October 9, 2019
Matter of Acuhealth Acupuncture, P.C. v Country-Wide Ins. Co. (2019 NY Slip Op 07245)
https://www.beynensonlaw.com/case-law/matter-of-acuhealth-acupuncture-p-c-v-country-wide-ins-co-2019-ny-slip-op07245/
- Decided
- October 9, 2019
- Citation
- 2019 NY Slip Op 07245 · 176 AD3d 799
- Posture
- Article 75 petition
- Outcome
- Provider prevailed
Posture, outcome, issues and treatment by other decisions are Beynenson Law’s classification. Treatment labels are assigned by a language model reading the citing decision; negative and appeal-history labels are checked by a second reader.
Summary
Editorial summary by Beynenson Law, not part of the court’s decision.
Reported in New York Official Reports at Matter of Acuhealth Acupuncture, P.C. v Country-Wide Ins. Co. (2019 NY Slip Op 07245)
| Matter of Acuhealth Acupuncture, P.C. v Country-Wide Ins. Co. |
| 2019 NY Slip Op 07245 [176 AD3d 799] |
| October 9, 2019 |
| Appellate Division, Second Department |
| Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. |
[*1]
| In the Matter of Acuhealth Acupuncture, P.C.,
Respondent, v Country-Wide Ins. Co., Appellant. |
Jaffe & Koumourdas, LLP (Thomas Torto, New York, NY, of counsel), for appellant.
Gary Tsirelman, P.C., Brooklyn, NY (Stefan Belinfanti and David M. Gottlieb of counsel), for respondent.
In a proceeding pursuant to CPLR article 75 to vacate an award of a master arbitrator dated February 25, 2016, Country-Wide Ins. Co. appeals from a judgment of the Supreme Court, Kings County (Kathy J. King, J.), dated October 27, 2016. The judgment, upon an order of the same court dated October 26, 2016, granting the petition, vacating the master arbitrator’s award dated February 25, 2016, and confirming the original arbitrator’s award dated December 4, 2015, is in favor of the petitioner and against Country-Wide Ins. Co. in the total sum of $13,864.96.
Ordered that the judgment is affirmed, with costs, and the matter is remitted to the Supreme Court, Kings County, for a determination of the amount of an additional attorney’s fee to be awarded to the petitioner pursuant to Insurance Department Regulations (see 11 NYCRR 65-4.10 [j] [4]).
Acuhealth Acupuncture, P.C. (hereinafter Acuhealth), is the assignee of a claim for no-fault benefits for treatment it rendered to Massiel Olsen. After the carrier, Country-Wide Ins. Co. (hereinafter Country-Wide), denied the claim, Acuhealth submitted the claim to arbitration. The arbitrator, upon refusing to consider Country-Wide’s defenses on the ground that Country-Wide’s submissions to the arbitrator were late, with no excuse for their lateness, found in favor of Acuhealth. On Country-Wide’s appeal, the master arbitrator vacated the award and issued a new award in favor of Country-Wide based on the defense that Acuhealth was fraudulently incorporated, which the original arbitrator had refused to consider on the ground that it was untimely submitted. Acuhealth then commenced this proceeding pursuant to CPLR article 75 to vacate the master arbitrator’s award. The Supreme Court granted Acuhealth’s petition, vacated the master arbitrator’s award in favor of Country-Wide, and confirmed the original arbitrator’s award in favor of Acuhealth. Country-Wide appeals.
An arbitrator acts within his or her discretionary authority by refusing to entertain late submissions (see Matter of Global Liberty Ins. Co. v Coastal Anesthesia Servs., LLC, 145 AD3d 644, 645 [2016]; Matter of Mercury Cas. Co. v Healthmakers Med. Group, P.C., 67 AD3d 1017, 1017 [2009]; Matter of Green v Liberty Mut. Ins. Co., 22 AD3d 755, 756 [2005]). Here, in rejecting the original arbitrator’s proper exercise of his discretionary authority, and in passing, de novo, upon factual questions concerning the validity of Country-Wide’s defense that Acuhealth was fraudulently incorporated (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 320-321 [2005]), the master arbitrator exceeded his power (see Matter of Smith [Firemen’s Ins. Co.], 55 NY2d 224, 230-231 [1982]; Matter of Allstate Ins. Co. v Keegan, 201 AD2d 724, 725 [1994]). Accordingly, we agree with the Supreme Court’s determination to vacate the master arbitrator’s award and confirm the original arbitrator’s award in favor of Acuhealth.
Moreover, as Acuhealth contends and Country-Wide concedes, Acuhealth is entitled to an attorney’s fee for this appeal pursuant to 11 NYCRR 65-4.10 (j), to be fixed by the Supreme Court (see Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C., 167 AD3d 404, 405 [2018]; Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 162 AD3d 407, 408 [2018]; Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 148 AD3d 703, 706 [2017]). The matter is therefore remitted to the Supreme Court, Kings County, for that purpose.
Acuhealth’s remaining contention is without merit. Balkin, J.P., Roman, Brathwaite Nelson and Christopher, JJ., concur.
Legal questions (3)
Questions of no-fault law this decision rules on, from our Legal Questions pages. Bars count the decisions on the question by year and court, coloured by category; circles are this decision and the decisions on the question it cites or that cite it. Point at a bar or circle for details. The categories and summaries are Beynenson Law’s classification, made by a language model and checked by a second reading.
When does a court vacate, modify or confirm a no-fault arbitrator’s or master arbitrator’s award under CPLR article 75?
This decision: Master arbitrator's award vacated because the master arbitrator went beyond the limited review allowed by 11 NYCRR 65-4.10
Affirmed vacatur of the master arbitrator's award because he rejected the arbitrator's proper refusal of late submissions and passed de novo on the fraudulent incorporation defense, exceeding his power.
Of the 119 decisions on this question in the Second Department courts and the Court of Appeals, 4 (this one included) are in the same category. 3 decisions in other departments that cite or are cited by this one are on the full map.
May the insurer raise and investigate a Mallela (fraudulent incorporation) defense, or is it precluded, waived or denied discovery?
This decision: Insurer may not pursue or investigate the Mallela defense here (rules on the question, but another ground decided the case)
Held the arbitrator properly refused to consider the late-submitted fraudulent incorporation defense, and the master arbitrator exceeded his power by deciding that defense de novo, so the award for the provider was confirmed.
Of the 136 decisions on this question in the Second Department courts and the Court of Appeals, 24 (this one included) are in the same category. One decision in other departments that cites or is cited by this one is on the full map.
How is the applicant’s attorney’s fee fixed for no-fault article 75 proceedings, de novo actions and appeals?
This decision: Applicant is entitled to a court-fixed fee for the proceeding or appeal; granted, or remitted to set the amount (rules on the question, but another ground decided the case)
Held, as conceded, that the provider was entitled to an attorney's fee for the appeal under 65-4.10 (j), and remitted to Supreme Court to fix the amount.
Of the 58 decisions on this question in the Second Department courts and the Court of Appeals, 22 (this one included) are in the same category. 2 decisions in other departments that cite or are cited by this one are on the full map.
Cited in this decision
- Matter of Global Liberty Ins. Co. v Coastal Anesthesia Servs., LLC (2016 NY Slip Op 08964)A no-fault arbitrator has discretion to refuse late submissions under 11 NYCRR 65-4.2 (b) (3).
- Matter of Mercury Cas. Co. v Healthmakers Med. Group, P.C. (2009 NY Slip Op 08826)A court denying vacatur or modification of a no-fault arbitration award must confirm the award under CPLR 7511 (e).
- Matter of Green v Liberty Mut. Ins. Co. (2005 NY Slip Op 07961)An arbitrator acted within discretionary authority in refusing late submissions from both parties to a no-fault arbitration.
- State Farm Mut. Auto. Ins. Co. v Mallela (2005 NY Slip Op 02416)Fraudulently incorporated medical providers are ineligible for no-fault reimbursement under 11 NYCRR 65-3.16 (a) (12).
- Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C. (2018 NY Slip Op 08238)The insurer's billing-fraud evidence did not establish a Mallela defense exempt from the 30-day denial deadline.
- Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C. (2018 NY Slip Op 03929)The insurer's Mallela challenge failed because it presented no evidence that the provider was fraudulently incorporated.
- Matter of GEICO Ins. Co. v AAAMG Leasing Corp. (2017 NY Slip Op 01552)A provider may recover an additional attorney's fee for an article 75 proceeding to confirm or vacate a master arbitration award.
Cited by
- American Tr. Ins. Co. v PDA NY Chiropractic, P.C. (2023 NY Slip Op 50938(U))A provider's substantial compliance with reasonable additional verification requests does not make its claims payable.
Similar decisions
- Matter of Bay Needle Care Acupuncture v Country-Wide Ins. Co. (2019 NY Slip Op 07249)A master arbitrator exceeds the permitted review power by reweighing evidence of fraudulent incorporation and reaching a different factual conclusion.
- Matter of V.S. Care Acupuncture, P.C. v Country-Wide Ins. Co. (2019 NY Slip Op 07265)A master arbitrator may assess legal sufficiency but may not weigh evidence or make independent factual findings.
- Matter of Country-Wide Ins. Co. v TC Acupuncture, P.C. (2021 NY Slip Op 01120)An alleged error in the burden of proof for a fraudulent incorporation defense does not alone warrant vacatur of an arbitration award.
- Matter of Bay Needle Care Acupuncture, P.C. v Country Wide Ins. Co. (2019 NY Slip Op 07061)The provider's challenge to its arbitration attorney fee failed because it submitted no documentation of hours worked.
- Matter of Acuhealth Acupuncture, P.C. v New York City Tr. Auth. (2018 NY Slip Op 08641)The master arbitrator's confirmation of an award denying benefits for exhausted policy limits had evidentiary support and a rational basis.