Civil Court of the City of New York, Kings County

307729/03

Delores J. Thomas, J.

Plaintiff moves for an order granting it summary judgment. The motion is granted.

Plaintiff, Ocean Diagnostic Imaging P.C. As Assignee of Mohammed Rahman (“Ocean Diagnostic”), commenced this action to recover the sum of $1,758.40 for medical services it provided to the assignor, Mohammed Rahman (“Rahman”), and its attorney’s fees [Summons And Complaint Plaintiff’s Exhibit A].

Defendant, American Protection Insurance Company (“American Protection”), opposes the motion in its entirety. Its counsel maintains that Ocean Diagnostic’s bills were properly denied [Affirmation In Opposition of Lawrence Chiarappo, Esq. dated May 28, 2004 Paragraph Five]. Defendant’s denial was based upon the Physician Peer Review conducted by Dr. Daniel G. Kassan, M.D. on March 2, 2003 [Defendant’s Exhibit B].

Dr. Kassan’s report stated the following: [*2]

There was no evidence of significant injury on physical examination of cervical spine or right knee that would support the need for MRI of cervical spine or right knee. The injuries described could be adequately evaluated with physical examination and close monitoring of progress.

Dr. Kassan concluded that the two MRIs “were inappropriate and without necessity.” He recommended that payment should not be made to the health care provider.

On March 13, 2003, American Protection denied the submitted claim based upon Dr. Kassan’s peer review.

Defendant’s denial stated that:

. . . there was no necessity for the MRI. Therefore, your bill is denied in full. Denial of Claim Form dated March 13, 2003 [Defendant’s Exhibit C].

Defendant sent the denial to plaintiff on March 13, 2003 [Affidavit of Kimberly Palmer dated May 26, 2004 Paragraph Seven].

In an action to recover first-party no-fault benefits for medical services rendered to its assignor, the health care provider establishes a prima facie entitlement to summary judgment by proof it submitted the statutory claim form setting forth the fact and the amount of loss sustained and that the payment of no-fault benefits was overdue (Star Medical Services P.C. v. Eagle Insurance Company, 2004 NY Slip Op. 24482, 2004 WL 2779347 [App Term, 2nd & 11th Jud Dists, December 1, 2004]).

The insurer must submit proof in admissible form to rebut plaintiff’s prima facie showing to oppose a motion for summary judgment (A.B. Medical Services, PLLC v. Lumbermens Mutual Casualty Company, 4 Misc 3d 86, [App Term, 2nd & 11th Jud Dists, 2004]).

An insurer may timely deny a claim on the ground that the medical treatment was medically unnecessary based upon a peer review. The peer review must set forth a sufficient factual foundation and medical rationale for the rejection of the claim (Triboro Chiropractic and Acupuncture P.L.L.C. v. Electric Insurance Company, 2 Misc3rd 135(A) [App Term, 2nd & 11th Jud Dists, 2004]). The peer review must be affirmed (A.B. Medical Services, PLLC v. New York Central Mutual Fire Insurance Company, 3 Misc 3d 136(A), 2004 WL 1302031 [App Term, 2nd & 11th Jud Dists, 2004]) or sworn to (A.B. Medical Services, PLLC v. Lumbermens Mutual Casualty Company, supra). If the report is not affirmed or sworn to, the court may grant summary judgment to the plaintiff (A.B. Medical Services, PLLC v. New York Central Mutual Fire Insurance Company, supra).

Notwithstanding defendant’s counsel’s representation [Chiarappo Affirmation Paragraph Nine], Dr. Kassan’s peer review was not affirmed. Nor did Dr. Kassan swear to the truth of the representations made in his report.

Since the peer review was not sworn to or affirmed, it is not admissible. Therefore, American Protection may not utilize Dr. Kassan’s report to oppose plaintiff’s application for summary relief.

In light of the fact that defendant has not offered any other basis for denying movant’s [*3]application, plaintiff’s motion for summary judgment is granted in its entirety.

The clerk is directed to enter judgment in favor of the plaintiff and against the defendant in the sum of $1,758.40 with statutory interest measured from August 5, 2003, along with statutory attorney’s fees, and applicable costs and disbursements.

This constitutes the decision and order of the court.

Dated:Brooklyn, New York

February 9, 2005

DELORES J. THOMAS

Judge Civil Court

Civil Court of the City of New York, New York County

18739/2003

For Plaintiff

Leon Kucherovsky Esq.

212 West 35th Street, New York, NY 10001

For Defendant

Megan M. Marchick Esq.

Melli, Guerin & Melli

17 Battery Place, New York, NY 10004

Lucy Billings, J.

Plaintiff provider of medical supplies sues to recover insurance benefits under NY Ins. Law § 5106(a) for nerve stimulating electrodes used by AR Medical Art, P.C., in treating the insured for injuries sustained in a motor vehicle collision. Plaintiff claims the insured assigned it his rights to insurance coverage for these medical supplies. Plaintiff moves for summary judgment on the claim. Defendant, without opposition from plaintiff, cross-moves for summary judgment dismissing the action. For the reasons explained below, the court grants defendant’s motion. C.P.L.R. § 3212(b).

I. PLAINTIFF’S PRIMA FACIE CLAIM FOR FIRST PARTY NO-FAULT

INSURANCE BENEFITS

To recover insurance benefits under New York’s “No-Fault” Insurance Law for medical expenses arising from a motor vehicle collision, plaintiff must establish “the fact and amount of loss sustained.” NY Ins. Law § 5106(a). See, e.g., New York Hosp. Med. Ctr. of Queens v. New York Cent. Mut. Fire Ins. Co., 8 AD3d 640, 641 (2d Dep’t 2004); Damadian MRI in Garden City v. Windsor Group Ins., 2 Misc 3d 138, 2004 NY Slip Op 50262 (App. Term 2d Dep’t 2004); Damadian MRI in Elmhurst v. Liberty Mut. Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51700 (App. Term 2d Dep’t 2003). For plaintiff, a provider of medical supplies, to establish that it sustained a loss covered by defendant insurer through admissible evidence, plaintiff must present, in admissible form, the treated patient’s assignment of coverage for the treatment expenses to the provider. C.P.L.R. § 3212(b); Rukaj v. Roth, 237 AD2d 503 (2d Dep’t 1997); Columbus Natl. Leasing Corp. v. Perkin-Elmer Corp., 177 AD2d 1035, 1036 (4th Dep’t 1991); Shaw, Licitra, Eisenberg, Esernio & Schwartz v. Friedman, 170 AD2d 1048, 1049 (4th Dep’t [*2]1991); BKS Assocs. v. Kenny, 151 AD2d 535 (2d Dep’t 1989). See, e.g., Colbourn v. ISS Intl. Serv. Sys., 304 AD2d 369, 370 (1st Dep’t 2003); McDonald v. Tishman Interiors Corp., 290 AD2d 266, 267 (1st Dep’t 2002); Seoulbank, NY Agency v. D & J Export & Import Corp., 270 AD2d 193, 194 (1st Dep’t 2000).

An assignment is a contract, which is ineffective without a signature, which in turn must be attested to. Acevedo v. Audubon Mgt., 280 AD2d 91, 95 (1st Dep’t 2001); Fields v. S & W Realty Assoc., 301 AD2d 625 (2d Dep’t 2003). This requirement is not onerous: the provider’s personnel who obtain the signed assignment at the provider’s facility can authenticate the patient’s signature. Regardless of summary judgment standards, an assignee claiming insurance benefits must submit to the insurer “a properly executed assignment.” 11 N.Y.C.R.R. § 65-3.11(b)(2).

The assignment also confers standing on plaintiff to sue based on defendant’s obligation to pay under an insurance policy issued to plaintiff’s assignor: a related element fundamental to plaintiff’s claim. E.g., Westchester County Med. Ctr. v. New York Cent. Mut. Fire Ins. Co., 262 AD2d 553, 555 (2d Dep’t 1999); Bailey v. Allstate Ins. Co., 243 AD2d 520, 521 (2d Dep’t 1997). If the insured patient, the assignor, had no right to coverage for medical supplies because he never received them or incurred any obligation to pay the supplier for them, he had no rights to assign the supplier. The supplier, the assignee, stands in no better position than the assignor: the assignor assigns no more than he has, and the assignee has no more right or claim than he had. Matter of International Ribbon Mills, 36 NY2d 121, 126 (1975); Trisingh Enters. v. Kessler, 249 AD2d 45, 46 (1st Dep’t 1998); Federal Fin. Co. v. Levine, 248 AD2d 25, 28 (2d Dep’t 1998). Hence plaintiff took its assignment subject to all defendant’s defenses against the assignor. Trisingh Enters. v. Kessler, 249 AD2d at 46.

Here, not only does plaintiff’s witness fail to identify the assignment contract attached to his affidavit or the insured’s signature on the form; this alleged assignment of benefits fails to specify (1) the assignee, that it is in fact plaintiff, (2) the date the collision from which the expenses arise occurred, or (3) the date of the assignment. Thus, even if the contract, the assignor’s signature, and the assignee were identified, nothing indicates that the assignment even postdated the precipitating occurrence, let alone that the assignment pertained to expenses arising from that occurrence.

Plaintiff’s failure to identify the assignment contract or the insured patient’s signature is hardly surprising, because here, the insured was not plaintiff’s patient, but, by plaintiff’s admission, the patient of AR Medical Art, to which plaintiff provided the supplies for which it seeks coverage. The insured patient, the assignor, did not receive the supplies; AR Medical Art did. The assignor did not incur the obligation to pay for them; AR Medical Art did. The insured patient had no right to coverage for supplies he did not receive from plaintiff and was not obligated for; therefore he had nothing to assign plaintiff.

Given the omissions and discrepancies in the claim that plaintiff submitted to defendant and that forms the basis for plaintiff’s claim here, plaintiff has failed to submit a complete claim. 11 N.Y.C.R.R. §§ 65-3.4(c), 65-3.11(b). See, e.g., Ocean Diagnostic Imaging P.C. v. State Farm Mut. Auto. Ins. Co., 5 Misc 3d 53, 54 (App. Term 2d Dep’t 2004); Adam’s Med. Supplies v. Windsor Group Ins. Co., 3 Misc 3d 126, 2004 NY Slip Op 50310 (App. Term 2d Dep’t 2004). A complete claim establishes the “particulars of the nature and extent of the injuries and [health benefits] received.” 11 N.Y.C.R.R. § 65.1-1; Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701 (App. Term 2d Dep’t 2003) (emphasis added). Without the assignee’s name, the claim does not show the party that ultimately incurred the claimed expenses and thus shows no injury. 11 N.Y.C.R.R. § 65.1-1; Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701. See, e.g., Colbourn v. ISS Intl. Serv. Sys., 304 AD2d at 370.

The defects in plaintiff’s assignment form, lacking not only the name of any assignee, but other essential facts as to whether the claimed expenses arose from an insured occurrence, at minimum require the denial of plaintiff’s motion for summary judgment. Moreover, insofar as [*3]plaintiff’s own documents supporting its claim reveal that the insured was the patient of AR Medical Art, not plaintiff, and that plaintiff provided the claimed covered supplies to AR Medical Art, not the insured, they affirmatively raise factual issues as to whether the assignor received the supplies and thus was entitled to coverage for them. Amaze Med. Supply v. Eagle Ins. Co., 3 Misc 3d 130, 2004 NY Slip Op 50389 (App. Term 2d Dep’t 2004); King’s Med. Supply v. Allstate Ins. Co., 2 Misc 3d 140, 2004 NY Slip Op 50280 (App. Term 2d Dep’t 2004); Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 139, 2004 NY Slip Op 50279 (App. Term 2d Dep’t 2004). The deficiencies and inconsistencies in plaintiff’s claim, themselves introducing factual issues, in sum, preclude summary judgment in plaintiff’s favor. E.g., King’s Med. Supply v. Allstate Ins. Co., 2 Misc 3d 140, 2004 NY Slip Op 50280; Damadian MRI in Elmhurst v. Liberty Mut. Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51700; S & M Supply Inc. v. Geico Ins., 2003 WL 21960343 at *1, 2003 NY Slip Op 51192 (App. Term 2d Dep’t July 9, 2003); Park Health Ctr. v. Green Bus Lines Inc., 2002 WL 416484 at *1, 2002 NY Slip Op 40029 (App. Term 2d Dep’t Jan. 11, 2002). The further issue is whether any of these defects requires outright dismissal of plaintiff’s action.

II. DISMISSAL

A.LACK OF COVERAGE

Plaintiff mailed its charges for the supplies to defendant February 11, 2003. Defendant acknowledges receiving the bill February 13, 2003.Within 30 days after a claimant submits its claim for insurance coverage of medical expenses arising from a motor vehicle collision, an insurer must pay or deny the claim. 11 N.Y.C.R.R. § 65-3.8(a)(1); Presbyterian Hosp. in City of NY v. Maryland Cas. Co., 90 NY2d 274, 278 (1997); Central Gen. Hosp. v. Chubb Group of Ins. Cos., 90 NY2d 195, 200 (1997); New York Hosp. Med. Ctr. of Queens v. Country-Wide Ins. Co., 295 AD2d 583, 584 (2d Dep’t 2002); Bonetti v. Integon Natl. Ins. Co., 269 AD2d 413, 414 (2d Dep’t 2000). The insurer may delay payment or denial by requesting verification of the claim from the claimant or a third party. Presbyterian Hosp. in City of NY v. Maryland Cas. Co., 90 NY2d at 279; New York Hosp. Med. Ctr. of Queens v. Country-Wide Ins. Co., 295 AD2d at 584; New York & Presbyt. Hosp. v. American Tr. Ins. Co., 287 AD2d 699, 700 (2d Dep’t 2001). To suspend the 30 day period for payment or denial, the insurer must request verification within 15 days after receiving the completed claim, by forwarding the prescribed form to the party from whom verification is sought. 11 N.Y.C.R.R. § 65-3.5(b); Presbyterian Hosp. in City of NY v. Maryland Cas. Co., 90 NY2d at 280-81; New York Hosp. Med. Ctr. of Queens v. Country-Wide Ins. Co., 295 AD2d at 584; Mount Sinai Hosp. v. Triboro Coach, 263 AD2d 11, 16 (2d Dep’t 1999).

Defendant did not pay or deny plaintiff’s claim within 30 days. Nor did defendant request verification, regarding the assignment, the insured’s receipt of the supplies for which plaintiff claimed coverage, or any other facts, within 15 days. Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701. Defendant’s employee responsible for plaintiff’s claim attests that, instead, defendant sent a letter dated February 27, 2003, notifying plaintiff:

that we are investigating the circumstances of this accident, as well as your patient’s eligibility for No-Fault benefits under our policy of insurance. As a result, all bills submitted . . . are being delayed pending the outcome of this investigation.

Aff. of Jason Fortier, Ex. D (emphasis added).

At an examination under oath August 11, 2003, plaintiff’s president and sole owner testified that plaintiff provides nerve stimulation electrodes “to the medical facility where the patient goes for treatment,” Aff. of Megan M. Marchick, Ex. K at 50, which is electrical stimulation “in conjunction with physical therapy performed at the doctor’s office”; plaintiff does not provide the supplies or treatment to patients. Id. at 72. Defendant subsequently denied plaintiff’s claim because the injured person was not covered under defendant’s insurance policy.

If the insurer fails to deny a claim timely or to suspend the 30 day time frame by timely and properly requesting verification, the insurer is precluded from later disclaiming liability [*4]based on breach of a policy condition or on exclusion from coverage. Presbyterian Hosp. in City of NY v. Maryland Cas. Co., 90 NY2d at 282-83; Country-Wide Ins. Co. v. Zablozki, 257 AD2d 506, 507 (1st Dep’t 1999); New York Hosp. Med. Ctr. of Queens v. Country-Wide Ins. Co., 295 AD2d at 584; Bonetti v. Integon Natl. Ins. Co., 269 AD2d at 414. These disclaimers are distinguished from a disclaimer based on lack of coverage because no policy is in effect covering the injured person or the incident causing the injury, a defense that is not precluded. 11 N.Y.C.R.R. § 65-3.8(e); Presbyterian Hosp. in City of NY v. Maryland Cas. Co., 90 NY2d at 283; Central Gen. Hosp. v. Chubb Group of Ins. Cos., 90 NY2d at 199-200; Zappone v. Home Ins. Co., 55 NY2d 131, 137-38 (1982); Bonetti v. Integon Natl. Ins. Co., 269 AD2d at 414.

Although defendant’s investigation yielded plaintiff’s admission that the insured assignor did not receive the supplies for which plaintiff claims coverage, the consequent lack of coverage for the supplies is not because of the absence of a policy covering the assignor or the vehicle or collision involved. While defendant might argue that because plaintiff’s admission demonstrates that the treatment provider, AR Medical Art, incurred the expense for the supplies, the injured party is AR Medical Art, which is not covered by a policy from defendant, the court need not reach that issue.

Regardless of defendant’s investigation, plaintiff’s claim itself establishes the absence of injury to plaintiff’s assignor and the absence of a precipitating vehicle collision. To the extent waiver rules preclude defenses based on defects in the claim not timely raised in the claims process, if plaintiff has injected a fact constituting a complete defense, it estops plaintiff from invoking waiver to avoid that defense. Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701. Where defendant demonstrates, through its own evidence or plaintiff’s, that the claimed injury does not arise from an insured incident, this defense is not precluded by the failure to deny the claim or request verification within the requisite periods. Ocean Diagnostic Imaging P.C. v. State Farm Mut. Auto. Ins. Co., 5 Misc 3d at 54; A.B. Med. Servs. PLLC v. State Farm Mut. Auto. Ins. Co., 4 Misc 3d 129, 2004 NY Slip Op 50638 (App. Term 2d Dep’t 2004); A.B. Med. Servs. PLLC v. State Farm Mut. Auto. Ins. Co., 3 Misc 3d 139, 2004 NY Slip Op 50575 (App. Term 2d Dep’t 2004).

B.LACK OF STANDING

These and the other deficiencies in the assignment of benefits to plaintiff, moreover, establish plaintiff’s lack of standing to sue, C.P.L.R. § 3211(a)(3); King’s Med. Supply v. Allstate Ins. Co., 2 Misc 3d 140, 2004 WL 829673 at *1 (App. Term 2d Dep’t Apr. 9, 2004); Rehab. Med. Care of NY v. Travelers Ins. Co., 188 Misc 2d 176, 177 (App. Term 2d Dep’t 2001), which, unlike other defenses, e.g., C.P.L.R. § 3211(a)(5) and (8), is not a waivable defense and may be raised by the court sua sponte. Stark v. Goldberg, 297 AD2d 203, 204 (1st Dep’t 2002); Axelrod v. New York State Teachers’ Retirement Sys., 154 AD2d 827, 828 (3d Dep’t 1989). Regardless whether defendant has objected to plaintiff’s standing, plaintiff may not proceed without it, because its absence negates the court’s authority to adjudicate the litigation. Society of Plastics Indus. v. County of Suffolk, 77 NY2d 761, 769 (1991); Stark v. Goldberg, 297 AD2d at 204; Axelrod v. New York State Teachers’ Retirement Sys., 154 AD2d at 828. The court has no power to act and to right a wrong unless plaintiff’s rights are affected. Society of Plastics Indus. v. County of Suffolk, 77 NY2d at 772-73.

Because the insured assignor did not receive the supplies for which plaintiff claims coverage and did not incur any obligation to pay for them, only AR Medical Art did, the assignor never was injured by defendant’s denial of reimbursement and never would have been, even without the assignment. New York State Assn. of Nurse Anesthetists v. Novello, 2 NY3d 207, 214 (2004); Axelrod v. New York State Teachers’ Retirement Sys., 154 AD2d at 828. Before executing the assignment, he had no stake in pursuing a claim for insurance coverage for the supplies. Society of Plastics Indus. v. County of Suffolk, 77 NY2d at 772. Thus he had no claim of injury or right to compensation to assign plaintiff. Matter of International Ribbon Mills, 36 NY2d at 126; Trisingh Enters. v. Kessler, 249 AD2d at 46; Federal Fin. Co. v. Levine, 248 AD2d at 28. [*5]

Plaintiff’s remedy to secure payment for the supplies is against AR Medical Art. If AR Medical Art in turn passes the charges for the supplies along to its patient, then he may seek coverage of those expenses from his insurer or assign this right to AR Medical Art. The fundamental purpose of New York’s “No-Fault” Insurance Law is to permit persons injured in a motor vehicle collision, not medical services providers in the first instance, to receive reimbursement for resultant medical expenses. NY Ins. Law art. 51; Oberly v. Bangs, 96 NY2d 295, 296 (2001); Argentina v. Emery World Wide Delivery, 93 NY2d 554, 561, 563 (1999); Walton v. Lumbermens Mut. Cas. Co., 88 NY2d 211, 214 (1996). If injured persons free themselves from payment for those expenses by assigning their right to reimbursement to their services provider, that assignment accomplishes the statutory purpose. The assignment here did not accomplish that purpose. Society of Plastics Indus. v. County of Suffolk, 77 NY2d at 774. It purported to give the provider a right to reimbursement that the patient never had nor needed. The principle of standing prohibits precisely what plaintiff seeks to accomplish here: as the patient assignee, pursuing another party’s claim that the patient was prohibited from doing in the first instance. Id. at 773.

Given the effect of standing on plaintiff’s right of access to the court, standing is a threshold determination, and plaintiff bears the burden to establish standing to adjudicate the claim presented. Id. at 769. In these actions where plaintiff seeks to establish that it sustained a loss through the provision of medical services to a patient covered by defendant insurer, a treated patient’s valid assignment of coverage for the treatment expenses to the provider is key to standing.

C.THE ASSIGNEE’S BURDEN TO ESTABLISH STANDING

As shown, if the assignment is ineffective, the claimant lacks coverage by the assignor’s insurance, a defense not precluded by an untimely denial. Because the assignee has no standing as a plaintiff in litigation without an effective assignment, plaintiff has the burden to establish an effective assignment throughout the litigation, as part of plaintiff’s prima facie case, whether or not defendant has raised the lack of an effective assignment, and at any stage. Part of showing the “loss sustained” is showing that the assignor and hence the assignee of the claim sustained a loss at all. NY Ins. Law § 5106(a). See, e.g., New York Hosp. Med. Ctr. of Queens v. New York Cent. Mut. Fire Ins. Co., 8 AD3d at 641; Damadian MRI in Garden City v. Windsor Group Ins., 2 Misc 3d 138, 2004 NY Slip Op 50262; Damadian MRI in Elmhurst v. Liberty Mut. Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51700.

Submission to the insurer of a claim with an assignment has been analogized to submission of a bill establishing an account stated. Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701. Yet if a bill does not indicate who it is from (the creditor), or whom it is to (the debtor), or who is obligated to pay whom, the bill does not establish an account stated between the creditor and debtor, regardless whether the debtor has objected. E.g., Schneider Fuel Oil v. DeGennaro, 238 AD2d 495, 496 (2d Dep’t 1997); Maines Paper & Food Serv. v. Restaurant Mgt., 229 AD2d 748, 750 (2d Dep’t 1996). Likewise, if the assignment does not indicate who the insured-assignor is, or who the claimant-assignee is, or who claims coverage under whose insurance policy, the claim is not established, regardless whether defendant insurer has raised the defect. See, e.g., Colbourn v. ISS Intl. Serv. Sys., 304 AD2d at 370. It is impossible for the insurer to acquiesce to the correctness of missing information. See Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701.

1.Prior Authority

The principal decision relied on to relieve plaintiff from the standing requirement is Presbyterian Hosp. in City of NY v. Aetna Cas. & Sur. Co., 233 AD2d 433 (2d Dep’t 1996). First of all, this decision did not conclude that the plaintiff had satisfied its prima facie burden to obtain summary judgment in the plaintiff’s favor, but denied the defendant summary judgment. One of the defendant’s grounds that was insufficient for summary dismissal was the patient’s “defective” assignment. Id. The decision indicates neither what the defect was, nor whether it [*6]even was related to the assignor’s signature or the specification of assignor, assignee, and occurrence. A “defect” is not necessarily a substantive omission and is less likely inadmissible form. More significantly, the defendant did not bear the burden to present the assignment in admissible form as part of its prima facie defense.

This decision in turn relies on St. Clare’s Hosp. v. Allcity Ins. Co., 201 AD2d 718 (2d Dep’t 1994), and Fabian v. Motor Veh. Acc. Indem. Corp., 111 AD2d 366 (2d Dep’t 1985). The more recent of the two, where the defendant contended the claim was deficient and lacking specificity, provides no detail as to the deficiency or there, whether it was related even to an assignment. St. Clare’s Hosp. v. Allcity Ins. Co., 201 AD2d at 720. The earlier decision simply held, after trial, that the defendant’s disclaimer of coverage was invalid because the disclaimer did not specify its basis: the insured’s noncooperation. Fabian v. Motor Veh. Acc. Indem. Corp., 111 AD2d at 367.

A.B. Med. Servs. v. CNA Ins. Co., 1 Misc 3d 137, 2004 NY Slip Op 500061 (App. Term 1st Dep’t 2004), taking another leap from St. Clare’s Hosp. v. Allcity Ins. Co., 201 AD2d at 720, held that defendant, by failing to deny the claim timely, waived the absence of signatures, again on the claim forms, again without indication that the absent signatures related to any assignment. Omissions in the claim forms are distinct from plaintiff’s failure to establish, via admissible evidence. that plaintiff is the party that sustained the loss.

This decision in turn relies on Mt. Sinai Hosp. v. Triboro Coach Inc., 263 AD2d at 17, where the defendant’s challenges to the claim forms included lack of medical information as well as absence of signatures. The primary ground for affirming summary judgment to the plaintiff, moreover, was the defendant’s failure to raise the challenges before the lower court. Reference to the failure also to raise the insurer’s challenges within the 10 days for requesting verification, the secondary ground, reveals that any challenges waived in the claims process plausibly relate only to the medical information. 11 N.Y.C.R.R. § 65.15(d)(2) (1999). In fact, where the evidence required for plaintiff to prevail on summary judgment is equated to the evidence required for a complete claim to an insurer, whether or not defendant is precluded from presenting its defense, the defense and evidence at issue relate to the claimed expenses’ medical necessity. See Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701.

2.The Fallacies in Applying That Authority

This action dramatically illustrates why an effective assignment must be established in the litigation, if not in the claims process. Here, even had the insurer requested verification of the assignment, the insured’s signature on the assignment contract, the assignee’s identity, and the dates of the assignment and of the collision precipitating the expenses, these bare details likely would not have revealed that the insured was not the claimant’s patient to whom the claimant provided anything. See New York Hosp. Med. Ctr. of Queens v. New York Cent. Mut. Fire Ins. Co., 8 AD3d at 641. Defendant would not have known of the “discrepancy” and the consequent absence of any “loss sustained.” Amaze Med. Supply v. Eagle Ins. Co., 2 Misc 3d 128, 2003 NY Slip Op 51701. Were plaintiff required, for summary judgment, as well as for trial, to authenticate the assignment’s signature, to render the document both admissible and effective, and thus attest to familiarity with the assignor’s signature, Acevedo v. Audubon Mgt., 280 AD2d at 95; Seoulbank, NY Agency v. D & J Export & Import Corp., 270 AD2d at 194; Fields v. S & W Realty Assoc., 301 AD2d 625, the scheme more likely would be exposed:

Q.Do you ever have any contact at all with the patient?

A.No.

Marchick Aff., Ex. K at 50.

Had defendant not delayed to conduct its investigation through an examination under oath, but instead met the deadlines, the insurer would have either (1) requested and received verification of the assignment’s components that were adequate on their face or (2) denied the claim without specifying inadequacies in the assignment document. See New York Hosp. Med. [*7]Ctr. of Queens v. New York Cent. Mut. Fire Ins. Co., 8 AD3d at 641. Without requiring plaintiff to set forth basic evidence for trial or summary judgment, see, e.g., McDonald v. Tishman Interiors Corp., 290 AD2d at 267, and barring the court from unearthing fundamental facts establishing standing, the contortion of the statutory scheme that easily could have happened here will happen.

Since here, the record does conclusively establish that plaintiff is without a claim and is in no position even to raise a factual issue requiring trial, the court grants defendant’s unopposed summary judgment motion and dismisses this action. C.P.L.R. § 3212(b); Hospital for Joint Diseases v. Allstate Ins. Co., 5 AD3d 441, 442 (2d Dep’t 2004). Simply stated, since defendant’s policy covering expenses incurred by plaintiff’s assignor “was never intended to provide coverage” for expenses incurred in a transaction between two other parties, plaintiff and AR Medical Art, “coverage could not be created” by defendant’s late disclaimer. Bailey v. Allstate Ins. Co., 243 AD2d at 521.

DATED: February 4, 2005

______________________________

LUCY BILLINGS, J.C.C.

Civil Court of the City of New York, Kings County

070376/04

Eileen N. Nadelson, J.

Plaintiff, a medical provider, instituted this action to recover first party no-fault benefits from Defendant insurer. Plaintiff moved for summary judgment, alleging that Defendant neither paid nor denied the claim within the statutorily mandated thirty-day period after receipt of the claims. Ins. Law sec. 5106; Regulations sec. 65-3.8.

Defendant, in opposition, claimed that the denials were timely on their face; however, Plaintiff argued that Defendant failed to provide legally sufficient proof of mailing the subject denials within the thirty-day period.

Defendant’s proof of mailing consists of an affidavit from one of its employees who states that it is part of her regular duties and responsibilities to handle claims filed for no-fault benefits. The affidavit goes on to state that she reviewed the records of the instant claim and based on that review, has determined that the denial was mailed on the date appearing on the denial form. She finally states that, “as per the regular course of business of this office, the bill was timely denied .” [*2]

The question before the court, one that has caused much confusion and litigation, is the information that must appear on an affidavit of mailing to meet the requirements of New York’s no-fault law to evidence a proper proof of mailing.

Generally, proof of proper mailing gives rise to a presumption that the item was received by the addressee. This presumption may be created by either proof of actual mailing or proof of a standard office practice or procedure designed to ensure that items are properly addressed and mailed. Residential Holding Corp. v. Scottsdale Insurance Co., 286 A.D> 2d 679, 729 NYS2d 776 (2d Dept. 2001).

In A & S Medical, P.C. v. Allstate Insurance Co., 2002 NY Slip Op. 50121(U) (1st Dept. 2002), the Plaintiff established proof of mailing the claim by an affidavit of one of its employees who actually placed the application in an envelop and then mailed the envelop at the post office herself by return receipt certified mail. This Plaintiff further presented the postal receipts, which the court concluded constituted proof of mailing the claim. In this case, the court further adduced that the defendant’s affidavit of an employee who reviewed the file and concluded that the claim was not received was inadequate to rebut the presumption of the plaintiff’s mailing of the claim.

Proof of proper mailing requires evidence of actual mailing or a standard office practice or procedure designed to ensure that the items are properly addressed and received. Affidavits that make no reference to the specifics of the office mailing practice or procedure, which merely aver that the bills were mailed within the statutory time period, are insufficient to establish proof of actual mailing. Comprehensive Medical v. Lumbermens Mutual Insurance Co., 4 Misc 3d 133(A) (NY Sup. App. Term 2004).

Consequently, in order to meet its burden of proving that denials were mailed within the thirty-day period, an insurer must attach an affidavit of an employee who personally mailed the denial or, conversely, the affidavit of an employee with personal knowledge of the office’s mailing practices and procedures, who describes those practices or procedures in detail, indicating how he or she acquired the knowledge of such practices or procedures, and whose personal review of the file indicates that those practices or procedures were followed with respect to the claim under review.

In the instant case, Defendant has failed to meet its burden of proving that the denials were mailed within the thirty-day period because the affidavit of its employee with respect to the mailing is legally deficient. The employee states that she is familiar with the office practices and procedures, but neglects to specify the details of those procedures. The affiant fails to state how she became familiar with these procedures, and her “personal knowledge’ consists merely of a review of the files, without stating at what point in the claim process she reviewed those files or the basis for her belief that regular office procedures were followed. Without sufficient substantiation that the denials were in fact mailed on the date claimed, the court must find for Plaintiff. [*3]

Summary judgment is awarded to Plaintiff. The clerk of the court is ordered to enter judgment in favor of Plaintiff in the amount of $1,181.63, plus statutory interest, costs, and attorney fees.

Dated: January 17, 2005

__________________________

EILEEN N. NADELSON, J.C.C.

Civil Court of the City of New York, Kings County

55621/03

Delores J. Thomas, J.

Upon the foregoing cited papers, the Decision/Order on this motion is as follows:

Plaintiff moves for an order granting it summary judgment.

Plaintiff commenced this action to recover for medical services it provided to five of its assignors pursuant to the no-fault endorsement contained in an automobile policy issued by defendant.

Plaintiff, as to each of its assignors, submits a copy of an assignment of benefits signed by each assignor and a copy of a verification of treatment form for each assignor. With respect to three of the assignors,^[FN1] plaintiff submits a copy of the denial of claim forms issued by [*2]defendant, which on their face indicate receipt by the defendant, and indicate a failure to deny the claim within thirty (30) days of receipt. With respect to the other two assignors,^[FN2] plaintiff submits an affidavit from Fenelly Olivares, in which he claims that he personally mailed the no-fault claims on January 10, 2003, as indicated in the annexed mailing receipt. In addition, plaintiff submits an affidavit from Shiva Hakimian, in which she claims that she is responsible for handling the claims of said two assignors, and that defendant failed to either pay or deny the claims of the two assignors within thirty (30) days of receipt.

A plaintiff establishes a prima facie case for recovery of no-fault benefits by submitting a statutory verification of treatment form showing the amount of the loss (A. B. Medical Services, PLLC v. Lumbermens Casualty Co., 4 Misc 3d 86, 2004 WL 1301910 [AT 2nd & 11th Jud Dists.]; Choicenet Chiropractic, P.C. v. Allstate Insurance Co., 2003 WL 1904296 [AT 2nd & 11th Jud. Dists.]).

In this case, by submitting copies of the assignments, proofs of claim, copies of defendant’s denial of claim forms as proof of mailing of the claims for three of its assignors, and submitting proof of mailing as to the claims for the other two assignors, plaintiff has presented a prima facie case for summary judgment. Defendant’s denial of claim forms which indicate the date the claims were received is sufficient proof of mailing (A.B. Medical Services v. New York Central Mutual Fire Insurance Co., 3 Misc 3d 136 [A], NYLJ, June 2, 2004, p. 27, col. 4, 2004 WL 1302031 [AT 2nd & 11th Jud Dists.]).

In this case, plaintiff seeks reimbursement for services provided to its assignors from October 22, 2002 through January 6, 2003. Plaintiff sent completed verification of treatment forms for said services to defendant in December 2002 and January 2003. With respect to three assignors, the denial of claim forms sent by defendant, after it received the verification of treatment forms, were sent more than thirty (30) days after receipt of the claims. With respect to two of the assignors, there is no indication that any denial of claim forms were sent after receipt of the verification of treatment forms.

In defense of this action, defendant does not rely on the denial of claim forms sent after receipt of the verification of treatment forms, but rather relies on denial of claim forms sent prior to receipt of the subject verification of treatment forms. Prior to receiving the subject verification of treatment forms, defendant sent denial of claim forms with respect to each assignor, indicating that it was the defendant’s position, based on an independent medical examination, that no further medical treatment was necessary for the injuries suffered by each of the assignors. In addition, each denial of claim form provided a cutoff date after which defendant would not pay for medical services. Annexed to each denial of claim form was a report from a doctor which supported the claim that further medical treatment was unnecessary. These types of denials are called blanket disclaimers. It is defendant’s position that once it sent a blanket disclaimer any treatment provided after the cutoff date contained in the denial form would be covered by the blanket disclaimer; so that even if the denial forms sent after receipt of the verification forms were sent more than thirty (30) days after receipt of the claim, they would be timely, based on the earlier blanket disclaimer.

In A & S Medical, P.C. v. Allstate Insurance Co., 196 Misc 2d 322 (AT 1st Dept. 2003), lv to appeal granted NY App. Div. 2004 Lexis 9836 (1st Dept. July 5, 2004), the court, in [*3]passing on blanket disclaimers, stated as follows:

“Although defendant argues otherwise, its belated denial of plaintiff’s no-fault claim is not properly ‘deemed’ timely on the basis of its earlier blanket disclaimer of responsibility to reimburse plaintiff’s assignor for further orthopedic treatment, a disclaimer which predated plaintiff’s rendition of the services billed for and the filing of plaintiff’s claim form. ‘When a provider of medical services submits a claim as assignee of an insured, neither the statute nor the regulations contemplate[s] the insurer simply sitting mute and failing to act upon the claim, silently and secretly relying upon an earlier denial issued directly to the insured.’

The contrary construction urged by defendant effectively authorizing the sub rosa denial of properly filed no-fault claims is inconsistent with the plain language of Insurance Law § 5106(a) and, if adopted, would serve to vitiate the so-called 30-day rule embodied in 11 NYCRR 65.15(g)(3) and to undermine a core objective of the no-fault scheme ‘to provide a tightly timed process of claim, disputation and payment.” (at p. 323-324, citations omitted).

The distinction between A & S Medical and this case is that in A & S Medical the blanket disclaimer was served on the assignor, while in this case, defendant claims that the blanket disclaimers were served on plaintiff, the medical provider. Phillip Asciolla, an employee of defendant, claims that he handles claims for no-fault benefits filed with defendant, and that he has reviewed defendant’s records which indicate that the annexed copies of the blanket disclaimer were mailed to plaintiff with respect to each assignor.

Plaintiff, citing several cases, claims that the affidavit submitted by defendant’s employee is not sufficient to prove that the blanket disclaimers were mailed. In the cases cited by plaintiff, the plaintiffs in those cases submitted evidence of the defendant’s failure to deny the claim within thirty (30) days of receipt, so that the defendant’s employee’s claim that he checked the defendant’s records and that the denials had been timely mailed was insufficient. In this case, while plaintiff has shown that defendant’s denials, generated by its verification of treatment forms, were not timely mailed, plaintiff fails to submit an affidavit from a person with knowledge, that plaintiff never received the blanket disclaimers prior to plaintiff’s treating its assignors. Under these circumstances, defendant’s proof of mailing of the blanket disclaimer forms, in the absence of a sworn denial of receipt by plaintiff, is sufficient.

As noted above, the only distinction between this case and A & S Medical is that in A & S Medical the blanket disclaimer was served on the assignor while in this case the blanket disclaimers were served on plaintiff medical supplier. This distinction need not lead to a different result, since the Appellate Term in A & S Medical took a strong position that the no-fault statutory scheme requires the insurer to deny each claim it receives in a timely fashion, and cannot rely on a blanket disclaimer served prior to receipt of the verification of treatment form. As the Appellate Term noted, permitting such a blanket disclaimer would vitiate the thirty-day rule within which a claim must be denied. [*4]

In addition, even if a previously served blanket disclaimer could serve as a timely denial for subsequent medical treatment, the blanket disclaimers herein cannot be used by defendant as a defense. The blanket disclaimers herein are incomplete. They do not list the name of the medical provider in item 23, and unlike the denials served after receipt of the verification of treatment forms, which list the plaintiff medical provider as the applicant for benefits, the blanket disclaimers list the assignors as the applicants for benefits. An incomplete blanket disclaimer, which makes no mention of the medical provider, cannot be considered a timely denial of a claim for treatment which was subsequently provided, even if the blanket disclaimers were served on the medical provider. At the very least, if defendant wishes to rely on a blanket disclaimer, it must be properly completed. Thus, defendant’s belated denials of plaintiff’s no-fault claims cannot be deemed timely denied based on the previously served, but improperly filled out, blanket disclaimers.

Defendant cites Hospital for Joint Diseases v. Allstate Insurance Co., 5 AD3d 441 (2nd Dept. 2004), as standing for the proposition that a blanket disclaimer can act as a timely denial of subsequent treatment. In that case, the plaintiff claimed that it was entitled to summary judgment on two no-fault claims it sent on March 6, 2002, since the defendant had failed to either pay or deny the claims within thirty (30) days of receipt. The defendant submitted evidence that it had previously notified the plaintiff’s assignor that it had terminated her no-fault benefits based on an independent medical examination. In addition, defendant showed that it had previously issued timely denials for identical claims previously submitted by the plaintiff, and that the plaintiff had repeatedly resubmitted the identical claims, until, one time, the defendant failed to issue a timely denial. The court found that the defendant’s denial was timely, since it had previously timely denied the identical claim. This case is quite different from Hospital for Joint Diseases, since defendant herein never issued a timely denial.

A no-fault claim is overdue if it is not paid or denied within thirty (30) days of receipt. Insurance Law § 5106(a); 11 NYCRR § 65.15(g)(1)(i). Since the blanket disclaimers are not valid, and since defendant either failed to pay or deny the claims with thirty (30) days of receipt, or never issued a denial, plaintiff’s no-fault claim is overdue.

Where an insurance company fails to deny a no-fault claim within thirty (30) days of receipt, it is precluded from raising the defense of lack of medical necessity (Amaze Medical Supply, Inc. v. Allstate Insurance Co., 2 Misc 3d 134[A], 2004 WL 758248 [AT 2nd & 11th Jud. Dists.]).

Defendant further argues that the fees sought by plaintiff exceed the Workers’ Compensation fee schedule. Since defendant failed to deny the claims within thirty (30) days of receipt, it is precluded from raising this defense (Mingmen Acupuncture Services, P.C. v. Liberty Mutual Insurance Co., 2002 WL 1362202 [AT 9th & 10th Jud Dists.]; Park Health Center v. Prudential Property & Casualty Insurance Co., 2001 WL 1803364 (AT 2nd 11th Jud Dists.]).

Accordingly, plaintiff’s motion for summary judgment is granted.

Interest on overdue claims accrues at 2% interest per month. Insurance Law

§5106(a); 11 NYCRR § 65.15(h)(1).

In accordance with 11 NYCRR § 65.17(b)(6)(v), once a court action is commenced, a party may recover attorneys’ fees in the sum of 20% of the amount of no-fault benefits awarded, including the interest awarded thereon, to a maximum of $850.00 per claim (Smithtown General Hospital v. State Farm Mutual Auto Insurance Co., 207 AD2d 338 [2nd Dept. 1994]).

The clerk is directed to enter judgment against defendant on the first cause of action [*5]in the sum of $1360.00, with 2% interest per month, from January 23, 2003. The clerk is directed to enter judgment against defendant on the second cause of action for attorneys’ fees in the sum of 20% of the above amount, including the interest awarded thereon, to a maximum of $850.00.

The clerk is directed to enter judgment against defendant on the third cause of action in the sum of $727.15, with 2% interest per month, from January 23, 2003. The clerk is directed to enter judgment against the defendant on the fourth cause of action for attorneys’ fees in the sum of 20% of the above amount, including the interest awarded thereon, to a maximum of $850.00.

The clerk is directed to enter judgment against the defendant on the fifth cause of action in the sum of $812.15, with 2% interest per month, from January 23, 2003. The clerk is directed to enter judgment against the defendant on the sixth cause of action for attorneys’ fees in the sum of 20% of the above amount, including the interest awarded thereon, to a maximum of $850.00.

The clerk is directed to enter judgment against defendant on the seventh cause of action in the sum of $850.00, with 2% interest per month, from February 10, 2003. The clerk is directed to enter judgment against defendant on the eight cause of action for attorneys’ fees in the sum of 20% of the above amount, including the interest awarded thereon, to a maximum of $850.00.

The clerk is directed to enter judgment against the defendant on the ninth cause of action in the sum of $85.00, with 2% interest per month, from February 10, 2003. The clerk is directed to enter judgment against the defendant on the tenth cause of action for attorneys’ fees in the sum of 20% of the above amount, including the interest awarded thereon, to a maximum of $850.00.

This constitutes the decision and order of the court.

Dated:Brooklyn, New York ________________________________

January 4, 2005 DELORES J. THOMAS

Judge, Civil Court

Footnotes

Footnote 1: Zoya Abayeva, Geraldine Aybar and Altagarcia Abayea.

Footnote 2: Alekandra Borukhova and Jeanne Rivkin.

[*1]

Civil Court of the City of New York, Kings County, December 21, 2004

APPEARANCES OF COUNSEL

Baker, Barshay & Neuwirth, Hauppauge (Robert J. Baker of counsel), for plaintiff. Carmen Callahan & Ingham, Farmingdale (Kerry-Ann Davidson of counsel), for defendant.

{**6 Misc 3d at 888} OPINION OF THE COURT

Ellen Gesmer, J.

This case presents squarely the question of whether an assignment {**6 Misc 3d at 889}is an essential element of a claim for first-party no-fault benefits, and whether the failure to include it is a waivable defect. For the reasons set forth below, the court holds that an assignment is an essential element of a claim for no-fault benefits, which cannot be waived.

In this action, the verified complaint alleges that Melvin Reyes was injured in a car accident on May 12, 2003 and received treatment from plaintiff to whom he assigned his rights to benefits under No-Fault Insurance Law § 5101 et seq. Plaintiff brings this action, as the assignee of Mr. Reyes, to recover $3,080 in first-party no-fault benefits. Plaintiff moves for summary judgment, and defendant opposes it, because of plaintiff’s failure to establish that it submitted an assignment of benefits to defendant with its notice of claim. Plaintiff contends that submission of an assignment of benefits is not part of its prima facie case and that any objections to the assignment are waived if not asserted in the defendant’s denial. Here, defendant [*2]concededly did not object in its denial to plaintiff’s failure to include an assignment in its proof of claim.

In making its argument, plaintiff relies on New York Hosp. Med. Ctr. of Queens v New York Cent. Mut. Fire Ins. Co. (8 AD3d 640 [2d Dept 2004]). That case would appear to support plaintiff’s position. There, the Appellate Division held that the insurance company’s failure to prove that it had mailed timely requests for verification of the assignments upon which the respondents’ claims were based prevented it from objecting to the claims “on the basis of lack of proof of the assignments.” (At 641; see also New York Hosp. Med. Ctr. of Queens v AIU Ins. Co., 8 AD3d 456 [2d Dept 2004].) Recently, citing New York Hosp. Med. Ctr., the Appellate Term for the 2d and 11th Judicial Districts reversed a trial court which had dismissed a no-fault case because the plaintiff had submitted an assignment which did not designate an assignee (Diagnostic Rehab. Med. Serv. PC v Travelers Indem. Co., 6 Misc 3d 68 [App Term, 2d & 11th Jud Dists 2004]). Specifically, the Appellate Term held (at 69) that the defendant insurer, “having failed to seek additional verification or allege any deficiency in the assignment in its denial of claim form, had waived any defenses with respect thereto.”

In its decision, the Appellate Term also overruled its own prior {**6 Misc 3d at 890}decision in A.B. Med. Servs. PLLC v Progressive Ins. (2003 NY Slip Op 50790[U], *1 [App Term, 2d & 11th Jud Dists 2003]), in which it had affirmed the denial of a plaintiff medical provider’s motion for summary judgment on the ground that the “purported assignment” did not bear the name of any assignee. Strikingly however, the Appellate Term did not disown its decision in A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co. (4 Misc 3d 141[A], 2004 NY Slip Op 51031[U] [App Term, 9th & 10th Jud Dists 2004]). In that case, decided three months after New York Hosp. Med. Ctr. (8 AD3d 640 [2004]), the Appellate Term reversed the grant of a plaintiff’s motion for summary judgment finding, inter alia, that one of the plaintiffs had failed to prove its prima facie case because the record did not contain an assignment. The Appellate Term reached that result even though the decision does not indicate that the defendant asked for verification of the assignment or issued a timely denial on that basis. This court concludes that A.B. Med. Servs. v State Farm Mut. Auto. Ins. Co. (4 Misc 3d 141[A], 2004 NY Slip Op 51031[U] [App Term, 9th & 10th Jud Dists 2004]) is still good law, both because the Appellate Term did not overrule it and because, for the reasons set forth below, it is consistent with governing precedent. Applying that decision to this case, this court must deny plaintiff’s motion for summary judgment since it failed to prove that it included an assignment in its notice of claim.

The continued validity of A.B. Med. Servs. (4 Misc 3d 141[A], 2004 NY Slip Op 51031[U]), notwithstanding the Appellate Division decision in New York Hosp. Med. Ctr. (8 AD3d 640 [2004]), is entirely consistent with the policies and principles stated in Central Gen. Hosp. v Chubb Group of Ins. Cos. (90 NY2d 195 [1997]). In that case, the Court of Appeals held that a defense of noncoverage cannot be waived in a no-fault case, even if the insurer fails to raise it in its denial. That decision extended [*3]to the no-fault context the Court’s holdings in Zappone v Home Ins. Co. (55 NY2d 131 [1982]) and Schiff Assoc. v Flack (51 NY2d 692 [1980]) that the defense of noncoverage could not be waived in cases concerning liability policies and professional indemnity insurance. The underlying theory of all of these cases is that if the insurer is not liable to the alleged insured under the contract of insurance, then contractual liability cannot be created by waiver (Schiff Assoc. v Flack, 51 NY2d 692, 698 [1980]; Zappone v Home Ins. Co., 55 NY2d 131, 135-136 [1982]; Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]). The Court of Appeals explained that, if for example, the insurance company had no contract of insurance at all with the alleged insured, or had no contract with its insured concerning the vehicle in the accident, then “there simply is no insurance at all and, therefore, no obligation to disclaim or deny.” (Zappone v Home Ins. Co., 55 NY2d 131, 139 [1982].){**6 Misc 3d at 891}

An assignment essentially extends the rights created by contract from the assignor to the assignee, so the assignee can sue on behalf of its assignor only if it has a valid assignment. Accordingly, the insurance company has no contractual obligation to the assignee in the absence of a valid assignment. Consequently, if the absence of an assignment could be waived by the insurance company’s failure to raise it, then contractual liability between the insurance company and the assured’s assignee would be created by waiver. But that should not be permitted, just as the courts do not permit a contractual obligation between the insurance company and its alleged insured to be created by waiver (Schiff Assoc. v Flack, 51 NY2d 692, 698 [1980]; Zappone v Home Ins. Co., 55 NY2d 131, 135-136 [1982]; Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]). Therefore, when no assignment is tendered, the insurance company has no contractual obligation to the assignee, and its objections to the absence of the assignment cannot be waived.

In this case, there simply was no assignment. Plaintiff did not attach one to its moving papers or to its reply papers. Therefore, plaintiff has failed to establish that defendant has any contractual obligation to it, and the court cannot grant summary judgment in its favor.

Civil Court of the City of New York, Kings County

115723/04

Bruce Newborough, P.C., Brooklyn, New York for the plaintiff; McDonell & Adels, P.C. (Lisa E. Hechler), Garden City, New York for the defendant

Ellen Gesmer, J.

The verified complaint alleges that Arthur Scott was injured in a car accident on March 20, 2003 and received treatment from plaintiff to whom he assigned his rights to benefits under the No-Fault Insurance Law §5101 et seq. Plaintiff brings this action, as the assignee of Mr. Scott, to recover $1,340.30 in first party no-fault benefits. Defendant moves for summary judgment on the grounds that plaintiff engaged in a pattern of fraudulent billing practices and has failed to verify its billing for the instant claim. Plaintiff failed to oppose defendant’s motion. Therefore the Court will decide this matter solely on defendant’s moving papers and annexed documentation.

Defendant maintains that it is issued a timely denial because it received the bill at issue on June 16, 2003, issued a request for additional verification on June 27, 2003 and, after [*2]receiving no response from plaintiff, ultimately denied plaintiff’s claim on December 1, 2003. However, defendant’s moving papers do not include any proof of mailing of its request for verification (S & M Supply, Inc. v Geico Ins. Co., 2003 NY Slip Op 51192[U] [2d & 11th Jud Dists 2003]). The affidavit of Ms. Dawn Madalone an Investigator employed by defendant’s Special Investigations Unit does not establish mailing because Ms. Madalone does not state in her affidavit that she has personal knowledge that the requests were sent to plaintiff (Presbyterian Hosp. v Maryland Casualty Ins. Co., 226 AD2d 613 [2d Dept 1996]). Nor does the Madalone affidavit create a presumption of mailing because it does not describe the standard operating procedures plaintiff uses to ensure that its verification requests are mailed (S & M Supply, Inc. v Geico Ins. Co., 2003 NY Slip Op 51192[U] [2d & 11th Jud Dists 2003]). Consequently, having failed to establish that it mailed the requests for verification, defendant has failed to show that its denial of plaintiff’s claim was timely. The fraud which defendant is claiming as a defense to payment of this claim is fraud by the plaintiff medical provider. Although an untimely denial permits a defendant to assert a defense of fraud by the assignor, a claim of fraud by the assignee must be asserted in a timely denial (Melbourne Medical, P.C. v Utica Mutual Ins. Co., 4 Misc 3d 92 [2d Dept 2004]). Consequently, defendant’s motion for summary judgment must be denied.

Even if this claim were not barred by the late denial, defendant would not be entitled to summary judgment in its favor. In order to satisfy its burden on a motion for summary judgment, defendant “must show that the accident was a deliberate event or a part of an insurance fraud scheme.” (A.M. Med., P.C. v NY Cent. Mut. Ins. Co., 2004 NY Slip Op 50298U, *2 [Civil Ct, Queens County 2004]). This is higher than the standard when the defendant is merely opposing a plaintiff’s motion for summary judgment based on a fraud defense; in that event, defendant must submit “facts, in admissible form and with the requisite particularity, to create triable issues of fraud” (A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 3 Misc 3d 130A (App Term, 2d and 11th Jud Dists 2004), such as an affidavit by a person with personal knowledge of the facts at issue (Melbourne Medical, P.C. v. Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004].

In support of its contention, defendant submits the transcript of the Examination Under Oath (EUO) of Dr. Patricia Garel, in which Dr. Garel states that she never provided psychological services to any of plaintiff’s patients although plaintiff submitted claims to defendant seeking reimbursement for psychological services allegedly rendered by her. However, the transcript of Dr. Garel’s EUO is not executed in accordance with CPLR 3116. CPLR 3116[a] provides that the transcript must be submitted to the witness so that the witness can read it and make any changes to it that are desired. If the witness then signs the transcript under oath, the transcript may be utilized. “Unsigned depositions do not suffice as proof requisite to defeat a motion for summary judgment.” (Pathmark Graphics Inc. v J.M. Fields, Inc., 53 AD2d 531 [1st Dept 1976]; see also Lo Cicero v Frisian, 150 AD2d 761 [2d Dept 1989]). This principle applies equally to an examination under oath taken by an insurance company. (Krupp v Aetna Life & Casualty Co., 103 AD2d 252, 263 [2d Dept 1984]).

In order to use a transcript that is not signed by the witness, if the witness is a nonparty, or, if a party and the transcript is not signed by the witness or certified, it is the burden of the [*3]party proffering the deposition transcript to show that the transcript was sent to the witness to be reviewed for any corrections, and that sufficient time to do so has passed (see Siegel, 1993 Supp Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR C3116:1, 1997-1998 Pocket Part, at 94). A party seeking to use an unsigned deposition transcript must show that the witness was given the opportunity that CPLR 3116 (a) provides to the witness to make sure that the transcript is correct in form and substance. This procedure is necessary to insure that the proponent of the transcript is not relying on an inaccurate transcript (Palumbo v Innovative Communications Concepts, 175 Misc 2d 156, 157-158 [Sup Ct, NY 1997]). In this case, defendant annexes a copy of a letter dated October 21, 2003 addressed to Dr. Garel’s attorneys requesting that she sign the transcript and have it notarized, but defendant does not proffer an affidavit of a person with personal knowledge that this letter was in fact mailed. Consequently, defendant has not shown either that the transcript was properly executed or that the opportunity that CPLR 3116[a] affords the depondent for execution has passed. Therefore, the Court cannot consider the EUO transcript of Dr. Garel because it does not constitute evidence in admissible form under CPLR 3212 (See Reilly v Newireen Assocs., 303 AD2d 214, 220 n.2 [1st Dept 2003]).

In further support of its fraud claim, defendant again relies on the affidavit of Ms. Madalone who states in her affidavit that defendant properly denied plaintiff’s claim based on overwhelming indica of fraud. Ms. Madalone states that her knowledge of the case comes from:

1. Her “review of the file which she maintained, ” 2. Her investigation into plaintiff’s billing practices; 3. A New York State Insurance Department press release concerning the indictment of Dr. Michael Ferrato, Ph.D of Ferrato Psychological Services, P.C. (FPS) 4. Claim forms submitted to defendant by PSG and FPS for various unidentified patients other than plaintiff’s assignor; 5. The transcripts of EUOs of Darcy Greenidge and Allan Gaskin; and 6. The Examination Before Trial (EBT) transcripts of Henry Johnson and Aida Ellis The Court cannot rely on any conclusions reached by Ms. Madalone which are based on unidentified documents in defendant’s investigative file since those documents are not before the court in admissible form (see CPLR 3212[b]; Friends of Animals, Inc. v Assoc. Fur Mfrs., Inc., 46 NY2d 1065, 1067 [1979]). The Court also cannot rely on the press release concerning the indictment of Dr. Ferrato since it is not in admissible form. Even if it were in admissible form, Ms. Madalone has failed to establish the relevancy of the indictment to this case since Dr. Ferrato did not treat the assignor in this case. Defendant also annexes to its moving papers reams of redacted documents which the Madalone affidavit contends proves that FPS submitted bills to defendant for the exact same services as those claimed by PSG for the same patient just days apart from the date when PSG claimed to have rendered services. However, since the name of the policy holder, the patient’s name, gender and address are redacted from the documents, there is no way for the Court to make an independent determination as to whether the documents in fact support defendant’s contention. More importantly, the documents are not in admissible form since they are not adequately identified (A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 3 Misc 3d 130A (App Term, 2d and 11th Jud Dists 2004). Therefore, the Court cannot rely [*4]on Ms. Madalone’s conclusion that these documents prove fraud.

Finally, like the transcript of the EUO of Dr. Garel, the transcripts of the EUOs and EBTs of Ms. Greenidge, Mr. Gaskin, Mr. Johnson and Ms. Ellis cannot be considered on a motion for summary judgment, since they are not executed and the defendant has failed to show that the deponents were given an opportunity to execute the transcripts.

Consequently, all of the documents relied on by Ms. Madalone cannot be considered by this Court in support of defendant’s motion for summary judgment because the documents are not in admissible form. Therefore, defendant failed to satisfy its burden to submit facts in admissible form and with the requisite particularity to establish fraud. Accordingly, defendant’s motion for summary judgment is denied.

This constitutes the Decision and Order of the Court.

Dated: December 8, 2004

ELLEN GESMER

Judge, Civil Court

Civil Court of the City of New York, Kings County

323338/03

Sylvia Hinds-Radix, J.

Plaintiffs commenced this action to recover first-party no-fault benefits for medical services rendered to their assignor, pursuant to Insurance Law § 5101 et. seq., as well as statutory interest and attorney’s fees. Thereafter, plaintiffs moved for summary judgment on their claims in the amount of $14,628.06, on the ground that defendant failed to pay or to deny their claims within the statutory 30-day period as required by Insurance Law section 5106 [a] ( Amaze Med. Supply Inc.v. Eagle Ins. Co., NYLJ, Dec. 29, 2003, at 21 Col 1 [App Term, 2d &11th Jud Dists]).

1. SUMMARY JUDGMENT STANDARD

The rule governing summary judgment requires the proponent of a summary judgment motion to make a prima facie showing of entitlement to judgment as a matter of law, tending admissible evidence to eliminate any material issues of fact from the case ( Winegrad v. New York University Medical Center, 64 NY2d 851 [1985]; Torterello v. Carlin, 260 AD2d 201 [1st Dept. 1999]). The burden of production as well as the burden of persuasion always rests on the proponent of the motion (Alvarez v. Prospect Hospital, 68 NY2d 320 [1986]).

If the moving party satisfies those standards, the burden shifts to the opponent to rebut [*2]that prima facie showing by presenting evidence in admissible form establishing the existence of triable issues of fact ( see, CPLR 3212, subd [b]; Zuckerman v. City of New York, 49, NY2d 557 [1980]; Davenport v. County of Nassau, 279, AD2d 497 [2001]; Pragano v. Kingsburg, 182 AD2d 270 [2nd Dept.1992]; Kaufman v. Silver, 90 NY2d 204, 208 [1997]). It is well settled that Summary judgment should be denied if there is any doubt as to the existence of a triable issue of fact ( Freese v. Schwartz, 203 AD2d 513 [2nd Dept. 1984]).

When deciding a motion for summary judgment, the court must review the evidence in the light most favorable to the non-moving party, and must give that party all of the reasonable inferences that can be drawn from the evidence ( Louniakov v. M.R.O.R. Realty Corp., 282 AD2d 657 [2nd Dept. 2001]; SSBSS Realty Corp. v. Public Service Mut. Ins. Co., 253 AD2d 583, 584-585 [1st Dept. 1998]).

11. COVERAGE OF MEDICAL EXPENSES PURSUANT TO INSURANCE LAW 5106 (a)

Pursuant to both the Insurance Law and the regulations promulgated by the Superintendent of Insurance, within (30) thirty days after a claimant submits proof of the facts and the amount of loss sustained, an insurer is required to either pay or deny a claim for insurance coverage of medical expenses arising from a motor vehicle accident (see, 11 NYCRR § 65.15 (g) (3); Central Gen. Hosp. v. Chubb Group of Ins. Co., 90 NY2d 195, 200 [1997]; Mount Sinai Hosp., v. Triboro Coach, 263 AD2d 11, 16 [2nd Dept. 1999]; New York Med. Center of Queens v. Country-Wide Ins. Co., 295 AD2d 583 [2nd Dept. 2002]).

The 30 day period may be extended by a request for verification pursuant to 11NYCRR

65.15 (d) (1) (2). (See, New York Hosp. Med. Ctr. of Queens v. Country Wide Ins. Co., 295 AD2d 584 [2nd Dept. 2002]; Presbyterian Hosp. In the City New York v. Maryland Cas. Co., 90 NY2d 279 [1997]).

If the requested verification has not been supplied to the insurer within 30 calendar days, after the original request, the insurer shall issue a follow-up request within 10 calendar days of the insured failure to respond. See, 11 NYCRR 65.15 (e) (2), now 15 days 11NYCRR 65-3.5 (b). S&M Supply v. Allstate Insurance Co., 2003 NY SLIP Op 51191 [U] [App Term, 2d & 11thJud Dists]. “An insurer shall not issue a denial of claim form . . . prior to its receipt of verification of all of the relevant information requested . . . “(New York Hosp. Med. Ctr. Of Queens v. Country-Wide Ins. Co., 295 AD2d 583, 585 [2002]; Glassman D.C., PC v. State Farm Mut. Auto. Ins. Co., 192 Misc2d 264, 265 [App Term, 2nd & 11 Jud Dists. 2002]).

If the additional verification required by the insurer is a medical examination, the insurer shall schedule the examination to be held within 30 calendar days from the date of receipt of the prescribed verification forms (see, 11 NYCRR 65.15 [d] [3]).

The only exception to the 30 day rule is where a carrier’s untimely denial is based upon the defense of lack of coverage, or a medical condition for which the patient was treated was not “related to the accident” (Central Gen. Hosp. v. Chubb Group of Ins. Co., 90 NY2d 195 [1997]). To withstand a motion based on this defense, the insurer has the burden to come forward with proof in admissible form to establish “the fact” or the evidentiary foundation for its belief that the patient’s treatment was unrelated to the accident (Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2002]). [*3]

Failure to pay or deny a claim within the 30- day period requirement, absent a request for additional verification, renders benefits “overdue,” and precludes the insurer from disclaiming liability based on a breach of a policy condition or a statutory exclusion defense (St. Clare’s Hosp. v. Allicity Ins. Co., 201 AD2d 720 [2nd Dept. 1994]). All overdue payments bear interest at a rate of 2% per month, and the claimant is entitled to recover attorney’s fees where a “valid claim or portion” was denied or overdue (see, Insurance Law 5106 (a); Presbyterian Hosp. in the City of New York v. Maryland Cas. Co., 90 NY2d 274 [1997]).

III. PLAINTIFFS MOTION FOR SUMMARY JUDGMENT

In support of its motion for summary judgment in this action, plaintiffs submitted the affidavit of David Safir, who states in his affidavit that he is the billing manager for the plaintiffs. Mr. Safir avers that he personally mailed all of the claim forms for no-fault medical services to the defendant, and defendant failed to pay or deny the claims within thirty days of receipt of the claims.

A review of plaintiffs’ motion papers indicates that plaintiffs established their prima facie entitlement to judgment by submitting proof that the statutory claim forms were mailed and received, and that defendant did not pay or deny the claims within the prescribed statutory 30-day period (Amaze Med. Supply Inc., v. Eagle Ins. Co., NYLJ, Dec. 29, 2003 [App Term, 2d & 11th Jud Dists]; Mary Immaculate Hosp. v. Allstate Ins. Co., 5 AD3d 742 [2004]). The burden then shifted to the defendant to demonstrate the existence of a triable issue of fact requiring a trial on the action ( Alvarez v. Prospect Hosp., 68 NY2d 320, 324 [1986]; St. Luke’s Roosevelt Hosp., v. American Tr. Ins. Co., 274 AD2d 511 [2nd Dept. 2000]).

IV. DEFENDANT’S OPPOSITION

Defendant, in its opposition to plaintiffs’ motion, admits to receipt of plaintiffs’ claims but contends that it denied the claims based on multiple grounds of (1) failure of plaintiffs’ assignor to appear for Scheduled Independent Medical Examinations (2) fees for medical supplies purchased were excessive as per the Workers’ Compensation Schedule (3) injury causation and (4) medical necessity.

(a) Failure to Appear for Scheduled Independent Medical Examinations

Defendant alleges that plaintiffs’ assignor violated a policy condition of the insurance policy by failing to appear for scheduled independent medical examinations (IMEs), thus precluding any recovery of benefits thereunder. In support of its allegation, defendant relies on the affidavit of Dan Ross, an employee of Alliance Health Medical, P.C., which is an outside entity that provides services for the defendant.

Mr. Ross states in his affidavit that his review of the file, and records pertinent to plaintiffs’ assignor, revealed that, defendant forwarded IME scheduling letters dated June 10, 2003 to plaintiffs’ assignor, requesting her to attend IMEs scheduled for June 26, 2003, and June 30, 2003. Mr. Ross further states that on July 2, 2003, Alliance Health Medical notified the defendant, that plaintiffs’ assignor failed to appear for the scheduled IMEs. In its opposition papers, defendant attached two copies of IME letters addressed to plaintiffs’ assignor, requesting the assignor to attend IME’s scheduled for June 26, 2003 and June 30, 2003. The letters were each dated June 10, 2003.

This court finds that defendant fail to comply with the follow-up procedures and timetable for verification set out in the governing regulations of 11NYCRR 65-3.5 (b), by [*4]following up with an additional request for verification, or by notifying plaintiffs’ assignor of her right to follow up procedures and timetable for verifications ( S&M Supply v. Allstate Insurance Co., 2003 NY SLIP Op 51191 [U] [App Term, 2d & 11thJud Dists]; Presbyterian Hosp. in the City of New York v. Aetna Cas,. & Sur. Co., 233 AD2d 432; Metro Med. Diagnostics v. Lumbermens Ins. Co., 189 Misc2d 597 (2001) [App Term 2d and 11th Jud Dists]).

Furthermore, no probative evidence was submitted by the defendant to establish that the IME letters were ever sent to plaintiff’s assignor. Mr. Ross states that a review of the file and records reveal that defendant forwarded IME request letters to plaintiff’s assignor, without averring that he mailed the request himself. He did not state in his affidavit that he had personal knowledge that the letters were mailed to plaintiffs’ assignor ( Rue v Stokes, 191 AD2d 245 [1993]; LI First Aid Medical Supply Inc., v. Progressive Cas Inc. Co., 196 Misc2d 258, nor has he created a presumption of mailing by relying on defendant’s business records or by describing the standard office practice or procedure used by the defendant to ensure that its requests are properly mailed ( see, CPLR section 4518 (a); Residential Holding Corp., v. Scottsdale Ins. Co., 286 AD2d 679 [2nd Dept. 2001]).

By submitting copies of letters addressed to plaintiffs’ assignor without an affidavit from someone with first hand knowledge attesting how, when, or by whom the letters were mailed, does not in itself support a presumption that the letters were mailed, and received by plaintiffs’ assignor ( American Home Assur. Co., v. Choudary, 255 AD2d 346 [2nd Dept. 1998]; Residential Holding Co., v. Scottsdale Ins Co., 286 AD2d 679, 680 [2nd Dept. 2001]; Presbyterian Hosp. in the City of New York , v. Maryland Casualty Ins. Co., 226 AD2d 613 [2nd Dept. 1996]). Consequently, the affidavit of Mr. Ross was insufficient to raise a triable issue of fact as to whether the requests for independent medical examinations were timely sent to plaintiffs’ assignor.

(b) Fees for Medical Supplies Excessive as per the Workers’ Compensation Law Fee Schedule

The defendant alleges that the fees sought by plaintiffs for medical supplies purchased for their assignor, exceeded those permitted by Workers’ Compensation Law Fee Schedule. It is well settled that, based on a timely denial, an insurer is entitled to interpose the defense that certain charges were not in conformity with the charges permissible under the workers’ compensation fee schedule (Park Health Ctr., v. Prudential Prop & Cas Ins. Co., NYLJ, Dec. 14, 2001 [App Term, 2d & 11th Jud Dists]). Insurance regulation 11 NYCRR 68, Appendix 17-C, Part E (b) (1), provides:

“For medical equipment and supplies (e.g., TENS units, soft cervical collars) provided by a physician or medical equipment supplier, the maximum permissible charge is 150 percent of the documented cost of the equipment to the provider.

This section provides essentially a fee schedule for equipment provided by a medical provider or a medical equipment supplier. In the Instant action, defendant failed to submit evidentiary proof

to establish that the benefits sought for medical supplies were not in conformity with the charges permissible under the workers compensation fee schedule law (Kings Medical Supply v. Travelers Property Casualty Corp., 756 NYS2d 385 [2003]; Abraham v. County Wide Ins. Co., [*5]NYLJ, Feb. 2, 2004 [App Term, 2d &11th Jud Dists]).

Furthermore, since defendant failed to timely deny plaintiffs claim or to seek additional verification of the claims within thirty days of it receipt of the claims, defendant is precluded from raising the defense of excessive fees in its opposition to plaintiffs’ motion for summary judgment (Mt. Sinai v. Triboro Coach, 263 AD2d 11 [2nd Dept. 1999]).

( c) Injury Causation

Defendant argues that there is no casual relationship between the accident and the injury alleged by plaintiffs’ assignor. To support its argument, defendant submitted an unsworn low impact “Automotive Engineering Report”. Defendant argues that the low impact analysis “Automotive Engineering report” concluded that plaintiffs assignor’s treatment was not related to the accident.

Although, defendant is not precluded from asserting the defense that the alleged injuries were not casually related to the accident despite an untimely denial of the claims (Central Gen. Hosp. v. Chubb Group of Ins. Co., 90 NY2d 195 [1997]; Mount Sinai Hosp., v. Triboro Coach, 263 AD2d 11, 16 [2nd Dept. 1999]), this court finds that the unsworn “Automotive Engineering Report” lacks evidentiary value and does not constitute competent proof in admissible form, and cannot be considered in opposition to plaintiffs’ motion for summary judgment (Dotez v. Allstate Ins. Co., [App Term, 9th & 10th Jud Dists.]). Additionally, defendant failed to present a sworn statement from someone with knowledge of the facts or with appropriate expertise to render an opinion (Mt. Sinai Hospital v. Triboro Coach Inc., 263 AD2d 11 [2nd Dept. 1999]).

(d) Medical Necessity

Defendant remaining argument is that the medical treatments rendered to plaintiffs’ assignor were not medically necessary. Lack of medical necessity is a valid defense to an action to recover no fault benefits if stated in a timely denial (Presbyterian Hosp. in the City of New York v. Maryland Casualty Ins. Co., 226 AD2d 613 [2nd Dept. 1996]; Central Gen. Hosp. v. Chubb Group of Ins. Co., 90 NY2d 195 [1997]). Since defendant failed to raise the defense of medical necessity within 30 days of receipt of the plaintiffs’ claims, defendant is precluded from interposing this defense to the motion for summary judgment (New York Presbyterian Hosp., v. Empire Ins., 286, AD2d 322 [2nd Dept. 2001]). Despite the use of a multiple defenses, the defendant cannot prevail if the defenses are not raised within the statutory prescribed period.

V. CONCLUSION

Accordingly, plaintiffs’ motion for summary judgment is hereby granted in its entirety. Judgment shall be entered in favor of plaintiffs in the amount of $14,628.06, together with appropriate statutory interest and attorneys’ fees.

The court did not consider defendant’s amended affirmation in opposition in rendering its decision and order, since the amended papers were not timely served upon the plaintiffs.

This constitutes the decision and order of this court.

Dated: November 10, 2004.

Brooklyn, New York

______________________________ [*6]

SYLVIA HINDS-RADIX

J.C.C.

Civil Court of the City of New York, Kings County

317285/03

Eileen N. Nadelson, J.

This action was brought under the Regulations of the New York State Insurance Department, 11 NYCRR sec. 65-1.1 et seq., to recover first party benefits under New York’s No-Fault Insurance Law.

The two assignments that form the basis of this action involve two persons who were allegedly injured in the same motor vehicle accident. Plaintiff medical provider submitted a bill for the first assignor, Jimmy Cadet (Cadet) on March 7, 2003. This claim was denied on May 15, 2003, based on the assignor’s failure to establish proof of the claim pursuant to his Examination Under Oath (EUO). Plaintiff submitted a bill for the second assignor, Naika Gousse (Gousse) on March 4, 2003; this claim was denied on May 15, 2003, because the assignor failed to appear for her EUO.

Plaintiff has moved for summary judgment, asserting that the denials of benefits were not received within the statutorily mandated 30 days after receipt of the claims, 11 NYCRR sec. 65-3.5, 65-3.8(a).

The EUO upon which the denial of claim for Cadet was based was unsigned by the [*2]assignor and not notarized. While objections based on allegedly fraudulent accident claims survive an insurer’s failure to timely deny such claim, Cf. Central General Hospital v. Chubb Group of Ins. Cos., 90 NY2d 195, 659 N.Y.S. 2d 246 (1997), and thereby toll the 30-day statutory period, when opposing a motion for summary judgment, the defendant insurer must be able to raise triable issues of fact in admissible form. Bonetti v. Integron Nat. Ins. Co., 269 AD2d 413, 703 N.Y.S. 2d 217 (2d Dept. 2000). The EUO submitted by Defendant insurer in the instant action is not in a legally admissible form, being unsigned and unverified. Consequently, the court holds that unsigned and unverified Examinations Under Oath are insufficient to raise triable issues of fact so as to defeat a motion for summary judgment.

Section 65-3.5 of 11 NYCCR, the regulations promulgated pursuant to New York’s No Fault Law, states:

(A) Within 10 business days after receipt of the completed application for motor

vehicle no-fault benefits, the insurer shall forward to the parties required to

complete them, those prescribed verification forms it will require prior to pay-

ment of the initial claim.

(B) Subsequent to the receipt of one or more of the completed verification forms,

any additional verification shall be requested within 15 business days of receipt

of the prescribed verification forms.

In the instant case, an EUO was requested of Gousse within the ten business days after the claim was submitted, and it is uncontroverted that she did not appear on the scheduled date. However, the Regulations impose a burden on the insurer to follow-up with an additional request if the initial request for verification was incomplete or not complied with at all. In this instance, the insurer did not follow the procedures of 11 NYCRR sec. 65-3.5(B) in seeking a second date for the EUO when Gousse failed to attend the first scheduled examination. Therefore, the 30-day statutory period was not tolled because Defendant insurer failed to adhere to the provisions of the No-Fault Regulations by not attempting to schedule a second EUO.

Based on the foregoing, the court grants Plaintiff’s motion for summary judgment. Judgment for Plaintiff in the amount of $4460 plus statutory 2% per month interest and statutory 20 % attorney’s fees.

Dated: October 27, 2004

__________________________

EILEEN N. NADELSON, J.C.C.

[*1]

Civil Court of the City of New York, Kings County, October 19, 2004

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for plaintiff. Jaffe & Nohaicki, New York City, for defendant.

{**5 Misc 3d at 768} OPINION OF THE COURT

Ann Elizabeth O’Shea, J.

This is an action to recover first-party no-fault benefits, attorney’s fees and costs pursuant to New York’s Insurance Law and no-fault regulations. The cause of action allegedly arose out of an automobile accident on June 24, 2002, in which Robert Nieves, plaintiff’s assignor, was injured. Plaintiff, a medical equipment supplier, allegedly provided Mr. Nieves with medical supplies for which it submitted a claim for $705 to defendant insurer. Defendant denied plaintiff’s claim on the ground that the supplies were not medically necessary. Plaintiff now moves for summary judgment, arguing that defendant’s denial was untimely and without any evidentiary support. Defendant, in opposition, asserts that plaintiff has not established its prima facie entitlement to summary judgment with admissible evidence, including evidence as to the documented cost of the supplies provided. For the following reasons, plaintiff’s motion is granted in all respects.

Under the No-Fault Insurance Law and regulations, a medical equipment supplier must submit a properly completed proof of claim^[FN1] to the insurer within 180 days after the supplies have [*2]been provided under the “old regulations” in effect prior to April 4, 2002 (11 NYCRR 65.12) or 45 days after the supplies have been provided under the “new regulations” in effect on April 4, 2002 and thereafter (11 NYCRR 65-1.1 [h]). The insurer then has 30 days from the date the claim is received to pay or deny the claim under both the old and new regulations (11 NYCRR 65.15 [g] [1] [i]; 65-3.8 [a] [1]). If the insurer has any objections to or questions about the claim, including, among other things, the necessity for the supplies provided, the amount of the claim, or the adequacy of the claim form,^[FN2] it may request that the claimant provide further information to verify the claim (11 NYCRR 65.15 [d] [1] [old regulations]; 11 NYCRR 65-3.5 [b] [new regulations]; see Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U], *2 [App Term, 2d Dept 2003] [“a properly completed claim form, which suffices on its face to establish the particulars of the nature and extent of the injuries and (health benefits) received and contemplated . . {**5 Misc 3d at 769}. and the proof of the fact and amount of the loss sustained . . . is all that is necessary at the claim stage . . .” (internal quotation marks and citations omitted)]; see also Dermatossian v New York City Tr. Auth., 67 NY2d 219, 224 [1986] [“to receive payment, (a claimant) need only file a ‘proof of claim’ (which) the insurers are obliged to honor . . . promptly or suffer the statutory penalties” (citations omitted)]; Damadian MRI in Elmhurst v Liberty Mut. Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51700[U] [App Term, 2d Dept 2003]). A request for verification must be made by the insurer within 10 business days after the claim has been received under the old regulations (11 NYCRR 65.15 [d] [1]) and within 15 business days under the new regulations (11 NYCRR 65-3.5 [b]). The 30-day clock in which to pay or deny the claim is then stopped until the requested information is provided by the claimant (see Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2d Dept 2004]; Liberty Queens Med., P.C. v Liberty Mut. Ins. Co., 2002 NY Slip Op 40420[U] [App Term, 2d & 11th Jud Dists 2002]). An insurer who fails to pay or deny the claim—or seek verification of the particulars of the claim—within the applicable time periods is thereafter precluded from raising any defenses to the claim, other than lack of coverage or fraud (Presbyterian Hosp. v Maryland Cas. Co., 90 NY2d 274 [1997]; Presbyterian Hosp. v Aetna Cas. & Sur. Co., 233 AD2d 433 [2d Dept 1996]; Central Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11 [2d Dept 1999]). The Court of Appeals has explained the principles and policies that prompted the adoption of this comprehensive regulatory scheme for the resolution of no-fault claims:

“[T]he primary purpose underlying the No-Fault Law [is] to assure claimants of expeditious compensation for their injuries through prompt payment of first-party benefits without regard to fault and without expense to them . . . To implement this legislative aim of curtailing delay and reducing expense in the adjustment of motor vehicle accident claims, the regulations . . . are written to encourage prompt payment of claims, to discourage investigation by insurers, and to penalize delays.”

(Dermatossian v New York City Tr. Auth., 67 NY2d 219, 225 [1986] [citations omitted].)

Those principles and policies have also informed court decisions limiting the proof required by medical providers and the defenses available to insurers on motions for summary judgment{**5 Misc 3d at 770} and at trial. To establish a prima facie case, a plaintiff medical supplier must submit proof that it timely transmitted its claim for no-fault benefits, that the defendant insurer received the claim but failed to pay or validly deny the claim within the permissible 30 days or to request verification within the applicable 10 or 15 business days after it received the claim (Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U], *2 [App Term, 2d Dept 2003] [“courts have declined to distinguish a proper proof of claim under the insurance regulations from the quantum of proof necessary to prevail on a motion for summary judgment in an ensuing action on the claim”]; see also Ocean Diagnostic Imaging PC v State Farm Mut. Auto. Ins. Co., 5 Misc 3d 53 [App Term, 2d Dept 2004]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2d Dept 2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d Dept 2003]). Once the plaintiff has established its prima facie case, the burden shifts to the defendant to come forward with admissible evidence refuting plaintiff’s evidence and demonstrating the existence of a material issue of fact (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]; Winegrad v New York Univ. Med. Ctr., 64 NY2d 851 [1985]).

In support of its motion for summary judgment, plaintiff submitted a copy of its NF-3 proof of claim form, accompanied by an affidavit of its billing manager attesting on personal knowledge to the issuance of the claim, and a copy of defendant’s denial form (NF-10), indicating defendant received the claim on August 28, 2002, and denied it on November 21, 2002.^[FN3] In this case, the NF-10 denial form, which is admissible as an admission by defendant, is sufficient to establish plaintiff’s prima facie entitlement to summary judgment, i.e., that the claim was transmitted, that defendant received it, and that defendant failed to pay or deny the claim within 30 days of receipt^[FN4] (see A.B. Med. Servs., PLLC v New York Cent. Mut. Fire Ins. Co., 3 Misc {**5 Misc 3d at 771}3d 136[A], 2004 NY Slip Op 50507[U] [2d Dept 2004]). Nothing more is required.^[FN5] [*3]

Defendant offers nothing in response to plaintiff’s motion other than a generic attorney’s affirmation in opposition and a generic memorandum of law with little but a passing connection to the claims in issue here. In any event, construing defendant’s opposition in the most favorable light possible, defendant fails to overcome plaintiff’s prima facie case for several reasons.

First, the denial is untimely, and, therefore, defendant is precluded from asserting any defense other than fraud or lack of coverage (Presbyterian Hosp. v Maryland Cas. Co., 90 NY2d 274 [1997]; Presbyterian Hosp. v Aetna Cas. & Sur. Co., 233 AD2d 433 [2d Dept 1996]; Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11 [2d Dept 1999]).

Second, the stated reason for the denial in defendant’s NF-10 is that “an extended delay between the motor vehicle accident and the beginning of treatment suggest not medically necessary and raises issue of casualty [sic].” It is by now firmly established that the burden is on the insurer to prove that the medical services or supplies in question were medically unnecessary (see, e.g., A.B. Med. Servs. v GEICO Ins., 2 Misc 3d 26 [App Term, 2d Dept 2003], and cases cited therein). In addition, a denial premised on lack of medical necessity must be supported by evidence such as an independent medical examination, peer review, or examination under oath “setting forth a sufficiently detailed factual basis and medical rationale for the claim’s rejection” (Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701, *1 [App Term, 2d Dept 2003]; see also Rockaway Blvd. Med. P.C. v Travelers Prop. Cas. Corp., 2003 NY Slip Op 50842[U] [App Term, 2d & 11th Dists 2003]; see also 11 NYCRR 65-3.8 [b] [4]; Choicenet Chiropractic P.C. v Travelers Prop. Cas. Corp., 2003 NY Slip Op 50697[U] [App Term, 2d & 11th Jud Dists 2003]; Rockaway Blvd. Med. P.C. v Allstate Ins. Co., 2003 NY Slip Op 50681[U] [App Term, 2d & 11th Jud Dists 2003]). {**5 Misc 3d at 772}Defendant’s conclusory, unsupported statement in its denial form is wholly inadequate to defeat plaintiff’s motion for summary judgment.

Finally, to the extent defendant’s defense to the summary judgment motion is that plaintiff did not document the cost of the supplies provided as part of its claim, the defense is without merit. It is true that, under the regulations, no-fault benefits available for medical supplies are limited to 150% of their “documented cost” (see 11 NYCRR Appendix 17-C, part E [b] [1]). However, in this court’s view, “documented cost” is not an element of plaintiff’s prima facie case. As is the case with issues of medical necessity, any questions about the amount claimed for medical supplies can and should be asked through a request for verification and, if possible, resolved at the claim stage, not by a court on a motion for summary judgment or at trial. Defendant had the opportunity to ask plaintiff to document the costs of the supplies when it received the claim. Because defendant failed to do so within the time permitted by the regulations, defendant is precluded from raising it now as a defense to plaintiff’s summary judgment motion.^[FN6] [*4]

For the foregoing reasons, plaintiff’s motion is granted in all respects. Judgment shall be entered in favor of plaintiff for $705 plus statutory interest and attorney’s fees plus costs.

Footnotes

Footnote 1: Or “substantially equivalent written notice” (11 NYCRR 65-3.5 [a]).

Footnote 2: For example, lack of authentication or other defect in the assignment of benefits (see, e.g., Elm Med., P.C. v American Home Assur. Co., 2003 NY Slip Op 51357[U]; but see A.B. Med. Servs. PLLC v Highlands Ins. Co., NYLJ, May 27, 2003, at 21, col 3 [Civ Ct, NY County]).

Footnote 3: Also annexed to the moving papers is a copy of an unsworn “Letter of Medical Necessity” concerning the assignor. This document is not considered by the court as it is not in admissible form.

Footnote 4: The court notes that the mailing log, date stamped by the Postal Service, also submitted in support of plaintiff’s motion, standing alone without any accompanying affidavit made on personal knowledge that the proof of claim was transmitted in accordance with plaintiff’s regular business procedures, would not be sufficient, for summary judgment purposes, to establish that the claim was transmitted to defendant.

Footnote 5: The additional documents submitted by plaintiff—a receipt for medical equipment and an assignment of benefits form signed by the assignor; a prescription for the medical equipment; invoices from Collona Distributors, Inc.; a copy of a cancelled check to Collona Distributors, Inc. for the full amount of the invoices—were not required as part of plaintiff’s prima facie burden of proof on its summary judgment motion, although they may have been instructive as a response to a timely request for verification of the claim by defendant.

Footnote 6: To the extent this decision is at odds with King’s Med. Supply v Travelers Prop. Cas. Corp. (194 Misc 2d 667 [Civ Ct, Kings County 2003]), which was decided before the development of the Appellate Term case law, this court respectfully declines to follow it.

Civil Court of the City of New York, Kings County

41116/2004

Peter P. Sweeney, J.

In this action pursuant to Insurance Law § 5101 et seq to recover first-party no-fault benefits, plaintiff moves to strike defendant’s seventh, eighth and tenth affirmative defenses on the ground that they were not pleaded with the specificity required by CPLR 3016(b). For the reasons stated below, the motion is denied in part and granted in part.

Factual Background

Plaintiff Carepluss Medical Supply Inc. a/a/o Edme Aenor commenced this action by the service of a summons and complaint, alleging that the defendant State Farm Mutual Automobile Insurance Company wrongfully denied a claim for first-party no-fault benefits. The claim was in [*2]the amount of $757.00 for medical supplies provided to its assignor Edme Aenor in connection with injuries arising out of a September 2, 2002 motor vehicle accident. In its denial dated April 9, 2003, the defendant acknowledged receipt of the clain on December 4, 2002 and denied the claim solely on the ground that Mr. Aenor failed to appear for two scheduled examinations under oath.

In its answer, defendant denied all the material allegations alleged in plaintiff’s complaint and asserted twelve affirmative defenses. Defendant’s seventh, eighth and tenth affirmative defenses provide as follows:

SEVENTH: That Plaintiff has engaged in fraudulent conduct in connection with the operation of its business and the submission of the claim to State Farm by intentionally paying substantially more for the items at issue for which reimbursement is sought, than the price that is readily available in the relevant marketplace, with the intent to deceive State Farm, and to inflate the charges that were submitted to State Farm.

EIGHTH: That Plaintiff has fraudulently and materially misrepresented to State Farm that the cost that was incurred and upon which the charges for the items at issue were based, were necessary and/or required costs, when In fact, the Plaintiff intentionally paid more for the items at issue than the price that is readily available in the relevant marketplace, with the intent to deceive State Farm and to inflate the charges that were submitted to State Farm.

TENTH: That the medical supplies fo which reimbursement is sought were not related to the accident in question and/or were never actually provided.

Plaintiff maintains that since these defenses are premised upon allegations of fraud and misrepresentation, they must be dismissed because they were not pleaded with the specificity required by CPLR 3016(b), which in pertinent part, provides: “[w]here a * * * defense is based upon misrepresentation [or] fraud * * * the circumstances constituting the wrong shall be stated in detail.”

Discussion

Plaintiff’s motion is granted, but only to the extent that defendant’s seventh and eighth affirmative defenses and that portion of defendant’s tenth affirmative defense alleging that “the medical supplies fo which reimbursement is sought were * * * were never actually provided” are stricken. These defenses are being stricken, not because of defendant’s non-compliance with CPLR 3016(b), but because defendant’s admitted failure to pay or reject the claims within 30 days of receipt precluded it from raising them (see Presbyterian Hosp. in City of NY v. Maryland Cas. Co., 90 NY2d 274; Central General Hosp. v. Chubb Group of Ins. Companies, 90 NY2d 195).

In the court’s view, the defendant complied with CPLR 3016(b) which “requires only that [*3]the misconduct complained of be set forth in sufficient detail to clearly inform a [plaintiff] with respect to the incidents complained of and is not to be interpreted so strictly as to prevent an otherwise valid cause of action in situations where it may be ‘impossible to state in detail the circumstances constituting a fraud'” (Lanzi v. Brooks, 43 NY2d 778, 780, quoting Jered Contr. Corp. v. New York City Tr. Auth., 22 NY2d 187, 194). Defendant’s seventh, eighth and tenth affirmative defenses pass muster under this analysis, especially since the facts and circumstances underlying these defenses are most likely within the exclusive knowledge of the plaintiff. It would seem to be impossible for the defendant to be any more specific at this stage of the proceedings.

The court is cognizant that in some instances, a defense premised upon fraud may be asserted even when a denial is issued beyond the 30 day period set forth in Insurance law § 5106[a]. Such instances, however, are limited to situations were the fraud, if proven, would establish that there was no coverage at all for the claim (Central General Hosp., 90 NY2d at 199). Thus, where a fraud defense is premised upon allegations that the collision underlying the claim was a staged event in furtherance of an insurance fraud scheme, the defense survives an untimely denial since a fabricated accident does not trigger coverage under the no-fault endorsement (see e.g. Mount Sinai Hospital v. Triboro Coach Inc ., 263 AD2d 11,19, citing Central General Hospital, supra ., Inwood Hill Medical P.C. v. Allstate Insurance Company, 2004 WL 1381082).

On the other hand, where fraud defenses are premised upon allegations of excessive or fraudulent billing, as is the case here, the defenses do not survive an untimely denial since the defenses, even if established, would not result in a finding that there was ” no coverage at all” for the claim (Melbourne Medical, P.C. v. Utica Mut. Ins. Co., 2004 WL 1431320, 2, citing Central Gen. Hosp., 90 NY2d at 199, 659 NYS2d 246, 681 NE2d 413; Presbyterian Hosp. in City of NY, 90 NY2d at 285).

Finally, plaintiff has not established a basis for striking that portion of defendant’s tenth affirmative defense which alleges that “the medical supplies for which reimbursement is sought were not related to the accident.” Even where there is an untimely denial, an insurer may raise a lack of coverage defense “premised on the fact or founded belief that an alleged injury does not arise out of an insured incident.” (Central General Hospital , 90 NY2d at 199). Such a defense does not necessarily have to be premised upon fraud and may be raised in situations where the insurer is claiming that the injuries at issue arose out of an uninsured accident (see e.g. Central General Hosp. , supra [allegation that injuries arose out of a separate work-related accident and not a motor vehicle accident]. In such circumstances, the specificity requirements of CPLR 3016(b) do not apply.

This constitutes the decision and order of the court.

Dated: September 29, 2004

_____________________________

PETER P. SWEENEY [*4]

Civil Court Judge