Index No. 156945/2016

Goldberg, Miller & Rubin, P.C., New York, NY (Harlan R. Schreiber and Timothy R. Bishop of counsel), for plaintiff.

Economou & Economou, P.C., Syosset, NY (Ralph C. Caio of counsel), for defendant.

This motion concerns whether plaintiff Unitrin Advantage Insurance Company must pay approximately $12,000 in no-fault insurance benefits to defendant Andrew J. Dowd, M.D. (plus interest and attorney fees), for two surgeries Dr. Dowd performed in 2011.

BACKGROUND

Several individuals (nonparties in this action) allegedly suffered a collision while in a vehicle covered by a no-fault insurance policy issued by Unitrin. One individual, Quente Wright, was treated by Dr. Dowd. In July 2011, Dr. Dowd operated on Wright. Dowd submitted a benefits claim to Unitrin for that surgery (for $5,943.59), which Unitrin received on August 1, [*2]2011. In September 2011, Dowd performed a second surgery on Wright, and submitted a second claim to Unitrin (for $6,106.56), which Unitrin received on October 7, 2011.

Unitrin was skeptical that Wright had been involved in a legitimate, rather than staged, collision. It was similarly skeptical that Wright had sustained any injuries requiring surgery. On September 22, 2011, Unitrin mailed to Dr. Dowd a request that he appear for an examination under oath (EUO) to answer questions about the medical necessity of the first surgery. The EUO was scheduled for October 6, 2011. Dr. Dowd did not appear for the EUO. Unitrin sent him a second letter, on October 11, 2011, requesting that he appear for a rescheduled EUO on October 25. Dowd again did not appear. Unitrin denied Dowd’s benefits claims for both surgeries based on his repeated failure to appear for an EUO.

Dr. Dowd disputed Unitrin’s denial of his claims for benefits. That dispute has a somewhat lengthy and involved procedural history that is not relevant here. What matters now is that in the current action, Unitrin is seeking a declaratory judgment that Dr. Dowd is not entitled to benefits. Dowd moves for summary judgment under CPLR 3212. He argues that he has established as a matter of law that he properly submitted claims for medical services rendered and that Unitrin failed to issue a timely denial of those claims. Unitrin cross-moves for summary judgment under CPLR 3212. According to Unitrin, Dr. Dowd failed to appear for a timely and properly scheduled EUO about the services that he claimed to have provided. Unitrin argues that it therefore properly denied the two claims

As to the benefits claim relating to the first surgery, Dr. Dowd’s motion is granted, and Unitrin’s cross-motion is denied. As to the benefits claim relating to the second surgery, Dr. Dowd’s motion is denied, and Unitrin’s cross-motion is granted.

DISCUSSION

A provider of medical services can establish a prima facie showing of entitlement to summary judgment by submitting admissible proof that the requisite claim forms were mailed and received by the carrier and that the payment is overdue. (See Insurance Law § 5106 [a]; New York & Presbyterian Hosp. v Countrywide Ins. Co., 44 AD3d 729, 843 [2d Dept 2007].) Here, Unitrin does not contest that it received the requisite claim forms from Dr. Dowd or that the claims remain unpaid. Unitrin argues instead that Dowd is not entitled to benefits because he, as Wright’s assignor, violated the terms of the applicable no-fault policy by failing to appear for an EUO upon request.

A no-fault insurer seeking a declaration of no coverage due to asserted violations of the terms of the policy must first demonstrate that it complied with each procedural and timeliness requirement of 11 NYCRR § 65-3.5, governing the handling of no-fault claims. (See American Transit Ins. Co. v Longevity Med. Supply, Inc., 131 AD3d 841, 841 [1st Dept 2015].) Among other things, § 65-3.5 provides that once an insurer receives the verification forms for a pending claim for benefits, the insurer then has 15 business days to seek further verification—for example, through requesting a claimant to appear for an EUO. (See id. § 65-3.5 [b]; Unitrin Advantage Ins. Co. v All of NY, Inc., 158 AD3d 449, 449 [1st Dept 2018].) A claimant’s failure [*3]without reasonable cause to appear for a timely and properly scheduled EUO is grounds to deny coverage.

Here, Unitrin does not seriously contest that its EUO requests were untimely as to the first surgery: The first request was mailed out on September 22, 2011, well beyond the 15-day period following Unitrin’s August 1 receipt of the benefits claim for the first surgery. Unitrin argues, though, that the EUO requests were timely as to the second surgery—and that Dr. Dowd’s failure to appear for an EUO means that Unitrin is entitled to deny benefits for both surgeries. This court disagrees.

To be sure, Unitrin’s starting premise is correct: A no-fault insurer may properly request an individual covered by no-fault insurance to appear for an EUO prior to receiving that individual’s benefits claim; and the insurer may properly deny benefits if the individual does not appear as requested. (See Mapfre Ins. Co. of NY v Manoo, 140 AD3d 468, 469 [1st Dept 2016].) But Unitrin’s conclusion does not follow. Where a claimant (such as a medical provider) submits multiple claims for benefits, and the insurer’s EUO request is timely as to some of those claims and untimely as to others, the insurer is entitled to deny coverage only as to those claims for which it timely requested verification—not as to all claims. (See All of NY, 158 AD3d at 449-450.)

This court is not persuaded by Unitrin’s contrary argument. Unitrin contends that in Hertz Vehicles, LLC v Alluri (171 AD3d 432 [1st Dept 2019]), the insurer had submitted one claim for which there was an untimely EUO request and one claim for which there was a timely request, which (assertedly) led both Supreme Court and the First Department to hold that the insurer could deny all claims retroactive to the date of loss. This contention has two key shortcomings.

First, neither the trial nor appellate decisions in Alluri actually say that where an EUO request is timely only as to one out of two claims (and then not complied with), the insurer can properly deny benefits as to both claims. Instead, each decision refers only to one claim for benefits, for which the insurer’s EUO request had been timely under Manoo. (See Hertz Vehs. v Alluri, 2017 NY Slip Op 32578 [U], at *3-*4 [Sup Ct, NY County Dec. 11, 2017]; Alluri, 171 AD3d at 432.)

Second, if the First Department had held in Alluri that one timely EUO request entitles an insurer to deny benefits even as to claims for which an untimely request had been made, that holding would have been inconsistent with the Court’s ruling the year before in All of NY Yet Alluri does not discuss, or even mention, All of NY Rather, Alluri relies on Manoo (see 171 AD3d at 432); and the holding in Manoo is premised on the Court’s conclusion that the insurer had “establish[ed] that it timely and properly mailed the notices for EUOs” to the covered individual. (140 AD3d at 469.)

Unitrin also points to the First Department’s statement in Unitrin Advantage Ins. Co. v Bayshore Phys. Therapy, LLC that “when defendants’ assignors failed to appear for the requested [medical examinations], plaintiff had the right to deny all claims retroactively to the date of loss.” ((82 AD3d 559, 560 [1st Dept 2011] [emphasis added]). But even Bayshore itself notes [*4]that the insurer there met its burden to “establish[] that it requested [medical examinations] in accordance with the procedures and time-frames set forth in the No—Fault implementing regulations.” (Id.; see also American Transit Ins. Co. v Longevity Med. Supply, Inc., 131 AD3d 841, 842 [1st Dept 2015] [emphasizing this point].) And it would be odd to say, in effect, that an insurer can still deny a benefits claim due to a claimant or assignor’s failure to appear at an EUO despite failing to timely or properly request the EUO after receiving that claim. Regardless, to the extent that a contradiction does exist between the First Department’s holdings in Bayshore and in All of NY, this court must follow the First Department’s most recent holding on the subject. (See Vaughan v Leon, 94 AD3d 646, 649 n 2 [1st Dept 2012].)

Unitrin’s EUO request upon receipt of the first claim was untimely. This court concludes, therefore, that Unitrin may not deny Dr. Dowd’s otherwise-sufficient claim for benefits from the first surgery based on Dowd’s failure to appear for an EUO.

That still leaves the claim for benefits from the second surgery. Under Manoo and Alluri, Unitrin’s EUO request was timely as to the second benefits claim—particularly since a key subject for questions at the EUO, namely the medical necessity of surgery on Quente Wright, would have been the same for both benefits claims. Dr. Dowd asserts, though, that the EUO request was improper: It did not sufficiently identify from whom Unitrin was seeking an EUO. This court disagrees. Unitrin has produced two EUO request letters that plainly request the appearance for an EUO of a principal from Dr. Dowd’s medical practice (i.e., either Dr. Dowd himself or someone with comparable authority), and also specify the subjects to be discussed at the EUO and the EUO’s time and place. Dr. Dowd does not contest that these letters were properly mailed. Nor does he contest that he failed to appear as requested. That is sufficient to establish that Dr. Dowd failed to comply with a requirement of the applicable no-fault insurance policy in this case as to his second claim for benefits.

Accordingly, it is hereby

ORDERED that the branch of Dr. Dowd’s motion under CPLR 3212 seeking summary judgment as to his claim for benefits in the amount of $5,943.59 (received by Unitrin on August 1, 2011) is denied; and it is further

ORDERED that the branch of Unitrin’s cross-motion under CPLR 3212 seeking summary judgment as to Dr. Dowd’s claim for benefits in the amount of $5,943.59 (received by Unitrin on August 1, 2011) is granted; and it is further

ADJUDGED AND DECREED that Unitrin owes no duty to pay Dr. Dowd that claim for benefits; and it is further

ORDERED that the branch of Dr. Dowd’s motion under CPLR 3212 seeking summary judgment as to his claim for benefits in the amount of in the amount of $6,106.56 (received by Unitrin on October 7, 2011) is granted; and it is further

ORDERED that the branch of Unitrin’s cross-motion under CPLR 3212 seeking [*5]summary judgment as to Dr. Dowd’s claim for benefits in the amount of $6,106.56 (received by Unitrin on October 7, 2011) is denied; and it is further

ADJUDGED AND DECREED that Dr. Dowd shall have judgment against Unitrin in the amount of $6,106.56; plus interest on that sum at 2% per month, running from November 6, 2012, until the entry of judgment; plus attorney fees as provided for under Insurance Law § 5106 (a) and 11 NYCRR § 65-4.6; and it is further

ORDERED that Dr. Dowd shall serve a copy of this order with notice of its entry on all parties and on the office of the County Clerk, which shall enter judgment accordingly; and it is further

ORDERED that notice of entry may be served by mail or overnight delivery service, with Dr. Dowd to e-file a copy of notice of entry (and accompanying affidavit(s) of service) on NYSCEF once filing of notices of entry in pending nonessential matters is again permitted by order of Chief Administrative Judge Lawrence Marks.

Date: 5/21/20

The Rybak Firm, PLLC (Damin J. Toell and Karina Barska of counsel), for appellant. Law Offices of Buratti, Rothenberg & Burns (Bryan M. Rothenberg and Argyria A.N. Kettagias of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Michael Gerstein, J.), entered December 11, 2018. The order denied plaintiff’s motion for summary judgment and granted defendant’s cross motion for summary judgment dismissing the complaint.

ORDERED that the order is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff Wave Medical Services, P.C. (Wave) moved for summary judgment and defendant Farmers New Century Insurance Co. (Farmers) cross-moved for summary judgment dismissing the complaint. In support of its cross motion, Farmers submitted an order that had been entered in a Supreme Court declaratory judgment action which granted a motion brought by, among others, Farmers seeking a default judgment against, among others, Wave. The order found specifically that the plaintiffs therein, including Farmers, were entitled to a default judgment on liability against Wave, but did not declare the rights of the parties. The Civil Court denied Wave’s motion for summary judgment and granted Farmers’ cross motion for summary judgment dismissing the complaint based upon the Supreme Court order. In response to Wave’s appeal, Farmers submits a judgment that was entered in the Supreme Court which declared, among other things, that Farmers has no duty to pay any no-fault [*2]benefits to Wave in any current or future proceeding because Wave is ineligible to collect no-fault benefits pursuant to 11 NYCRR 65-3.16 (a) (12).

A court “may in general take judicial notice of matters of public record” (Headley v New York City Tr. Auth., 100 AD3d 700, 701 [2012]; see Matter of Oak Tree Realty Co., LLC v Board of Assessors, 71 AD3d 1027 [2010]; Kingsbrook Jewish Med. Ctr. v Allstate Ins. Co., 61 AD3d 13 [2009]). In light of the Supreme Court’s declaration that Farmers has no obligation to pay no-fault benefits to Wave in any current proceeding, set forth in the Supreme Court judgment of which we take judicial notice, we find that the Civil Court properly denied Wave’s motion for summary judgment and granted Farmers’ cross motion for summary judgment dismissing the complaint (see Healing Art Acupuncture, P.C. v 21st Century Ins. Co.,59 Misc 3d 139[A], 2018 NY Slip Op 50583[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2018]).

Accordingly, the order is affirmed.

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

Paul Kenny

[*1]

Sobo & Sobo, LLP, Middletown (Mark P. Cambareri of counsel), for appellant.

Brand & Tapply, LLC, New York City (Courtney J. Lyons of counsel), for respondent.

Reynolds Fitzgerald, J. Appeal from an order of the Supreme Court (Burns, J.), entered February 19, 2019 in Chenango County, which, among other things, granted plaintiff’s motion for a default judgment.

On October 28, 2017, defendant Jonathan DiLorenzo (hereinafter defendant) was a passenger in a vehicle when the vehicle was involved in an accident. As a result of the accident, defendant sought medical treatment for lower back pain and injuries to his knees and teeth. Once defendant informed plaintiff, the vehicle owner’s insurer, of his intent to submit a claim for supplemental uninsured/underinsured motorist coverage, plaintiff commenced an investigation pursuant to the terms of its insurance policy. As part of the investigation, defendant participated in an examination under oath, wherein he admitted that, prior to the accident, he sought medical treatment for an injury to his right knee and chiropractic adjustment for back pain, and that he participated in mixed martial arts competitions. Despite numerous requests, defendant failed to produce medical records and to authorize plaintiff access to his preaccident medical and dental records. Ultimately, plaintiff denied defendant’s claim for no-fault benefits as a result of defendant’s breach of the duty to cooperate in the investigation and material misrepresentations regarding the nature and extent of defendant’s injuries, and because his injuries did not arise from the use or operation of the motor vehicle.

In October 2018, plaintiff commenced this action against, among others, defendant, asserting causes of action for breach of contract, fraud and a declaratory judgment, and seeking compensation for the costs involved in investigating the claim. Defendant was served, by way of CPLR 308 (2), on November 27, 2018 and plaintiff filed an affidavit of service on November 30, 2018. Shortly after filing the summons and complaint, plaintiff moved, by order to show cause, for a preliminary injunction and a temporary restraining order, enjoining all current or future litigation and arbitration proceedings concerning requests for no-fault benefits arising from the accident. In November 2018, Supreme Court granted plaintiff’s motion. In doing so, it declined to consider defendant’s opposition papers, on the ground that they were neither properly nor timely filed in the court electronic filing (hereinafter e-filing) system.

On January 4, 2019, plaintiff moved for a default judgment against all defendants. On January 17, 2019, one week past his 30-day allowance to do so,^[FN*] defendant filed his answer. Defendant opposed plaintiff’s motion and cross-moved to dismiss the complaint against him for lack of personal jurisdiction. He also sought leave to renew and vacate Supreme Court’s November 2018 order granting plaintiff’s motion for the preliminary injunction. Supreme Court granted plaintiff’s motion for a default judgment, finding that plaintiff effected proper service upon defendant, that defendant did not timely answer and defendant failed to demonstrate a valid reason for the late filing. The court also summarily denied defendant’s cross motion to renew and vacate the November 2018 order, finding that it was not made within 30 days of entry of that order. Defendant appeals.

Defendant contends that Supreme Court did not have personal jurisdiction over him to render a default judgment since plaintiff failed to sufficiently prove service of process. Service of process upon a natural person must be made in strict compliance with the methods set forth in CPLR 308. Failure to serve process leaves the court without personal jurisdiction over a defendant. “As a general proposition, a process server’s affidavit of service establishes a prima facie case as to the method of service and, therefore, gives rise to a presumption of proper service” (Carver Fed. Sav. Bank v Shaker Gardens, Inc., 135 AD3d 1212, 1213 [2016] [internal quotations and citations omitted]). The affidavit of service reflects that the Orange County Sheriff left the summons and complaint with defendant’s grandmother at 16 Strack Road in the Town of Goshen, Orange County, followed by mailing, that same day, a copy of the summons to the same address. Defendant does not deny that his grandmother was served nor does he claim that the address was not proper or that he did in fact receive the pleadings. Instead, in a conclusory fashion, defendant states that he “currently resides in Middletown, NY” without specifying an address or providing any proof of his residence. Defendant “failed to adequately rebut the presumption of proper service created by the affidavit[ ] of service” (Christiana Bank & Trust Co. v Eichler, 94 AD3d 1170, 1170 [2012]), as this “bare claim . . . is not a detailed and specific contradiction of the allegations in the process server’s affidavit” (id. at 1171 [internal quotation marks and citations omitted]). We therefore agree with Supreme Court that service was proper, and the court acquired jurisdiction over defendant.

Next, defendant alleges that plaintiff’s motion for a default judgment should have been denied because plaintiff failed to provide the requisite notice pursuant to CPLR 3215 (g) (1) and (3), the delay in serving the answer was short and plaintiff did not suffer any prejudice. Initially, we find that plaintiff complied with the requisite notice pursuant to CPLR 3215 (g) (1). The statute requires that any defendant who has appeared is entitled to at least five days’ notice of the time and place of the application. Plaintiff served counsel with notice of the default judgment on January 4, 2019, 21 days prior to the application being heard. Further, defendant’s contention that additional notice was required pursuant to CPLR 3215 (g) (3) is without merit. As provided in the statute, notice is required if the “action [is] based upon nonpayment of a contractual obligation” (CPLR 3215 [g] [3]). The instant action is one for breach of contract, fraud and a declaratory judgment, and plaintiff seeks compensation for fees involved in investigating the claim. As this is not an action for nonpayment of a contractual obligation, such additional notice was not required (see Basile v Mulholland, 73 AD3d 597, 597 [2010]).

Plaintiff demonstrated entitlement to a default judgment by submitting proof of service upon defendant, the facts supporting its claim and defendant’s default (see Dayco Mech. Servs., Inc. v Toscani, 94 AD3d 1214, 1214 [2012]). However, under the circumstances, Supreme Court abused its discretion in granting plaintiff’s motion for a default judgment. Although defendant’s motion papers lacked specific details of the underlying circumstances for the delay, the delay herein was de minimis—one week—and should be excused (see Bank of N.Y. Mellon v Jinks, 127 AD3d 1367,1368-1369 [2015]; Heinrichs v City of Albany, 239 AD2d 639, 640 [1997]). Defendant timely opposed the motion, offering a meritorious defense. There is no indication that the default was willful or that plaintiff was prejudiced as a result of the late answer. Moreover, defendant appeared in the action when he opposed plaintiff’s motion for a preliminary injunction and temporary restraining order. Public policy favors the resolution of cases on the merits (see Watson v Pollacchi, 32 AD3d 565, 565 [2006]; BPS Mgt. Corp. v New York Tit. Ins. Co., 115 AD2d 921, 922 [1985]).

Lastly, defendant contends that Supreme Court erred in denying his cross motion to renew as untimely. We agree. Supreme Court confused the cross motion to renew with a motion to reargue and summarily denied it since it was not made within 30 days. This time period applies solely to motions to reargue (see CPLR 2221 [d] [3]; Redeye v Progressive Ins. Co., 158 AD3d 1208, 1208 [2018]). Defendant argues that his opposition papers to plaintiff’s order to show cause seeking the preliminary injunction should have been considered by the court as he had not consented to e-filing, he timely mailed the documents pursuant to the instructions set forth in the order to show cause and he recently obtained his medical records, which were not available at the time of the return date on the order to show cause. “A motion for leave to renew . . . shall be based upon new facts not offered on the prior motion that would change the prior determination . . . [and] shall contain reasonable justification for the failure to present such facts on the prior motion” (CPLR 2221 [e] [2], [3]; see Matter of Karnofsky [New York State Dept. of Corr. & Community Supervision], 125 AD3d 1198, 1200 [2015]). Pursuant to Rules of the Chief Administrator of the Courts (22 NYCRR) § 202.5-bb (a) (1), mandatory e-filing may only be imposed “in such classes of actions and such counties as shall be specified by [O]rder of the Chief Administrator of the Courts.” On October 12, 2017, the Chief Administrative Judge issued Administrative Order of the Chief Administrative Judge of the Courts AO/294/18, which stated that Chenango County—the county in which this action was commenced—was a “consensual or voluntary e-filing county only.” As such, it did not impose mandatory e-filing in any type of case.

Moreover, in all cases, “[a] clerk shall not refuse to accept for filing any paper presented for that purpose except where specifically directed to do so by statute or rules promulgated by the [C]hief [A]dministrator of the [C]ourts” (CPLR 2102 [c]). Under the consensual e-filing rules, which applied in this case, a party that has not consented to e-filing must serve their papers via a hard copy (see Rules of Chief Admin of Cts [22 NYCRR] § 202.5-b [b] [2] [i]). Defendant diligently attempted to file his opposition in a timely manner. However, those papers were not considered by Supreme Court. Additionally, counsel averred that defendant’s medical records were not available at the time of plaintiff’s order to show cause and, as they demonstrate evidence of defendant’s injuries, they were pertinent thereto. Defendant has provided reasonable justification for failing to submit the additional facts in his opposition to plaintiff’s order to show cause (see Mula v Mula, 151 AD3d 1326, 1327 [2017]; Premo v Rosa, 93 AD3d 919, 921 [2012]). In view of the foregoing, Supreme Court abused its discretion in granting plaintiff’s motion for default judgment and denying defendant’s cross motion to renew and vacate the November 28, 2018 order.

Egan Jr., J.P., Lynch and Aarons, JJ., concur. Ordered that the order is reversed, on the law, without costs, plaintiff’s motion for a default judgment denied, defendant Jonathan DiLorenzo’s cross motion to renew/vacate granted, the preliminary injunction stayed and matter remitted to the Supreme Court to consider said defendant’s opposition papers with respect to plaintiff’s motion for a preliminary injunction.

Footnotes

Footnote *:As defendant was served pursuant to CPLR 308 (2), service is not complete until 10 days after the filing of proof of service. As plaintiff filed the affidavit of service on November 30, 2018, service was complete on December 10, 2018, giving him 30 days after that date to answer.

Index No. 156465/2018

Law Office of Peter C. Merani, P.C., New York, NY (Adam Waknine of counsel), for plaintiff.

Law Offices of Dino R. Dirienzo, Syosset, NY (Ralph C. Caio of counsel), for defendants MII Supply, LLC,. Dynamic Surgery Center, LLC, Comprehensive Medical Assist, P.C., and Citimed Services, P.A.

The following e-filed documents, listed by NYSCEF document number (Motion 001) 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 64, 65 were read on this motion for SUMMARY JUDGMENT

In this motion, plaintiff American Transit Insurance Company requests a declaratory judgment that it is not required to pay no-fault benefits to the various medical-provider defendants. American Transit seeks summary judgment under CPLR 3212 against certain answering defendants and default judgment under CPLR 3215 against the remaining defendants. This motion, however, is not properly before this court, because American Transit’s action has already been dismissed. The motion is denied.

This action was dismissed in May 2019 under 22 NYCRR § 202.27 due to American Transit’s failure twice to appear at scheduled preliminary conferences. American Transit never moved to vacate that default dismissal. Indeed, American Transit’s papers on the present motion do not even acknowledge that this action was previously dismissed, much less seek to offer a reasonable excuse for American Transit’s default. This court is disinclined to deem this motion to be somehow an implicit request for vacatur of the dismissal of the action.

This court’s reluctance is only heightened by the fact that American Transit’s motion is not based on admissible evidence. American Transit claims that it has good reason to believe that the underlying automobile collision in this case was staged, and therefore not an insurable [*2]incident. (See Central Gen. Hosp. v Chubb Grp. of Ins. Cos., 90 NY2d 195, 199 [1997].) But the evidence that American Transit identifies as the basis for this conclusion is a summary report that is neither sworn nor notarized, as required for it to qualify as a non-hearsay affidavit. (See NYSCEF No. 50 at 2-7.) As a result, this court could not rely on the report as a basis to vacate the dismissal of the action. (See Harris v Krauss, 87 AD3d 469, 469 [1st Dept 2011] [reversing grant of motion to vacate under CPLR 5015, where moving papers relied on evidence in a putative affidavit that had not been properly notarized].)

Thus, even if this court were to construe the present motion liberally as an application to vacate this court’s prior dismissal of this action on default—and this court declines to do so— American Transit would still fail to establish its entitlement to relief.

Accordingly, it is hereby

ORDERED that American Transit’s motion is denied.

Date: 5/13/20

[*1]

Kopelevich & Feldsherova, P.C., Brooklyn, NY (David Landfair of counsel), for appellants.

Hollander Legal Group, P.C. (Allan S. Hollander and Harris J. Zakarin, P.C., Melville, NY, of counsel), for respondent.

In an action for a judgment declaring that the plaintiff is not obligated to pay certain no-fault insurance benefits, the defendants Jamaica Wellness Medical, P.C., LVOV Acupuncture, P.C., and United Wellness Chiropractic, P.C., appeal from an order of the Supreme Court, Nassau County (James P. McCormack, J.), entered July 11, 2017. The order granted the plaintiff’s motion for summary judgment, in effect, declaring that the plaintiff is not obligated to pay claims for no-fault insurance benefits submitted by the defendants Jamaica Wellness Medical, P.C., LVOV Acupuncture, P.C., and United Wellness Chiropractic, P.C., on behalf of the defendants Andy Williams, Amanda Nixon, and Shaquille Swan.

Ordered that the order is affirmed, with costs, and the matter is remitted to the Supreme Court, Nassau County, for the entry of a judgment, inter alia, declaring that the plaintiff is not obligated to pay claims for no-fault insurance benefits submitted by the defendants Jamaica Wellness Medical, P.C., LVOV Acupuncture, P.C., and United Wellness Chiropractic, P.C., on behalf of the defendants Andy Williams, Amanda Nixon, and Shaquille Swan.

The defendants Andy Williams, Amanda Nixon, and Shaquille Swan (hereinafter collectively the individual defendants) allegedly were injured in a motor vehicle accident and assigned their rights to recover for no-fault benefits under the vehicle owner’s insurance policy to the defendants Jamaica Wellness Medical, P.C., LVOV Acupuncture, P.C., and United Wellness Chiropractic, P.C. (hereinafter collectively the medical provider defendants). The plaintiff commenced this action for a judgment declaring that it is not obligated to pay claims for no-fault insurance benefits submitted by the medical provider defendants on behalf of the individual defendants on the ground that the individual defendants failed to appear for two scheduled examinations under oath (hereinafter EUOs). The plaintiff moved for summary judgment, in effect, declaring that the plaintiff is not obligated to pay claims for no-fault insurance benefits submitted by the medical provider defendants on behalf of the individual defendants. The medical provider defendants opposed the motion. In an order entered July 11, 2017, the Supreme Court granted the plaintiff’s motion. The medical provider defendants appeal.

“ ’The failure to comply with the provision of an insurance policy requiring the insured to submit to an examination under oath . . . is a material breach of the policy, precluding recovery of the policy proceeds’ ” (Interboro Ins. Co. v Clennon, 113 AD3d 596, 597 [2014], quoting Argento v Aetna Cas. & Sur. Co., 184 AD2d 487, 487-488 [1992]). An insurer may establish its prima facie entitlement to judgment as a matter of law based on the failure to submit to an EUO by establishing that the letters scheduling the EUOs were timely and properly mailed, that the insured failed to appear at two scheduled EUOs, and that the insurer issued a timely and proper denial of the claims (see IDS Prop. Cas. Ins. Co. v Stracar Med. Servs., P.C., 116 AD3d 1005, 1007 [2014]; Interboro Ins. Co. v Clennon, 113 AD3d at 597).

Here, the plaintiff established, prima facie, that the letters scheduling the EUOs were timely and properly mailed by submitting an affidavit from an individual who had personal knowledge of the standard office practice for ensuring that the letters are properly addressed and mailed (see Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d 693, 694 [2016]). In opposition, the medical provider defendants failed to raise a triable issue of fact because they did not submit any evidence that the letters were not properly mailed. The medical provider defendants’ mere denial of receipt was insufficient to rebut a presumption that the letters were received (see Nassau Ins. Co. v Murray, 46 NY2d 828, 829-830 [1978]).

The plaintiff also established, prima facie, that the individual defendants failed to appear at two scheduled EUOs by submitting the affidavits of individuals with personal knowledge that the individual defendants failed to appear at the location of the EUOs on the dates they were scheduled (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720, 721 [2006]). In opposition, the medical provider defendants failed to raise a triable issue of fact. They did not submit evidence to establish that the first EUO was mutually rescheduled (see DVS Chiropractic, P.C. v Interboro Ins. Co., 36 Misc 3d 138[A], 2012 NY Slip Op 51443[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]).

Additionally, the plaintiff established, prima facie, that it issued a timely and proper denial of the claims by demonstrating that the denials were sent within 30 days of the second scheduled EUO, through affidavits from individuals who had personal knowledge as to the standard office practice for ensuring that denials are properly addressed and mailed (see 11 NYCRR 65-3.5 [b]; 65-3.8 [a] [1]; Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d at 694). The affidavits submitted by the medical provider defendants in opposition failed to raise a triable issue of fact because they did not directly contradict the affidavits submitted by the plaintiff with regard to its standard office practices for addressing and mailing denial letters.

Furthermore, the medical provider defendants’ contention that the plaintiff’s motion for summary judgment should have been denied because the plaintiff failed to either pay or deny four of the medical provider defendants’ bills is without merit because the bills were sent more than 45 days after service was rendered (see 11 NYCRR 65-1.1 [d]).

Accordingly, we agree with the Supreme Court’s determination to grant the plaintiff’s motion for summary judgment, in effect, declaring that the plaintiff is not obligated to pay claims for no-fault insurance benefits submitted by the medical provider defendants on behalf of the individual defendants. Since this is a declaratory judgment action, we remit the matter to the Supreme Court, Nassau County, for the entry of judgment, inter alia, declaring that the plaintiff is not obligated to pay claims for no-fault insurance benefits submitted by the medical provider defendants on behalf of the individual defendants (see Lanza v Wagner, 11 NY2d 317, 334 [1962]). Chambers, J.P., Roman, Cohen and Christopher, JJ., concur.

Law Office of Jason Tenenbaum, P.C. (Jason Tenenbaum and Shaaker Bhuiyan of counsel), for appellant. Law Office of Melissa Betancourt, P.C. (Melissa Betancourt and David Steigbigel of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Harriet L. Thompson, J.), entered March 2, 2018. The order denied defendant’s motion for summary judgment dismissing the complaint and granted plaintiff’s cross motion for summary judgment.

ORDERED that so much of the appeal as is from the portion of the order that denied defendant’s motion for summary judgment dismissing the complaint is dismissed as academic in light of this court’s determination of the remainder of the appeal; and it is further,

ORDERED that the order, insofar as reviewed, is reversed, with $30 costs, plaintiff’s cross motion for summary judgment is denied, and summary judgment dismissing the complaint is awarded to defendant pursuant to CPLR 3212 (b), in accordance with the decision herein.

Plaintiff commenced this action to recover assigned first-party no-fault benefits for supplies provided to its assignor, who had purportedly been injured in a motor vehicle accident on March 9, 2015. Thereafter, defendant moved for summary judgment dismissing the complaint on the ground that plaintiff’s assignor had failed to appear for scheduled examinations under oath and independent [*2]medical examinations, and plaintiff cross-moved for summary judgment. By order entered March 2, 2018, the Civil Court denied defendant’s motion and granted plaintiff’s cross motion.

Defendant correctly argues that plaintiff’s cross motion for summary judgment should have been denied, as the proof submitted by plaintiff failed to establish that the claim at issue had not been timely denied (see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498 [2015]), or that defendant had issued a timely denial of claim form that was conclusory, vague or without merit as a matter of law (see Westchester Med. Ctr. v Nationwide Mut. Ins. Co., 78 AD3d 1168 [2010]; Ave T MPC Corp. v Auto One Ins. Co., 32 Misc 3d 128[A], 2011 NY Slip Op 51292[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2011]). Thus, the portion of the order which granted plaintiff’s cross motion for summary judgment must be reversed and plaintiff’s cross motion denied.

Ordinarily, a reversal of this portion of the Civil Court’s order, standing alone, would result in the matter being remitted to the Civil Court for all further proceedings. However, on appeal, defendant argues that the complaint should be dismissed based upon a Supreme Court, Bronx County, declaratory judgment action against plaintiff and plaintiff’s assignor, among others, seeking a declaration that the defendants therein are not entitled to no-fault coverage for the March 9, 2015 accident. For the reasons stated in K.O. Med., P.C. v Mercury Cas. Co. (57 Misc 3d 155[A], 2017 NY Slip Op 51614[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]), in the interest of judicial economy, we take judicial notice of the judgment in that action which declares that plaintiff and its assignor “are not entitled to no-fault benefits as a result of a motor vehicle accident that occurred on 03/09/15” and that “any and all arbitrations or matters in a court of competent jurisdiction involving any of the Defendants as Assignee of Marie Vil . . . regarding a motor vehicle accident that occurred on 03/09/15, are permanently stayed and dismissed.” Upon taking such judicial notice, we award defendant summary judgment dismissing the complaint pursuant to CPLR 3212 (b) and dismiss as academic so much of the appeal as is from the portion of the Civil Court’s order that denied defendant’s motion for summary judgment (see id.; see also Maiga Prods. Corp. v Hertz Co., 61 Misc 3d 132[A], 2018 NY Slip Op 51448[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2018]).

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

Paul Kenny

Index No. 159037/2018

Law Offices of Daniel J. Tucker, Brooklyn NY (Megan Harris of counsel), for plaintiff.

Law Offices of Gabriel & Shapiro LLC, Rockville Centre, NY (Joseph Padrucco of counsel), for defendant Janan S. Syed, DC.

This motion concerns the potential obligation to pay no-fault insurance benefits of plaintiff American Transit Insurance Company. Nonparty Tynise Watson was a passenger in a vehicle that was allegedly involved in a collision. The vehicle was covered by a no-fault insurance policy issued by American Transit. Various medical providers applied for no-fault benefits as assignees of Watson, which American Transit denied.

In this action, American Transit seeks a declaratory judgment that it is not required to pay no-fault benefits to the various medical provider defendants. American Transit now moves for summary judgment under CPLR 3212 against defendant Janan S. Syed, DC, and moves for default judgment under CPLR 3215 against the properly served and non-appearing defendants [*2]who remain in the action.

American Transit’s motion for summary judgment and for default judgment is denied.

DISCUSSION

Both branches of American Transit’s motion rely on the same legal theory and supporting evidence. American Transit contends, in essence, that it has good reason to believe that the collision putatively giving rise to Watson’s need for medical treatment was staged, which is a proper ground for denying coverage.

A no-fault insurer seeking a declaration of no coverage based on a conclusion that the underlying collision was staged must establish as a “fact or founded belief that the alleged injury does not arise out of an insured incident.” (Central Gen. Hosp. v Chubb Grp. of Ins. Cos., 90 NY2d 195, 199 [1997].) Here, American Transit submits an affidavit from a claims investigator familiar with the case to support its conclusion that the collision was not genuine. That affidavit, however, is insufficient to meet American Transit’s burden. The affidavit’s account of the circumstances of the accident—and thus the various “red flag” indicators of a staged collision—it is based largely on inadmissible evidence, namely a police accident report and the unsigned transcript of Watson’s examination under oath (EUO).

A police accident report is admissible as a business record if, when prepared, it was based on the preparing officer’s personal observations at the scene, or if the information in the report came from an eyewitness with a business duty to report to the officer. (See Pena v. Slater, 100 AD3d 488, 489 [1st Dept 2012]; State Farm Mut. Auto Ins. Co. v Langan, 18 AD3d 860, 862 [2d Dept 2005].) Here, however, the police report states expressly that the preparing officer did not witness the underlying collision at issue (see NYSCEF No. 13, at 3); indeed, the report appears to indicate that the officer was not present at the scene at the time she investigated the circumstances of the collision (see id. at 1). Nor does American Transit attempt to establish that the occupants of the vehicle (the presumptive sources of the information in the report) were under a business duty to report to the investigating officer. The police report here is thus inadmissible for the hearsay purpose for which American Transit seeks to use it: establishing as fact the circumstances under which the alleged collision occurred. (See Jupa v Zaidi, 309 AD2d 606, 607 [1st Dept 2003]; accord Langan, 18 AD3d at 862.)

The affidavit of American Transit’s investigator also draws heavily on Watson’s EUO transcript. But that transcript is not signed or notarized. (See NYSCEF No. 14 at 76.) And although the transcript itself suggests that American Transit intended to send a copy of the transcript to Watson to review, sign, notarize, and return (see id.), American Transit has not met its burden to establish that it actually followed through and provided Watson the transcript, as required by CPLR 3116 (a). (See Ramirez v Willow Ridge Country Club, 84 AD3d 452, 453 [1st Dept 2011] [noting that the proponent of a deposition transcript bears the burden to show compliance with CPLR 3116 (a)].) On this record, therefore, the transcript is inadmissible hearsay as well. (See Santos v. Intown Assocs., 17 AD3d 564, 565 [2d Dept 2005].)

As hearsay, neither the police report nor the EUO transcript in this case are competent evidence to support American Transit’s motion for summary judgment. (See Jupa, 309 AD2d at 607; Santos, 17 AD3d at 565.) Nor can American Transit rely upon them to support a motion for default judgment. (See Martinez v Reiner, 104 AD3d 477, 478 [1st Dept 2013]; Zelnik v Bidermann Indus. U.S.A., Inc., 242 AD2d 227, 228 [1st Dept 1997].)

Excluding facts gleaned from the police report and Watson’s EUO transcript, the affidavit of American Transit’s investigator is based on little more than the day, time, and location of the collision. But those facts, standing alone, are not sufficient to establish a founded belief that the collision was staged—either on a prima facie basis for purposes of default judgment, or as a matter of law for purposes of summary judgment.

Accordingly, it is hereby

ORDERED that the branch of American Transit’s motion seeking summary judgment under CPLR 3212 against defendant Janan S. Syed, DC, is denied; and it is further

ORDERED that the branch of American Transit’s motion seeking default judgment under CPLR 3215 against the remaining properly served and non-appearing defendants is denied; and it is further

ORDERED that the parties shall confer and shall prepare a joint request for a preliminary conference with this court, as set forth in the Remote Conference Protocol available on this court’s website, http://ww2.nycourts.gov/courts/1jd/supctmanh/index.shtml.

Date: 5/07/20

[*1]

Peter C. Merani, P.C., New York, NY (Stephen C. Lanzone and Samuel A. Kamara of counsel), for appellant.

The Law Office of Jason Tenenbaum, P.C., Garden City, NY, for respondent.

In an action pursuant to Insurance Law § 5106 (c) for a de novo determination of claims for no-fault insurance benefits, the plaintiff appeals from an order of the Supreme Court, Nassau County (George R. Peck, J.), entered April 3, 2017. The order, insofar as appealed from, denied those branches of the plaintiff’s motion which were for summary judgment on the complaint and dismissing the defendant’s counterclaim for no-fault benefits, or, in the alternative, pursuant to CPLR 3211 (a) (3) to dismiss the defendant’s counterclaim for no-fault benefits for lack of standing, and granted those branches of the defendant’s cross motion which were for summary judgment dismissing so much of the complaint as alleged that she lacked standing and, in effect, for a determination that she had standing to seek recovery of no-fault insurance benefits from the plaintiff.

Ordered that the order is affirmed insofar as appealed from, with costs.

The defendant, Stacey Kapeleris, was involved in a motor vehicle collision on April 15, 2008. In October 2008, Kapeleris underwent spinal surgery at Winthrop University Hospital (hereinafter Winthrop), which was performed by a physician associated with Long Island Neurosurgical Associates, P.C. (hereinafter LI Neurosurgical). Nassau Anesthesia Associates (hereinafter Nassau Anesthesia) provided the anesthesia services for the surgery. Kapeleris assigned her right to no-fault insurance benefits for medical expenses to Winthrop and to Nancy E. Epstein, a physician who was associated with LI Neurosurgical. On appeal, the parties do not dispute that the assignment to Winthrop constituted a valid assignment at the time of its execution within the meaning of the relevant no-fault regulations.

In November 2008, Winthrop submitted a claim to Kapeleris’s insurer, the plaintiff, Allstate Insurance Company (hereinafter Allstate), for no-fault insurance benefits for Kapeleris’s surgery and related care in the amount of $51,489.16. That same month, LI Neurosurgical submitted a claim to Allstate in the amount of $6,348.99, and Nassau Anesthesia submitted a claim for $1,263.63. Allstate denied all three claims on the ground that the services were not medically necessary based upon an independent medical examination that was performed in August 2008. Subsequently, the three providers billed Kapeleris directly for their services. In August 2011, Kapeleris settled the bills submitted by the three providers through direct payments made from an attorney trust account by the attorneys representing Kapeleris in connection with her personal injury action stemming from the underlying accident. Payment was made to Winthrop in the amount of $21,317.02, to LI Neurosurgical in the amount of $2,250, and to Nassau Anesthesia in the amount of $1,542.86.

In February 2014, Kapeleris submitted the matter to arbitration seeking $33,588.11 in connection with the three claims at issue. In March 2015, the arbitrator rendered an award in favor of Kapeleris in the sum of $10,682.87. Allstate appealed the award to a master arbitrator, who affirmed the award.

On August 6, 2015, Allstate commenced this action pursuant to Insurance Law § 5106 (c) for a de novo determination of Kapeleris’s claims for no-fault insurance benefits. Kapeleris served an answer to the complaint containing, inter alia, a counterclaim for no-fault benefits. Allstate moved, inter alia, for summary judgment on the complaint and dismissing Kapeleris’s counterclaim for no-fault benefits or, in the alternative, pursuant to CPLR 3211 (a) (3) to dismiss Kapeleris’s counterclaim for no-fault benefits for lack of standing, arguing that Kapeleris assigned her rights to those benefits to the medical providers that treated her. Kapeleris cross-moved, among other things, for summary judgment dismissing so much of the complaint as alleged that she lacked standing and, in effect, for a determination that she had standing to seek recovery of no-fault insurance benefits from Allstate. The Supreme Court, inter alia, denied Allstate’s motion, and granted the aforementioned branches of Kapeleris’s cross motion. With respect to the issue of standing, the court determined, among other things, that since Kapeleris had tendered payment to Winthrop and LI Neurosurgical from her own proceeds, she had standing to pursue any claims for reimbursement against Allstate for nonpayment.

An accident victim may assign his or her no-fault claim to a medical provider who has provided a medical service (see 11 NYCRR 65-3.11; Long Is. Radiology v Allstate Ins. Co., 36 AD3d 763, 764-765 [2007]). The no-fault regulations provide that assignments must be made on the prescribed statutory forms (see 11 NYCRR 65-3.11 [b] [2]; John T. Mather Mem. Hosp. v Linzer, 32 Misc 3d 59, 61 [App Term, 2d Dept, 9th & 10th Jud Dists 2011]). The prescribed language requires the assignee (treatment provider) to certify that “[t]hey have not received any payment from or on behalf of the assignor [patient] and shall not pursue payment directly from the assignor for services provided by said assignee for injuries sustained due to the [subject] motor vehicle accident” (11 NYCRR Appendix 13 [NYS Forms NF-3, NF-4, NF-5, NF-AOB]; see John T. Mather Mem. Hosp. v Linzer, 32 Misc 3d at 60). In this regard, as set forth in an informal opinion issued by the Office of the General Counsel of the New York State Insurance Department, “a health care provider who has accepted a no-fault assignment of benefits from a no-fault claimant may not pursue the patient directly for health services rendered that have been denied as medically unnecessary, notwithstanding the language of the assignment, which states ‘in the event that the no-fault carrier fails or refuses to pay for the services provided then I, the patient, agree that I will be responsible for the value of services rendered by said Doctor,’ ” as “[t]he use of such language is prohibited under N.Y. Comp. Codes R. & Regs. tit. 11, § 65-3.11(b) (2) (2005) (Regulation 68-C)” (Ops Gen Counsel NY Ins Dept No. 06-05-07 [May 2006]; see John T. Mather Mem. Hosp. v Linzer, 32 Misc 3d at 60; see also A.M. Med. Servs., P.C. v Progressive Cas. Ins. Co., 101 AD3d 53, 64 [2012] [“informal opinion of the General Counsel, while not binding on the courts, is entitled to deference unless irrational or unreasonable” (citation omitted)]).

Here, in support of her cross motion, Kapeleris submitted evidence establishing that although she had assigned her right to no-fault benefits to two medical providers, Winthrop and Nancy E. Epstein, she was billed directly by Winthrop and LI Neurosurgical for their services after the claims of those providers were denied by Allstate for lack of medical necessity (cf. Abruscato v Allstate Prop. & Cas. Ins. Co., 165 AD3d 1209, 1211 [2018]). Further, Kapeleris’s evidentiary submissions showed that she remitted payment to those providers for their services in connection with the subject accident. Thus, Kapeleris’s evidentiary submissions showed that neither Winthrop nor LI Neurosurgical could certify that “[t]hey have not received any payment from or on behalf of the assignor [Kapeleris],” and that they would “not pursue payment directly from the assignor for services provided by said assignee for injuries sustained due to the [subject] motor vehicle accident.” This evidence was sufficient to demonstrate, prima facie, that the assignment to Winthrop and LI Neurosurgical, though valid when made, had been rendered ineffectual, and therefore, Kapeleris had standing to pursue her claims for no-fault benefits against Allstate for services rendered by Winthrop and LI Neurosurgical.

Furthermore, Kapeleris demonstrated that she did not execute an assignment of her rights to collect no-fault benefits to Nassau Anesthesia (see 11 NYCRR 65-3.11 [b] [1], [2]; Lopes v Liberty Mut. Ins. Co., 24 Misc 3d 127[A], 2009 NY Slip Op 51279[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2009]). Thus, Kapeleris also demonstrated, prima facie, that she had standing to pursue her claim for no-fault benefits against Allstate for the payment she made to Nassau Anesthesia.

In opposition, Allstate failed to raise a triable issue of fact (see Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]).

The parties’ remaining contentions either need not be reached in light of our determination, are without merit, or are not properly before this Court.

Accordingly, we agree with the Supreme Court’s determination denying those branches of Allstate’s motion which were for summary judgment on the complaint and dismissing Kapeleris’s counterclaim for no-fault benefits, or, in the alternative, pursuant to CPLR 3211 (a) (3) to dismiss Kapeleris’s counterclaim for no-fault benefits for lack of standing, and granting those branches of Kapeleris’s cross motion which were for summary judgment dismissing so much of the complaint as alleged that she lacked standing and, in effect, for a determination that she had standing to seek recovery of no-fault insurance benefits from Allstate. Rivera, J.P., Roman, Hinds-Radix and Duffy, JJ., concur.

654605/2019

Burke, Conway & Stiefeld, White Plains, NY (Michelle Dunleavy of counsel), for plaintiffs.

The Rybak Firm, PLLC, Brooklyn, NY (Oleg Rybak of counsel), for defendants Agyal Physical Therapy PLLC, Alford A. Smith MD, PC, and Metro Pain Specialists, PC.

Kopelevich & Feldsherova, P.C., Brooklyn, NY (David Landfair of counsel), for defendant M & M Supplies Group, Inc.

The following e-filed documents, listed by NYSCEF document number (Motion 001) 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 47, 48, 49, 50, 51, 52, 53, 54 were read on this motion to/for DEFAULT JUDGMENT

This motion concerns the potential obligation to pay no-fault insurance benefits of plaintiffs Liberty Mutual Insurance Company and LM General Insurance Company (Liberty Mutual). Defendants Trevohn Martin, Dwayne Bailey, and Damell Jackson were in a vehicle that was involved in a collision. The vehicle was covered by a no-fault insurance policy issued by Liberty Mutual. Martin, Bailey, and Jackson (and various medical providers acting as their assignees) applied for no-fault benefits, which Liberty Mutual denied.

In this action, Liberty Mutual is seeking a declaratory judgment that it is not required to pay no-fault benefits to Martin, Bailey, Jackson, or the various medical provider defendants. Liberty Mutual now moves for a default judgment under CPLR 3215 (and other related relief) against defendants. Defendants Agyal Physical Therapy PLLC, Alford A. Smith MD, PC, and Metro Pain Specialists, PC, and defendant M & M Supplies Group, Inc., separately cross-move under CPLR 3012 (d) to extend defendants’ time to answer, and to compel acceptance of defendant’s late answer, respectively.

Liberty Mutual’s motion for default judgment is denied; defendants’ cross-motions are [*2]granted.

DISCUSSION

I. Liberty Mutual’s Motion for Default Judgment

To obtain a default judgment, a plaintiff must among other things submit nonhearsay proof of all the facts necessary to establish its prima facie entitlement to relief. (See CPLR 3215 [f]; Joosten v Gale, 129 AD2d 531, 535 [1st Dept 1987]; Matter of Dyno v Rose, 260 AD2d 694, 698 [3d Dept 1999].) This court concludes that Liberty Mutual has not met that burden here.

Liberty Mutual’s request for declaratory relief rests on two different grounds. As to defendant Jackson (and his medical-provider assignees), Liberty Mutual contends that he failed to appear for a properly scheduled examination under oath (EUO), thereby breaching a condition precedent to coverage. As to defendants Martin and Bailey (and their medical-provider assignees), Liberty Mutual contends, in essence, that it has good reason to believe that Martin and Bailey helped stage the collision that putatively gave rise to their need for medical treatment, which is a proper ground for denying coverage.

A. Liberty Mutual’s Denial of Coverage as to Defendant Jackson and His Assignees

A no-fault insurer seeking a declaration of no coverage due to asserted violations of the terms of the policy must first demonstrate that it complied with each of the procedural and timeliness requirements of 11 NYCRR § 65-3.5, governing the handling of no-fault claims. (See American Transit Ins. Co. v Longevity Med. Supply, Inc., 131 AD3d 841, 841 [1st Dept 2015].) Liberty Mutual has not satisfied that requirement here. Among other things, § 65-3.5 provides that once an insurer receives a claim for benefits, the insurer has 10 business days to provide the claimant with the forms necessary to verify the claim. (See 11 NYCRR § 65-3.5 [a].) Once the insurer receives the completed verification forms, it then has 15 business days to seek further verification, for example through requesting a claimant to appear for an EUO. (See id. § 65-3.5 [b].) A claimant’s failure without reasonable cause to appear for a properly scheduled EUO is grounds to deny coverage.

As to Jackson, Liberty Mutual has not submitted evidence establishing when it first received a claim for benefits from him or from one of his treating providers, when it provided the necessary verification forms, or when it first received one of those forms back. Absent this evidence, Liberty Mutual cannot show that it timely complied with the procedural requirements of § 65-3.5. At most, Liberty Mutual submits an affidavit of a claims manager, stating in relevant part that based on her knowledge of Liberty Mutual’s procedures and review of Jackson’s claim file, “[a]ll verification requests and denials were timely mailed.”^[FN1] This brief and conclusory statement is not sufficient.

Additionally, Liberty Mutual fails to show that Jackson was properly notified of the scheduled EUOs. Liberty Mutual submits copies of two scheduling letters together with affidavits of service attesting to their mailing. Neither affidavit, however, is signed or dated; and the notarization blank on each affidavit is not filled in. (See NYSCEF No. 11 at 4, 8.) The [*3]affidavits, therefore, are defective.^[FN2] They cannot establish that the scheduling letters were properly mailed. (See Levine v Health First, 147 AD3d 1193, 1195 [3d Dept 2017].) Nor does Liberty Mutual provide any other evidence (in affidavit form or otherwise) that might remedy this deficiency.

Liberty Mutual thus has failed on this motion to provide facts establish a prima facie case that defendant Jackson failed to appear for timely and properly scheduled EUOs, as required to support Liberty Mutual’s request for a declaration of no coverage. Liberty Mutual’s motion for default judgment against Jackson and his assignees is denied.

B. Liberty Mutual’s Denial of Coverage as to Defendants Martin and Bailey and Their Assignees

A no-fault insurer seeking a declaration of no coverage on default based on a conclusion that the underlying collision was staged must establish prima facie the “fact or founded belief that the alleged injury does not arise out of an insured incident.” (Central Gen. Hosp. v Chubb Grp. of Ins. Cos., 90 NY2d 195, 199 [1997].)

Here, Liberty Mutual submits an affidavit from a claims investigator familiar with the case to support its conclusion that the collision was not genuine. That affidavit, in turn, relies heavily on the transcripts from the EUOs of Martin and Bailey. But Liberty Mutual fails to show that those transcripts are admissible. In particular, the transcripts are not signed; and Liberty Mutual does not attempt to establish that it ever provided them to Martin and Bailey to review and sign, as required by CPLR 3116 (a). (See Ramirez v Willow Ridge Country Club, 84 AD3d 452, 453 [1st Dept 2011] [noting that the proponent of a deposition transcript bears the burden to show compliance with CPLR 3116 (a)].)

At least for purposes of this motion, therefore, key portions of the affidavit of Liberty Mutual’s claims investigator are based only on hearsay, and are thus insufficient to support the entry of a default judgment. (See Martinez v Reiner, 104 AD3d 477, 478 [1st Dept 2013]; Zelnik v Bidermann Indus. U.S.A., Inc., 242 AD2d 227, 228 [1st Dept 1997].) The claim by Liberty Mutual’s claims investigator in her affidavit that “the facts and circumstances surrounding the accident are indicative of no-fault fraud patterns, specifically a staged accident” is merely conclusory. To be sure, the affidavit does state that Martin and Bailey had previously been in similar accidents together before, which might be probative on the question of whether the collision here was fake. But the affidavit neither provides any details to support this statement nor identifies the basis of this statement beyond it having been “revealed” by an “investigation.”

On this record, therefore, Liberty Mutual has not established prima facie a founded belief that Martin and Bailey were engaged in no-fault insurance fraud rather than being genuine victims of a car accident. Liberty Mutual’s motion for default judgment against Martin and Bailey (and their respective assignees) is denied.

II. Defendants’ Cross-Motions Regarding Their Answers

In addition to opposing Liberty Mutual’s default-judgment motion, defendants Agyal Physical Therapy PLLC, Alford A. Smith MD, PC, and Metro Pain Specialists, PC, and defendant M & M Supplies Group, Inc., separately cross-move under CPLR 3012 (d) to, in [*4]effect, permit them to answer Liberty Mutual’s complaint. The cross-motions are granted.

The moving defendants’ cross-motions are based on CPLR 317, which permits a defendant to appear and defend the action if “he did not personally receive notice of the summons in time to defend and has a meritorious defense.” These defendants provide affidavits attesting to their lack of receipt of Liberty Mutual’s summons and complaint. For the reasons described above, the moving defendants have a potentially meritorious defense. And although the question is a close one in the circumstances of this case, this court concludes that moving defendants’ affidavits sufficiently establish that they did not personally receive timely notice of the summons.

Accordingly, it is hereby

ORDERED that Liberty Mutual’s motion for default judgment under CPLR 3215 is denied; and it is further

ORDERED that the cross-motion of defendants Agyal Physical Therapy PLLC, Alford A. Smith MD, PC, and Metro Pain Specialists, PC, under CPLR 3012 (d) to extend their time to answer is granted nunc pro tunc, and the answer dated December 6, 2019 is deemed timely served and filed; and it is further

ORDERED that the cross-motion of defendant M & M Supplies Group, Inc., under CPLR 3012 (d) to compel Liberty Mutual to accept its proposed answer dated January 6, 2020, is granted.

Dated: May 4, 2020

Hon. Gerald Lebovits, J.S.C.

Footnotes

Footnote 1:Liberty Mutual’s reply affirmation also attaches what appears to be an NF-3 verification form from one of Jackson’s treating providers. But the affirmation does not offer any information or representations to authenticate the attached verification form. Nor does the affirmation indicate whether this was the first verification form received back by Liberty Mutual.

Footnote 2:By contrast, the affidavit of additional mailing in support of Liberty Mutual’s motion for default judgment—completed by the same person who prepared the affidavits of service for the the EUO scheduling letters—is properly signed, dated, and notarized. (See NYSCEF No. 8 at 2.)

Law Office of David O’Connor, PC (David O’Connor of counsel), for appellant. Law Office of Aloy O. Ibuzor (Theresa M. Carrubba and William Angstreich of counsel), for respondent.

Appeal from an order of the Civil Court of the City of New York, Queens County (Tracy A. Catapano-Fox, J.), entered November 20, 2018. The order denied plaintiff’s motion for leave to renew, in effect, its opposition to the branch of defendant’s motion seeking to toll the accrual of no-fault statutory interest, which prior motion had been granted in an order of that court dated June 18, 2018 to the extent of tolling no-fault interest from August 9, 2002 to August 18, 2017 and, upon renewal, to deny that branch of defendant’s motion.

ORDERED that the order entered November 20, 2018 is affirmed, with $25 costs.

Plaintiff commenced this action in 2002 to recover assigned first-party no-fault benefits for services allegedly rendered in 2001. Plaintiff served a notice of trial dated July 21, 2017. Defendant moved to strike the notice of trial and to dismiss the complaint or, in the alternative, to toll the accrual of no-fault statutory interest. By order dated June 18, 2018, the Civil Court granted the branch of defendant’s motion seeking to toll the accrual of no-fault interest to the extent of tolling the interest from August 9, 2002 to August 18, 2017, and denied the other branches of defendant’s motion. Plaintiff moved for leave to renew, in effect, its opposition to the branch of defendant’s motion seeking to toll the no-fault interest, arguing that there had been a change in the law. By order [*2]entered November 20, 2018, the Civil Court denied the motion.

Pursuant to CPLR 2221 (e) (2) and (3), a motion for leave to renew “(2) shall be based upon new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination and (3) shall contain reasonable justification for the failure to present such facts on the prior motion.” In the June 18, 2018 order, the court tolled the no-fault interest based upon a provision of the No-Fault Regulations which states that, once an action has been commenced, statutory interest accumulates “unless the applicant unreasonably delays the . . . court proceeding” (11 NYCRR 65.15 [h], now 11 NYCRR 65—3.9 [d]; see also Aminov v Country Wide Ins. Co., 43 Misc 3d 87 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2014]). In Eagle Surgical Supply, Inc. v Country-Wide Ins. Co. (58 Misc 3d 154[A], 2018 NY Slip Op 50157[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2018]), this court declined to toll the interest because, in that case, it was not clear from the record that the plaintiff had caused the delay. Plaintiff’s motion for leave to renew was based upon the argument that Eagle Surgical Supply, Inc. represents a change in the law. Since that case merely applied the existing law to a new set of facts, it does not represent a change in the law, and plaintiff’s motion for leave to renew was properly denied.

Accordingly, the order is affirmed.

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

Paul Kenny