Decided and Entered: October 24, 2023
Before: Manzanet-Daniels, J.P., Rodriguez, Pitt-Burke, Higgitt, Rosado, JJ.

Roman Kravchenko, Melville (Jason Tenenbaum of counsel), for appellant.

McCormack & Mattei, P.C., Garden City (Jamila Shukry of counsel), for respondent.

Order, Supreme Court, New York County (John J. Kelley, J.), entered June 28, 2023, which denied petitioner’s application pursuant to CPLR article 75 to vacate a master arbitration award, dated December 1, 2022, affirming an arbitrator’s award denying petitioner’s claim for no-fault benefits for medical services rendered to the insured, unanimously affirmed, without costs.

The court correctly denied the petition to vacate the master arbitration award. “Generally, a court will not set aside an arbitrator’s award for errors of law or fact unless the award is so irrational as to require vacatur” (Matter of Carty v Nationwide Ins. Co., 212 AD2d 462 [1st Dept 1995]). Here, petitioner does not dispute that the subject policy was exhausted prior to the underlying arbitration, but argues that its claim for no-fault compensation, which was submitted and denied prior to the exhaustion of the policy, should retain priority of payment. The fact that the arbitrator followed First Department precedent in Harmonic Physical Therapy, P.C. v Praetorian Ins. Co. (47 Misc 3d 137[A], 2015 NY Slip Op 50525[U] [App Term, 1st Dept 2015]) rather than Second Department precedent in Alleviation Med. Servs., P.C. v Allstate Ins. Co. (55 Misc 3d 44 [App Term, 2d Dept 2017], affd on other grounds 191 AD3d 934 [2d Dept 2021]) does not warrant reversal. To the contrary, this Court has held that, in awarding a claim after a policy has been exhausted, an arbitrator exceeded his or her power since an insurer’s duties cease upon the insurer’s payment of the contractual limit on its no-fault policy (see Matter of DTR Country-Wide Ins. Co. v Refill Rx Pharm., Inc., 212 AD3d 481 [1st Dept 2023], lv denied 40 NY3d 904 [2023]).

THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: October 24, 2023

Decided and Entered: October 10, 2023
Before: Manzanet-Daniels, J.P., Gesmer, González, Kennedy, O’Neill Levy, JJ.

Gary Tsirelman, P.C., Brooklyn (Gary Tsirelman of counsel), for appellant.

Jaffe & Velazquez, LLP, New York (Thomas Torto of counsel), for respondent.

Order, Supreme Court, New York County (Lyle E. Frank, J.), entered August 3, 2022, which denied respondent Bay Needle Care Acupuncture, P.C.’s motion for attorney’s fees, unanimously affirmed, with costs.

Supreme Court properly denied Bay Needle’s motion seeking additional attorney’s fees pursuant to 11 NYCRR 65-4.10(j)(4), because Bay Needle failed to provide any explanation for the lengthy delay in moving for such relief and failed to submit any proof of the fees incurred. Previously, in a “Decision, Order and Judgment,” dated November 28, 2016 and filed with the Clerk on December 5, 2016, Supreme Court (Kathryn E. Freed, J.) denied petitioner Country-Wide Insurance Company’s petition to vacate a master arbitration no-fault award dated December 28, 2015, dismissed the proceeding, and confirmed the awards of the lower arbitrator and master arbitrator which were rendered in favor of Bay Needle. Approximately five and a half years later, Bay Needle moved for additional attorney’s fees of $2,000 incurred in opposing Country-Wide’s petition.

To the extent Bay Needle argues that it timely sought to submit a proposed judgment within the 60-day period prescribed by 22 NYCRR 202.48, it was rejected by the County Clerk and returned for correction. Bay Needle provided no explanation for its failure to submit a corrected judgment, or otherwise timely move for additional attorney’s fees after issuance of the 2016 Decision, Order, and Judgment. Thus, Bay Needle effectively abandoned its claim.

Moreover, the amount of attorney’s fees awarded pursuant to 11 NYCRR 65-4.10(j)(4) is left to the court’s discretion (see Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 162 AD3d 407, 408 [1st Dept 2018]). Here, the court properly exercised its discretion by not awarding additional fees of $2,000 in a case involving a no-fault claim of $2,100, which was resolved six years prior, and where Bay Needle’s counsel failed to provide contemporaneous documentation of the fees incurred.

We have considered Bay Needle’s remaining arguments and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: October 10, 2023

[*1]

Roman Kravchenko, Melville, for appellant.

Larkin Farrell LLC, New York (Anthony R. Troise of counsel), for respondent.

Order, Supreme Court, Bronx County (Marissa Soto, J.), entered January 27, 2023, which granted petitioner American Transit Insurance Company’s (American Transit) petition to vacate the award of a master arbitrator, dated August 11, 2022, affirming a lower arbitrator’s award, dated May 26, 2022, in favor of respondent Smart Choice Medical P.C. (Smart Choice) in the amount of $1,211.48, vacated the arbitration award, and denied Smart Choice’s request for attorney fees, unanimously affirmed, without costs.

“Where, as here, there is compulsory arbitration involving no-fault insurance, the standard of review is whether the award is supported by evidence or other basis in reason” (Matter of Miller v Elrac, LLC, 170 AD3d 436, 436-437 [1st Dept 2019]; see also Country-Wide Ins. Co. v Zablozki, 257 AD2d 506, 507 [1st Dept 1999], lv denied 93 NY2d 809 [1999]).

“When an individual submits a personal injury claim for motor vehicle no-fault benefits, the insurance company may request that the individual submit to an IME, and if the individual fails to appear for that IME, it constitutes a breach of a condition precedent vitiating coverage” (Hereford Ins. Co. v Lida’s Med. Supply, Inc., 161 AD3d 442, 442 [1st Dept 2018] [internal quotation marks omitted]). Like Hereford, American Transit established its entitlement to judgment as a matter of law by submitting the letters sent to the claimant notifying him about the date, time, and location of the initially scheduled IME, a second scheduled IME, a third scheduled IME, and an affidavit of mailing for these letters. American Transit also submitted affidavits from the medical professional assigned to conduct the scheduled IMEs, who stated that the claimant failed to appear at the date and time of his appointment. This principle is well-established law in this Court (see e.g. Matter of Global Liberty Ins. Co. of N.Y. v Capital Chiropractic, P.C., 181 AD3d 429, 429 [1st Dept 2020]; Matter of Global Liberty Ins. Co. of N.Y. v Top Q. Inc., 175 AD3d 1131, 1131-1132 [1st Dept 2019]; Matter of Global Liberty Ins. Co. v Professional Chiropractic Care, P.C., 139 AD3d 645, 646 [1st Dept 2016]).

Generally, if a valid claim or portion of a claim for no-fault benefits is overdue, Insurance Law § 5106 (a) entitles “the claimant . . . to recover his attorney’s reasonable fee, for services necessarily performed in connection with securing payment of the overdue claim, subject to [the] limitations promulgated by the superintendent in regulations” (Matter of Country-Wide Ins. Co. v TC Acupuncture P.C., 172 AD3d 598, 598 [1st Dept 2019]). However, because we find Smart Choice’s claim invalid as a matter of law, it is not entitled to such fees. Concur—Oing, J.P., Singh, Moulton, Scarpulla, Shulman, JJ.

[*1]

The Rybak Firm, PLLC, Brooklyn (Maksim Leyvi of counsel), for appellants.

Thomas Torto, New York, for respondent.

Order, Supreme Court, New York County (Melissa A. Crane, J.), entered August 27, 2021, which granted plaintiff Country-Wide Insurance Company’s motion for summary judgment declaring that plaintiff has no duty to defendants-appellants to pay no-fault claims based on the injured party’s failure to appear for examinations under oath (EUO), and permanently stayed any further action involving the injured party, unanimously reversed, on the law, without costs, the motion denied and the declaration and stay vacated.

Although plaintiff timely requested an EUO and subsequently issued a timely denial (see Unitrin Advantage Ins. Co. v Bayshore Physical Therapy, PLLC, 82 AD3d 559, 560 [1st Dept 2011]), the motion court erred in granting summary judgment. 11 NYCRR 65-3.5 (e) requires an EUO request be based on application of objective standards, and that the insurer must have a specific objective justification. Summary judgment is premature under CPLR 3212 where an insurer fails to provide a medical provider with its objective justification for requesting the EUO (Country-Wide Ins. Co. v Delacruz, 205 AD3d 473, 473 [1st Dept 2022]). This Court has explained that the insurer’s reason for the EUO is essential for medical providers to oppose an insurer’s summary judgment motion, and that information is in the exclusive knowledge and control of the insurer (American Tr. Ins. Co. v Jaga Med. Servs., P.C., 128 AD3d 441, 441 [1st Dept 2015]).

Plaintiff’s argument that the opposing defendants waived any objection to the reasonableness of EUO request is unavailing (Country-Wide, 205 AD3d at 474). Concur—Kapnick, J.P., Kern, Gesmer, Moulton, Higgitt, JJ.

[*1]

Jaffe & Asher LLP, White Plains (Marshall T. Potashner of counsel), for appellants.

Eppinger, Reingold & Korder, Larchmont (Mitchell L. Korder of counsel), for respondents.

Order, Supreme Court, New York County (Nancy M. Bannon, J.), entered September 21, 2022, which denied plaintiffs’ motion pursuant to CPLR 602 (b) to consolidate eight Civil Court actions with this action, unanimously reversed, on the law, without costs, and plaintiffs’ motion granted.

This action arises out of insurance claims based on an accident on December 30, 2020 in which defendant Melito Bonilla, while a passenger in a parked car, was injured when the car was struck by another vehicle. Each of the claims is under an insurance policy issued by plaintiffs that required Bonilla to appear for an examination under oath (EUO). Plaintiffs Liberty Mutual Insurance Company and LM General Insurance Company commenced this action on December 28, 2021, seeking a declaratory judgment, alleging that they do not owe no-fault coverage for medical fees in connection to Bonilla’s injuries because he failed to appear for an EUO.

After the action was commenced, two of Bonilla’s medical providers, Bay Ridge Chiropractic PC and Hudson Valley Chiro & Rehab PC, both of which are defendants in this action, brought eight actions, all in Richmond County Civil Court, seeking payment from Liberty for treatment of Bonilla’s alleged injuries. Liberty asserts that the same defense applies in each case, namely that it is not required to cover the injuries because Bonilla failed to appear for scheduled EUOs.

It was an improvident exercise of discretion to have denied plaintiffs’ motion to consolidate (see Amcan Holdings, Inc. v Torys LLP, 32 AD3d 337, 340 [1st Dept 2006]). The issue of whether Bonilla failed to submit to the EUO, and whether such failure entitles Liberty to disclaim coverage for his alleged injuries and treatment, would affect the outcome of each of the cases, and Liberty would risk inconsistent verdicts and multiple trials if the Civil Court actions are not consolidated with this one (see Phoenix Garden Rest. v Chu, 202 AD2d 180, 180-181 [1st Dept 1994]). Moreover, in opposing plaintiffs’ motion, defendants have not argued that they would be prejudiced. Concur—Webber, J.P., González, Scarpulla, Rodriguez, JJ.

[*1]

Gary Tsirelman, P.C., Brooklyn (Gary Tsirelman of counsel), for appellant.

Jaffe & Velazquez, LLP, New York (Thomas Torto of counsel), for respondent.

Order, Supreme Court, New York County (Lyle E. Frank, J.), entered on or about February 3, 2022, which granted petitioner Country-Wide Insurance Company’s (Country-Wide) petition to vacate a master arbitrator’s award, dated September 20, 2021, which affirmed a lower arbitrator’s award, dated May 31, 2021, in favor of respondent Refill Rx Pharmacy, Inc, as assignee of Kimberly Rosas (Refill) and against Country-Wide, in the amount of $2,715.48, and denied respondent’s cross motion for attorneys’ fees, unanimously affirmed, without costs.

Vacatur of the award was warranted under CPLR 7511 (b) (1) (iii) as the lower arbitrator exceeded his power by issuing an award exceeding the contractual limit for the subject no-fault coverage policy of $50,000, and the master arbitrator erred in affirming. Once a no-fault insurer “has paid the full monetary limits set forth in the policy, its duties under the contract of insurance cease” (Countrywide Ins. Co. v Sawh, 272 AD2d 245, 245 [1st Dept 2000]). An arbitrator’s award directing payment beyond the monetary limit of a no-fault insurance policy exceeds the arbitrator’s power and constitutes grounds for vacatur of the award (see Matter of Brijmohan v State Farm Ins. Co., 92 NY2d 821, 823 [1998]; see also Matter of Ameriprise Ins. Co. v Kensington Radiology Group, P.C., 179 AD3d 563 [1st Dept 2020]). Country-Wide was not precluded from raising the issue of policy exhaustion before the court, even if it was not before the arbitrators in the underlying arbitration (Matter of Ameriprise Ins. Co. at 564).

Country-Wide submitted an affidavit from its No-Fault Litigation/Arbitration supervisor, attesting that the instant claims file of Refill’s assignor, Ms. Rosas, reflects that the policy has been exhausted beyond its $50,000 limit. The affidavit also contains a ledger reflecting the dates that claims by various medical providers were paid, which exhausted Ms. Rosas’ policy. Thus, Country-Wide’s submissions showed that the policy was properly exhausted prior to the underlying arbitration (see 11 NYCRR 65-3.15).

In view of the foregoing, Refill is not entitled to the attorneys’ fees it requested (see 11 NYCRR 65-4.10 [j] [4]).

We have considered Refill’s remaining arguments and find them unavailing. Concur—Kapnick, J.P., Friedman, Kennedy, Mendez, Shulman, JJ.

[*1]

The Rybak Firm, PLLC, Brooklyn (Michael I. Kroopnick of counsel), for appellants.

Freiberg, Peck & Kang, LLP, Armonk (Yilo J. Kang of counsel), for respondents.

Order, Supreme Court, Bronx County (Eddie J. McShan, J.), entered December 8, 2021, which, to the extent appealed from as limited by the briefs, denied defendants All City Family Healthcare, Aron Rovner, MD, PLLC, Averroes Physical Therapy PC, Burke Physical Therapy PC, Cavallaro Medical Supply, East 19 Medical Supply Corp., JSJ Anesthesia Pain Management PLLC, Jules F. Parisien, Longevity Medical Supply, Inc., LR Medical PLLC, Metro Pain Specialists, PC, Nova Medical Diagnostic, P.C., CMA Psychology, P.C., Danimark Physical Therapy PC, Fairpoint Acupuncture PC, and NYEEQASC, LLC’s (the Rybak defendants) motion to dismiss the complaint or, alternatively, to sever the claims, unanimously affirmed, without costs. Order, same court and Justice, entered December 8, 2021, which denied the Rybak defendants’ motion for a protective order, unanimously affirmed, without costs. Appeal from order, same court (Fidel E. Gomez, J.), entered June 14, 2022, which denied the Rybak defendants’ motion to sever the claims pursuant to the law of the case doctrine, unanimously dismissed, without costs, as academic.

On a motion to dismiss a declaratory judgment action for failure to state a cause of action, “the only question is whether a proper case is presented for invoking the jurisdiction of the court to make a declaratory judgment, and not whether the plaintiff is entitled to a declaration favorable to him” (Law Research Serv. v Honeywell, Inc., 31 AD2d 900, 901 [1st Dept 1969]). Here, plaintiffs stated causes of action for declaratory judgment. Contrary to the Rybak defendants’ contention, plaintiffs need not allege a proper claim for fraud in the complaint. Further, plaintiffs were not merely seeking an advisory opinion. Rather, their request for a declaration regarding the eligibility of defendants to recover no-fault benefits under the relevant policies amounts to a justiciable controversy sufficient to render declaratory judgment (State Farm Mut. Auto. Ins. Co. v Anikeyeva, 89 AD3d 1009, 1010-1011 [2d Dept 2011]).

The court providently exercised its discretion in declining to sever plaintiff’s claims into separate actions. Generally, “[t]o avoid the waste of judicial resources and the risk of inconsistent verdicts, it is preferable for related actions to be tried together” (Rothstein v Milleridge Inn, 251 AD2d 154, 155 [1st Dept 1998]). Although the Rybak defendants’ severance arguments carry some weight, after consideration of all relevant factors, including the potential prejudice that would be suffered by plaintiffs in having to litigate 32 separate actions involving many of the same parties and witnesses, the court properly declined to sever the claims (see Hempstead Gen. Hosp. v Liberty Mut. Ins. Co., 134 AD2d 569, 569-570 [2d Dept 1987]; cf. Radiology Resource Network, P.C. v Fireman’s Fund Ins. Co., 12 AD3d 185, 185 [1st Dept 2004]). In view of the foregoing, the appeal from the order denying the Rybak defendants’ second motion to sever pursuant [*2]to the law of the case doctrine is dismissed as academic.

The court properly declined to dismiss the claims which had also been previously asserted by the Rybak defendants in separate Civil Court actions as Civil Court cannot grant the declaratory relief that plaintiffs seek here (see State Farm Fire & Cas. Co. v Jewsbury, 169 AD3d 949, 950-951 [2d Dept 2019]).

The court providently exercised its discretion in declining to grant the Rybak defendants a protective order to preclude plaintiffs from deposing them. Generally, a party seeking a protective order bears the initial burden of showing either that the discovery sought is irrelevant or that it is “obvious the process will not lead to legitimate discovery” (Liberty Petroleum Realty, LLC v Gulf Oil, L.P., 164 AD3d 401, 403 [1st Dept 2018]). Where a party seeking a protective order fails to “substantiate their conclusory claims,” the motion must be denied (Ocean to Ocean Seafood Sales v Trans-O-Fish & Seafood Co., 138 AD2d 265, 266 [1st Dept 1988]). Here, the Rybak defendants did not meet their initial burden, as they simply asserted, in conclusory fashion, that they had no knowledge of the automobile accidents and did not witness the accidents, and thus could not attest to whether they had been staged (see id.; City Wide Social Work v NY Cent. Mut. Fire Ins. Co., 20 Misc 3d 134[A], 2008 NY Slip Op 51470[U] [App Term, 2d Dept, 2d & 11th Jud Dists 2008]). The Rybak defendants’ affirmative defenses also support plaintiffs’ need to depose them. Concur—Kern, J.P., Kennedy, Scarpulla, Pitt-Burke, Higgitt, JJ.