SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the Civil Court, Kings County

(D. Kurtz, J.), entered on September 25, 2002, which denied its motion for summary judgment.

Order unanimously modified by providing that plaintiff’s motion for summary judgment is granted to the extent of awarding plaintiff partial summary judgment in the principal sum of $10,002.86 and by remanding the matter to the
court below for further proceedings in accordance with the decision herein; as so modified, affirmed without costs.

Plaintiff sues to recover the sum of $13,573.32 representing first-party no-fault benefits for medical supplies it provided to the injured assignors. In our opinion, plaintiff’s motion for summary judgment should have been granted to the extent of awarding plaintiff partial summary judgment in the sum of $10,002.86, representing those claims which were not denied by defendant until more than 30 days after plaintiff had submitted them (11 NYCRR 65.15 [g] [3]) since, as to said claims, the insurer is precluded from raising the proffered defenses [*2](Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274; Amaze Med. Supply Inc. v Eagle Ins. Co., NYLJ, Dec. 29, 2003 [App Term, 2d & 11th Jud Dists]). Inasmuch as plaintiff has established a prima facie case, it was entitled to partial summary judgment with respect thereto (see Amaze Med. Supply Inc. v Eagle Ins. Co., supra) including statutory interest and attorney’s fees (see St. Clare’s Hosp. v Allstate Ins. Co., 215 AD2d 641). The matter is accordingly remanded to the court below for a calculation of such interest and attorney’s fees (see Insurance Law § 5106 [a]; former 11 NYCRR 65.15 [h] [1];
65.17 [b] [6]).

However, plaintiff’s motion for summary judgment was properly denied as to the remaining claims which defendant had timely denied in accordance with the
Insurance Regulations. Insurance Regulation 11 NYCRR 68, Appendix 17-C, Part E (b) (1) provides:

“(b)(1) For medical equipment and supplies (e.g. TENS units, soft cervical collars) provided by a physician or medical equipment supplier, the maximum permissible charge is 150% of the documented cost of the equipment to the provider.”

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the Civil Court, Kings County (A. Schack, J.), entered October 7, 2002, denying its motion for summary judgment.

Order unanimously modified by providing that plaintiff’s motion for summary judgment is granted to the extent of awarding it partial summary judgment in the sum of $1,347.50, and matter remanded to the court below for a calculation of statutory interest and an assessment of
attorney’s fees, and for all further proceedings on the remaining portion of the claim in accordance with the decision herein; as so modified, affirmed without costs.

For the reasons set forth in Amaze Med. Supply Inc. v Eagle Ins. Co. (NYLJ, Dec. 29, 2003 [App Term, 2d & 11th Jud Dists]), plaintiff established a prima facie case by its properly submitted proof of claim (e.g. Damadian MRI in Elmhurst, P.C. v Liberty Mut. Ins. Co., NYLJ, Dec. 29, 2003 [App Term, 9th & 10th Jud Dists]). Lack of medical necessity is a defense to an action to recover no-fault benefits, which an insurer may assert pursuant to a timely denial, based on a medical examination or a sufficiently detailed peer review report (Amaze Med. Supply Inc. v Eagle Ins. Co., supra). Defendant failed to accompany its otherwise timely claim denial with the requisite proof, and in the absence of any other defense raised in the denial form including the purported defense, raised for the first time in opposition to the summary judgment motion, that the benefits sought for medical equipment provided to the assignor exceeded 150 percent of the [*2]equipment’s cost from the supplier (11 NYCRR 68, Appendix 17-C, Part E [b] [1]), defendant is precluded (cf. Amaze Med. Supply Inc. v Eagle Ins. Co., supra).

However, in addition to its claim forms, plaintiff’s proof in support of its motion for summary judgment contained documents that had not previously accompanied said forms. The documents revealed that the prescribed medical equipment did not include two items, an EMS belt ($78) and an EMS kit ($120), listed in the invoices of supplies delivered and for which benefits were claimed. While the failure timely to object to defects in the proof of claim waives all such objections thereto (New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699,
701 [2001]), having interjected an issue of fact which, if true, amounts to a complete defense to a portion of the claim, plaintiff should be estopped from invoking waiver (or preclusion) to avoid a defense that the cost of unprescribed medical equipment is not a recoverable no-fault benefit (see Amaze Med. Supply Inc. v Eagle Ins. Co., supra).

Accordingly, the matter is remanded to the court below for a calculation of the statutory interest and an assessment of attorney’s fees due on $1,347.50, the portion of the claim for which summary judgment is granted (Insurance Law § 5106 [a]; 65.15 [h] [1]; 11 NYCRR 65.17 [b] [6]; see St. Clare’s Hosp. v Allstate Ins Co., 215 AD2d 641 [1995]), and for all further proceedings on the remainder of the claim.
Decision Date: April 09, 2004

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by defendant from an order of the Civil Court, Queens County (A. Agate, J.), entered March 19, 2003, denying its motion for summary judgment dismissing the complaint and granting plaintiff’s cross motion for summary judgment deemed an appeal from the judgment, entered pursuant to said order, on May 14,

2003, awarding plaintiff the principal sum of $1,791.73 (see CPLR 5501 [c]).

Judgment unanimously reversed without costs, so much of the order, entered March 19, 2003, as granted plaintiff’s cross motion for summary judgment vacated, plaintiff’s cross motion denied and matter remanded to the court below for
all further proceedings.

Plaintiff commenced this action to recover $1,791.73, in first-party no-fault benefits for medical services it rendered to its assignor, as well as statutory interest and attorney’s fees, pursuant to Insurance Law § 5101 et seq. Thereafter, defendant moved for summary judgment dismissing the complaint and plaintiff cross-moved for summary judgment. By order entered March 19, 2003, the court
below denied the motion and granted the cross motion. A judgment was
subsequently entered pursuant to said order on May 14, 2003 awarding plaintiff the sum of $2,485.08. [*2]

Upon a review of the record, we find that plaintiff failed to establish its prima facie entitlement to summary judgment inasmuch as it did not show that the assignor made an assignment to plaintiff Damadian MRI in Garden City, P.C. The assignment form herein names the assignee merely as “Damadian MRI.” Although
the assignment demonstrates plaintiff’s standing to sue sufficient to withstand a
motion to dismiss (see e.g. Neuro Care Assoc. v State Farm Ins. Co., NYLJ, June
25, 1998 [App Term, 2d & 11th Jud Dists]), it raises a question of fact as to whether plaintiff is the same entity as the one named in the assignment.

We note that defendant’s notices for examinations under oath did not
toll the statutory period inasmuch as at the applicable time, there was no provision in the no-fault regulations for such verification (A.B. Med. Servs. PLLC v Eagle Ins. Co., NYLJ, Dec. 29, 2003 [App Term, 9th & 10th Jud Dists]; see also A.B. Med. Servs.
PLLC v Lumbermens Mut. Cas. Co., NYLJ, Oct. 27, 2003 [App Term, 2d & 11th Jud Dists]).

In view of the foregoing, plaintiff’s cross motion for summary judgment should have been denied. Moreover, defendant’s motion for summary judgment dismissing the complaint was properly denied as its remaining contentions lack merit (see Damadian MRI in Garden City, P.C. v Windsor Group Ins., No. 2003-717 Q C, decided herewith).
Decision Date: April 09, 2004

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the Civil Court, Kings County

(L. Baily-Schiffman, J.), entered January 31, 2003, which granted defendant’s
motion to vacate the default judgment.

Order unanimously reversed without costs and defendant’s motion to vacate the default judgment denied.

In order to vacate a default judgment, the movant must establish
both a reasonable excuse for defaulting as well as a meritorious defense to the
action (see Titan Realty Corp. v Schlem, 283 AD2d 568 [2001]; Matter of
Gambardella v Ortov Light., 278 AD2d 494 [2000]). While the determination of what constitutes a reasonable excuse lies within the sound discretion of the trial court
(Matter of Gambardella v Ortov Light., 278 AD2d 494, supra), the movant must
submit supporting facts in evidentiary form sufficient to excuse the default (see Incorporated Vil. of Hempstead v Jablonsky, 283 AD2d 553 [2001]; Bravo v New
York City Hous. Auth., 253 AD2d 510 [1998]). In the case at bar, the affidavit [*2]
submitted in support of defendant’s motion was from one of its employees allegedly having personal knowledge of the claim. However, said employee failed to set forth supporting facts in evidentiary form indicating who made the purported inquiry about
an extension of time to answer, whether the inquiry was oral, written or made in
person, and on what date the purported inquiry was made. Accordingly, the
employee’s affidavit was insufficient to establish a reasonable excuse.

Furthermore, while defendant argues that it has a meritorious defense to the action, to wit, the no-fault claim was timely denied based on a peer review, it appears that such review was conclusory in nature and lacked a medical rationale for the claim’s rejection (Amaze Med. Supply Inc. v Eagle Ins. Co., NYLJ,
Dec. 29, 2003 [App Term, 2d & 11th Jud Dists]). Therefore, we are of the opinion
that defendant likewise failed to establish a meritorious defense to the action.

Decision Date: April 09, 2004

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by defendant from an order of the Civil Court, Queens County (A. Agate, J.), entered February 26, 2003, denying its motion for summary judgment dismissing the complaint and granting plaintiff’s cross motion for summary judgment, deemed an appeal from the judgment, entered pursuant to said order, on April 8, 2003, awarding plaintiff the sum of $1,469.84 (see CPLR 5501 [c]).

Judgment unanimously reversed without costs, so much of the order, entered February 26, 2003, as granted plaintiff’s cross motion for summary judgment vacated, plaintiff’s cross motion denied and matter remanded to the court below for all further proceedings.

Plaintiff commenced this action to recover $878.67, in first-party no-fault benefits for medical services it rendered to its assignor, as well as statutory interest and attorney’s fees, pursuant to Insurance Law § 5101 et seq. Thereafter, defendant moved for summary judgment dismissing the complaint and plaintiff cross-moved for summary judgment. By order entered February 26, 2003, the court below denied the motion and granted the cross motion. A judgment was subsequently entered pursuant to said order on April 8, 2003 awarding plaintiff the sum of $1,469.84.

Upon a review of the record, we find that plaintiff failed to establish its prima facie entitlement to summary judgment inasmuch as it did not show that the assignor made an assignment to plaintiff Damadian MRI in Garden City, P.C. The assignment form herein names [*2]the assignee merely as “Damadian MRI.” Although the assignment demonstrates plaintiff’s standing to sue sufficient to withstand a motion to dismiss (see e.g. Neuro Care Assoc. v State Farm Ins. Co., NYLJ, June 25, 1998 [App Term, 2d & 11th Jud Dists]), it raises a question of fact as to whether plaintiff is the same entity as the one named in the assignment.

We note that defendant’s notices for examinations under oath did not toll the statutory period inasmuch as at the applicable time, there was no provision in the no-fault regulations for such verification (A.B. Med. Servs. PLLC v Eagle Ins. Co., NYLJ, Dec. 29,
2003 [App Term, 9th & 10th Jud Dists]; see also A.B. Med. Servs. PLLC v Lumbermens Mut. Cas. Co., NYLJ, Oct. 27, 2003 [App Term, 2d & 11th Jud Dists]). In view of the foregoing, plaintiff’s cross motion for summary judgment should have been denied. Moreover, defendant’s motion for summary judgment dismissing the complaint was properly denied as its remaining contentions lack merit (see Damadian MRI in Garden City, P.C. v Windsor Group Ins., No. 2003-862 Q C, decided herewith).
Decision Date: April 09, 2004

[*1]

Supreme Court, Appellate Term, Second Department, April 9, 2004

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellant. Shapiro Beilly Rosenberg Aronowitz Levy & Fox, LLP, New York City (Roy J. Karlin of counsel), for respondent.

{**3 Misc 3d at 44} OPINION OF THE COURT

Memorandum.

Order unanimously modified by providing that plaintiff’s motion is granted to the extent of awarding plaintiff partial summary judgment in the sum of $2,598.04, and matter remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees, and for all further proceedings on the remaining portion of the claim in accordance with the decision herein; as so modified, affirmed without costs.

In this action to recover $2,998.04 in assigned first-party no-fault insurance benefits, defendant insurer denied all but $780.96 of plaintiff’s $3,779 claim for medical equipment on the ground that the supplier’s prices exceeded the prevailing rates for such equipment in plaintiff’s “geographic location” (cf. 11 NYCRR 68.5 [b]) and because certain of the items claimed, two “TENS Belts” ($78) and two “TENS Accessory Kits” ($122), were duplicative of other items for which benefits were paid. In Kings Med. Supply v Allstate Ins. Co. (2003 NY Slip Op 1681[U] [App Term, 9th & 10th Jud Dists]), the court concluded that because the Insurance Department regulation permitting reference to “the prevailing fee in the geographic location of the provider” pertains only where “the superintendent has not adopted or established a fee schedule applicable to the provider” (11 NYCRR 68.5 [b]), and that the [*2]regulatory limitation on a provider’s medical equipment to 150% of cost (11 NYCRR Appendix 17-C, part E [b] [1]) is an applicable fee schedule within the contemplation of 11 NYCRR 68.5 (b), an insurer may not deny a claim on the ground that the fees alleged exceeded the prevailing rates in the provider’s geographical location. If, as defendant urges, the premises underlying the determination that such a rule “help[s] contain the no-fault premium” (Goldberg v Corcoran, 153 AD2d 113, 118 [1989] [internal quotation marks omitted]) are unsound, the solution is remedial action by the appropriate regulatory authority. Defendants claim denial, although timely, was factually insufficient in that it failed to provide any specifics with regard to its conclusory defense that certain of the prescribed medical equipment was duplicative. Under the circumstances, the defenses proffered in the denial forms were ineffective to avoid preclusion. A timely denial alone does not avoid preclusion where said denial is factually insufficient, conclusory, vague or otherwise involves a defense which has no merit as a matter of law (Insurance Law § 5106 [a]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d {**3 Misc 3d at 45}11 [1999]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 140[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists]).

However, plaintiff’s proof in support of the summary judgment motion included previously unproduced documents revealing that the equipment prescribed each assignor did not include the aforementioned “TENS accessory kit” ($122) and “TENS belt with straps” ($78), listed in the equipment provided each assignor and for which plaintiff sought $400 in no-fault health benefits. As we noted in Amaze Med. Supply v Eagle Ins. Co. (supra), where a plaintiff interjects an issue of fact in support of its motion for summary judgment which, if true, negates its prima facie case, if not amounting to a complete defense to a portion of the claim, namely, that the cost of unprescribed medical equipment is not a recoverable no-fault benefit, plaintiff should be estopped from invoking the waiver and preclusion rules which would otherwise apply in a no-fault benefits action (see 11 NYCRR 65.15 [d] [1], [2]; Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]; New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699, 701 [2001]). The defect was not apparent on the face of an otherwise sufficient claim, and insurers should not be required to demand such verification in every case to preserve the defense where no basis therefor is discerned, to the detriment of the purposes of the no-fault legislation, in essence, “to encourage prompt payment of claims, to discourage investigation by insurers and to penalize delays” (Dermatossian v New York City Tr. Auth., 67 NY2d 219, 225 [1986]).

Thus, partial summary judgment should have been granted in the amount of $2,598.04. The matter is remanded to the court below for a calculation of the statutory interest and attorney’s fees due on said amount (Insurance Law § 5106 [a]; 11 NYCRR 65.15 [h] [1]; 65.17 [b] [6]; St. Clare’s Hosp. v Allstate Ins. Co., 215 AD2d 641 [1995]), and for all further proceedings on the remainder of the claim.

Pesce, P.J., Patterson and Golia, JJ., concur.

—[*1]

In a proceeding pursuant to CPLR article 75 to permanently stay arbitration of an uninsured motorist claim, Rajeev Singh appeals from an order of the Supreme Court, Nassau County (McCarty, J.), dated September 17, 2002, which denied his cross motion to dismiss the petition, granted the petition, and permanently stayed the arbitration.

Ordered that the order is reversed, on the law, without costs or disbursements, the cross motion is granted, the petition is denied, and the proceeding is dismissed.

The appellant, Rajeev Singh, claimed injuries as a result of an accident on August 4, 2001, caused by an allegedly uninsured vehicle that stopped short and then drove off following the accident. On March 8, 2002, Singh’s attorney sent to his insurer, the petitioner, Nationwide Insurance Company (hereinafter Nationwide), by certified mail, return receipt requested, a letter enclosing an application for no-fault insurance benefits and a notice “with respect to uninsured [*2]and/or underinsured motorist benefits.” This notice to which the letter referred was captioned “Notice of Intention to Make Claim and Arbitrate.” It contained a statement pursuant to CPLR 7503 (c) that Singh “intends to demand arbitration” and that Nationwide would be precluded from raising the objection, inter alia, that a valid agreement had not been made or complied with unless Nationwide applied to stay arbitration within 20 days after receipt of the notice.

The letter was sent to Nationwide at its North Syracuse office, and its receipt is undisputed. On March 18, 2002, Robert Marino from Nationwide’s Woodbury Claims Department sent a letter of disclaimer, inter alia, because the insured had failed to notify Nationwide of his claim as soon as practicable.

By a document dated June 12, 2002, Singh notified Nationwide that he was demanding arbitration before the American Arbitration Association (hereinafter the AAA) and that “unless the time to apply for a stay of arbitration has already expired” he repeated the preclusion warning authorized by CPLR 7503 (c) would apply. This document was served on Nationwide at its Woodbury office by certified mail, return receipt requested. Within 20 days of its receipt of this demand for arbitration, Nationwide commenced this proceeding to stay arbitration on the ground, inter alia, that Singh’s notification of his claim was untimely.

Singh cross-moved to dismiss on the ground that the proceeding itself was not timely commenced. He relied on his notice of intention to arbitrate transmitted by his attorney’s letter dated March 8, 2002, by certified mail, return receipt requested. In opposition, Nationwide’s counsel argued in an affirmation that the notice of intention to arbitrate was not a formal demand to arbitrate against which a proceeding to stay would be required. Counsel further made passing mention that the notice of intention to arbitrate had been served on Nationwide in North Syracuse and that the demand for arbitration was served on Robert Marino in the Woodbury Claims Department, who was handling the uninsured motorist benefit claim.

The Supreme Court granted the petition to stay arbitration, holding that the proceeding was timely. It held that the notice of intention to arbitrate in its timing and circumstances was intended to mislead. Thus, the 20-day preclusion was measured from the later demand for arbitration. This was error.

The basis on which Nationwide sought to justify the timeliness of its application was that a notice of intention to arbitrate is not a demand for arbitration and that the 20-day preclusion of CPLR 7503 (c) applies only to the demand. However, CPLR 7503 (c) provides: “A party may serve upon another party a demand for arbitration or a notice of intention to arbitrate [containing the 20-day preclusion warning].” (Emphasis added.) Thus, the preclusion applies identically to a demand for arbitration and a notice of intention to arbitrate (see Alexander, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR C7503:6). Indeed, the notice of intention has been characterized, as Singh’s lawyer did in his March 8, 2002, letter, as simply a “Notice” by Professor David D. Siegel in New York Practice (Siegel, NY Prac § 593, at 1002 [3d ed). Also, the seminal case on the preclusive effect of CPLR 7503 (c), Matter of Jonathan Logan, Inc. (Stillwater Worsted Mills) (31 AD2d 208 [1968], affd 24 NY2d 898 [1969]), arose not from a demand for arbitration but from a notice of intention to arbitrate. [*3]

It is true, as Nationwide contends, that service intended to conceal a notice of intention to arbitrate and to precipitate an insurer’s default will not be given preclusive effect when the notice is buried among unrelated documents or is served on a remote office of the insurer (see Crawford v Merrill Lynch, Pierce, Fenner & Smith, 35 NY2d 291, 296 [1974] [notice for arbitration before AAA not served on attorneys representing the defendant in action in which the defendant had moved to compel arbitration before NYSE, but was served on an office different from the one on which the summons commencing the action had been served; notice contained misleading statements suggesting that the plaintiff was joining in the defendants’ motion to compel arbitration before the NYSE]; Matter of Insinga v Liberty Mut. Ins. Co., 265 AD2d 411, 412 [1999] [notice, served on respondent, not its attorneys, was hidden among voluminous other documents to prevent respondent from contesting arbitrability]; Matter of Balboa Ins. Co. v Barnes, 123 AD2d 691 [1986] [demand for arbitration enclosed in the middle of a packet of 11 documents mailed to the insurer’s home office in California despite a prior request that future correspondence be sent to the New York office]; Rider Ins. Co. v Marino, 84 AD2d 832 [1981] [demand mailed to insurer at address unrelated to the business at hand and placed amidst a packet of documents submitted in support of the claim with a covering letter adumbrating reference to the demand]). Yet, these cases were not decided in a vacuum. The issue of misleading tactics had to be raised by the petitioners who tardily sought to stay arbitration, and had to be supported by someone with knowledge of the facts on the basis of which they contended that they had been misled.

In the case at hand, Nationwide never claimed to have been misled; this came only from the Supreme Court. Furthermore, no affidavit by a Nationwide claims employee was submitted that would support the conclusion that Nationwide was misled. This Court confronted just such a situation in Matter of State-Wide Ins. Co. v Rowe (228 AD2d 606 [1996]). There, the tardy motion to stay arbitration (sought by way of a notice of intention to arbitrate) was rejected by the court on the one ground originally asserted in the petition (see Matter of Steck, 88 NY2d 827 [1996]). It was not until State-Wide Insurance Company moved for renewal that it raised the claim of a defective and misleading notice of intention to arbitrate. In Rowe, at least the contention was supported with an affidavit of the claims department manager. This Court affirmed the rejection of this new ground articulated in the renewal motion since the argument and facts were known at the time of the original petition.

The Rowe case compels us to reverse the grant of a stay of arbitration of Singh’s uninsured motorist claim. Nationwide never made the claim, interposed in the Rowe case only on renewal, that its time to move to stay arbitration was defeated by trickery. Nor does it seem that it could support such a claim. Singh’s attorney did not bury the notice of intention to arbitrate among a sheaf of other documents. He only transmitted one other document with it, namely an application for no-fault benefits. Furthermore, this was transmitted, quite understandably, to Nationwide’s North Syracuse office because that is the location of its no-fault division. The record demonstrates that this location had no adverse effect on Nationwide’s ability to respond with alacrity and to move to stay arbitration within 20 days because Nationwide, in fact, sent a disclaimer letter dated a mere 10 days later from its Woodbury office.

Accordingly, the Supreme Court erred in denying Singh’s cross motion to dismiss and in granting Nationwide’s untimely petition to stay arbitration since the evidence does not support the conclusion that Nationwide was misled into filing an untimely petition, and Nationwide itself never raised this issue. Santucci, J.P., Adams, Crane and Cozier, JJ., concur.

Civil Court Of The City Of New York, Queens County

Index No. 81843/02

For Plaintiff: Alden Banniettis, Esq. 2972 Avenue X, Brooklyn, NY

11235

For Defendant: Jacobson & Schwartz, Esqs, 510 Merrick Rd., POB 46,

Rockville Centre, NY 11571

Denis J. Butler, J.

Recitation, as required by CPLR §2219(a), of the papers considered in the

review of this motion for summary judgment:

Papers Numbered

Notice of Motion and Affidavits/Affirmations Annexed________1_________

Upon the foregoing cited papers, the Decision/Order on this Motion is as follows:

In an action to recover No-Fault benefits, plaintiff moves for summary judgment against defendant. Plaintiff submitted two timely and proper NF-3 claim forms on April 19, 2002 which were received by the defendant on April 29, 2002 and May 6, 2002. The plaintiff also submitted timely claim forms on April 24, 2002 and June 5, 2002, which insurer received on May 2, 2002 and June 10, 2002, respectively. Defendant issued denials for each of the aforementioned claims on June 27, 2002 and has failed to make payments on any of the bills.

Plaintiff contends that all of defendant’s denials were untimely except for the denial for the bill received on June 10, 2002. Plaintiff further argues that the denials are insufficient to raise a triable issue of fact since they are improperly based upon what the defendant labels a “Low Impact Study.”

Defendant does not dispute the timeliness of the denials, but argues that the injuries did not arise from a covered accident. Defendant contends that the accident at issue was a “Low Impact” accident and could not have caused the injuries alleged by the assignor. Defendant relies upon a report prepared by a private consultant retained by defendant which concludes that the speed of the assignor’s vehicle was “not sufficient to cause persistent injury to volunteer test [*2]subjects.” Defendant concludes that since the injuries allegedly sustained by the assignor could not have been caused by this accident, plaintiff’s claim is fraudulent and therefore did not arise from a covered accident. Central Gen. Hosp. v. Chubb Group of Ins. Cos., 90 NY2d 195. (despite an untimely denial, an insurer is not barred from raising as a defense that the “services rendered to treat the injuries at issue did not arise from a covered accident.”)

It is the holding of this court that the plaintiff’s motion for summary judgment is granted. Defendant submitted inadmissible reports and improperly denied plaintiff’s bills based upon a “Low Impact Study.” The case law is clear that in order to deny a claim on the theory that a particular accident was not a covered event the insurer must show that the accident was a deliberate event or a part of an insurance fraud scheme. As the evidence submitted by the defendant fails to establish that the accident was a deliberate event or part of an insurance fraud scheme the defendant’s claim that the accident was not a covered event is without merit.

The defendant, in its affirmation in opposition, merely relies on an affidavit by its claims adjuster dated January 21, 2004, wherein such adjuster asserts that the claims were timely denied based upon the “Low Impact Study” conducted by FTI/SEA Consulting. The affidavit fails to state whether the adjuster had actual knowledge of the “Low Impact Study”, whether she is an accident reconstruction expert or how she came to the conclusion that the injuries could not be related to the motor vehicle accident at issue. A.B. Medical Services PLL v. Lumbermans Mutual Casualty, N.Y.L.J September 30, 2003. (insurer cannot negate the careful proscriptions for expert proof in Central General Hospital in favor of mere speculation and debate).

Further, it is well established “that one opposing a motion for summary judgment must produce evidentiary proof in admissible form sufficient to require a trial of material questions of fact on which he rests his claim or must demonstrate acceptable excuse for his failure to meet the requirement of tender in admissible form; mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient. Zuckerman v. City of New York, 49 NY2D 557. The defendant submitted an unsworn to Accident Analysis Report. An unsworn report on which the defendant relied is not in admissible form and as such is not sufficient to defeat a motion for summary judgment. Washington v. City of Yonkers, 293 A.D.2d 741. Therefore, the defendant has failed to submit sufficient proof which would allow this court to determine whether the accident caused the alleged injuries.

Moreover, the basis for each of the insurer’s denials were that the results from a “Low Impact Study” had shown that the injuries alleged in the claim forms were not related to the motor vehicle accident in question and were inconsistent with a collision of that nature. The insurer posits that an accident at this speed could not have caused the alleged injuries and that therefore the claim is fraudulent and not covered.

Defendant relies upon the theory that if a collision was a deliberate event caused in the furtherance of an insurance fraud scheme, it would not be a covered accident. Metro Medical Diagnostics, P.C. v. Eagle Ins. Co., 293 A.D.2d 751; see also Westchester Medical Center v. Travelers Property Cas. Ins. Co., 309 A.D.2d 927. However, the defendant has failed to come forth with evidence that the accident was a deliberate event or a part of an insurance fraud scheme. Rather the defendant erroneously relies upon an inadmissible report which states that the injuries were caused by an accident which was “not sufficient to cause persistent injury to volunteer test subjects.” The report, even if admissible, fails to establish that the accident was a [*3]deliberate event caused in the furtherance of an insurance fraud scheme.

The No-Fault Law requires the carrier to either pay or deny the claim for No-Fault benefits within thirty days from the date the applicant supplies proof of claim. (Insurance Law, §5106(a); 11 NYCRR §65.15(g)(3). The bills received prior to June 10, 2002 were denied after thirty days. Without a valid “coverage” defense the court grants the plaintiff summary judgment as to each of those bills . Only the bill received by the insurer on June 10, 2002 was timely denied. As to the bill which was timely denied, the defendant has failed to submit sufficient proof in admissible form which would allow this court to determine whether the accident in question could cause the alleged injuries. An affidavit by a claims adjuster regarding the validity of a “Low Impact Study” and an unsworn report are insufficient to oppose a motion for summary judgment.

Accordingly, plaintiff’s motion for summary judgment is granted. The plaintiff is given leave to enter judgment against the defendant in the sum of $7,562.00 plus statutory attorneys’ fees and interest.

Judge, Civil Court

Decision Date: April 02, 2004