[*1]

Supreme Court, Appellate Term, Second Department, April 6, 2006

APPEARANCES OF COUNSEL

Teresa M. Spina, Woodbury (Emilio A. Cacace of counsel), for appellant. Amos Weinberg, Great Neck, for respondent.

{**12 Misc 3d at 31} OPINION OF THE COURT

Memorandum.

Order modified by providing that plaintiff’s motion for summary judgment is granted to the extent of awarding plaintiff partial summary judgment in the sum of $3,971.20 and matter remanded to the court below for the calculation of statutory interest and assessment of attorney’s fees thereon and for all further proceedings on the remaining claim; as so modified, affirmed without costs.

In this action to recover first-party no-fault benefits, plaintiff A.B. Medical Services PLLC established a prima facie entitlement to partial summary judgment in the sum of $3,971.20, by proof that it submitted claims, setting forth the fact and the amounts of the losses sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]). While the court below awarded plaintiff summary judgment in the sum of $4,061.96, in his affirmation in support of plaintiff’s motion, David Safir, plaintiff’s “practice and medical billing manager,” specifically requested summary judgment in the sum of $3,971.20. Plaintiff has failed to make out a prima facie entitlement to a claim for the additional sum of $90.76. [*2]

It is uncontroverted on the record that defendant timely denied A.B. Medical’s claims in the respective sums of $1,972.08 and $1,999.12. However, a timely denial alone does not avoid preclusion where said denial is factually insufficient, conclusory or vague (Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43 [App Term, 2d & 11th Jud Dists 2004]; see also Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564 [2005]; Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664 [2004]). The claims were essentially denied for failure to establish medical necessity. Although defendant was not required to attach to its denial of claim forms the peer reviews upon which the denials were purportedly based (see 11 NYCRR 65-3.8 [b] [4]; A.B. Med. Servs. PLLC v Nationwide Mut. Ins. Co., 7 Misc 3d 132[A], 2005 NY Slip Op 50605[U] [App Term, 2d & 11th Jud Dists 2005]), defendant’s denial of claim forms fail to set forth with sufficient particularity the factual basis and medical rationale for its denial based on lack of medical necessity, and it is therefore precluded from asserting said defense (see Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43 [2004], supra). Moreover,{**12 Misc 3d at 32} the peer reviews submitted by defendant in opposition to plaintiff’s motion were unsworn, and therefore in inadmissible form (see A.B. Med. Servs. PLLC v Motor Veh. Acc. Indem. Corp., 6 Misc 3d 131[A], 2005 NY Slip Op 50088[U] [App Term, 2d & 11th Jud Dists 2005]; A.B. Med. Servs. PLLC v Lumbermens Mut. Cas. Co., 4 Misc 3d 86 [App Term, 2d & 11th Jud Dists 2004]). In any event, even assuming said reports’ admissibility and that they set forth a sufficient factual basis and medical rationale for denial of the claims, they cannot remedy the factual insufficiency of defendant’s denials (see Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664 [2004], supra).

Golia, J., dissents and votes to reverse the order and deny plaintiff’s motion for summary judgment. As set forth in the majority opinion, it is “uncontroverted on the record that defendant timely denied A.B. Medical’s claims in the respective sums of $1,972.08 and $1,999.12” (at 31). The majority also acknowledges that the regulations do not require defendants to attach a copy of the peer review report to an NF-10 denial of claim form. Nevertheless, my colleagues assert that the denial of claim form failed to state, with the requisite specificity, the reasons the claims were being denied.

What they fail to recognize is that the specific reason for the denial was the “negative” peer review report (see 11 NYCRR 65-3.8 [b] [4]). That is all the specificity that is required under that regulation which states: “If the specific reason for a denial of a no-fault claim . . . is a . . . peer review report . . .” (id.; emphasis added).

To follow the reasoning of the majority would be to require a nonphysician claims examiner to interpret a physician’s peer review report, and then list, with specificity, the medical reasons for the claim’s denial. It seems a tad incongruous for the regulations to permit the NF-10 denial of claim form to be sent without attaching the doctor’s peer review report and then to require a “lay” person to interpret that report and state with “specificity” the doctor’s reasons for finding the treatment medically unnecessary.

In the case at bar, the claimant submits an affidavit stating that it requested a copy of that report but never received same. The defendant submits an affidavit by a person in charge of the file stating that no such request is present in the file. For the purpose of the issues before this court, it doesn’t matter if the request was sent, if the mail was lost, or if the defendant’s affidavit is inaccurate, inasmuch as the regulations do not provide{**12 Misc 3d at 33} for any draconian remedy for defendant’s failure to provide the report in a timely manner. The claim denials were mailed on the 20th and 27th of January 2003, and the request for the peer review was not mailed until July 18, 2003. The underlying action was “commenced” two months later, on September 17, 2003. Apparently, the claimant waited six months to request the reports but waited less than two months to decide to bring this action.

Finally, a question arises as to whether the failure of the defendant to submit a “sworn” copy of the peer review report, in opposition to a claimant’s motion for summary judgment, mandates that the motion be granted. I do not find such a failure to be fatal when opposing a motion for summary judgment, for the reasons stated in my dissent in Ocean Diagnostic Imaging, P.C. v Lancer Ins. Co. (6 Misc 3d 62 [App Term, 2d & 11th Jud Dists 2004]).

Pesce, P.J., and Rios, J., concur; Golia, J., dissents in a separate memorandum.

[*1]

Supreme Court, Appellate Term, Second Department, March 27, 2006

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellants.

{**12 Misc 3d at 9} OPINION OF THE COURT

Memorandum.

Order, insofar as appealed from, affirmed without costs.

In this action to recover first-party no-fault benefits for medical services rendered to their assignors, plaintiffs moved for partial summary judgment in the sum of $5,460.79. On appeal, plaintiffs have limited their claim to the sum of $5,427.09. Plaintiffs established a prima facie entitlement to summary judgment by proof that they submitted the claims, setting forth the fact and the amounts of the losses sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]).

In opposition to plaintiffs’ motion, defendant argued that the claims were properly and timely denied on the ground of lack of medical necessity based on peer review reports. For the reasons set forth herein, this defense is unavailing to defendant. We note initially that the record [*2]does not contain denial of claim forms submitted by A.B. Medical Services PLLC in the respective{**12 Misc 3d at 10} sums of $71.40, $218.35 and $71.06. Having failed to pay or deny these claims within the 30-day statutory period (11 NYCRR 65-3.8 [c]), defendant is precluded from raising most defenses with respect to said claims (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]).

It is uncontroverted on the record that the remaining claims were timely denied. However, a “timely denial alone does not avoid preclusion where said denial is factually insufficient, conclusory, vague or otherwise involves a defense which has no merit as a matter of law” (Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43, 44 [App Term, 2d & 11th Jud Dists 2004]; see also Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564 [2005]; Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664, 665 [2004]). The claims by A.B. Medical in the sum of $1,144.65 ($182.37, $71.06 and $891.22) were denied for lack of medical necessity based on an annexed peer review which failed to state the factual basis and medical rationale for the recommended denial of said claims. A.B. Medical’s claim for $1,573.24 was denied on the ground of lack of medical necessity based on a peer review report which disallowed reimbursement of no-fault benefits due to the lack of sufficient information, including prior medical examinations, which the record indicates were available. In the absence of a showing by defendant that it attempted to procure these reports through verification requests for the purpose of conducting the peer review, defendant is precluded from asserting the defense of lack of medical necessity as to this claim (see 11 NYCRR 65-3.5 [b]; 65-3.6 [b]; A.B. Med. Servs. PLLC v American Mfrs. Mut. Ins. Co., 6 Misc 3d 133[A], 2005 NY Slip Op 50114[U] [App Term, 2d & 11th Jud Dists 2005]; Park Neurological Servs. P.C. v GEICO Ins., 4 Misc 3d 95 [App Term, 9th & 10th Jud Dists 2004]).

The remaining claims were denied for failure to establish medical necessity based on “peer review[s].” Although defendant was not required to attach to its denial of claim forms the peer reviews upon which the denials were purportedly based (see 11 NYCRR 65-3.8 [b] [4]; A.B. Med. Servs. PLLC v Nationwide Mut. Ins. Co., 7 Misc 3d 132[A], 2005 NY Slip Op 50605[U] [App Term, 2d & 11th Jud Dists 2005]), the defendant’s denial of claim forms fail to set forth with sufficient particularity the factual basis and medical rationale for its denials based on lack of medical necessity, and it is therefore precluded from asserting said defense (see Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43 [2004], supra).{**12 Misc 3d at 11}

In opposition to plaintiffs’ motion, defendant also asserted the defense that plaintiffs’ assignor was involved in a fraudulent scheme to procure the subject insurance policy in order to pay reduced insurance premiums, and that, consequently, plaintiffs providers were not eligible to recover assigned no-fault benefits. Vehicle and Traffic Law § 313 provides in pertinent part: “(1) (a) No contract of insurance . . . shall be terminated by cancellation by the insurer until . . . after mailing to the named insured . . . a notice of termination by regular mail . . . .” Vehicle and Traffic Law § 313 “supplants an insurance carrier’s common-law right to cancel a contract of insurance retroactively on the grounds of fraud or misrepresentation, and mandates that the cancellation of a contract pursuant to its provisions may only be effected prospectively” (Matter of Liberty Mut. Ins. Co. v McClellan, 127 AD2d 767, 769 [1987]; see also Matter of Cruz v New Millennium Constr. & Restoration Corp., 17 AD3d 19 [2005]; Matter of Metlife Auto & Home v [*3]Agudelo, 8 AD3d 571 [2004]; Matter of Integon Ins. Co. v Goldson, 300 AD2d 396 [2002]; Matter of Insurance Co. of N. Am. v Kaplun, 274 AD2d 293 [2000]). The statute “places the burden on the insurer to discover any fraud before issuing the policy, or as soon as possible thereafter, and protects innocent third parties who may be injured due to the insured’s negligence” (Matter of Insurance Co. of N. Am. v Kaplun, 274 AD2d at 298). There has been no allegation that defendant effectively cancelled the subject insurance policy pursuant to section 313.

However, case law has made clear that whereas the policy may not be retroactively cancelled, thereby protecting “innocent third parties who may be injured due to the insured’s negligence” (id. at 298), in “an action to recover benefits under a policy, the insurance carrier may assert as an affirmative defense that the insured’s misrepresentations and/or fraud in obtaining the policy precludes any recovery by the insured” (id. at 298-299). The issue presented here is whether, assuming the insurance policy was fraudulently procured, plaintiff health care provider is an “innocent” third party which case law protects and, thus, as assignee of the insured who allegedly perpetrated the fraud, acquires greater rights than had by the assignor. We hold that only innocent third parties who are injured are protected (id. at 298), and not a health care provider who deals with the assignor-insured at its peril in accepting an assignment of the insured’s no-fault benefits. Contrary to plaintiffs’ contention, the defense of fraudulent procurement of an insurance{**12 Misc 3d at 12} policy, which is nonwaivable and hence exempt from the 30-day preclusion rule, may be asserted as against plaintiffs providers in this action seeking to recover assigned no-fault benefits (cf. Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751, 751-752 [2002]). Upon our review of the record, we find that defendant’s submissions in support of its defense were sufficient to raise issues of fact as to whether the insurance policy was fraudulently procured. Therefore, plaintiffs’ motion for partial summary judgment was properly denied. To the extent that Ocean Diagnostic Imaging P.C. v Commerce Ins. Co. (7 Misc 3d 133[A], 2005 NY Slip Op 50642[U] [App Term, 2d & 11th Jud Dists 2005]) may be inconsistent with the determination herein, the dicta set forth therein should not be followed (see Ocean Diagnostic Imaging, P.C. v Nationwide Mut. Ins. Co., 11 Misc 3d 135[A], 2006 NY Slip Op 50477[U] [2006]).

Golia, J. (concurring with the result only, in the following memorandum): While I agree with the ultimate disposition in the decision reached by the majority, I wish to emphasize that I disagree with certain propositions of law set forth in cases cited therein which are inconsistent with my prior expressed positions and generally contrary to my views.

Pesce, P.J., and Rios, J., concur; Golia, J., concurs in a separate memorandum.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Eileen Nadelson, J.), entered October 29, 2004. The order granted plaintiff’s motion for summary judgment.

Order affirmed without costs.

In this action to recover first-party no-fault benefits for medical services rendered to its assignors, plaintiff health care provider established a prima facie entitlement to summary judgment by proof that it submitted claims, setting forth the fact and the amount of the loss sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists]). Even assuming that defendant had a right to request an examination under oath (EUO) (see Star Med. Servs. v Eagle Ins. Co., 6 Misc 3d 56 [2004]), there is no merit to defendant’s contention that the failure of one of plaintiff’s assignors to appear for an EUO precludes summary judgment with respect to the claims submitted on behalf of said assignor. Defendant failed to send the EUO demand to said assignor at his proper address, and the sending of an EUO request to said assignor’s attorney was insufficient to toll the 30-day statutory period (11 [*2]NYCRR 65-3.8 [c]) within which defendant was required to pay or deny the claim. Accordingly, defendant is precluded from raising most defenses (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]).

However, defendant is not precluded from asserting the defense that the alleged injuries do not arise out of a covered accident, despite the untimely denials of the claims (see Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2002]). The transcripts of the EUO testimony given by one of plaintiff’s assignors and by defendant’s insured were insufficient to demonstrate that defendant’s denial was based upon a “founded belief that the alleged injur[ies] do[] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]). Accordingly, the order granting plaintiff’s motion for summary judgment should be affirmed.

Rios and Belen, JJ., concur.

Golia, J.P., dissents in a separate memorandum.

Golia, J.P., dissents and votes to reverse the order and deny plaintiff’s motion for summary judgment.

I am in agreement with the majority that an untimely denial does not preclude a defendant from asserting the defense that the claimed collision was in furtherance of a scheme to defraud (see Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2002]).

However, I disagree that the transcripts of the examination under oath (EUO) testimony given by one of plaintiff’s assignors coupled with that of defendant’s insured was insufficient to demonstrate that defendant’s denial was based upon a “founded belief that the alleged injur[ies] do[] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]).

Even though the defendant’s insured was not present when the accident occurred, his EUO testimony provided actual observations of facts which he made when he arrived at the scene of the accident. Those observations are in direct conflict with the testimony provided by one of the plaintiff’s assignors as to what she claimed she did after the accident. The clear factual conflict between these EUO transcripts is sufficient to meet the standard set forth in Central Gen. Hosp. v Chubb Group of Ins. Cos. (90 NY2d at 199).
Decision Date: March 7, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Nassau County, First District (Howard S. Miller, J.), dated October 19, 2004. The order denied plaintiff’s motion for summary judgment without prejudice to renewal upon proper proof of medical necessity.

Order unanimously reversed without costs, plaintiff’s motion for summary judgment granted and matter remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees.

In this action to recover first-party no-fault benefits for medical services provided to its assignor, plaintiff established a prima facie entitlement to summary judgment by proof that it submitted a claim, setting forth the fact and the amount of the loss sustained, and that payment of no-fault benefits was overdue (see Insurance Law §
5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Damadian MRI in Elmhurst v Liberty Mut. Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51700[U] [App Term, 9th & 10th Jud Dists]). Contrary to the motion court’s determination, plaintiff was not required to submit a physician’s affidavit to establish medical necessity as part of its prima facie case, since medical necessity is established in the first instance by proof of submission of the claim form (see Park Neurological Servs. P.C. v GEICO Ins., 4 Misc 3d 95 [App Term, 9th & 10th Jud Dists 2004]). Defendant timely denied the claim on the ground of lack of medical necessity based on a peer review report appended to plaintiff’s moving papers, wherein the peer reviewer stated, inter [*2]alia, that “a review of the records reveals no evidence of a thorough physical examination and history having been performed by the referring doctor,” and that “[u]ntil such pertinent information is made available for my review reimbursement cannot be suggested.”

Where an insurer’s denial is based on a peer review, which concludes that there was no medical necessity due to “the lack of sufficient information” upon which the reviewer could make such determination, it fails to set forth an adequate factual basis and medical rationale and is thus deficient (see Park Neurological Servs. P.C. v GEICO Ins., 4 Misc 3d at 96-97), without a showing that defendant sought to obtain such information by means of a request pursuant to the verification procedures (see 11 NYCRR 65-3.5 [b]; 65-3.6 [b]; A.B. Med. Servs. PLLC v American Mfrs. Mut. Ins. Co., 6 Misc 3d 133[A], 2005 NY Slip Op 50114[U] [App Term, 2d & 11th Jud Dists]). However, “[w]here . . the [peer review] report clearly indicates that the pertinent physician’s reports and other documentation had been requested and provided for the purpose of conducting a peer review, and the conclusion of lack of medical necessity is based on the peer reviewer’s opinion, in effect, that there was no substantiation in the reports and documents reviewed of medical necessity for the . . . medical treatment provided, the defendant insurer is not obligated to seek further verification . . . and such peer review is sufficient to raise an issue of fact precluding summary judgment in favor of [a] plaintiff [provider]” (Amaze Med. Supply Inc. v Travelers Prop. Cas. Corp., 7 Misc 3d 128[A], 2005 NY Slip Op 50452[U] [App Term, 2d & 11th Jud Dists]).

In the instant case, the denial of claim form was, in effect, based on the lack of sufficient information, which, in the absence of a showing by defendant that it availed itself of the claim verification procedures for the purpose of conducting the peer review, precludes defendant from asserting the defense of lack of medical necessity (A.B. Med. Servs. PLLC v American Mfrs. Mut. Ins. Co., 6 Misc 3d 133[A], 2005 NY Slip Op 50114[U], supra; Park Neurological Servs. P.C. v GEICO Ins., 4 Misc 3d 95, supra; cf. [*3]
Amaze Med. Supply Inc. v Travelers Prop. Cas. Corp., 7 Misc 3d 128[A], 2005 NY Slip Op 50452[U], supra).

Accordingly, the order is reversed, plaintiff’s motion for summary judgment is granted and the matter is remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder.
Decision Date: March 3, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Donald S. Kurtz, J.), entered January 19, 2005. The order, insofar as appealed from, granted plaintiffs’ motion for summary judgment on the first cause of action regarding assignor Robert Gevorkov.

Order, insofar as appealed from, reversed without costs and plaintiffs’ motion for summary judgment on the first cause of action regarding assignor Robert Gevorkov denied.

Contrary to plaintiffs’ contention, defendant’s appeal was timely taken. According to the affidavit of service, defendant was served with the order with notice of entry on January 24, 2005 and, therefore, had 35 days from that date to take an appeal (CPLR 5513 [a], [d]; 2103, 5515). Defendant served plaintiffs with its notice of appeal on February 24, 2005. Since service of the notice of appeal was timely, we deem excusable the late filing of the notice of appeal on March 7, 2005 (see CPLR 5520 [a]; Messner v Messner, 42 AD2d 889 [1973]).

In an action to recover first-party no-fault benefits, a plaintiff establishes a prima facie entitlement to summary judgment by proof that it submitted a claim, setting forth the fact and the [*2]amount of the loss sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]). In the instant case, plaintiffs failed to demonstrate an entitlement to summary judgment on the first cause of action regarding assignor Robert Gevorkov since they failed to adequately establish that they submitted the claim forms to defendant (see A.B. Med. Servs. v State Farm Mut. Auto. Ins. Co., 3 Misc 3d 130[A], 2004 NY Slip Op 50387[U] [App Term, 2d & 11th Jud Dists]). Proof of proper mailing requires evidence of “actual mailing or . . . a standard office practice or procedure
designed to ensure that items are properly addressed and mailed” (Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679, 680 [2001]; see also Matter of Rodriguez v Wing, 251 AD2d 335, 336 [1998]; Amaze Med. Supply v Allstate Ins. Co., 2 Misc 3d 138[A], 2004 NY Slip Op 50264[U] [App Term, 2d & 11th Jud Dists]; S & M Supply, Inc. v GEICO Ins., 2003 NY Slip Op 51192[U] [App Term, 2d & 11th Jud Dists]). Plaintiffs’ proof, the affidavit of Dr. Ovshayev, who described herself as a principal of Magnezit Medical Care, P.C., made no reference to said plaintiff’s standard office mailing practices or procedures, and the bare averment that the “required proof of claims [were submitted] in a timely manner” and that bills for the services rendered to Robert Gevorkov were mailed to defendant on given dates did not establish that she had personal knowledge that the claim forms were timely mailed to defendant (see S & M Supply, Inc. v GEICO Ins., 2003 NY Slip Op 51192[U], supra; Amaze Med. Supply v Colonial Penn Ins. Co., 3 Misc 3d 135[A], 2004 NY Slip Op 50471[U] [App Term, 2d & 11th Jud Dists]; Jul & Pol Corp. v American Tr. Ins. Co., 2003 NY Slip Op 51153[U] [App Term, 2d & 11th Jud Dists]). Since plaintiffs did not provide proof of proper
mailing of the claim forms regarding assignor Robert Gevorkov, the lower court’s order, insofar as appealed from, should be reversed and plaintiffs’ motion for summary judgment as to assignor Gevorkov denied.

Pesce, P.J., Weston Patterson and Belen, JJ., concur.
Decision Date: February 28, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

Appeal from an order of the District Court of Nassau County, First District (Howard S. Miller, J.), dated December 20, 2004. The order denied plaintiff’s motion for summary judgment with leave to renew upon submission of proper papers.

Order unanimously affirmed without costs.

In an action to recover first-party no-fault benefits, a plaintiff provider establishes a prima facie entitlement to summary judgment by proof of submission of statutory claim forms, setting forth the fact and amounts of the losses sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary
Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]). Further, the necessary claim forms must be appended to plaintiff’s motion papers in order to establish a prima facie case (see A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 7 Misc 3d 127[A], 2005 NY Slip Op 50432[U] [App Term, 2d & 11th Jud Dists]).

In support of plaintiff’s motion, plaintiff’s attorney indicated that appended thereto were the subject claim forms being sued upon. Such affirmation by an attorney without personal knowledge does not constitute a proper vehicle for the admissibility of the claim forms (see Zuckerman v City of New York, 49 NY2d 557, 563 [1980]). Moreover, the affidavit of plaintiff [*2]provider made no specific reference to the appended claim forms. Under the circumstances, plaintiff’s motion for summary judgment was properly denied with leave to renew upon submission of proper papers.

We note that the court below correctly determined that a nurse’s peer review may be competent to establish the admissibility of the medical opinions and conclusions contained therein provided that the reviewer’s training, observations and
actual experience to render such opinions are sufficiently set forth (see People v Lewis, 16 AD3d 173 [2005]; Abraham v Country-Wide Ins. Co., 3 Misc 3d 130[A], 2004 NY Slip Op 50388[U] [App Term, 2d & 11th Jud Dists]).

In view of the determination herein, we reach no other issue.
Decision Date: February 27, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Diccia T. Pineda-Kirwan, J.), entered December 16, 2003. The order granted plaintiff’s motion for summary judgment and denied defendant’s cross motion for summary judgment dismissing the complaint.

Order modified by providing that plaintiff’s motion for summary judgment is denied; as so modified, affirmed without costs.

Plaintiff health care provider commenced the instant action to recover $10,811.67 in first-party no-fault benefits for medical services rendered to its assignor, Rafael Rodrigues, for injuries he allegedly sustained in a motor vehicle accident on December 3, 2000. The instant appeal involves the same accident and assignor that formed the basis of the appeal in GPM Chiropractic, P.C. v State Farm Mut. Ins. Co. (7 Misc 3d 135[A], 2005 NY Slip Op 50744[U] [App Term, 2d & 11th Jud Dists]). Upon our review of the record, we find that the affidavit submitted by defendant’s investigator was sufficient to demonstrate that defendant’s denial was based upon a “founded belief that the alleged injur[ies] do[] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195,199 [1997]; GPM Chiropractic, P.C. v State Farm Mut. Ins. Co., 7 Misc 3d 135[A], 2005 NY Slip Op 50744[U], supra). Accordingly, since defendant demonstrated the existence of a triable issue of fact as to whether [*2]there was a lack of coverage (see Zuckerman v City of New York, 49 NY2d 557 [1980]), plaintiff’s motion for summary judgment should have been denied.

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

Golia, J., concurs in part and dissents in part in a separate memorandum. [*3]
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS
PRESENT : PESCE, P.J., GOLIA and RIOS, JJ.
V.S. MEDICAL SERVICES, P.C.,
as assignee of RAFAEL RODRIGUES,

Respondent,

-against-
STATE FARM MUTUAL INSURANCE CO.,

Appellant.

Golia, J., concurs in part and dissents in part and votes to grant summary judgment to the defendant.

I concur with the majority in its finding that “the affidavit submitted by defendant’s investigator was sufficient to demonstrate that defendant’s denial was based upon a ‘founded belief that the alleged injur[ies] do[] not arise out of an insured incident’…”

However, I would not have reached that issue. Although not specifically addressed in the majority decision, the “proof” submitted by the plaintiff in support of its claim was insufficient in that it did not include any “assignment of benefit” form. Therefore, the plaintiff lacks standing to prosecute this claim, and has not made a prima
facie showing of entitlement to summary judgment due to its failure to submit evidentiary proof that the prescribed statutory billing forms had been mailed and received (Insurance Law § 5106 [a]; 11 NYCRR 65.15 [g] [3]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]). Plaintiff has also failed to comply with 11 NYCRR 65.12 (e) which provides that “[n]o action shall lie against the Company unless, as a condition precedent thereto, there shall have been full compliance with the terms of this coverage” (see also Inwood Hill Med., P.C. v General Assurance Co., 10 Misc 3d 18 [App Term, 1st Dept 2005]).

Inasmuch as the plaintiff failed to submit a proper and complete set of documents in accordance with the prescribed statutory billing forms, it did not make out a prima facie entitlement to summary judgment. [*4]
Decision Date: February 27, 2006

[*1]

Supreme Court, Appellate Term, Second Department, February 17, 2006

APPEARANCES OF COUNSEL

Bruno, Gerbino & Soriano, LLP, Melville (Charles W. Benton of counsel), for appellant. Amos Weinberg, Great Neck, for respondents.

{**11 Misc 3d at 72} OPINION OF THE COURT

Memorandum.

Judgment reversed with $10 costs, order entered August 18, 2004 vacated, plaintiffs’ motion for partial summary judgment denied and defendant’s cross motion granted to the extent of ordering a hearing to determine plaintiffs’ compliance with Rules of the Chief Administrator of the Courts (22 NYCRR) § 130-1.1a and, in the event plaintiffs’ complaint is not stricken following said hearing, compelling plaintiffs to serve, within 30 days after entry of the [*2]posthearing order, responses to defendant’s sixth interrogatory and to produce the documents requested in the eighth, ninth, tenth and eleventh numbered paragraphs of defendant’s notice for discovery and inspection.

In this action to recover first-party no-fault benefits for medical services rendered to its assignor, plaintiffs established their prima facie entitlement to partial summary judgment by proof that they submitted claims, setting forth the fact and the amounts of the losses sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]). Defendant’s assertion that it timely denied the claims lacks merit because the record does not contain an affidavit from a person with personal knowledge either stating that the December 20, 2002 denial of claim form was mailed or setting forth “a sufficiently detailed description of standard office mailing procedure so as to give rise to the presumption of mailing” (S&M Supply Inc. v Progressive Ins. Co., 8 Misc 3d 138[A], 2005 NY Slip Op 51312[U], *2 [App Term, 2d & 11th Jud Dists 2005]). Since defendant failed to pay or deny the claim within the 30-day prescribed period (11 NYCRR 65-3.8 [c]), it is precluded from raising most defenses (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]). As a result, the burden shifted to defendant to demonstrate the existence of a material issue of fact (see Zuckerman v City of New York, 49 NY2d 557 [1980]).

However, defendant further claims that pursuant to CPLR 3212 (f), plaintiffs are not entitled to partial summary judgment{**11 Misc 3d at 73} due to their failure to respond to discovery demands served upon them. Indeed, defendant even cross-moved to preclude plaintiffs from offering evidence at trial due to their failure to respond to said discovery demands or, in the alternative, to compel plaintiffs to respond to defendant’s discovery demands. Annexed to said cross motion were copies of various discovery demands defendant served upon plaintiffs which sought discovery of information regarding potential defenses which defendant is precluded from raising. Defendant also sought discovery regarding plaintiffs’ status as professional corporations licensed to practice in New York. Annexed to defendant’s cross motion was a copy of plaintiffs’ response to defendant’s discovery demands which, among other things, stated that plaintiffs would produce the documents requested in defendant’s notice for discovery and inspection. To the extent the discovery demands concerned matters relating to defenses which defendant is precluded from raising, they are palpably improper notwithstanding the fact that plaintiffs did not specifically object thereto (see Fausto v City of New York, 17 AD3d 520 [2005]; Marino v County of Nassau, 16 AD3d 628 [2005]; Garcia v Jomber Realty, 264 AD2d 809 [1999]). However, defendant’s sixth interrogatory and the documents requested in the eighth, ninth, tenth and eleventh numbered paragraphs of defendant’s notice for discovery and inspection sought information regarding the corporate structure and licensing status of plaintiffs.

In State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005]), the Court of Appeals answered a certified question from the United States Court of Appeals for the Second Circuit and held that insurers may withhold payment for first-party no-fault benefits provided by fraudulently licensed medical corporations to which patients have assigned their claims. As noted by the Court of Appeals, Business Corporation Law § 1507 provides: “A professional service corporation may issue shares only to individuals who are authorized by law to practice in this [*3]state a profession which such corporation is authorized to practice” (id. at 319 n 1) and, in addition, pursuant to 11 NYCRR 65-3.16 (a) (12), “[a] provider of health care services is not eligible for reimbursement under section 5102 (a) (1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement” (id. n 2). We hold that a defense based upon plaintiffs’ allegedly fraudulent corporate licensure is not precluded (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005], supra; see generally{**11 Misc 3d at 74} Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]). Accordingly, the sixth interrogatory and eighth, ninth, tenth and eleventh numbered paragraphs in defendant’s notice for discovery and inspection sought information to which defendant was entitled pursuant to State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005], supra). Since said items were not palpably improper or privileged, plaintiffs were required, but failed, to challenge the propriety of defendant’s notice for discovery and inspection pursuant to CPLR 3120 within the time prescribed by CPLR 3122. Likewise, plaintiffs failed to object to defendant’s sixth interrogatory. As a result, plaintiffs are obligated to produce the information sought (see Fausto, 17 AD3d 520 [2005], supra; Marino, 16 AD3d 628 [2005], supra; Garcia, 264 AD2d 809 [1999], supra).

In view of the foregoing, plaintiffs’ motion for partial summary judgment should have been denied due to plaintiffs’ failure to respond to said discovery demands (see CPLR 3212 [f]). Moreover, defendant’s cross motion for an order precluding plaintiffs from offering evidence at trial or, in the alternative, compelling plaintiffs to respond to discovery demands should, subject to the outcome of the hearing for which this matter is remanded (see infra), be granted to the extent of requiring plaintiffs to respond to defendant’s sixth interrogatory and to produce the documents requested in the eighth, ninth, tenth and eleventh numbered paragraphs of defendant’s notice for discovery and inspection.

As indicated above, there is a threshold issue that must be resolved by the Civil Court. Defendant, in the court below as well as in this court, raises an issue concerning the genuineness of the signature of plaintiffs’ counsel, Amos Weinberg, on various papers submitted in this action. Although the complaint, plaintiffs’ notice of motion seeking partial summary judgment and the affidavit of service for said motion which were submitted to the Civil Court bore signatures which purported to be that of plaintiffs’ counsel, Mr. Weinberg, and which, at least, appear to have been signed by the same person, it is apparent to this court that the signatures on the notice of entry of the order appealed from and upon the respondents’ brief submitted to this court, also purportedly signed by Mr. Weinberg, are markedly different. Moreover, we are mindful of the fact that Mr. Weinberg previously testified in a hearing before the Civil Court, Queens County, that it was a pattern and practice in his office to have other people, who are not attorneys, sign his name on a{**11 Misc 3d at 75} regular basis to documents which are filed in court (see Park Health Ctr. v Countrywide Ins. Co., 2 Misc 3d 737 [2003]). As a result, under the circumstances of this case, we are of the opinion that the branch of defendant’s cross motion which sought a hearing to determine which documents submitted in this case, if any, Mr. Weinberg signed in compliance with Rules of the Chief Administrator of the Courts (22 NYCRR) § 130-1.1a should be granted.

Golia, J., concurs with the result only in the following memorandum: While I agree with the ultimate disposition in the decision reached by the majority, I wish to emphasize that I disagree with certain propositions of law set forth in cases cited therein which are inconsistent with my prior expressed positions and generally contrary to my views.

Pesce, P.J., and Belen, J., concur; Golia, J., concurs in a separate memorandum.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Peter Paul Sweeney, J.), entered February 2, 2005. The order, insofar as appealed from, as limited by the brief, granted plaintiff’s cross motion for summary judgment.

Order, insofar as appealed from, affirmed without costs.

In this action to recover first-party no-fault benefits for health care services rendered to its assignor, defendant moved for summary judgment dismissing the complaint and plaintiff cross-moved for summary judgment. Plaintiff established a prima facie entitlement to summary judgment by proof that it submitted claims, setting forth the fact and the amounts of the losses sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists]). Contrary to defendant’s contention, plaintiff was entitled to rely upon defendant’s denial of claim forms which were annexed to defendant’s motion papers to establish the dates of defendant’s receipt of the claim forms (see A.B. Med. Servs. PLLC v Prudential Prop. & Cas. Ins. Co., 7 Misc 3d 14 [App Term, 2d & 11th Jud Dists 2005]; A.B. Med. Servs. v New York Cent. Mut. Fire Ins. Co., 3 Misc 3d 136[A], 2004 NY Slip Op 50507[U] [App Term, 2d & 11th Jud Dists]). Since defendant failed to establish that it mailed the denial of claim forms to plaintiff within the [*2]prescribed 30-day claim determination period (Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [c]; see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Careplus Med. Supply Inc. v Travelers Home & Mar. Ins. Co., 7 Misc 3d 133[A], 2005 NY Slip Op 50648[U] [App Term, 2d & 11th Jud Dists]; Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 133[A], 2004 NY Slip Op 50447[U] [App Term, 2d & 11th Jud Dists]), it is precluded from raising its defenses with
exceptions not herein relevant (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]). As a result, the court properly granted plaintiff’s cross motion for summary judgment.

Pesce, P.J., Weston Patterson and Belen, JJ., concur.
Decision Date: February 14, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Eileen Nadelson, J.), entered October 29, 2004, deemed an appeal from a judgment of that court entered December 20, 2004. The order granted plaintiff’s motion for summary judgment. The judgment entered thereon awarded plaintiff the principal sum of $4,460.

Judgment unanimously reversed, order entered October 29, 2004 vacated and plaintiff’s motion granted only to the extent of awarding plaintiff summary judgment in the principal sum of $1,791 with respect to the claims submitted on behalf of Naika Gousse, and matter remanded to the court below for a calculation of statutory interest and an assessment of attorney’s fees thereon, and for all further proceedings on the remaining claims.

We have deemed the appeal from the order entered October 29, 2004, which granted plaintiff’s motion for summary judgment, to be an appeal from the judgment entered pursuant to that order (see CPLR 5520 [c]; Neuman v Otto, 114 AD2d 791 [1985]).

In this action to recover first-party no-fault benefits for medical services rendered to its assignors, plaintiff health care provider established a prima facie entitlement to summary judgment by proof that it submitted claims, setting forth the fact and the amounts of the losses sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists]).

In opposition to plaintiff’s motion, defendant failed to raise a triable issue of fact with respect to the claims totaling $1,791, which were submitted on behalf of plaintiff’s assignor, [*2]Naika Gousse. Although said claims were submitted subsequent to April 5, 2002, the effective date of the revised no-fault insurance regulations (which authorize examinations under oath [EUOs] for verification purposes), defendant’s submissions failed to establish that the insurance policy in effect at the time the EUOs were requested contained a no-fault endorsement including a provision authorizing EUOs (see Careplus Med. Supply Inc. v Travelers Home & Marine Ins. Co., 7 Misc 3d 133[A], 2005 NY Slip Op 50648[U] [App Term, 2d & 11th Jud Dists]). Contrary to defense counsel’s contentions, an EUO provision in the mandatory no-fault endorsement is distinct from an EUO provision in the liability portion of the policy (see Melbourne Med., P.C. v Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004]). Moreover, even assuming that the policy did contain an endorsement authorizing EUOs, defendant did not follow the requisite follow-up verification procedures (see 11 NYCRR 65-3.5 [b]). Accordingly, the claim denials based upon Gousse’s nonattendance were ineffective (see King’s Med. Supply Inc. v New York Central Mut. Fire Ins. Co., 5 Misc 3d 136[A], 2004 NY Slip Op 51550[U] [App Term, 2d & 11th Jud Dists]).

On the other hand, with respect to the claims totaling $2,669, which were submitted on behalf of plaintiff’s assignor, Jimmy Cadet, defendant’s submissions were legally sufficient to support defendant’s allegations that the alleged injuries did not arise out of an insured incident (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]). Accordingly, since defendant demonstrated the existence of a
triable issue of fact, the court below erred in granting plaintiff’s motion for summary judgment with respect to the claims submitted on behalf of plaintiff’s assignor, Jimmy Cadet.

In view of the foregoing, plaintiff is granted summary judgment in the principal sum of $1,791 with respect to the claims submitted on behalf of Naika Gousse, and the matter is remanded to the court below for the calculation of statutory interest and attorney’s fees due on those claims, pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder, and for all further proceedings on the remaining claims submitted on behalf of Jimmy Cadet.
Decision Date: February 14, 2006