June 23, 2009

Crossbridge Diagnostic Radiology v Encompass Ins. (2009 NY Slip Op 51415(U))


The main facts considered by the court were that Crossbridge Diagnostic Radiology was seeking first-party no-fault benefits after the insurer, Encompass Insurance, had denied their claim on the grounds that the policy benefits had been exhausted. Crossbridge argued that the denial was untimely and that there was no admissible evidence to establish that the policy benefits were actually exhausted. The main issue decided was whether the evidence presented by Encompass Insurance was admissible and sufficient to establish that the policy benefits had been exhausted. The holding was that the evidence presented by Encompass Insurance was not in admissible form, and therefore did not establish a triable issue of fact. The judgment of the Civil Court granting Crossbridge's motion for summary judgment was affirmed as a result.

Reported in New York Official Reports at Crossbridge Diagnostic Radiology v Encompass Ins. (2009 NY Slip Op 51415(U))

Crossbridge Diagnostic Radiology v Encompass Ins. (2009 NY Slip Op 51415(U)) [*1]
Crossbridge Diagnostic Radiology v Encompass Ins.
2009 NY Slip Op 51415(U) [24 Misc 3d 134(A)]
Decided on June 23, 2009
Appellate Term, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.
Decided on June 23, 2009



2008-399 K C.
Crossbridge Diagnostic Radiology as assignee of MOHAMED ALI LMIMOUNI, Respondent,


Encompass Insurance, Appellant.

Appeal from an order of the Civil Court of the City of New York, Kings County (Kathy J. King, J.), entered May 18, 2007, deemed from a judgment of the same court entered September 12, 2007 (see CPLR 5512 [a]; Neuman v Otto, 114 AD2d 791 [1985]). The judgment, entered pursuant to the May 18, 2007 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $911.99.

Judgment affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant opposed the motion, arguing that it denied plaintiff’s claim on the ground that no coverage existed since the policy benefits had been exhausted. In response, plaintiff argued that defendant failed to timely deny plaintiff’s claim and, in any event, defendant did not present admissible evidence establishing that the policy benefits were exhausted because the affidavit by defendant’s claims representative was executed before a Massachusetts notary public and there was nothing showing that it complied with CPLR 2309 (c). The Civil Court granted plaintiff’s motion for summary judgment, holding that defendant failed to proffer evidence establishing a triable issue of fact. The instant appeal by defendant ensued. A judgment was subsequently entered.

A “defendant’s failure to issue a denial of the claim within 30 days d[oes] not preclude a defense that the coverage limits of the subject policy have been exhausted” (New York & Presbyt. Hosp. v Allstate Ins. Co., 12 AD3d 579, 580 [2005] [internal quotations omitted]; see also Presbyterian Hosp. in City of NY v General Acc. Ins. Co. of Am., 229 AD2d 479, 480 [1996]). However, the affidavit proffered by defendant, in which defendant’s claims representative asserted that the available coverage had been exhausted, was not in admissible [*2]form. Defendant’s affidavit was not in conformity with CPLR 2309 (c), which fact was duly objected to by plaintiff in the Civil Court (see Impulse Chiropractic, P.C. v New York Cent. Mut. Fire Ins. Co., 19 Misc 3d 127[A], 2008 NY Slip Op 50498[U] [App Term, 2d & 11th Jud Dists 2008]; Dan Med., P.C. v New York Cent. Mut. Ins. Co., 17 Misc 3d 130[A], 2007 NY Slip Op 51981[U] [App Term, 2d & 11th Jud Dists 2007]). Moreover, defendant’s attorney’s affirmation was of no probative value since she did not establish that she had personal knowledge that the coverage limits of the policy had been exhausted. Consequently, defendant’s assertion of the exhaustion of available coverage was without any probative value.

Defendant’s remaining contention is unpreserved for appellate review and, in any event, lacks merit (see East Acupuncture, P.C. v Electric Ins. Co., 16 Misc 3d 128[A], 2007 NY Slip Op 51281[U] [App Term, 2d & 11th Jud Dists 2007]; Oleg Barshay, D.C., P.C. v State Farm Ins. Co., 14 Misc 3d 74 [App Term, 2d & 11th Jud Dists 2006]).
Accordingly, the judgment is affirmed.

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

Golia, J., dissents in a separate memorandum.

Golia, J., dissents and votes to reverse the judgment, vacate the order entered May 18, 2007 and deny plaintiff’s motion for summary judgment, in the following memorandum:

The majority decision here places form over substance and does not comport with the entire body of law as rendered by the Court of Appeals.

One of the pre-eminent cases in no-fault law is the Court of Appeals’ decision in Central Gen. Hosp. v Chubb Group of Ins. Cos. (90 NY2d 195 [1997]). The commonly held belief among many who are involved in no-fault law and litigation is that Chubb provides that a defendant will not be precluded from raising the defense of a “staged” accident despite having failed to deny the claim within 30 days. In actuality, however, there was no claim of a “staged” accident in Chubb. The defendant simply asserted that the assignor’s injuries were the result of a work-related accident and were therefore not covered by the automobile insurance policy in question. The Court of Appeals specifically held that despite the fact that the assignor was a covered person who was involved in an otherwise “covered” accident, there was a founded belief that her injuries were due to some other cause and were therefore not covered by the policy of insurance.

Indeed, Chubb relied heavily upon the prior Court of Appeals’ decision of Zappone v Home Ins. Co. (55 NY2d 131 [1982]). There, Mr. Zappone sent notice to the defendant Home Insurance Company that he had been in an automobile accident and was being sued by those injured in that accident. That notice sought coverage by the carrier in excess of the benefits being provided by the primary carrier. Home Insurance failed to disclaim coverage until some 15 months later, which unquestionably exceeded the mandates of subdivision 8 of section 167 of the Insurance Law.

The Court of Appeals was then confronted with applying a statute whose clear effect would result in directing an insurance carrier to provide coverage and reimbursement for which the carrier did not contract. The Court declined to do so and stated that,

“Literal interpretation of the words used will not be [*3]accorded when to do so will occasion great inconvenience, or produce inequality, injustice or absurdity. It is, moreover, always presumed that no unjust or unreasonable result was intended and the statute must be construed consonant with that presumption” (id. at 137 [citations omitted]).

Nevertheless, here the majority gives no weight to defendant’s attorney’s affirmation that effectively placed into issue whether, in accordance with the terms of the insurance contract, the assignor’s benefits had “maxed out”. Indeed, her affirmation refers to and incorporates certain documents pertaining to the fact that this claim is beyond the $8,000 monetary limit for no-fault benefits under the insurance contract at issue.

More specifically, that affirmation states that :
“The bill was denied because the policy benefits of $8,000.00 provided under the Massachusetts policy have been exhausted . . . [A]nnexed hereto as Exhibit B . . . [are] copies of the following:
Application for PIP Benefits indicating accident occurred in Massachusetts; printouts from carrier containing coverage information and portion of insurance policy providing for PIP coverage in the amount of $8,000.00; Payment History showing payout of benefits in the amount of $8,000.00″
These documents, coupled with the uncertified “affidavit” by Ms. Teixera, which was sworn to before a notary of our sister state of Massachusetts, in addition to the affirmation of the moving attorney, should certainly constitute a “founded belief” that this claim is not covered by the policy of insurance (see Weiss v Garfield, 21 AD2d 156 [1964] and the dissent in Ocean Diagnostic Imaging, P.C. v Lancer Ins. Co, 6 Misc 3d 62 [App Term, 2d & 11th Jud Dists 2004]). Indeed, even if it does not reach that level, then the lessons taught by Chubb and Zappone should still have mandated that plaintiff’s motion for summary judgment be denied.
Decision Date: June 23, 2009