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 (Robin S. Garson, J.), entered March 23, 2006. The order denied defendant’s unopposed motion, pursuant to CPLR 3126, seeking an order striking the complaint due to plaintiff’s failure to provide discovery or, in the alternative, compelling plaintiff to provide discovery.

Order reversed without costs and defendant’s motion to strike plaintiff’s complaint granted.

Plaintiff commenced the instant action to recover assigned first-party no-fault benefits. After issue was joined, defendant served various discovery demands.
Subsequently, defendant moved to strike plaintiff’s complaint pursuant to CPLR 3126 (3) due to plaintiff’s failure to respond to defendant’s discovery demands or, in the alternative, for an order compelling plaintiff to comply with the discovery demands. Although plaintiff failed to oppose the motion, the court nevertheless denied defendant’s motion and this appeal by defendant ensued.

Defendant’s motion papers were sufficient to demonstrate that plaintiff may be ineligible to receive reimbursement for no-fault benefits (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]) and that the discovery sought was material and necessary to defendant’s defense of this action (CPLR 3101; see also Crossbay Acupuncture, P.C. v State Farm Mut. Auto. Ins. Co., 15 Misc 3d 110 [App Term, 2d & 11th Jud Dists 2007]; Midwood Acupuncture, P.C. v State Farm Ins. Co., 14 Misc 3d 131[A], 2007 NY Slip Op 50052[U] [App Term, 2d & 11th Jud Dists]; North Acupuncture, P.C. v State Farm Ins. Co., 14 Misc 3d 130[A], 2006 NY Slip Op 52523[U] [App Term, 2d & 11th Jud Dists]; North Acupuncture, P.C. v State Farm Ins. Co., 14 Misc 3d 129[A], 2006 NY Slip Op 52512[U] [App Term, 2d & 11th Jud Dists]; First Help Acupuncture P.C. v State Farm Ins. Co., 12 Misc 3d 130[A], 2006 NY Slip Op 51043[U] [App Term, 2d & 11th Jud Dists]). “Although dismissing a complaint pursuant to CPLR 3126 is [*2]a drastic remedy, it is warranted where a party’s conduct is shown to be willful, contumacious, or in bad faith (see Beneficial Mtge. Corp. v Lawrence, 5 AD3d 339 [2004], lv denied 3 NY3d 602 [2004]; Frias v Fortini, 240 AD2d 467 [1997])” (Rowell v Joyce, 10 AD3d 601, 601 [2004]). In this case, the willful and contumacious character of plaintiff’s conduct can be inferred from its failure to respond to defendant’s discovery demands and its failure to submit written opposition to defendant’s motion to strike the complaint (see Devito v J & J Towing, Inc., 17 AD3d 624 [2005]; Rowell v Joyce, 10 AD3d 601, supra). Consequently, under these circumstances, defendant’s motion to strike the complaint pursuant to CPLR 3126 (3) should have been granted.

Pesce, P.J., Rios and Belen, JJ., concur.
Decision Date: September 14, 2007

[*1]

Supreme Court, Appellate Term, Second Department, September 14, 2007

APPEARANCES OF COUNSEL

Gary Tsirelman, P.C., Brooklyn (Darya Klein of counsel), for appellant. Teresa M. Spina, Woodbury (Emilio A. Cacace of counsel), for respondent.

{**17 Misc 3d at 41} OPINION OF THE COURT

Memorandum.

{**17 Misc 3d at 42}Order affirmed without costs and, upon searching the record, summary judgment granted to defendant dismissing plaintiff’s cause of action with respect to those portions of plaintiff’s claims seeking reimbursement of the unpaid balance of 23 acupuncture sessions conducted between February 9 and April 4, 2004.

In an action to recover assigned first-party no-fault benefits, a provider generally establishes its prima facie entitlement to summary judgment by proof of the submission of a claim form, setting forth the fact and the amount of the loss sustained, and that payment of no-fault benefits is overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; 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]). While defendant asserted that plaintiff did not prove a prima facie case because plaintiff, a provider of acupuncture services performed by a licensed acupuncturist, did not demonstrate that the fees it charged were within the prevailing fees for acupuncture services performed by a licensed acupuncturist in plaintiff’s geographic location (see 11 NYCRR 68.5 [b]), such contention lacks merit since plaintiff’s prima facie case does not require such a showing. Accordingly, the burden shifted to defendant to raise a triable issue of fact (see Zuckerman v City of New York, 49 NY2d 557 [1980]).

In opposition to plaintiff’s motion for summary judgment, which sought to recover on four claims submitted to defendant with respect to 30 sessions of acupuncture performed from February 9 through May 12, 2004, defendant sufficiently demonstrated that it timely mailed the [*2]denial of claim forms at issue based upon its standard office practice or procedure (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]). Plaintiff was not entitled to summary judgment on the claims pertaining to the seven sessions of acupuncture conducted from April 7 through May 12, 2004, which were denied based upon the results of an independent medical examination, since defendant’s papers were sufficient to demonstrate the existence of an issue of fact with respect to defendant’s defense of lack of medical necessity (see A.B. Med. Servs., PLLC v Liberty Mut. Ins. Co., 39 AD3d 779 [2007]; A.B. Med. Servs., PLLC v GEICO Cas. Ins. Co., 39 AD3d 778 [2007]).

Defendant’s opposing papers also demonstrated that defendant denied reimbursement for the unpaid balance of the remaining 23 acupuncture sessions conducted between February 9 and April 4, 2004 on the ground that the fees charged by{**17 Misc 3d at 43} plaintiff exceeded the “maximum allowance under the applicable fee schedule[s].” We agree that it was proper for defendant to use the workers’ compensation fee schedule for acupuncture services performed by chiropractors to determine the amount to which plaintiff was entitled upon the subject 23 sessions (Great Wall Acupuncture v GEICO Gen. Ins. Co., 16 Misc 3d 23 [App Term, 2d & 11th Jud Dists 2007]). Accordingly, there is no merit to plaintiff’s assertion that because the fees charged were reasonable and were within the range of prevailing fees for licensed acupuncturists in the geographic area in which plaintiff operated, defendant should have paid the entire amount for these 23 sessions (id.; see also Ops Gen Counsel NY Ins Dept, No. 04-10-03 [Oct. 2004]).

Further, since it is undisputed that defendant has fully paid plaintiff $673.90 for the 23 acupuncture sessions, the amount to which plaintiff is entitled under the workers’ compensation fee schedule for acupuncture services performed by chiropractors, it is appropriate for this court to search the record and grant summary judgment to defendant dismissing plaintiff’s cause of action to the extent that it seeks additional reimbursement for the 23 acupuncture sessions (Merritt Hill Vineyards v Windy Hgts. Vineyard, 61 NY2d 106 [1984]).

Rios, J. (concurring in the result in the following memorandum). I am constrained to concur based upon the majority holding in Great Wall Acupuncture v GEICO Gen. Ins. Co. (16 Misc 3d 23 [App Term, 2d & 11th Jud Dists 2007]).

Pesce, P.J., and Belen, J., concur; Rios, J., concurs in a separate memorandum.

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 Esposito, J.), entered December 6, 2005. The order denied defendant’s motion for summary judgment.

Order modified by providing that the motion is denied without prejudice to renewal upon proper papers; as so modified, affirmed without costs.

Plaintiff brought the instant action to recover $1,340.30 in assigned first-party no-fault benefits. Defendant moved for summary judgment and the court denied the motion for failure to support it with a copy of the pleadings, a ground not raised by plaintiff. In our opinion, the order should be modified as indicated above for the reasons set forth in Multiquest, P.L.L.C. v Allstate Ins. Co. ( Misc 3d , 2007 NY Slip Op [No. 2006-312 Q C], decided herewith).

Pesce, P.J., Rios and Belen, JJ., concur.
Decision Date: September 12, 2007

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 Esposito, J.), entered December 6, 2005. The order denied defendant’s motion for summary judgment.

Order modified by providing that the motion is denied without prejudice to renewal upon proper papers; as so modified, affirmed without costs.

Plaintiff brought the instant action to recover $1,236.99 in assigned first-party no-fault benefits. Defendant moved for summary judgment and the court denied the motion for failure to support it with a copy of the pleadings, a ground not raised by plaintiff.

CPLR 3212 (b) requires that a motion for summary judgment be supported by a copy of the pleadings. Without such pleadings, unless the record is sufficiently complete (Greene v Wood, 6 AD3d 976 [2004]), the motion is procedurally defective (Wider v Heller, 24 AD3d 433 [2005]), and the court may deny it even in the absence of a party raising the objection (see General Motors Acceptance Corp. v Albany Water Bd., 187 AD2d 894, 895 n [1992]). Accordingly, we conclude that, under the circumstances presented, the matter should have been denied without prejudice to renewal upon proper papers (see Wider v Heller, 24 AD3d 433, supra). In view of the foregoing, we do not reach the parties’ contentions with regard to the merits of the motion (see id.).

Pesce, P.J., Rios and Belen, JJ., concur. [*2]
Decision Date: September 12, 2007

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 Esposito, J.), entered December 6, 2005. The order denied defendant’s motion for summary judgment.

Order modified by providing that the motion is denied without prejudice to renewal upon proper papers; as so modified, affirmed without costs.

Plaintiff brought the instant action to recover $1,236.99 in assigned first-party no-fault benefits. Defendant moved for summary judgment and the court denied the motion for failure to support it with a copy of the pleadings, a ground not raised by plaintiff. In our opinion, the order should be modified as indicated above for the reasons set forth in Multiquest, P.L.L.C. v Allstate Ins. Co. ( Misc 3d , 2007 NY Slip Op [No. 2006-312 Q C], decided herewith).

Pesce, P.J., Rios and Belen, JJ., concur.
Decision Date: September 12, 2007

[*1]

Supreme Court, Appellate Term, Second Department, September 12, 2007

APPEARANCES OF COUNSEL

Bruno, Gerbino & Soriano, LLP, Melville (Charles W. Benton of counsel), for appellant. Belesi & Conroy, P.C., Garden City (Matthew J. Conroy of counsel), for respondent.

{**17 Misc 3d at 38} OPINION OF THE COURT

Memorandum.

Judgment reversed without costs, order entered December 8, 2005 vacated, plaintiff’s motion for summary judgment denied and defendant’s cross motion for summary judgment granted.

In this action by a provider to recover first-party no-fault benefits for an August 17, 1999 psychological evaluation of its assignor, plaintiff moved for summary judgment. Defendant cross-moved for summary judgment arguing, inter alia, that plaintiff was ineligible to receive reimbursement of no-fault benefits because plaintiff was fraudulently incorporated, relying on State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005]). Finding, inter alia, that the defense of “improper incorporation” was waived because defendant failed to assert the defense in its denial of claim form or in its answer, the court below awarded plaintiff summary judgment.

As defendant raises no issue with respect to plaintiff’s establishment of its prima facie case, we do not pass on the propriety of the implicit determination of the court below with [*2]respect thereto.

A regulation which took effect in 2002, after the services at issue herein were provided, states, “A provider of health care services is not eligible for reimbursement under section{**17 Misc 3d at 39} 5102(a)(1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement” (11 NYCRR 65-3.16 [a] [12]). This regulation has been held to bar reimbursement of no-fault benefits without regard to when the services were rendered (Allstate Ins. Co. v Belt Parkway Imaging, P.C., 33 AD3d 407 [2006]; see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005], supra; see generally Metroscan Imaging, P.C. v GEICO Ins. Co., 13 Misc 3d 35 [App Term, 2d & 11th Jud Dists 2006]). Such a defense is not waived by the failure to assert it in a denial of claim form (Crossbay Acupuncture, P.C. v State Farm Mut. Auto. Ins. Co., 15 Misc 3d 110 [App Term, 2d & 11th Jud Dists 2007]) nor is it precluded as a result of an untimely denial (Midwood Acupuncture, P.C. v State Farm Mut. Auto. Ins. Co., 14 Misc 3d 131[A], 2007 NY Slip Op 50052[U] [App Term, 2d & 11th Jud Dists 2007]). Contrary to the determination of the court below, the defendant’s answer, as amended by order dated September 9, 2005, asserted the defense that plaintiff was “not entitled to receive payment as it was not properly formed in that it failed to meet the applicable New York State and local licensing requirements necessary to perform such services in New York.” We note in passing that even if defendant had failed to interpose the defense in its answer, a court may nevertheless grant a motion for summary judgment based on an unpleaded defense (Rogoff v San Juan Racing Assn., 54 NY2d 883, 885 [1981]) where, as here, plaintiff did not assert any surprise or prejudice thereby (Ingordo v Square Plus Operating Corp., 276 AD2d 528 [2000]) and had “ample opportunity” to contest the defense in its opposition to the motion (Cangialosi v Hallen Constr. Corp., 282 AD2d 565, 566 [2001]; Lynbrook Glass & Architectural Metals Corp. v Elite Assoc., 225 AD2d 525, 527 [1996]).

Although Mallela involved a provider which was a professional service corporation (see Business Corporation Law art 15) and the instant plaintiff is a professional service limited liability company (see Limited Liability Company Law art 12), the requirements of membership, professional licensing, and filing are substantially the same. As a result, 11 NYCRR 65-3.16 (a) (12) clearly applies to professional service limited liability companies. Limited Liability Company Law § 1203 (b) requires that a member of such a company be licensed for any professional services the company is organized to provide. There is no dispute that plaintiff’s articles of organization stated that the company was to provide, inter alia, psychological services and{**17 Misc 3d at 40} listed a licensed psychologist as the provider of those services. However, the named psychologist testified under oath that she was never an owner or member of plaintiff and that she never received a stock certificate or any compensation based on an ownership interest.

Defendant also proved that plaintiff’s ownership has changed since its initial organization, and while certain other health services were variously added and dropped, the same psychologist, and no other, continued to be listed as a member and manager of plaintiff. Not only was the foregoing sufficient to defeat plaintiff’s motion for summary judgment, it also satisfied defendant’s burden of proof on its cross motion for summary judgment by demonstrating that plaintiff performed psychological services in violation of Limited Liability Company Law §§ 1203 and 1207.

Plaintiff did not dispute this proof, but sought to excuse any violation of the statute by proffering a hearsay affidavit of a person who purported to relate the nonfraudulent intentions of [*3]plaintiff’s original owner. Even if the affidavit presented a reasonable excuse for the failure to obtain an affidavit from plaintiff’s original owner (see Zuckerman v City of New York, 49 NY2d 557 [1980]; cf. Oddo v Edo Mar. Air, 34 AD3d 774 [2006]), it failed to excuse the initial fraudulent act of listing the psychologist as a member and manager of plaintiff or plaintiff’s continuing to so list the psychologist through successive changes of ownership including the period when the services herein were provided. Consequently, defendant was entitled to summary judgment upon its cross motion (see 11 NYCRR 65-3.16 [a] [12]; State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005], supra; Allstate Ins. Co. v Belt Parkway Imaging, P.C., 33 AD3d 407 [2006], supra).

In light of the foregoing, we reach no other issue.

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

—[*1] McDonnell & Adels, P.C., Garden City, N.Y. (Zara G. Friedman of counsel), for appellant.

Joseph Henig, P.C., Bellmore, N.Y., for respondent.

In an action to recover no-fault medical payments, the defendant appeals from so much of an order of the Supreme Court, Nassau County (Feinman, J.), dated January 27, 2006, as granted the motion of the plaintiff Mount Sinai Hospital, as assignee of Sidney Weingarten, denominated as one for leave to renew and reargue, but which was, in actuality, one for leave to reargue, and, upon reargument, vacated so much of a prior order of the same court dated July 8, 2005, as denied that plaintiff’s motion for summary judgment on the first cause of action and granted that plaintiff’s motion.

Ordered that the order dated January 27, 2006 is reversed insofar as appealed from, on the law, with costs, the motion, denominated as one for leave to renew and reargue, but which was, in actuality, one for leave to reargue, is denied, so much of the order dated July 8, 2005, as denied the motion of the plaintiff Mount Sinai Hospital, as assignee of Sidney Weingarten, for summary judgment on the first cause of action is reinstated and, upon searching the record (see CPLR 3212 [b]), that branch of the defendant’s cross motion which was for summary judgment dismissing the first cause of action is granted. [*2]

Pursuant to Insurance Law § 5106 (a) and 11 NYCRR 65-3.5, an insurer is required to either pay or deny a claim for no-fault automobile insurance benefits within 30 days from the date an applicant supplies proof of claim (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Failure to pay benefits within the 30-day requirement renders the benefits overdue (see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [a] [1]). The 30-day period may be extended if within 10 days from receipt of a completed application, an insurer demands additional verification of a claim (see 11 NYCRR former 65.15 [d] [1]; [e]; New York & Presbyt. Hosp. v Allstate Ins. Co., 30 AD3d 492, 493 [2006]; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568,569 [2004]). If the requested verification has not been supplied to the insurer within 30 days from the insurer’s original request, the insurer shall issue a follow-up request within 10 days of the insured’s failure to respond (see 11 NYCRR former 65.15 [e] [2]; New York Hosp. Med. Ctr. of Queens v Country-Wide Ins. Co., 295 AD2d 583, 584 [2002]). “A claim need not be paid or denied until all demanded verification is provided” (New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., supra at 570, see Insurance Law § 5106 [a]; 11 NYCRR 65-3.5 [c], 65-3.8 [a] [1]; New York Hosp. Med. Ctr. of Queens v Country-Wide Ins. Co., 295 AD2d 583, 584 [2002]; Westchester County Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 262 AD2d 553, 554 [1999]). “When a hospital fails to respond to a verification request, the 30-day period in which to pay or deny the claim does not begin to run, and any claim for payment by the hospital is premature” (New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., supra at 570).

Here, it is undisputed that the defendant made timely requests for additional information. The plaintiff Mount Sinai Hospital, as assignee of Sidney Weingarten (hereinafter the plaintiff), claims that it sent the requested material on December 21, 2004, by certified mail, and that the material was received by the defendant the next day. Assuming that sufficient evidence exists that the requested material was mailed (see Westchester Med. Ctr. v Liberty Mut. Ins. Co., 40 AD3d 981 [2007]), the 30-day period within which the defendant was required to either pay or deny the claim did not begin to run until December 22, 2004, the date the verification material was allegedly received (see New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., supra at 570), and did not expire until January 21, 2005. Since the plaintiff commenced its lawsuit by the filing of a summons with notice and verified complaint on November 19, 2004, approximately two months before the defendant was required to pay or deny the claim, the plaintiff’s action was brought prematurely and the defendant was entitled to summary judgment dismissing the plaintiff’s first cause of action (see Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492, 493 [2005]). This Court may award this relief even though the defendant did not appeal from the original order denying that branch of its cross motion which was for summary judgment dismissing the first cause of action (see Merritt Hill Vineyards v Windy Hgts. Vineyard, 61 NY2d 106, 110 [1984]; Wolf v Atai, 139 AD2d 729,731 [1988]).

The defendant’s remaining argument, regarding a protective order, has been rendered academic. Crane, J.P., Goldstein, Dillon and Carni, JJ., concur.

Nassau Dist Ct

11579/04

Attorneys for plaintiff: La Sorsa & Beneventano

Attorneys for defendant: McDonnell & Adels, PC

Andrew M. Engel, J.

The Plaintiff commenced this action to recover no-fault first party benefits for medical services allegedly provided to its assignor on February 28, 2003 and on March 3, 2003, in the total sum of $240.00, which has not been paid. The action was commenced on or about May 12, 2004. Issue was joined on or about June 7, 2004. The Plaintiff now moves for summary judgment. The Defendant opposes that motion and cross-moves for summary judgment as well. The Plaintiff opposes the cross-motion.

Summary judgment is a drastic remedy, Sillman v. Twentieth Century-Fox Film Corporation, 3 NY2d 395, 165 NYS2d 498 (1957), which should not be granted where there is any doubt as to the existence of a triable issue of fact. Rotuba Extruders, Inc. v. Ceppos, 46 NY2d 223, 413 NYS2d 141 (1978) To prevail, the movant must first make a showing of entitlement to judgment, as a matter of law, Bank of New York v. Granat, 197 AD2d 653, 602 NYS2d 942 (2nd Dept. 1993), tendering evidentiary proof in admissible form. Friends of Animals, Inc. v. Associate Fur Manufacturers, Inc., 46 NY2d 1065, 416 NYS2d 790 (1979). It is only thereafter incumbent upon the party opposing summary judgment to “demonstrate by admissible evidence the existence of a factual issue requiring a trial of the action or tender an acceptable excuse for his failure so to do.” Zuckerman v. City of New York, 49 NY2d 557, 427 NYS2d 595 (1980). A movant’s failure to make such a showing, regardless of the sufficiency of opposing papers, mandates the denial of a summary judgment motion. Winegrad v. New York University Medical Center, 64 NY2d 851, 487 NYS2d 316 (1985)

Relying upon the affidavit of Gary Lombardo, an employee of the Plaintiff, and the Office Manager of the Plaintiff’s billing agent, Triborough Healthcare Management, Inc., the Plaintiff alleges that it timely submitted its claim for the services in question to the Defendant and that the [*2]Defendant failed to timely pay or deny this claim. The Defendant admits receipt of the Plaintiff’s claim on March 24, 2003, thereby curing any defect in the Plaintiff’s proof of mailing. Prestige Medical & Surgical Supply Inc. v. Clarendon National Insurance Company, 13 Misc 3d 127(A), 824 NYS2d 758 (App. Term 2nd and 11th Jud. Dists. 2006); Magnezit Medical Care, P.C. v. New York Central Mutual Fire Ins. Co., 12 Misc 3d 144(A), 824 NYS2d 763 (App. Term 2nd and 11th Jud. Dists. 2006), but alleges that the claim was denied due to the Plaintiff’s assignor’s failure to cooperate, and a founded belief that the alleged accident of February 13, 2003 was a staged and intentional act, raising a defense of lack of coverage. The affirmation of counsel, who does not have any personal knowledge of the matter, is without probative value, Wehringer v. Helmsley-Spear, Inc., 91 AD2d 585, 457 NYS2d 78 (1st Dept. 1982) aff’d 59 NY2d 688, 463 NYS2d 417 (1983); McDermott v. South Farmingdale Water District, 167 AD2d 517, 562 NYS2d 191 (2nd Dept. 1990); Di Sabato v. Soffes, 9 AD2d 297, 193 NYS2d 184 (1st Dept. 1959) and cannot supplement Mr. Lombardo’s affidavit.

Relying on the affidavit of Scott Herman, an investigator with the Defendant’s Special Investigative Unit, the Defendant alleges that it had a founded belief that the accident of February 13, 2003 was a staged event. The Defendant bases this defense on Mr. Herman’s belief that this loss occurred shortly after the State Farm policy was issued, that the Plaintiff’s assignor allegedly had numerous prior claims, that there were allegedly multiple individuals claiming injuries in the vehicle insured by the Defendant, that the driver of the vehicle insured by the Defendant had allegedly been involved numerous prior accidents, that there was allegedly a question of whether or not the driver of the vehicle insured by the Defendant had permission to drive the vehicle, that one of the passengers of the vehicle insured by the Defendant allegedly provided a false social security number, and that there were allegedly a number of inconsistencies in the testimony given by the Defendant’s insured and some of the occupants of the insured vehicle their examinations under oath. The Defendant further alleges that the Plaintiff’s assignor failed to appear for two scheduled examinations under oath. As was true for the Plaintiff’s counsel’s affirmation, defense counsel’s affirmation is of no probative value herein.

At the outset it is noted that neither the papers submitted in support of the Plaintiff’s motion, nor the papers submitted in support of the Defendant’s cross-motion are in admissible form sufficient to support either motion for summary judgment. Simply annexing documents to the moving papers, without a proper evidentiary foundation is inadequate. Higen Associates v. Serge Elevator Co., Inc., 190 AD2d 712, 593 NYS2d 319 (2nd Dept. 1993) To succeed on their respective motions the parties must lay a proper business record foundation for the documents upon which they rely, by someone with sufficient personal knowledge of the party’s office practices and procedures. Fortune Medical, P.C. v. Allstate Insurance Co., 14 Misc 3d 136, 836 NYS2d 492 (App. Term 9th & 10 Jud. Dists. 2007); Ontario Medical, P.C. v. Sea Side Medical, P.C., 15 Misc 3d 129, 2007 WL 926349 (App. Term 9th & 10 Jud. Dists. 2007); V.S. Medical Services, P.C. v. One Beacon Insurance, 14 Misc 3d 142, 836 NYS2d 504 (App. Term 2nd & 11th Jud. Dists. 2006)

As concerns the Plaintiff’s motion,”[t]o the extent defendant issued denial of claim forms (NF-10)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, Midborough Acupuncture, P.C. v. New York Cent. [*3]Mut. Fire Ins. Co., 13 Misc 3d 132 (A), 2006 N.Y.Slip Op. 51879(U), supra ).” Dan Medical, P.C. v. New York Central Mutual Fire Insurance Company, 14 Misc 3d 44, 829 NYS2d 404 (App. Term 2nd & 11th Jud. Dists. 2006); See also: Fortune Medical, P.C. v. Allstate Insurance Co., supra . Similarly, the opinion of the Defendant’s investigator is not based upon his personal knowledge, but is purportedly based upon his review of certain documents allegedly contained in the Defendant’s files, some of which are simply annexed to the Defendant’s motion papers without establishing any evidentiary foundation others of which are omitted altogether.

Neither the statement of Mr. Lombardo, on behalf of the Plaintiff, that the records relied upon are “maintained by Triborough on behalf of KOI Medical Acupuncture, PC in the ordinary course of business,” (Lombardo Affidavit 2/20/07, ¶ 9) nor the statement of Mr. Hermann, on behalf of the Defendant, that he made his “affidavit upon [his] personal knowledge and full review of files and records maintained by State Farm in its ordinary course of business” (Hermann Affidavit 5/1/07, ¶1) establish a business record exception to the hearsay rule, rendering these documents inadmissible.

As noted in People v. Kennedy,68 NY2d 569, 510 NYS2d 853 (1986), “The essence of the business record exception to the hearsay rule is that records systematically made for the conduct of a business as a business are inherently highly trustworthy because they are routine reflections of day-to-day operations and because the entrant’s obligation is to have them truthful and accurate for purposes of the conduct of the enterprise (citation omitted).” See also: People v. Guidice, 83 NY2d 630, 634 NE2d 951 (1994) CPLR § 4518(a) sets forth the exception:

Any writing or record, whether in the form of an 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.

As can be seen, the proponent of the offered evidence must establish three general elements, by someone familiar with the habits and customary practices and procedures for the making of the documents, before they will be accepted in admissible form: (1) that the documents were made in the regular course of business; (2) that it was the regular course of the subject business to make the documents; and, (3) that the documents were made contemporaneous with, or within a reasonable time after, the act, transaction, occurrence or event recorded.^[FN1] People v. Kennedy, supra .; People v. Cratsley, 86 NY2d 81, 629 NYS2d 992 (1995). The parties herein, at best, have only made a feigned attempt to satisfy these elements.

While the Defendant is correct in asserting that its attempts to submit the transcripts of the examinations under oath are not barred by the hearsay rule, because the Defendant is not offering the statements contained therein for their truth, Spensieri v. Lasky, 94 NY2d 231, 701 NYS2d 689 (1999); Nucci v. Proper, 95 NY2d 597, 721 NYS2d 593 (2001); Winant v. Carras, 208 AD2d 618, 617 NYS2d 487 (2nd Dept. 1994) lv. den. 85 NY2d 812, 631 NYS2d 288 (1995) [*4]but for the exact opposite reason, to show their falsity and fraud, Stern v. Waldbaum, Inc., 234 AD2d 534, 651 NYS2d 187 (2nd Dept. 1996); DeLuca v. Ricci, 194 AD2d 457, 599 NYS2d 267 (1st Dept. 1993); Dawson v. Raimon Realty Corporation, 303 AD2d 708, 758 NYS2d 100 (2nd Dept. 2003), the transcripts, nevertheless, are not properly before this court. These transcripts are neither signed nor verified, Krupp v. Aetna Life & Casualty Co., 103 AD2d 252, 479 NYS2d 992 (2nd Dept.1984); Tancos v. Centaur Insurance Company, 133 AD2d 622, 519 NYS2d 730 (2nd Dept.1987); and, the Defendant offers no explanation as to why. McDonald v. Mauss, 38 AD3d 727, 832 NYS2d 291 (2nd Dept. 2007) Additionally, the Plaintiff has not demonstrated any formal requirements for the taking of these individuals’ alleged testimony sufficient to assure their accuracy. Complete Orthopedic Supplies, Inc. v. State Farm Insurance Company, __ Misc 3d __, 838 NYS2d 861 (Civ.Ct. Queens Co. 2007) Notably absent from the transcripts submitted are certifications as to the transcripts’ accuracy, executed by the Notary Public who purportedly took the testimony. cf. Morchik v. Trinity School, 257 AD2d 534, 684 NYS2d 534 (1st Dept.1999); Cox v. Jeffers, 222 AD2d 395, 634 NYS2d 519 (2nd Dept. 1995) Without such certification, the Plaintiff is asking the court to rely on transcripts which may be inaccurate. Jacobs v. Herrera, 4 Misc 3d 1018(A), 798 NYS2d 345 (Dist.Ct. Nassau Co. 2004)

If for no other reason, the parties’ failure to support their respective summary judgment motions with proof in admissible form mandates the denial of the motion and the cross-motion. Even if, however, the papers of one or both of the parties were to be deemed presented in admissible form, these motions would still have to be denied.

Contrary to the Plaintiff’s argument, the Defendant’s lack of coverage defense, based upon the Defendant’s alleged founded belief that the alleged accident in this matter was staged, is not waived by the failure to issue a denial or the issuance of an untimely denial. Central General Hospital v. chubb Group of Insurance Companies, 90 NY2d 195, 659 NYS2d 246 (1997); Metro Medical Diagnostics, P.C. v. Eagle Insurance Company, 293 AD2d 751, 741 NYS2d 284 (2nd Dept. 2002); Fair Price Medical Supply Corp. v. Travelers Indemnity Company, 42 AD3d 277, 837 NYS2d 350 (2nd Dept. 2007); Executive MRI Imaging, P.C. v. New York Central Mut. Fire Insurance Company, 13 Misc 3d 140, 831 NYS2d 359 (App. Term 2nd & 11th Jud Dist. 2006)

Moreover, assuming, for the sake of argument, the submission of documentation in evidentiary form, while the Defendant’s failure to deny or pay the Plaintiff’s timely claim satisfies the Plaintiff’s prima facia case, 11 N.Y.C.R.R. § 65-3.8(a)(1) and (c); Presbyterian Hospital in the City of New York v. Maryland Casualty Company, 90 NY2d 274, 660 NYS2d 536 (1997); Nyack Hospital v. State Farm Mutual Automobile Insurance Company, 11 AD3d 664, 784 NYS2d 136 (2nd Dept. 2004); Westchester Medical Center v. AIG, Inc., 36 AD3d 900, 829 NYS2d 180 (2nd Dept. 2007), which carries with it a ” presumption of [coverage] which attaches to the claim form'”, A.B. Medical Services, PLLC v. State Farm Mutual Automobile Insurance Company, 7 Misc 3d 822, 795 NYS2d 843 (Civ. Ct. Kings Co. 2005) quoting Stephen Fogel Psychological, P.C. v. Progressive Casualty Insurance Company, 7 Misc 3d 720, 827 NYS2d 217 (App. Term 2nd & 11th Jud. Dists. 2004), aff’d as mod. 35 AD3d 720, 827 NYS2d 217 (2nd Dept. 2006); see also: V.S. Medical Services, P.C. v. Allstate Insurance Company, 11 Misc 3d 334, 811 NYS2d 886 (Civ. Ct. Kings Co. 2006),placing the burden of going forward on the Defendant, See: Mount Sinai Hospital. v. Triboro Coach Inc., 263 AD2d 11, 699 NYS2d 77 (2nd [*5]Dept.1999); New York Message Therapy, P.C. v. State Farm Mutual Insurance Company, 14 Misc 3d 1231, 836 NYS2d 494 (Civ. Ct. Kings Co. 2006); Inwood Hill Medical P.C. v. Allstate Insurance Company, 3 Misc 3d 1110, 787 NYS2d 678 (Civ.Ct. NY Co. 2004), as will be discussed below, assuming the Defendant’s proof was in admissible form, the Defendant has raised questions of fact as to whether or not this was a staged accident sufficient to defeat the Plaintiff’s summary judgment motion. See: A.M. Medical Services, P.C. v. Nationwide Mutual Insurance Company, 12 Misc 3d 143, 824 NYS2d 760 (App. Term 2nd & 11th Dists. 2006); Amaze Medical Supply Inc. v. Lumbermens Mutual Casualty Company, 10 Misc 3d 127, 809 NYS2d 480 (App. Term 2nd & 11th Jud. Dists. 2005)

Similarly, even if the documentation submitted were in evidentiary form, the Defendant’s claims of failure to cooperate and lack of coverage cannot be determined as a matter of law, based upon the facts presented to the court.

Effective on April 5, 2002, the revised insurance regulations mandated the inclusion of examinations under oath in the personal injury protection endorsement of all policies issued thereafter, providing that an eligible injured person submit to examinations under oath “as may reasonably be required … by the Company” 11 NYCRR 65-1.1(d). Rigid Medical of Flatbush, P.C. v. New York Central Mutual Fire Insurance Company, 11 Misc 3d 139(A), 816 NYS2d 700 (App. Term 2nd & 11th Jud. Dists. 2006) Before an insurer may assert the defense of failure to appear, however, “the insurer must include the revised prescribed endorsement with new or renewal policies issued on or after April 5, 2002, and the claim rules are to be governed by the policy endorsement in effect.” S & M Supply v. State Farm Mutual Automobile Insurance Company, 4 Misc 3d 130(A), 791 NYS2d 873 (App. Term, 9th & 10th Jud. Dists. 2004);Capio Medical, P.C. v. Progressive Casualty Insurance Company, 7 Misc 3d 129(A), 801 NYS2d 231 (App. Term 2d & 11th Jud. Dists. 2005). Having failed to establish that the insurance policy herein contained an endorsement authorizing examinations under oath, the Plaintiff’s assignor’s alleged failure to appear for such an examination cannot serve as grounds for the denial of Plaintiff’s claim. A.B. Medical Services PLLC v. Allstate Insurance Company, 11 Misc 3d 135(A), 816 NYS2d 693 (App. Term 2nd & 11th Jud. Dists. 2006); Star Medical Services P.C. v. Eagle Insurance Company, 6 Misc 3d 56, 791 NYS2d 266 (App. Term 2nd & 11th Jud. Dists. 2004)

Additionally, like “independent” medical examinations, to successfully deny a claim based upon the Plaintiff’s assignor’s failure to attend an examination under oath, the insurer must establish, inter alia, proper mailing of the request for the examination by someone with knowledge. Stephen Fogel Psychological, P.C. v. Progressive Casualty Insurance Company, 35 AD3d 720, 827 NYS2d 217 (2nd Dept. 2006); Radiology Today, P.C. v. Citiwide Auto Leasing Inc., 15 Misc 3d 92, 838 NYS2d 336 (App. Term 2nd & 11th Jud. Dists. 2007) Neither Defendant’s counsel nor Mr. Hermann, the Defendant’s investigator, indicate that they have any personal knowledge of the alleged mailing of two notices for an examination under oath to the Plaintiff’s assignor; nor do they describe a “standard office practice or procedure designed to ensure that items are properly addressed and mailed” which would give rise to a presumption of receipt by the Plaintiff’s assignor. Residential Holding Corp. v. Scottsdale Insurance Company, 286 AD2d 679, 729 NYS2d 776 (2nd Dept. 2001); Hospital for Joint Diseases v. Nationwide Mutual Insurance Company, 284 AD2d 374, 726 NYS2d 443 (2nd Dept. 2001) That these notices [*6]were allegedly mailed by certified mail, return receipt requested, does not cure the deficiencies in the Defendant’s proof, as there is no proof that these notices were, in fact, mailed in such fashion. Nowhere on the letters is the mailing receipt number indicated; and, the purported mailing receipt fails to indicate what item was mailed and the address to which it was allegedly sent. Similarly, the mailing receipt does not contain a postmark or any other marking from the United States Postal Service. Moreover, although not submitted with the letters, both defense counsel and Mr. Hermann indicate that return receipt postcards were not signed by the Plaintiff’s assignor, but “by an unknown individual ….” (Hermann Affidavit 5/1/07, ¶ 6 and Linwood Affirmation, 4/19/07, ¶ 9) See: New York and Presbyterian Hospital v. Allstate Insurance Company, 29 AD3d 547, 814 NYS2d 687 (2nd Dept. 2006); Compare: Westchester Medical Center v. Liberty Mutual Insurance Company, 40 AD3d 981, 837 NYS2d 210 (2nd Dept. 2007) [the certified receipts contained a postmark and the documents’ identification numbers; and, the return receipt card, bearing the same information, was signed by a representative of the recipient]

As for the Defendant’s lack of coverage claim, while the Defendant’s papers raise a number of questions which may reasonably be interpreted as demonstrating that the accident in question either never took place or was staged, the Defendant’s papers are, at times, in conflict with themselves and raise more genuine issues of material fact than they resolve.

By way of example, both defense counsel and Mr. Hermann, in describing this allegedly fraudulent accident aver, “The alleged incident in issue occurred on February 13, 2003 at the intersection of Coney Island Avenue and Avenue H in Brooklyn, New York … According to the police report, the adverse vehicle was traveling northbound on Coney Island Avenue when he slowed down to avoid hitting a double parked car and was rear-ended by the insured vehicle.” [italics in original] (Hermann Affidavit 5/1/07, ¶ 3 and Linwood Affirmation, 4/19/07, ¶ 5) The police report which the Defendant submits, however, indicates that the subject accident occurred on Williamsbridge Road one hundred and fifty feet north of Morris Park Avenue in Bronx County, and that the insured vehicle was allegedly struck on the side by the adverse vehicle which was exiting a Blockbuster parking lot. Similarly, among the number of inconsistencies in the testimony purportedly provided by the insured, the driver and some of the other passengers of the insured vehicle is the claim that the insured, who was not in the vehicle at the time of the accident, testified that he picked up his vehicle at approximately 9:30 p.m. on the night of the accident, while “the police report lists the accident as occurring after 10:00 p.m.” (Hermann Affidavit 5/1/07, ¶ 7j and Linwood Affirmation, 4/19/07, ¶ 11j) The accident report submitted by the Defendant, however, indicates that the accident occurred at 2050 military time, or 8:50 p.m., making it possible for the insured to have picked up his vehicle at 9:30 p.m., as he apparently claims.

As previously indicated, if they were in admissible form, the documentation submitted by the Defendant “demonstrate[d] to the court that it had a founded belief’ that the alleged accident was intentionally caused in order to survive a summary judgment motion by the plaintiff-provider … However, defendant-insurer’s founded belief [is] not enough to obtain judgment on its own.” Universal Open MRI of the Bronx, P.C. v. State Farm Mut. Auto Ins., 12 Misc 3d 1151, 819 NYS2d 852 (Civ. Ct. Kings Co. 2006) The papers presented by the Defendants raise a number of factual issues which are subject to the inferences to be drawn from the evidence presented, many of which involve an assessment of credibility, and all of which must be reserved for the trier of [*7]facts. St. Luke’s Roosevelt Hospital v. Allstate Insurance Company; 303 AD2d 743, 757 NYS2d 457 (2nd Dept. 2003); Kolivas v. Kirchoff, 14 AD3d 493, 787 NYS2d 392 (2nd Dept. 2005); Scott v. Long Island Power Authority, 294 AD2d 348, 741 NYS2d 708 (2nd Dept. 2002); Lacagnino v. Gonzalez, 306 AD2d 250, 760 NYS2d 533 (2nd Dept. 2003); Ocean Diagnostic Imaging P.C. v. State Farm Mutual Automobile Insurance Company, 9 Misc 3d 73, 803 NYS2d 333 (App. Term 2005)

Accordingly, for all of the foregoing reasons, the Plaintiff’s motion and the Defendant’s cross-motion are denied.

This constitutes the decision and order of this court.

Dated: Hempstead, New York

September 10, 2007

___________________________

ANDREW M. ENGEL

J.D.C.

Footnotes

Footnote 1: Other evidentiary issues may still arise affecting admissibility, such as an attempt at admitting photocopies or electronic reproductions, see CPLR § 4539, or the presence of statements made by individuals who had not business duty to impart such information. Johnson v. Lutz, 253 NY 124, 170 N.Y.S. 517 (1930)

Civil Court of the City of New York, Queens County

11430-2004

For the Plaintiff:

The Law Offices of Eva Gaspari PLLC

By Eva Gaspari, Esq.

2300 West 7th Street

Brooklyn, New York 11223

Tel: (718) 266-3009

For the Defendant:

Freiberg & Peck, LLP

By Yilo J. Kang, Esq.

49 West 37th Street, 9th Floor

New York, New York 10018

Tel:(212) 252 -9550

Charles S. Lopresto, J.

The plaintiff’s assignor, Cheryl Brown, was allegedly injured in a motor vehicle accident on January 7, 2003 while driving a vehicle she rented from Budget Rent A Car (hereafter Budget). At the time, Ms. Brown had an insurance policy with Progressive Insurance Company, which covered another vehicle which was not involved in the accident. Ms. Brown received medical equipment for treatment of injuries arising from the motor vehicle accident. The [*2]plaintiff, Ave T MPC, Corp., submitted two separate claims to the defendant, Progressive Insurance Company (hereafter Progressive), for the equipment dispensed on February 6, 2003 and February 22, 2003, in the amounts of $79.99 and $888.00, respectively. The two claims came to a total of $967.99, which, together with interest, costs and attorney fees, reflects the amount sought to be recovered in this case. The plaintiff is now seeking benefits under Ms. Brown’s insurance policy with Progressive for the accident which occurred while she was driving the Budget Rent A Car. Defendant contends that Ms. Brown is not an eligible person for insurance under the policy as she was driving a vehicle other than the vehicle insured by Progressive and thus was not covered.

A trial regarding this matter was held on July 23, 2007. At trial, the parties stipulated that the plaintiff had timely and properly submitted claims for no-fault benefits with respect to the medical equipment at issue to Progressive Insurance Company on behalf of the plaintiff. Given the stipulation of these facts, the plaintiff rested its case. The parties further stipulated that the defendant’s answer would be amended to contain the defense that the event or loss was not covered by the policy of insurance issued by the defendant and the defendant abandoned it’s defense that the claims in dispute had been denied based upon a failure of Ms. Brown to abide by and cooperate in accordance with the terms of the insurance policy. The parties stipulated that the sole issue for the court to determine was if there was a lack of coverage.

The defendant called Tammy Reichel, a senior litigation specialist employed by the defendant, whose responsibilities consisted of reviewing claims which were in litigation. Ms. Reichel testified that Cheryl Brown did have an insurance policy with Progressive Insurance in effect on the date of the accident. The claims presently in dispute had been denied based upon a failure to cooperate as per the terms of the policy. After the claims were received, the defendant repeatedly requested that Ms. Brown cooperate with the coverage investigation and submit to the taking of a recorded statement or otherwise contact the defendant. Various follow up letters were sent to Ms. Brown seeking information with respect to coverage. After receipt of the bills in question from the plaintiff, the defendant advised the plaintiff via a verification request that the benefits were delayed pending the claimant’s cooperation with their requests. After numerous attempts to obtain the recorded statement, the defendant denied the claims in dispute based upon the claimant’s breach of her insurance policy’s cooperation clause for failure to submit to a recorded statement request. While the instant lawsuit was pending, Ms. Reichel testified that the defendant, Progressive, received information from which she identified as an “ISO run” from an ISO computer data base. Ms. Reichel stated that all insurance companies are under a duty to provide information to this data base and she routinely relies upon information obtained from this data base and fully incorporates said information into her records made in the regular course of the defendant’s business. Said information indicated that Budget Rent A Car had received a claim from Ms. Brown for the same accident. Thereafter, a telephone conversation between Allison Saronui of Progressive Insurance Company and Trisha Hopfauf from the Budget Claims Department took place. A fax was sent from Ms. Hopfauf to Ms. Saronui on August 24th, 2007 memorializing this conversation which stated, inter alia, that “Budget was primary for PIP on this loss since this was a NY accident.”. Said fax also contained information acknowledging receipt of a medical bill for Ms. Brown on August 11th, 2003 for services rendered January 10th,2003 to March 13th, 2003, which was denied by Budget on the basis that her claim was untimely. Based upon such information and a police report indicating that the vehicle insured by [*3]the defendant and owned by Ms. Brown was not the vehicle involved in the accident, Ms. Reichel testified that she had a “founded belief” that Progressive was not the carrier liable for the accident and that this accident was not “covered” by the terms of the Progressive policy since the claimant was covered by a policy of insurance other than the one issued by the defendant.

CONCLUSIONS OF LAW

1. Has the defendant established that the loss was not a covered accident?

Generally, an insured who seeks to recover for a loss under an insurance policy has the burden of proving that the loss occurred and that the loss was a covered incident under the terms of the policy. Gongolewski v. Travelers Ins. Co., 252 AD2d 569[2nd Dept 1998], quoting Vasile v. Hartford Acc. & Indem.Co., 213 AD2d 541[ 2nd Dept. 1995]. However, in an action for first-party no fault benefits, which is the case at bar, a provider’s proof of timely submission of a properly completed claim form makes out a prima facie case and there is a presumption of medical necessity. See, Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128 [ App Term 2d & 11th Jud Dists ]; see also, A.B. Med. Servs. PLLC v. Lumbermens Mut. Cas. Co., 4 Misc 3d 86 [App Term 2d & 11th Jud Dists 2004]. Adopting the Appellate Term’s concept in the related area of medical necessity, it should therefore follow that there is also a presumption of coverage which attaches to the claim form.

In this case, it was stipulated by the parties that the plaintiff had timely and properly submitted claims for no-fault benefits, which established plaintiff’s prima facie case thus establishing a presumption of coverage. A.B.Medical Services, PLLC v. State Farm Mutual Automobile Ins. Company, 7 Misc 3d 822; New York Massage Therapy v. State Farm Mutual Ins. Co. ,14 Misc 3d 1231 (A). Once the plaintiff makes a prima facie showing, the burden of explanation or of “going forward with the case” falls upon the defendant to show a lack of coverage. Mount Sinai Hosp. V. Triboro Coach Inc., 263 AD2d 11. The satisfaction of this burden would permit the defendant to disprove the presumption of coverage. Palmier v. United States Fidelity and Guaranty Company, 135 AD2d 1057 (3rd Dept. 1987).

In the case at bar, the defendant contends that this burden has been satisfied in that it has established that the defendant had a “founded belief” that the loss in question was not covered by the policy of insurance. In Central Gen. Hosp. V. Chubb Group of Ins.Cos., 90 NY2d 195, the Court of Appeals held that ” an insurer… may assert a lack of coverage defense premised on the fact or founded belief that the alleged injury does not arise out of an insured incident”. This case dealt with an insurers failure to reject a claim to recover no-fault benefits within the 30 day period prescribed by statute and regulations and held that the insurer would not be precluded from disclaiming when the defense is lack of coverage. The “fact or founded belief” standard discussed in Chubb, which is often used in “staged accident” cases, is inapplicable in this case. The facts in this case are distinguishable from a “staged accident” case. There has been no contention that the accident did not occur; that it was part of a fraudulent scheme or was an intentional act and thus not a covered incident under the policy. It is uncontroverted that a policy of insurance existed in this case which was issued to Ms. Brown by Progressive. Either the accident in question was covered or it was not. A contracting party to an insurance agreement should not be relieved of it’s duties of performance under the contract because a party “believes” [*4]that performance is not required whether that belief is founded or not if in fact performance is required. In order for the court to determine the issue, it is crucial and essential for the court to know what are the terms of coverage contained within the policy. The defendant did not introduce a copy of the policy of insurance that is in dispute. The defendant merely introduced the declarations page of the claimant’s insurance policy indicating that the car involved in the accident that the claimant was driving was not listed as a car insured by the defendant. In this case the defendant has failed to meet it’s burden to show that the policy of insurance issued to Ms. Brown did not cover the loss at issue. The policy may have contained a clause which covered the use of a rental vehicle as a temporary substitute for the insured’s vehicle while being repaired. See, SZ Medical, PC. V. Lancer Ins. Co.. 7 Misc 3d 86. Absent the actual production of the insurance policy the court can only guess and surmise at the terms and conditions therein. This court is well aware of the exclusions set forth in 11 NYCRR§ 65-1.1, in particular, exclusion C which states PIP coverage does not apply to “the named insured or relative occupying … a motor vehicle other than the insured vehicle”. However, said exclusions do not negate the responsibility of the insurance company to produce said policy at trial. Therefore, it is the holding of this court that the insurance company must introduce the policy at trial in order to demonstrate that the loss in question fell outside the terms of the insured’s policy of coverage in order to satisfy it’s burden.

2. Should have defendant submitted the matter to arbitration?

Notwithstanding the foregoing, the case at bar concerns a priority of payment issue. If a priority of payment issue arises as provided in NYCRR section 65-3.2; it is not considered a coverage question and must be submitted to mandatory arbitration. Section 5105 (b) of the Insurance Law establishes mandatory arbitration procedures promulgated by the Superintendent of Insurance for the resolution of disputes arising between insurers concerning their responsibility for the payment of first- party benefits. See Matter of Pacific Ins. Co. V State Farm Mut. Auto. Ins. Co.,150 AD2d 455[ Second Dept.1989]. In Matter of Pacific, thecourt dealt with issues similar to the facts presented in this case. The court held that ” (t)he Supreme Court erred in ruling that the present issue falls outside the jurisdiction of Insurance Law § 5105 and that it is, therefore not subject to mandatory arbitration, contrary to the clear mandate of 11 NYCRR 65.15 (j) (2), which provides that If a dispute regarding priority of payment arises among insurers who otherwise are liable for the payment of first-party benefits, then the first party to whom notice of claim is given… shall be responsible for payment… Any such dispute shall be resolved in accordance with the arbitration procedures established pursuant to section 5105 of the Insurance Law (section 65.10 of this Part)’. In addition, 11 NYCRR 65.10 (a) (5) provides in pertinent part that any controversy between insurers involving the responsibility or obligation to pay first-party benefits (i.e., priority of payment or sources of payment as provided in section 65.15[j] of this Part) is not considered a coverage question and must be submitted to mandatory arbitration under this section'”. In this case, the defendant refused to pay Ms. Brown’s claims when they were first presented with them. That refusal raised a question as to “priority of payments” between the defendant and Budget, which issue must be determined and submitted to mandatory arbitration pursuant to Insurance Law § 5105 and 11 NYCRR 65.10 (a) (5). The record reveals that Progressive received bills from the plaintiff prior to any claim made with [*5]Budget . This raises a dispute of priority of payments as between insurers which must be submitted for resolution by mandatory arbitration and this

court is without jurisdiction. SZ Medical, P.C v. Lancer Insurance Company, 7 Misc 3d 86. Accordingly, the complaint is dismissed.

____________________________

DATE:_______________Hon Charles S. Lopresto

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 (Timothy J. Dufficy, J.), entered May 4, 2006, deemed an appeal from a judgment entered June 21, 2006 (see CPLR 5501 [c]). The judgment, entered upon the May 4, 2006 order which granted plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $3,302.30.

Judgment affirmed without costs.

In this action to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant opposed the motion on the ground that it timely denied plaintiff’s claims based upon the failure of plaintiff’s assignor to appear for independent medical examinations. The court granted plaintiff’s motion, holding that defendant
failed to establish that the denial of claim forms were timely mailed. Thereafter a judgment was entered.

Inasmuch as defendant raised no issue in the court below or on appeal with respect to plaintiff’s establishment of its prima facie case, we do not pass on the propriety of the implicit determination of the court below with respect thereto. While defendant denied these claims based upon the assignor’s failure to appear for scheduled independent medical examinations, defendant did not submit an affidavit from someone with personal knowledge regarding the assignor’s failure to appear. As a result, defendant failed to raise a triable issue of fact with [*2]regard to said claims (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]; First Help Acupuncture, P.C. v Progressive Northeastern Ins. Co., 15 Misc 3d 144[A], 2007 NY Slip Op 51167[U] [App Term, 2d & 11th Jud Dists]). Accordingly, the judgment is affirmed, albeit on other grounds.

Pesce, P.J., Weston Patterson and Belen, JJ., concur.
Decision Date: September 04, 2007