—[*1] Thomas Torto, New York, for appellant.

Ruskin Moscou Faltischek, P.C., Uniondale (Matthew F. Didora of counsel), for respondent.

Order, Supreme Court, New York County (Marylin G. Diamond, J.), entered November 30, 2010, which denied the petition to stay arbitration of claims for no-fault insurance benefits and granted respondent’s cross motion to dismiss the proceeding, unanimously affirmed, with costs.

Petitioner argues that respondent is a fraudulently incorporated medical services provider and therefore is not only ineligible for reimbursement of no-fault payments (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]) but is also precluded from demanding arbitration pursuant to Insurance Law § 5106 (b) (and the no-fault policy issued by petitioner). Contrary to this argument, the defense of fraudulent incorporation is “for the arbitrator and not for the courts” (see Matter of Nassau Ins. Co. v McMorris, 41 NY2d 701, 701 [1977]; Matter of MVAIC v Interboro Med. Care & Diagnostic PC, 73 AD3d 667 [2010]). Indeed, it has been the subject of numerous arbitration proceedings (see e.g. State Farm Mut. Auto. Ins. Co. v Kissena Med. Imaging, P.C., 25 Misc 3d 1214[A], 2009 NY Slip Op 52094[U] [2009]; Uptodate Med. Serv., P.C. v State Farm Mut. Auto. Ins. Co., 22 Misc 3d 128[A], 2009 NY Slip Op 50046[U], *2 [2009]).

We have considered plaintiff’s remaining contentions and find them unavailing. Concur—Andrias, J.P., Sweeny, Renwick, Freedman and Manzanet-Daniels, JJ.

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 (Lisa S. Ottley, J.), entered July 17, 2009. The order, insofar as appealed from, granted the branches of defendant’s motion seeking summary judgment dismissing the complaint as to claims totaling $1,092.93 for services rendered November 23, 2005 through December 7, 2005.

ORDERED that the order, insofar as appealed from, is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, defendant moved for summary judgment dismissing the complaint on the ground that plaintiff had failed to appear at scheduled examinations under oath (EUOs). The Civil Court granted the motion to the extent of dismissing claims totaling $1,092.93 for services rendered November 23, 2005 through December 7, 2005, and plaintiff appeals.

A review of the record indicates that defendant’s motion papers were sufficient to establish that the letters scheduling the EUOs had been timely mailed in accordance with the standard office practices and procedures of the law firm retained by defendant to conduct the EUOs and that the claim denial form, which denied the claims in question on the ground of failure to appear for EUOs, had been timely mailed in accordance with defendant’s standard office practices and procedures (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16, [App Term, 2d & 11th Jud Dists 2007]). Defendant also demonstrated that plaintiff had failed to appear for the EUOs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]; W & Z Acupuncture, P.C. v Amex Assur. Co., 24 Misc 3d 142[A], 2009 NY Slip Op 51732[U] [App Term, 2d, 11th & 13th Jud Dists 2009]). Since the appearance of [*2]an eligible injured person’s assignee at an EUO upon a proper request is a condition precedent to the assignee’s right to recover under the policy (see Insurance Department Regulations [11 NYCRR] § 65-1.1; Stephen Fogel Psychological, P.C., 35 AD3d at 722; W & Z Acupuncture, P.C., 24 Misc 3d 142[A], 2009 NY Slip Op 51732[U]), defendant was entitled to summary judgment dismissing the claims in question.

Plaintiff’s remaining contentions either lack merit or are improperly raised for the first time on appeal (see Gulf Ins. Co. v Kanen, 13 AD3d 579 [2004]). Accordingly, the order, insofar as appealed from, is affirmed.

Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: July 05, 2011

SUPREME COURT OF THE STATE OF NEW YORK

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

Appeal from an order of the Civil Court of the City of New York, Queens County (Diane A. Lebedeff, J.), entered June 4, 2009. The order, insofar as appealed from, denied plaintiff’s motion for summary judgment.

ORDERED that the order, insofar as appealed from, is affirmed, without costs. In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from so much of an order as denied its motion for summary judgment.

A no-fault provider establishes its prima facie entitlement to summary judgment by proof of the submission to the defendant of a claim form, proof of the fact and the amount of the loss sustained, and proof either that the defendant had failed to pay or deny the claim within the requisite 30-day period, or that the defendant had issued a timely denial of claim that was conclusory, vague or without merit as a matter of law (see Insurance Law § 5106 [a]; Westchester Med. Ctr. v Nationwide Mut. Ins. Co., 78 AD3d 1168 [2010]; see also New York & Presbyt. Hosp. v Allstate Ins. Co., 31 AD3d 512 [2006]). Here, while plaintiff demonstrated that the claims were not paid, it failed to demonstrate either that defendant had failed to deny the claim or that defendant had issued a legally insufficient denial of claim form. Accordingly, the order, insofar as appealed from, is affirmed.

Steinhardt, J.P., Pesce and Weston, JJ., concur.
Decision Date: July 05, 2011

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.), entered September 24, 2009. The order denied defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order is reversed, without costs, and defendant’s motion for summary judgment dismissing the complaint is granted.

In this action by a provider to recover assigned first-party no-fault benefits, the Civil Court denied defendant’s motion for summary judgment dismissing the complaint. The court found, with respect to plaintiff’s second cause of action, that defendant had failed to timely deny the claim at issue on the ground that the assignor had failed to appear for scheduled independent medical examinations (IMEs) and, with respect to plaintiff’s first and third causes of action, that the peer review reports submitted by defendant in support of its defense of lack of medical necessity were not, pursuant to CPLR 2106, in admissible form.

With respect to plaintiff’s first and third causes of action, the affidavit submitted by defendant in support of its motion for summary judgment established that defendant had timely denied the claims at issue, on the ground of lack of medical necessity, in accordance with defendant’s standard office practices and procedures (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]). Moreover, defendant annexed to its motion papers affirmed peer review reports which set forth a factual basis and medical rationale for the peer reviewers’ determinations that there was a lack of medical necessity [*2]for the services rendered (see e.g. Delta Diagnostic Radiology, P.C. v Integon Natl. Ins. Co., 24 Misc 3d 136[A], 2009 NY Slip Op 51502[U] [App Term, 2d, 11th & 13th Jud Dists 2009]; Delta Diagnostic Radiology, P.C. v American Tr. Ins. Co., 18 Misc 3d 128[A], 2007 NY Slip Op 52455[U] [App Term, 2d & 11th Jud Dists 2007]; A. Khodadadi Radiology, P.C. v NY Cent. Mut. Fire Ins. Co., 16 Misc 3d 131[A], 2007 NY Slip Op 51342[U] [App Term, 2d & 11th Jud Dists 2007]). Consequently, defendant established its prima facie entitlement to summary judgment upon these causes of action.

In opposition to the motion, plaintiff failed to raise a triable issue of fact with respect to the first and third causes of action since plaintiff failed to submit an affirmation from a doctor rebutting the conclusions set forth in the peer review reports (see Innovative Chiropractic, P.C. v Mercury Ins. Co., 25 Misc 3d 137[A], 2009 NY Slip Op 52321[U] [App Term, 2d, 11th & 13th Jud Dists 2009]; Pan Chiropractic, P.C. v Mercury Ins. Co., 24 Misc 3d 136[A], 2009 NY Slip Op 51495[U] [App Term, 2d, 11th & 13th Jud Dists 2009]). While plaintiff asserted that Dr. Schechter’s peer review report contained a stamped signature and, as a result, the peer review report was inadmissible, that assertion, without any indication as to why plaintiff believed that the signature was a stamped facsimile signature, was insufficient to raise an issue of fact (see Ortho-Med Surgical Supply, Inc. v Mercury Cas. Co., 27 Misc 3d 128[A], 2010 NY Slip Op 50587[U] [App Term, 2d, 11th & 13th Jud Dists 2010]; Eden Med., P.C. v Eveready Ins. Co., 26 Misc 3d 140[A], 2010 NY Slip Op 50265[U] [App Term, 2d, 11th & 13th Jud Dists 2010]). Thus, the branches of defendant’s motion seeking summary judgment dismissing plaintiff’s first and third causes of action should have been granted.

With respect to plaintiff’s second cause of action, defendant established that it had timely denied the claim at issue on the ground that the assignor had failed to appear at scheduled IMEs, by submitting an affidavit from an employee of Transcion Corporation, which was hired by defendant to schedule the IMEs. That affidavit sufficiently established that the IME notices were sent to the assignor on April 16, 2008 and May 9, 2008 in accordance with Transcion Corporation’s standard office practices and procedures (see St. Vincent’s Hosp. of Richmond, 50 AD3d 1123; Delta Diagnostic Radiology, P.C., 17 Misc 3d 16). Defendant also submitted an affidavit of the doctor who was to perform the IMEs to establish that the assignor had failed to appear for the duly scheduled IMEs on May 8, 2008 and May 22, 2008 (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). Since the appearance of the assignor at an IME was a “condition precedent to the insurer’s liability on the policy” (Stephen Fogel Psychological, P.C., 35 AD3d at 722; Insurance Department Regulations [11 NYCRR] § 65-1.1), defendant was entitled to summary judgment dismissing plaintiff’s second cause of action.

Accordingly, the Civil Court’s order denying defendant’s motion for summary judgment is reversed and defendant’s motion for summary judgment dismissing the complaint is granted.

Pesce, P.J., Rios and Steinhardt, JJ., concur. [*3]
Decision Date: June 30, 2011

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 (Robin S. Garson, J.), entered June 11, 2009. The order denied defendant’s motion for summary judgment dismissing the complaint.

ORDERED that the order is modified by providing that the branches of defendant’s motion seeking summary judgment dismissing the claims for the sums of $180 (dates of service July 6, 2006 – July 10, 2006), $180 (dates of service July 18, 2006 – July 31, 2006), $360 (dates of service August 4, 2006 – August 31, 2006), $180 (dates of service September 5, 2006 – September 25, 2006), and $270 (dates of service October 12, 2006 – October 23, 2006) are granted; as so modified, the order is affirmed, without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff seeks to recover for acupuncture services rendered to its assignor. Plaintiff billed defendant at $90 per session. Defendant paid for some of the sessions, but at a reduced rate per session, and partially denied the claims for these sessions as to the unpaid portion, basing its determination of the appropriate amount of reimbursement upon the workers’ compensation fee schedule for acupuncture services performed by chiropractors. Reimbursement for other sessions was entirely denied due to plaintiff’s assignor’s failure to attend scheduled independent medical examinations (IMEs). Defendant moved for summary judgment dismissing the complaint, contending that it was entitled to summary judgment with respect to those bills or portions of bills for which it had denied reimbursement based upon plaintiff’s assignor’s failure to attend scheduled IMEs and for which it had reduced reimbursement based upon the fee schedules. The Civil Court denied defendant’s unopposed motion on the ground that the motion presented “issues of credibility [*2]which the court cannot resolve on a motion for summary judgment,” and stated that the supporting exhibits themselves raised triable issues of fact. This appeal ensued.

A review of the record indicates that defendant’s motion papers were sufficient to establish that the letters scheduling the IMEs and that the claim denial forms had been timely mailed in accordance with defendant’s standard office practices and procedures (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]). Defendant also established that plaintiff’s assignor had failed to attend scheduled IMEs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). Since the appearance of plaintiff’s assignor at the IMEs was a “condition precedent to the insurer’s liability on the policy” (Stephen Fogel Psychological, P.C., 35 AD3d at 722; see Insurance Department Regulations [11 NYCRR] § 65-1.1), defendant was entitled to summary judgment dismissing the complaint with regard to those claims which it had denied on that basis “retroactively to the date of loss” (id.), i.e., so much of the bill dated August 14, 2006 as sought to recover the sum of $180 (dates of service July 6, 2006 – July 10, 2006), $180 (dates of service July 18, 2006 – July 31, 2006), $360 (dates of service August 4, 2006 – August 31, 2006), $180 (dates of service September 5, 2006 – September 25, 2006), and $270 (dates of service October 12, 2006 – October 23, 2006).

With respect to the unpaid portions of the remaining bills which defendant claims were timely denied based upon the fee schedules, the letters from defendant to plaintiff which were annexed to defendant’s motion papers and which advised plaintiff that the processing of its bills was being delayed pending an examination under oath were insufficient to toll the 30-day period within which defendant was required to pay or deny those bills (see Insurance Law § 5106 [a]; Insurance Department Regulations [11 NYCRR] § 65-3.5 [a]; see also Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 60 AD3d 1045 [2009]). Accordingly, defendant was not entitled to summary judgment with respect to those bills, albeit for a reason other than that stated by the Civil Court.

Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: June 30, 2011

Supreme Court, Queens County

13330/09

Janice A. Taylor, J.

This is an action seeking disability benefits for the plaintiff under an insurance policy between himself and the defendant. In his complaint, plaintiff asserts that he was injured on December 14, 2005 when he was involved in a motor vehicle accident on Van Siclen Street at or near its intersection with Avenue S in the County of Kings, City and State of New York. At the time of the accident, plaintiff worked as a driver for Fed Ex Home Delivery (“Fed Ex”). Plaintiff first applied for disability benefits from the defendant under his no-fault policy. In October, 2006, plaintiff was deemed totally disabled by Fed Ex’ physicians. Following the expiration of this no-fault benefits, plaintiff applied for payment from the defendant under his secondary disability policy. It is uncontested that defendant denied [*2]plaintiff’s claim for disability benefits. This action was commenced on May 21, 2009 by the filing of a summons and complaint.

By order dated January 10, 2011, this court denied defendant’s motion for summary judgment due to defendant’s failure to include a signed certification, pursuant to Court Rule 130-1.1(a) with its motion. Defendant Protective Insurance Company (“Protective”) now moves, pursuant to CPLR §2221, for leave to renew its prior motion for summary judgment. As the movant has now included the required certification, the instant motion to renew is granted.

Upon renewal, this court will first consider defendant Protective’s motion seeking an order, pursuant to CPLR §3025, for leave to amend its answer to include the affirmative defense of statute of limitations. It is well-settled that “a party may amend [its] pleading * * * at any time by leave of court” and that “[l]eave shall be freely given upon such terms as may be just.” (CPLR §3025 [b]; Fahey v. County of Ontario, 44 NY2d 934, 935 [1978]; Hempstead Concrete Corp. v. Elite Assocs., 203 AD2d 521, 523[2d Dept. 1994]). Allowing such an amendment is committed “almost entirely to the court’s discretion to be determined on a sui generis basis.” (See, Leitner v. Jasa Hous. Mgmt. Servs. for the Aged, Inc., 6 AD3d 667 [2d Dept. 2004]; Zeide v. National Cas. Co., 187 AD2d 576 [2d Dept. 1992]; Corsale v. Pantry Pride Supermarkets, 197 AD2d 659, 660 [2d Dept. 1993]; Hickey v. Hudson, 182 AD2d 801, 802 [2d Dept. 1992]). Where, as here, the opposing party fails to make a showing of operative prejudice; i.e., prejudice attributable to the mere omission to plead the defense in the original answer, the amendment may be allowed “during or even after trial” (Murray v. City of New York, 43 NY2d 400, 405 [1977], citing Dittmar Explosives v. A.E. Ottaviano, Inc., 20 NY2d 498, 502 [1967]; see, Breco Envtl. Contrs., Inc. v. Town of Smithtown, 307 AD2d 330 [2d Dept. 2003]; Grall v. Ba Mar, Inc., 233 AD2d 368 [2d Dept. 1996]). As the plaintiff has failed to prove, or to even assert, that he would be prejudiced by the proposed amendment, defendant Protective’s motion, pursuant to CPLR §3025, is granted. The supplemental summons and amended complaint annexed to the instant motion is deemed timely served.

Upon amendment of its answer and the inclusion of the affirmative defense of statute of limitations, defendant Protective now moves, pursuant to CPLR §3212, for an order granting summary judgment and dismissing the complaint. It is well-settled that the proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issues of fact from the case (See,Zuckerman v. City of New York, 49 NY2d 557, 562 [1980]; Sillman v. Twentieth Century-Fox Film Corp., 3 NY2d 395, 404 [1957]). Failure to make such a showing necessitates denial of the motion.

CPLR §3212(b) requires that for a court to grant summary judgment it must determine if the movant’s papers justify holding, as a matter of law, “that the cause of action or defense has no merit.” The evidence submitted in support of the movant must be viewed in the light most favorable to the non-movant (see, Grivas v. Grivas, 113 AD2d 264, 269 [2d Dept. 1985]; Airco Alloys Division, Airco Inc. v. Niagara Mohawk Power Corp., 76 [*3]AD2d 68 [4th Dept. 1980]; Parvi v. Kingston, 41 NY2d 553, 557 [1977].

Defendant Protective asserts that the instant complaint must be dismissed based on documentary evidence, pursuant to CPLR §3211(a)(1),(5), because the plaintiff has failed to commence this action within the contractual time period. A complaint which is facially sufficient may be dismissed if there exists documentary evidence which conclusively contradicts the claims (See, Smuckler v. Mercy College, et al, 244 AD2d 349 [2d Dept. 1997]). In support of its motion, defendant Protective submits, inter alia, the pleadings, the prior motion and responsive papers, a certified copy of the subject insurance policy, its proposed amended answer and a copy of the Note of Issue filed on April 5, 2010.

A review of the subject insurance policy reveals that, paragraph 11 of the General Provisions states:

“Written proof of loss must be furnished to us within ninety (90) days after the date of loss for which claim is made.”

Paragraph 13 thereof states:

“No lawsuit may be brought to recover on the Group Master Policy within sixty (60) days after written proof of loss has been given as required by this policy. No such lawsuit may be brought after two (2) years from the time written proof of loss is required to be given.

The movant asserts that, pursuant to the subject insurance policy, plaintiff was required to submit written proof of loss by March 14, 2006 and to commence a lawsuit by March 14, 2008. As aforestated, this action was commenced on May 21, 2009, more than fourteen (14) months after the expiration of the contractual time period.

In opposition to the instant motion, plaintiff does not dispute that the contractual time-period is two years, ninety days from the date of his accident, nor does plaintiff dispute that he failed to commence this action within the contractual time period. Instead, plaintiff asserts that the statute of limitations provision of the subject insurance policy is unconscionable and must be voided by this court.

It is well-settled that the determination of whether a contract, or a provision thereof, is unconscionable is a matter of law reserved for the court (See, Wilson Trading Corp. V. David Ferguson, Ltd., 23 NY2d 398 [1968]). For a court to determine that a contract, or a contractual provision, is unconscionable, a court must determine that the agreement is so one-sided that it “shocks the conscience such that no person in his or her right mind would make it on the one hand, and no honest and fair person would accept it on the other” (Kojovic v. Goldman, 35 AD3d 65, 823 N.Y.S.2d 35 [1st Dept. 2006] citing Christian v. Christian, 42 NY2d 63, 365 N.E.2d 849, 396 N.Y.S.2d 817 [1977]). [*4]

A finding of unconscionability usually requires both a showing that the contract was procedurally and substantively unconscionable when made (emphasis added) (See, Gillman v. Chase Manhattan Bank, N.A., 73 NY2d 1, 534 N.E.2d 824, 537 N.Y.S.2d 787 [1988]). A contract is procedurally unconscionable when one of the parties lacked a meaningful choice in its execution. Misrepresentation of facts, high pressure sales tactics and unequal bargaining position have each been found to be examples of elements of a procedurally unconscionable contract (See, Matter of Friedman, 64 AD2d 70, 407 N.Y.S.2d 999 [2nd Dept 1978]). A contract is substantively unconscionable when the terms of the contract are unreasonably favorable to the other party (Gillman, supra). Examples of elements of substantive unconscionability include contracts that contain inflated prices, unfair disclaimers of warranty and termination clauses (See, Matter of Friedman, supra). While a determination of unconscionability generally requires a court to find elements of both procedural and substantive unconscionability, a contract, or provision thereof, that is deemed to be outrageous on grounds of substantive unconscionability alone can also be stricken by the court (See, Gillman, supra; State of New York v. Wolowitz, 96 AD2d 47[1983]).

In ruling whether a contract is procedurally unconscionable, a court may consider several factors such as the professional experience of the parties, the level of negotiations that occurred during the formation of the contract and the equality of the bargaining positions of the parties (See, Industralease Automated and Scientific Equipment Corporation v. R.M.E. Enterprises, Inc., et al, 58 Ad2d 482 [2d Dept. 1977]). In the instant action, it is uncontested that plaintiff is neither an attorney nor an experienced insurance professional; and that the subject insurance policy was a part of a pre-negotiated package of benefits he received through his employment with Fed Ex. Neither party asserts that plaintiff actually signed the subject insurance policy and affirmatively agreed to its terms.

In considering plaintiff’s allegation of procedural unconscionability of the terms of the subject policy, this court must take into account plaintiff’s lack of bargaining power in the formation of the agreement, whether each party had a reasonable opportunity to understand the terms of the contract (See, Gillman, supra). It is clear that plaintiff is neither a legal nor an insurance professional and that he had no opportunity to negotiate any of the terms of the subject policy. Thus, this court finds that, due to the overwhelmingly unequal bargaining power of the parties in the formation of the contract, the disputed contractual statute of limitations contained within the subject policy is procedurally unconscionable.

This court must also determine if the contractual statute of limitations is substantively unconscionable. In actions for breach of contract, the cause of action accrues, and the statute of limitations begins, from the time of the breach (See, McCoy v. Feinman, 99 NY2d 295 [2002]; Fourth Ocean Putnam Corp. v. Interstate Wrecking Company, 66 NY2d 38 [1985]; John J. Kasner & Co. v. City of New York, 46 NY2d 544 [1979]; Mainline Electric Corp. v. East Quogue Union Free School District, 46 AD3d 859 [2d Dept. 2007]; Henry Boeckmann, Jr. and Associates v. Board of Education, Hempstead [*5]Union Free School District No. 1. et al., 207 Ad2d 773 [2d Dept. 1994]).

Pursuant to the terms of subject policy, the defendant had no obligation to pay under plaintiff’s secondary disability policy until after the March 1, 2008 expiration of the three-year no-fault benefit period. Until plaintiff actually demanded payment from the defendant and said demand was refused, plaintiff had no cause of action against the defendant for breach of contract. However, the terms of the subject policy require plaintiff to commence an action within two years, ninety days of the underlying accident, before the expiration of the no-fault benefit period. Thus, contrary to established New York law, the subject insurance policy requires plaintiff’s contractual statute of limitations to begin to run before he had an enforceable cause of action (See, McCoy, supra; Fourth Ocean Putnam Corp., supra; Mainline Electric Corp., supra).

An examination of the facts as alleged by the parties reveals that, after the expiration of his no-fault benefits, plaintiff had less than two weeks to demand payment from the defendant, for that demand to be refused and for the plaintiff to commence an action for breach of contract. Following a demand from the plaintiff, it was the defendant who controlled when it would pay, or refuse to pay under this disability policy. Thus, the subject insurance policy gave defendant the opportunity to delay its refusal to pay until after the expiration of the contractual statute of limitations. Additionally, if, by the March 14, 2008 expiration of the contractual statute of limitations, plaintiff had not yet demanded payment and said demand had not yet been rejected by the defendant, plaintiff’s contractual time to commence a lawsuit would have expired before the defendant ever breached its contractual obligations. Moreover, even if the refusal to pay were ultimately determined to be a breach of contract, the terms of the contractual statute of limitations would have eliminated the possibility that the defendant could be sued for the breach. Thus, this court finds that the disputed contractual statute of limitations is so unreasonably favorable to the defendant that said provision is substantively unconscionable.

In Day Op of North Nassau, Inc. d/b/a Ambulatory Surgery of North Nassau v. Viola, the Supreme Court of New York, Nassau County found that a contractual term was unconscionable where it allowed a defendant to benefit from its own breach (See, Day Op of North Nassau, Inc. d/b/a Ambulatory Surgery of North Nassau v. Viola, 2007 NY Slip Op. 51542U [Supreme Court, Nassau County, 2007]). Citing definitions and examples of unconscionability set forth in Gillman v. Chase Manhattan Bank, N.A. and State of New York v. Wolowitz, the Honorable Ira B. Warshawsky, J.S.C. ruled that a term of a shareholders’ agreement which eliminated the shareholder’s right to contest the forced sale of her shares, even if the sale resulted from the wrongful breach of contract by the corporation, was oppressive, unjust and unconscionable (See, Day Op of North Nassau, Inc. d/b/a Ambulatory Surgery of North Nassau, supra; Gillman v. Chase Manhattan Bank, N.A., supra, State of New York v. Wolowitz, supra). While the decision of the Supreme Court, Nassau County is not binding on the undersigned, this court similarly finds that, pursuant to the rules of law set forth by both the New York Court of Appeals and the Supreme Court, Appellate Divisions, the contractual statute of limitations of the subject [*6]insurance policy is both procedurally and substantively unconscionable. Where a contract, or a provision thereof, has been deemed unconscionable, it may be voided by this court (See, generally, King v. Fox, 7 NY3d 181 [2006]). Thus, the contractual statute of limitations will not be enforced by this court. Accordingly, that portion of the defendant’s motion which seeks summary judgment and dismissal of the complaint, pursuant to CPLR §3212, §3211(a)(1),(5) is denied.

Defendant also moves, pursuant to CPLR §3212, §3211(a)(7), for summary judgment and dismissal of the complaint for plaintiff’s failure to state a cause of action. A motion to dismiss made pursuant to CPLR §3211(a)(7), can only be granted if, from the pleadings’ four corners, factual allegations are not discerned which manifest any cause of action cognizable at law. In furtherance of this task, the court liberally construes the complaint, accepts as true the facts alleged in the complaint and any submissions in opposition to the dismissal motion, and accords the plaintiff the benefit of every possible favorable inference (See, 511 W. 232nd Owners Corp. v. Jennifer Realty Co., 98 NY2d 144 [2002]).

In support of its motion, defendant asserts that the complaint must be dismissed because plaintiff does not yet have a ripe cause of action. Paragraph four of the General Provisions of the subject policy states:

Subrogation: We shall be subrogated to any and all rights of recovery which and Covered Person may have or acquire against any party or the insurer of any party for benefits paid or payable under the Group Master Policy. Any Covered Person who receives benefits from us for any accidental injury or death therefrom shall be deemed to have assigned their right of recovery for such benefits to us and agree to do what is necessary to secure such recovery, including execution of all appropriate papers to cause repayment to us. If the third party pays a Covered Person as a result of judgment, arbitration, compromise settlement or other arrangement for injuries sustained by the Covered Person for which benefits were paid under the Group Master Policy, the Covered Person agrees to repay us for all benefits paid. Cost of collection including attorney’s fees and court costs shall be shared pro rata between the Covered Person and us.

In addition, if benefits are payable to a Covered Person under the Group Master Policy after a third party pays the Covered Person, we will take credit for all amounts received by the Covered Person, less amounts paid to us, against all future payments under the Group Master Policy. No amount shall be owed by us until the amount of benefits we would have paid on behalf of or to the Covered Person exceeds the amount received by the Covered Person from a third party.

In support of its motion, defendant asserts that plaintiff has been adjudicated to be partially disabled. The maximum amount of payment under the policy is $750.00 per month. It is uncontested that plaintiff commenced and settled a lawsuit related to this action, in March 2008, with a third-party for the sum of $21,436.00. Under the subrogation [*7]clause of the subject policy, defendant asserts it will take plaintiff 36 months, at $750.00 per month, to run off the credit from the settlement before the defendant must pay plaintiff’s disability claims. In opposition, plaintiff asserts that he was deemed to be totally disabled by a physician employed by Fed Ex Delivery and that his settlement was for pain and suffering, not for the lost wages that he claims under this policy. Thus, plaintiff asserts that the subrogation clause does not apply and that his action is ripe.

Thus, when this court accepts as true plaintiff’s version of the facts, as required by CPLR §3211(a)(7), it is clear that plaintiff has properly alleged a cognizable cause of action. Accordingly, defendant’s motion to dismiss for plaintiff’s failure to state a cause of action is denied.

Dated: June 29, 2011

JANICE A. TAYLOR, J.S.C.