. v New York State Ins. Fund, 47 AD3d 633 [2008]; see generally Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214 [1996]; Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207 [1981]). Accordingly, the court below properly denied the petition to vacate the master arbitrator’s award. However, upon denying the petition, the court was required, pursuant to CPLR 7511 (e), to confirm the award (see Matter of Exclusive Med. & Diagnostic v Government Empls. Ins. Co., 306 AD2d 476 [2003]).

We note that a special proceeding should terminate in a judgment, not an order (see CPLR 411).

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

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 (Thomas D. Raffaele, J.), entered February 23, 2006, deemed from a judgment entered January 10, 2007 (see CPLR 5501 [c]). The judgment, entered pursuant to the February 23, 2006 order granting plaintiff’s motion for summary judgment and denying defendant’s cross motion for summary judgment, awarded plaintiff the principal sum of $1,758.40.

Judgment reversed without costs, so much of the order as granted 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’s motion for summary judgment was supported by an affirmation from plaintiff’s
counsel, an affidavit from plaintiff’s office services supervisor, and an unaffirmed, undated letter of medical necessity. In opposition, defendant argued, inter alia, that plaintiff’s affidavit failed to lay a proper foundation for the documents annexed to the motion papers and that, as a result, plaintiff failed to establish a prima facie case. In addition, defendant cross-moved for summary judgment based upon the failure of plaintiff’s assignor to appear for examinations under oath and upon plaintiff’s breach of a so-ordered discovery stipulation. The court below granted plaintiff’s motion for summary judgment and denied defendant’s cross motion. This appeal by defendant ensued.

On appeal, defendant reiterates its argument that plaintiff did not make a prima facie showing because plaintiff failed to establish the admissibility of the claim forms annexed to its motion papers. We agree. The affidavit submitted by plaintiff’s office services supervisor was insufficient to establish that he possessed personal knowledge of plaintiff’s practices and procedures so as to lay a foundation for the admission, as business records, of the documents [*2]annexed to plaintiff’s moving papers. In any event, plaintiff failed to annex to its motion for summary judgment the claim forms upon which it sought to recover. Accordingly, plaintiff failed to make a prima facie showing of its entitlement to summary judgment (see Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]; AB Med. Servs, PLLC v Lancer Ins. Co., 13 Misc 3d 139[A], 2006 NY Slip Op 52241[U] [App Term, 2d & 11th Jud Dists 2006]; A.B. Med. Servs., PLLC v State Farm Mut. Auto. Ins. Co., 7 Misc 3d 127[A], 2005 NY Slip Op 50432[U] [App Term, 2d & 11th Jud Dists 2005]).

With respect to the merits of defendant’s cross motion for summary judgment, the court below correctly denied same since defendant failed to demonstrate as a matter of law its entitlement to summary judgment. Defendant did not demonstrate that plaintiff’s causes of action were premature (cf. Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492, 493 [2005]). Further, contrary to defendant’s contention, the parties’ so-ordered stipulation does not entitle defendant to summary judgment since plaintiff’s time to provide the verified responses to defendant’s discovery demands was stayed during the pendency of plaintiff’s motion for summary judgment (see CPLR 3214 [b]; Reilly v Oakwood Hgts. Community Church, 269 AD2d 582 [2000]; John Eric Jacoby, M.D., P. C. v Loper Assocs., 249 AD2d 277 [1998]; cf. Vista Surgical Supplies Inc. v Progressive Cas. Ins. Co., 13 Misc 3d 141[A], 2006 NY Slip Op 52267[U] [App Term, 2d & 11th Jud Dists 2006] [so-ordered stipulation provided that the time to furnish discovery could not be extended without leave of court]).

In light of the foregoing, we do not reach defendant’s remaining contentions.

Weston Patterson, J.P., and Rios, J., concur.

Golia, J., concurs in a separate memorandum.

Golia, J., concurs in the result only, in the following memorandum:

While I agree with the ultimate disposition in the decision reached by the majority, I wish to note that I am constrained to agree with certain propositions of law set forth in cases cited therein which are inconsistent with my prior expressed positions and generally contrary to my views.

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 (Genine D. Edwards, J.), dated July 13, 2006. The order denied the petition to vacate a master arbitrator’s award.

Order modified by adding thereto a provision confirming the master arbitrator’s award; as so modified, affirmed without costs.

Upon a review of the record, we find that the determination of the master arbitrator upholding the arbitrator’s award, which denied petitioner’s claims for first-party no-fault benefits, had a rational basis and was not arbitrary and capricious (see Matter of Progressive Cas. Ins. Co. v New York State Ins. Fund, 47 AD3d 633 [2008]; Great Wall Acupuncture v GEICO Gen. Ins. Co., 16 Misc 3d 23 [App Term, 2d & 11th Jud Dists 2007]; see generally Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214 [1996]; Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207 [1981]). Indeed, until this court rendered its decision in Great Wall Acupuncture v GEICO Gen. Ins. Co. (16 Misc 3d 23 [App Term, 2d & 11th Jud Dists 2007], supra), there was no settled appellate law regarding an insurer’s reduction of the amount of fees charged by a licensed acupuncturist for acupuncture services rendered. Accordingly, the court below properly denied the petition to vacate the master arbitrator’s award. However, upon [*2]denying the petition, the court was required, pursuant to CPLR 7511 (e), to confirm the award (see Matter of Exclusive Med. & Diagnostic v Government Empls. Ins. Co., 306 AD2d 476 [2003]).

We note that a special proceeding should terminate in a judgment, not an order (see CPLR 411).

Pesce, P.J., Weston Patterson and Rios, JJ., concur.
Decision Date: April 29, 2008