[*1]

Goldberg, Miller & Rubin P.C., New York (Eli Shmulik and Harlan R. Schreiber of counsel), for appellant.

The Rybak Firm PLLC, Brooklyn (Maksim Leyvi of counsel), for respondents.

Order, Supreme Court, New York County (Melissa A. Crane, J.), entered on or about November 1, 2019, which denied summary judgment on plaintiff’s first cause of action for a declaration disclaiming coverage for no-fault benefits sought by defendants-respondents Jules Francois Parisien, M.D. and SP Orthotic Surgical & Medical Supply, Inc., unanimously reversed, on the law, with costs, the motion granted, and it is declared that plaintiff has no coverage obligation for no-fault benefits sought by the defendants-respondents. The Clerk is directed to enter judgment accordingly.

Where, as here, the insurer submits evidence of a medical provider claim (NF-3), the timely request for an independent medical examination (IME) of the injured claimant within 15 days of the receipt of that claim, and the injured claimant is a no-show at two duly noticed IMEs, the basis for disclaimer of coverage is established, as a matter of law, and summary judgment is properly awarded to the insurer with respect to further coverage obligations and reimbursement of outstanding medical bills with respect to all treating providers (see Kemper Independence Ins. Co. v Adelaida Physical Therapy, P.C., 147 AD3d 437 [1st Dept 2017]; National Liab. & Fire Ins. Co. v Tam Med. Supply Corp., 131 AD3d 851 [1st Dept 2015]). Concur—Renwick, J.P., Kapnick, Gesmer, Kern, JJ.

Decided on November 20, 2020

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Glinkenhouse, Floumanhaft & Queen (Alan Queen of counsel), for appellant. Jaffe & Velazquez, LLP (Jean H. Kang of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Queens County (David M. Hawkins, J.), entered August 1, 2018. The order denied plaintiff’s motion to recalculate, from a simple rate to a compound rate, an award of statutory no-fault interest in a judgment of that court entered April 17, 2017 and, sua sponte, vacated the April 17, 2017 judgment.

ORDERED that so much of the appeal as is from the portion of the order as sua sponte vacated the April 17, 2017 judgment is dismissed; and it is further,

ORDERED that so much of the appeal as is from the portion of the order as denied plaintiff’s motion to recalculate, from a simple rate to a compound rate, an award of statutory no-fault interest in a judgment of that court entered April 17, 2017 is dismissed as moot.

This action by a provider to recover assigned first-party no-fault benefits for a claim for services rendered in 1999 was settled in 2008. Defendant did not pay the settlement amount, and a judgment was entered on April 17, 2017 (see CPLR 5003-a) awarding statutory no-fault interest at a simple rate (see 11 NYCRR 65-3.9 [a], effective April 5, 2002). Plaintiff moved, pursuant to CPLR 5019 (a), to have the interest recalculated at a compound rate (see former 11 NYCRR 65.15 [h] [1]). By order entered August 1, 2018, the Civil Court denied plaintiff’s motion and, sua sponte, vacated the April 17, 2017 judgment, finding that, because of plaintiff’s “delay” in entering judgment, plaintiff was not entitled to any prejudgment statutory no-fault interest (but see Seaside Rehabilitation v Allstate Ins. Co., 63 Misc 3d 162[A], 2019 NY Slip Op 50918[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]).

The portion of the order which vacated the April 17, 2017 judgment did not address a demand for relief made on notice and was, therefore, sua sponte. Thus, that portion of the order is not appealable as of right (see CCA 1702 [a] [2]; Sholes v Meagher, 100 NY2d 333 [2003]; [*2]Active Care Med. Supply Corp. v Delos Ins. Co., 55 Misc 3d 144[A], 2017 NY Slip Op 50650[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]), and we decline to grant leave to appeal. Plaintiff “could properly have moved to vacate the order and appealed as of right” to this court in the event that the motion was denied (Sholes, 100 NY2d at 335; see Active Care Med. Supply Corp., 55 Misc 3d 144[A], 2017 NY Slip Op 50650[U]; see also CCA 1702 [a] [3]), but the record before us does not indicate that plaintiff has made such a motion.

Since the April 17, 2017 judgment has been vacated, plaintiff’s motion to recalculate, from a simple rate to a compound rate, an award of statutory no-fault interest in that judgment is moot. We note, however, that claims submitted before April 5, 2002 are governed by the former regulations providing for compound interest (see Belt Parkway Imaging, P.C. v State Wide Ins. Co., 30 Misc 3d 127[A], 2010 NY Slip Op 52229[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2010]).

Accordingly, the appeal is dismissed.

ALIOTTA, P.J., ELLIOT and TOUSSAINT, JJ., concur.

156859/2019

Short & Billy, P.C., New York, NY (Christopher E. O’Donnell of counsel), for plaintiff.

Samandarov & Associates, P.C., Floral Park, NY (David M. Gottlieb of counsel), for defendant.

Plaintiff, American Transit Insurance Company, brought this action under Insurance Law § 5106 (c) to obtain a de novo adjudication of the entitlement to no-fault insurance benefits of defendant, Surgicore of Jersey City LLC. Surgicore moves to dismiss part of American Transit’s claim for benefits under CPLR 3211 (a) (2), arguing that this court lacks subject-matter jurisdiction over that aspect of the claim. The motion is denied.

BACKGROUND

In July 2017, Surgicore’s assignor, Jose Velazquez, was allegedly involved in a motor-vehicle collision. In October 2017, a Surgicore physician performed surgery on Velazquez’s right shoulder and right knee, allegedly to treat injuries suffered in the July 2017 collision. In [*2]preparation for the surgery, another Surgicore physician administered a nerve block to nerves in Velazquez’s right shoulder and arm.

Surgicore sought insurance reimbursement for the nerve block and the surgery. American Transit, concluding that these procedures were not medically necessary, denied reimbursement. Surgicore then brought two no-fault arbitration proceedings (one for the nerve block, one for the surgery) to challenge the denial of its reimbursement claim.

An arbitrator held a hearing at which Surgicore’s claims in the two proceedings were considered together. The arbitrator concluded, in very similar decisions issued the same day, that Surgicore failed to support adequately its lack-of-medical necessity defense as to either the nerve block or the surgery. The arbitrator therefore awarded the amounts claimed by Surgicore at the hearing—$517.89 for the nerve block and $25,962.93 for the surgery—plus interest and attorney fees. American Transit sought review of these decisions before a master arbitrator. The master arbitrator, in very similar decisions issued the same day, affirmed the arbitration awards in their entirety.

American Transit then brought this action, seeking a de novo adjudication under Insurance Law 5106 (c) of the award to Surgicore of $517.89 and $25,962.93 for the procedures performed on Velazquez. Surgicore moves to dismiss under CPLR 3211 (a) (2) and (a) (7).

DISCUSSION

Insurance Law § 5106 (c) provides that the award of a master arbitrator in a no-fault arbitration proceeding “shall be binding . . . provided . . . that where the amount of such master arbitrator’s award is five thousand dollars or greater, exclusive of interest and attorney’s fees, the insurer or the claimant may institute a court action to adjudicate the dispute de novo.”

Here, as a formal matter, there are two awards issued by the master arbitrator—one, for the pre-operative nerve block, plainly under the $5,000 threshold; and one, for the operation itself, plainly over the $5,000 threshold. Surgicore argues that this court lacks subject-matter jurisdiction over American Transit’s de novo challenge to the master arbitrator’s award of $517.89 (plus interest and fees) for the nerve block,^[FN1] and therefore that this aspect of American Transit’s action must be dismissed.^[FN2] This court is not persuaded by Surgicore’s argument.

To be sure, this court agrees with Surgicore that § 5106 (c)’s reference to a “master arbitrator’s award,” singular, must be given effect. A plaintiff may not, therefore, “aggregate[e] various [arbitral] awards in order to meet the statutory minimum” of $5,000.^[FN3] (Repwest Ins. Co. v Advantage Radiology, P.C., Index No. 156431/2012, 2013 WL 5924820, at *1 [Sup Ct, NY County Oct. 29, 2013].) That principle, though, is not sufficient to resolve this case.

It is undisputed that the two claims for reimbursement at issue here arose from treatments performed on one day on one patient-assignor by staff of one medical-provider assignee in connection with one operation. It is also undisputed that after American Transit denied the claims, Surgicore’s arbitral challenges to those denials were considered at the same hearing by one arbitrator and decided by that arbitrator on the same day for the same reasons; and that American Transit’s requests for review of those decisions were decided on the same day for the same reasons by one master arbitrator.

This court concludes that in these circumstances, the master arbitrator’s award of $517.89 for the pre-operation nerve block and of $25,962.93 for the operation itself are properly considered a single, unified “award” for purposes of the de-novo-challenge provision of Insurance Law § 5106 (c). Separating these two monetary awards for § 5106 purposes, merely because Surgicore chose to assert its two claims for reimbursement in separate arbitrations, would exalt form over substance to no purpose. And Surgicore provides no reason why they should be separated—instead simply taking it as given that they are separate.

Surgicore argues that several prior decisions issued by justices of this court demonstrate that Surgicore’s claims for reimbursement must be considered separately for purposes of § 5106 (c)’s $5,000 threshold. Those decisions, however, present a materially different factual scenario: they each involve multiple patients, multiple providers, or both.^[FN4] Those decisions are thus [*3]distinguishable because, unlike here, they do, in substance, involve multiple benefits awards rather than a single, unitary award.

Finally, Surgicore argues that this court should defer to the view expressed via email by a senior attorney at the Department of Financial Services that the language of § 5106 (c) “precludes the stacking or linking of awards in the first instance.” (NYSCEF No. 9 at 2, quoting NYSCEF No. 10, at 1.) Setting aside whether this email, standing alone, warrants deference, the email’s conclusion does not resolve the issue presented by this motion. The question posed to the DFS attorney was whether “an insurer is permitted to ‘consolidate’ arbitration awards” to meet the $5,000 statutory threshold. (NYSCEF No. 10 at 2.) Unsurprisingly, the DFS attorney’s response was that “stacking or linking of awards” to meet the statutory threshold is not permitted. (Id. at 1.) But that response does not address the key issue on this motion—whether the master arbitrator’s decisions here should be deemed to have made separate awards in the first place.

This court concludes that the master arbitrator’s decisions, properly understood, constituted a single arbitral award for purposes of the $5,000 threshold of Insurance Law § 5106 (c). The amount of that award, $26,480.52, exceeds the statutory threshold. American Transit’s de novo challenge to the award under § 5106 (c) therefore states a cause of action.

Accordingly, it is hereby

ORDERED that Surgicore’s motion to dismiss under CPLR 3211 is denied.

DATE 11/19/2020

Footnotes

Footnote 1:The $5,000 threshold imposed by Insurance Law § 5106 (c) is phrased in terms of when an insurer or claimant “may institute a court action” seeking de novo adjudication, rather than when Supreme Court or Civil Court may hear a de novo challenge. This threshold is thus perhaps better understood as a limit on the § 5106 cause of action rather than on the scope of the court’s subject-matter jurisdiction over § 5106 actions. The Appellate Division, First Department, has not had occasion to address this issue, however; and the Second Department has referenced it only in passing dicta. (See Avenue C. Med., P.C. v Encompass Ins. of MA, 130 AD3d 764, 764 [2d Dept 2015].) Although this distinction is not necessarily academic—a cause-of-action defense is waivable, for example, whereas a jurisdictional defense is not—it does not affect the resolution of the motion to dismiss in the current case.

Footnote 2:Surgicore’s motion papers are ambiguous as to whether it seeks dismissal only of American Transit’s de novo challenge to the $517.89 nerve-block award, or dismissal of the entire action. Since American Transit’s de novo challenge to the $25,962.93 surgery award plainly may be maintained in this court, this court construes Surgicore’s motion as addressed only to the challenge to the nerve-block award.

Footnote 3:American Transit argues, citing the Court of Appeals’ decision in Matter of Greenberg v Ryder Truck Rental, Inc. (70 NY2d 573 [1987]), that multiple awards can be challenged de novo in the same action as long as they are part of the same dispute between insurer and claimant (and the aggregate amount of those awards is over $5,000). (See NYSCEF No. 18 at 5-6.) But in Matter of Greenberg, the issue was limited to whether a de novo challenge asserted after the award of damages in a single, bifurcated arbitration proceeding also brought up for review the arbitrator’s liability determination made at the first stage of the bifurcated proceeding. The Court held that if the $5,000 threshold is satisfied, a de novo challenge encompasses both the arbitral award and the prior, predicate liability determination in the arbitration proceeding. (See 70 NY2d at 576-577.) That holding, though, did not resolve whether a de novo challenge to an award over $5,000 in one arbitral proceeding can also bring up for review awards made in other, related arbitral proceedings—as opposed to determinations made at an earlier stage of the same proceeding.

Footnote 4:See NYSCEF No. 9 at 3, citing Imperium Ins. Co. v Innovative Chiropractic Servs., P.C. (2014 NY Slip Op 50697[U] [App Term 2014]); Decision & Order, Hereford Ins. Co. v Iconic Wellness Surgical Servs., LLC, Index No. 157166/2018, NYSCEF No. 35 (Jan. 29, 2019). See also NYSCEF No. 22 at 1, citing Decision & Order, American Transit Ins. Co v Health Plus Surgery Ctr., LLC, Index No. 156988/2019, NYSCEF No. 18 (Feb. 7, 2020). Accord Decision & Order, American Transit Ins. Co. v HealthPlus Surgery Ctr., LLC, Index No. 155561/2019, NYSCEF Nos. 21, 24 (Mar. 2, 2020) (multiple providers); Repwest, 2013 WL 5924820, at *1 (addressing claims for benefits assigned by “nine parties injured in three separate automobile accidents”).

[*1]

The Law Office of Jason Tenenbaum, P.C., Garden City (Jason Tenenbaum of counsel), for appellant.

Samandarov & Associates, P.C., Floral Park (David M. Gottlieb of counsel), for respondents.

Order, Supreme Court, Bronx County (Alison Y. Tuitt, J.), entered January 15, 2020, which denied the petition to vacate a master arbitration award, dated June 17, 2019, affirming the no-fault arbitrator’s award of no-fault benefits to respondents, and dismissed the proceeding brought pursuant to CPLR article 75, unanimously affirmed, without costs, and the matter remanded to Supreme Court for a determination of respondents’ reasonable attorneys’ fees for this appeal.

The no-fault arbitrator found that petitioner’s vague and conclusory explanation that the denial was based on an independent medical examination which did not support reimbursement, without providing any of the examination’s findings, or checking boxes on the NF-10 form to indicate that the denial was based on a lack of medical necessity, was insufficient. The master arbitrator reviewed the no-fault arbitrator’s determination and the parties’ submissions, and confirmed the no-fault arbitrator’s award of benefits to respondent assignees. Supreme Court, reviewing the findings of the master and no-fault arbitrators, correctly found that the award was rational, and was not arbitrary and capricious (see Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207, 211 [1981]; Matter of Rose Castle Redevelopment II, LLC v Franklin Realty Corp., 184 AD3d 230, 234 [1st Dept 2020]; Azrielant v Azrielant, 301 AD2d 269, 275 [1st Dept 2002], lv denied 99 NY2d 509 [2003]). Petitioner’s vague declination of benefits lacked the degree of specificity required by statute and case law, which provide that insurers must clearly inform applicants of their position regarding disputed matters by “appris[ing] the claimant with a high degree of specificity of the ground or grounds on which the disclaimer is predicated” (General Acc. Ins. Group v Cirucci, 46 NY2d 862, 864 [1979]; see 11 NYCRR 65-3.2 [e]). Respondents are entitled to reasonable attorneys’ fees for this appeal, to be determined by Supreme Court (see Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C., 167 AD3d 404 [1st Dept 2018]; 11 NYCRR 65-4.10 [j] [4]). Concur—Webber, J.P., González, Scarpulla, Shulman, JJ.

Decided on November 13, 2020

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Decided on November 13, 2020

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Decided on November 13, 2020

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Decided on November 13, 2020

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Goldberg, Miller and Rubin, P.C. (Timothy R. Bishop of counsel), for appellant. The Rybak Firm, PLLC (Damin J. Toell of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Sharon Bourne-Clarke, J.), entered November 8, 2018, deemed from a judgment of that court entered December 19, 2018 (see CPLR 5501 [c]). The judgment, entered pursuant to the November 8, 2018 order denying defendant’s motion for summary judgment dismissing the complaint and granting plaintiff’s cross motion for summary judgment, awarded plaintiff the principal sum of $4,183.05.

ORDERED that the judgment is reversed, with $30 costs, the order dated November 8, 2018 is vacated, defendant’s motion for summary judgment dismissing the complaint is granted and plaintiff’s cross motion is denied.

In this action by a provider to recover assigned first-party no-fault benefits, defendant appeals from an order of the Civil Court denying defendant’s motion which had sought summary judgment dismissing the complaint on the ground that defendant had established that there was no coverage for no-fault benefits since defendant had not issued an automobile insurance policy which would cover the underlying accident, and granting plaintiff’s cross motion for summary judgment. A judgment was subsequently entered on December 19, 2018, from which the appeal is deemed to have been taken (see CPLR 5501 [c]).

“[A] lack of coverage defense may be raised without regard to any issue as to the [*2]propriety or timeliness of an insurer’s denial of claim form (see Zappone v Home Ins. Co., 55 NY2d 131, 135-136 [1982] [lack of coverage defense is not precluded]; see also Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]). The papers submitted by defendant in support of its [ ] motion were sufficient to establish that the policy being sued upon was a workers’ compensation insurance policy which did not cover plaintiff’s claim to receive reimbursement of assigned first-party no-fault benefits. As plaintiff failed to demonstrate the existence of an applicable automobile insurance policy issued by defendant or to otherwise raise a triable issue of fact, [defendant’s motion for summary judgment should have been granted]” (Ultimate Health Prods., Inc. v Hereford Ins. Co., 51 Misc 3d 127[A], 2016 NY Slip Op 50367[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]; Flatbush Chiropractic, P.C. v Hereford Ins. Co., 49 Misc 3d 149[A], 2015 NY Slip Op 51712[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2015]).

Accordingly, the judgment is reversed, the order dated November 8, 2018 is vacated, defendant’s motion for summary judgment dismissing the complaint is granted and plaintiff’s cross motion is denied.

ALIOTTA, P.J., ELLIOT and SIEGAL, JJ., concur.