July 10, 2008

Multiquest, P.L.L.C. v Allstate Ins. Co. (2008 NY Slip Op 51531(U))

Headnote

The facts of the case involved a dispute between Multiquest, P.L.L.C. and Allstate Insurance Company over the reimbursement of first-party no-fault benefits for psychological services rendered in August and September 1999. The main issue decided was whether Multiquest was eligible to receive reimbursement for these services, as Allstate alleged that Multiquest was fraudulently incorporated. The court held that an Insurance Department Regulation was inapplicable to claims for services rendered prior to April 4, 2002, and in a similar case, it was held that the Regulation should be given retroactive effect. However, Allstate established that Multiquest had performed the psychological services in violation of Limited Liability Company Law, thus making them ineligible for reimbursement of no-fault benefits. The holding of the case was that Multiquest was ineligible to obtain reimbursement of the benefits and Allstate was entitled to summary judgment dismissing the complaint.

Reported in New York Official Reports at Multiquest, P.L.L.C. v Allstate Ins. Co. (2008 NY Slip Op 51531(U))

Multiquest, P.L.L.C. v Allstate Ins. Co. (2008 NY Slip Op 51531(U)) [*1]

Multiquest, P.L.L.C. v Allstate Ins. Co.

2008 NY Slip Op 51531(U) [20 Misc 3d 136(A)]

Decided on July 10, 2008

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This opinion is uncorrected and will not be published in the printed Official Reports.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 July 10, 2008

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

PRESENT: : RIOS, J.P., PESCE and GOLIA, JJ
2007-329 Q C.

Multiquest, P.L.L.C. a/a/o HUBERT JONES, Respondent,
against
Allstate Insurance Company, Appellant.

Appeal from an order of the Civil Court of the City of New York, Queens County (Gerald Dunbar, J.), entered February 2, 2006, deemed from a judgment entered February 5, 2007 (see CPLR 5501 [c]). The judgment, entered pursuant to the January 19, 2006 order granting plaintiff’s motion for summary judgment and denying defendant’s cross motion for summary judgment, awarded plaintiff the principal sum of $1,236.99.

Judgment reversed without costs, order entered January 19, 2006 vacated, plaintiff’s motion for summary judgment denied and defendant’s cross motion for summary judgment dismissing the complaint granted.

In this action by a provider to recover assigned first-party no-fault benefits for psychological services rendered in August and September 1999, plaintiff moved for summary judgment. Defendant cross-moved for summary judgment arguing, inter alia, that plaintiff was ineligible to receive reimbursement of no-fault benefits because plaintiff was fraudulently incorporated, relying on State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005]). Holding that Insurance Department Regulations (11 NYCRR) § 65-3.16 (a) (12) was inapplicable to claims for services rendered prior to April 4, 2002, the court granted plaintiff’s motion for summary judgment and denied defendant’s cross motion seeking summary judgment dismissing the complaint. This appeal ensued. A judgment was subsequently entered.

In Allstate Ins. Co. v Belt Parkway Imaging, P.C. (33 AD3d 407 [2006]), the Appellate [*2]Division, First Department, held that Insurance Department Regulations (11 NYCRR) § 65-3.16 (a) (12) is to be given retroactive effect notwithstanding the fact that it would bar reimbursement of assigned first-party no-fault benefits for services rendered prior to April 4, 2002 (see also Metroscan Imaging, P.C. v GEICO Ins. Co. (13 Misc 3d 35, 37-39 [App Term, 2d & 11th Jud Dists 2006]). Defendant’s cross motion for summary judgment established that plaintiff performed psychological services in violation of Limited Liability Company Law sections 1203 and 1207. Consequently, based upon our prior determination in Multiquest, P.L.L.C. v Allstate Ins. Co. (17 Misc 3d 37 [App Term, 2d & 11th Jud Dists 2007]), plaintiff was ineligible to obtain reimbursement of assigned first-party no-fault benefits for such services and defendant was entitled to summary judgment dismissing the complaint.

Rios, J.P., Pesce and Golia, JJ., concur.
Decision Date: July 10, 2008