23 decisions · 19 Appellate Term · 4 trial courts
Issues this month: Timeliness and preclusion 9 Discovery and procedure 5 Medical necessity 5 IME no-show 4 MVAIC 3 Fraudulent incorporation (Mallela) 2
The insurer's IME-based summary judgment motion was denied for failure to establish notice mailing and the assignor's nonappearance. The Appellate Term, First Department, affirmed the denial of dismissal. Relying on Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., the court found the insurer's prima facie showing deficient, requiring denial regardless of the sufficiency of the provider's opposition.
The provider's untimely discovery challenge and failure to produce any discovery supported dismissal of its complaint. The Appellate Term, Second Department, affirmed the judgment, insofar as appealed from, following noncompliance with discovery ordered in actions consolidated for Mallela issues. A licensing-eligibility defense under 11 NYCRR 65-3.16 (a) (12) is not precluded by an untimely denial and need not be pleaded with particularity under CPLR 3016 (b). The insurer's papers showed a potentially meritorious defense. The protective-order motion, filed nearly four months after supplemental demands, was untimely under CPLR 3122 (a). Although palpably improper or privileged demands remain excepted, the court found most demands outside those exceptions and affirmed dismissal because the provider produced nothing; it reached no other issue.
A provider seeking default judgment more than a year after default must show a reasonable excuse for delay and a meritorious complaint. The Appellate Term, Second Department, reversed the order, denied the provider's motion for a default judgment, and granted the insurer's cross motion to dismiss under CPLR 3215 (c). The provider moved approximately two years and four months after serving the summons with endorsed complaint, and offered no opposition to the insurer's cross motion. The Civil Court had conditionally allowed default judgment unless the insurer answered within 30 days. Reviewing the motion papers, the appellate court found dismissal as abandoned required under CPLR 3215 (c).
The insurer's unrebutted IME report established that the medical supplies lacked medical necessity. The Appellate Term, Second Department, reversed the order, insofar as appealed from, and granted the insurer's cross motion for summary judgment dismissing the provider's complaint. The IME report set forth a factual basis and medical rationale for the doctor's determination, and the provider did not rebut the insurer's showing. The Civil Court had implicitly found under CPLR 3212 (g) that the insurer timely denied the claim on medical-necessity grounds, a finding the provider did not challenge. The insurer therefore was entitled to dismissal rather than a trial on medical necessity.
The insurer's unrebutted peer reviews established that the medical supplies lacked medical necessity. The Appellate Term, Second Department, reversed the order, insofar as appealed from, and granted the insurer's cross motion for summary judgment dismissing the provider's complaint. The peer review reports supplied factual bases and medical rationales for the doctors' conclusions, and the provider did not rebut that showing. The Civil Court had implicitly found under CPLR 3212 (g) that the insurer timely denied the claim on medical-necessity grounds. The provider did not challenge that finding, leaving no basis to deny the insurer's cross motion.
The insurer's affidavit describing a records search raised a triable issue as to whether it had issued the alleged policy. The Appellate Term, Second Department, reversed the provider's judgment, vacated the summary judgment order, and denied the provider's motion. The insurer submitted an affidavit stating that its records showed no policy for the purported owner under the claimed policy number, along with accident, application, and denial documents. Although insufficient to establish lack of coverage as a matter of law, the proof raised a factual issue without detailing the search steps. The appellate court was not bound by law of the case and considered the merits; it did not review the unchallenged finding that the provider established its prima facie case.
The providers failed to demonstrate exhaustion of remedies against the known vehicle owner before seeking no-fault benefits from MVAIC. The Appellate Term, Second Department, reversed the order, granted MVAIC's summary judgment motion dismissing the complaint, and denied the providers' cross motion. The providers and their assignor knew the owner's identity, and the assignor had been a passenger in that vehicle. Following Hauswirth v American Home Assur. Co., the court required the providers, as assignees, to exhaust remedies against the owner before seeking payment from MVAIC.
MVAIC raised a triable issue on exhaustion by submitting a police report identifying the insurer of the vehicle carrying the assignor. The Appellate Term, Second Department, reversed the order granting the provider summary judgment and denied the motion. The assignor had been a passenger, and MVAIC opposed payment on the ground that the provider had not established exhaustion of remedies against the vehicle's owner. Following Hauswirth v American Home Assur. Co. and Matter of Eagle Ins. Co. v Rodriguez, the police report and other submissions sufficed to raise a factual issue concerning exhaustion before the provider sought relief from MVAIC.
The insurer established timely mailing of EUO notices and denials and the assignor's failure to appear at two scheduled EUOs. The provider obtained summary judgment after the District Court found insufficient objective justification for the EUO request. The insurer's examiner and mailroom supervisor established mailing through standard office practices, and the investigator who was to conduct the EUOs established nonappearance. The papers also substantiated the basis for the request. Because the provider did not claim to have responded to the EUO request, it could not challenge its reasonable basis. The Appellate Term, Second Department, reversed the order, denied the provider's motion, and granted the insurer's cross motion dismissing the complaint.
An insurer's request for an IME is not subject to the objective justification requirement applicable to EUO requests. In the provider's action for assigned no-fault benefits, the insurer established mailing of the IME notices through the scheduling company's standard office practices, nonappearance through the examining doctor's affidavit, and timely mailing of the denials. The objective standards requirement in 11 NYCRR 65-3.5 (e) applies to EUOs, not IMEs. Appearance at an IME is a condition precedent to liability under 11 NYCRR 65-1.1. The Appellate Term, Second Department, reversed the District Court's order and granted the insurer's motion for summary judgment dismissing the complaint.
The provider failed to demonstrate exhaustion of remedies against the known vehicle owner before seeking benefits from MVAIC. The Appellate Term, Second Department, reversed the provider's judgment, vacated the underlying order, granted MVAIC's summary judgment motion dismissing the complaint, and denied the provider's cross motion. Both the provider and the assignors knew the identity of the owner of the vehicle in which the assignors had been passengers. Following Hauswirth v American Home Assur. Co., the court required exhaustion against that owner before relief could be sought from MVAIC.
The provider's motion to strike the insurer's demand for a trial de novo after mandatory arbitration was denied. The provider argued under 22 NYCRR 28.12 (a) that counsel's appearance without evidentiary submissions or the doctor amounted to a default. The Appellate Term, Second Department, affirmed, citing B.Y., M.D., P.C. v Geico Indem. Co.
No-fault interest is not tolled where the insurer fails to establish proper mailing of its denial forms. The provider obtained summary judgment, but the Civil Court later vacated the judgment under CPLR 5015 and limited interest to the period between commencement and the summary judgment order. Under Insurance Law § 5106 (a) and 11 NYCRR 65-3.9 (c) and (d), the majority treated the claims as undenied and held that interest accrued from 30 days after receipt of each claim until payment. The Appellate Term, Second Department, reversed, denied the insurer's vacatur motion and reinstated the judgment. One justice dissented in part, seeking a hearing on actual receipt of the denials.
The insurer failed to establish mailing of the EUO requests because its attorney's affirmation did not describe the law office's mailing procedures. The insurer sought summary judgment dismissing assigned no-fault claims based on the assignors' failure to attend EUOs. It had to establish timely mailing of initial and follow-up verification requests under 11 NYCRR 65-3.5 (b) and 65-3.6 (b), along with nonappearance through someone with personal knowledge. The affirmation did not describe procedures ensuring that the requests were properly addressed and mailed. The Appellate Term, Second Department, affirmed the order, insofar as appealed from, denying the insurer's cross motion for summary judgment.
A no-fault claim accrues for limitations purposes when payment becomes overdue. The Appellate Term, Second Department, modified the order to deny the insurer's CPLR 3211 (a) (5) motion as to claims for services rendered February 1-26, March 2-31 and April 3-24, 2001, while affirming dismissal of earlier claims. Under CPLR 213 (2), Insurance Law § 5106 (a) and former 11 NYCRR 65.15 (g) (3), the pleaded timely submissions could have accrued up to 210 days after service: 180 days to submit and 30 days to pay or deny. The insurer failed to establish earlier receipt through unexplained date stamps. One justice dissented in part, finding the remaining claims time-barred.
The providers proved overdue claims, and the insurer raised no triable issue after evidence preclusion under a stipulation. In this assigned no-fault action, the insurer's own documentary submissions established receipt of the surgical facility's and orthopedic services provider's claims and that payment was overdue under Insurance Law § 5106 (a). A so-ordered stipulation precluded the insurer from offering certain evidence concerning its medical necessity defense. Its opposition did not raise a factual issue. The Appellate Term, First Department, reversed the order denying the providers' motion, granted summary judgment on their respective claims, and directed entry of judgment.
The insurer failed to establish a prohibited financial relationship between the chiropractic provider and the referring practitioner. The insurer sought summary judgment under Public Health Law § 238-a (1) (a) and (b). It alleged no ownership or investment interest, and its unparticularized evidence of leases with unnamed physicians two years before the referral did not establish a compensation arrangement with this practitioner. Public Health Law § 238-a (5) (b) (i) excludes office rentals meeting specified requirements from compensation arrangements. Because the insurer failed to meet its initial burden, the adequacy of the provider's opposition was immaterial. The Appellate Term, First Department, reversed, denied the insurer's motion, and reinstated the complaint.
The insurer's conclusory peer review report failed to raise a triable issue concerning medical necessity. Two providers established entitlement to summary judgment on their assigned no-fault claims under Insurance Law § 5106 (a). Even assuming that the insurer's denials were timely, the report lacked sufficient facts to support its medical necessity defense. The Appellate Term, First Department, reversed the order denying the providers' motion and granted summary judgment to the surgical facility and orthopedic services provider on their respective claims, directing entry of judgment.
Service by mail under CPLR 312-a is ineffective if the defendant does not sign and return the acknowledgment of receipt. The provider mailed the summons and complaint in an action for assigned no-fault benefits. The insurer moved to dismiss because it had not signed and returned the acknowledgment and the provider had not served it by another method. The provider's attorney argued that the insurer should be compelled to sign. Because the acknowledgment was not signed and returned, no personal jurisdiction was acquired. The Appellate Term, Second Department, reversed the Civil Court's order and granted the insurer's motion to dismiss the complaint.
The insurer's untimely billing and assignment defenses were precluded, but the providers' class allegations were also dismissed. The Supreme Court, Nassau County, dismissed the fraud and unjust-enrichment counterclaims under CPLR 213 (8) and (1), and the General Business Law § 349 counterclaim as time-barred; relation back under CPLR 203 (f) did not save the fraud claim. RICO counterclaims under 18 USC § 1962 (c) and (d) survived because discovery of the alleged pattern presented factual questions. Under CPLR 3211 (b), the challenged defenses were dismissed for 30-day preclusion or, for staged accidents, insufficient supporting evidence. Class allegations were dismissed under CPLR 902 because the providers missed the 60-day certification deadline; pending motions against counterclaims did not extend it.
An assignor's failure to attend a postclaim IME is a nonprecludable coverage defense despite a denial issued beyond 30 days. The insurer cross-moved for summary judgment and conceded that only some denials were timely. The providers argued that the IME defense was precluded. The Civil Court, Kings County, dismissed the action with prejudice, relying on Unitrin Advantage Ins. Co. v Bayshore Physical Therapy. Attendance is a condition precedent under 11 NYCRR 65-1.1 (d); its breach voids coverage from inception and permits denial of claims retroactively to the loss. The court held that the 30-day requirements of Insurance Law § 5106 (a) and 11 NYCRR 65-3.8 (c) did not preclude this defense.
A peer review report must supply a sufficient factual basis and medical rationale before the provider must submit contrary expert proof. The insurer sought summary judgment on claims for electrodiagnostic testing. Its reviewer assumed that persistent radicular symptoms were undocumented, but the records documented radiating pain, numbness, positive tests, and symptoms despite conservative treatment. The District Court, Nassau County, found the report rested on conclusory assumptions and disputed or incorrect facts; the absence of opposing expert proof was therefore immaterial. Medical necessity remained for trial. The insurer nevertheless established timely mailing of its denials and its fee schedule defense, and the provider raised no triable issue on either. The insurer would not need to prove those matters again at trial.
The insurer established mailing of the IME notices and the assignor's failure to attend both scheduled examinations. The District Court, Nassau County, granted summary judgment under CPLR 3212 and dismissed the provider's no-fault complaint. The scheduling company's operations manager described office procedures ensuring correct addressing and mailing and confirmed the letters' preparation and mailing from the file. The examining physician's affidavit established both unexcused nonappearances. Following Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co. and the condition in 11 NYCRR 65.12, the court found a breach of a condition precedent that vitiated coverage. The provider did not dispute receipt or the notices' timeliness.
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