Sloan v Nationwide Mut. Ins. Co. (2022 NY Slip Op 50997(U))

Index No. CV-721236-19/QU

Plaintiff’s Counsel:
Law Offices of Gabriel & Moroff, P.C.
2 Lincoln Avenue, Suite 302
Rockville Centre, NY 11570

Defendant’s Counsel:
Hollander Legal Group
105 Maxess Road Suite S128
Melville, NY 11747

I. Papers

The following papers were read on Defendant’s motion for summary judgment dismissing Plaintiff’s complaint and Plaintiff’s cross-motion on its claim:

Papers        & nbsp;           & nbsp;           & nbsp;           & nbsp;        Numbered
Defendant’s Notice of Motion and Affirmation in Support dated September 17, 2020 (“Motion”) and electronically filed with the court on September 21, 2020. 1
Plaintiff’s Notice of Cross-Motion and Affirmation in Support dated December 13, 2021 (“Cross-Motion”) and electronically filed with the court on the same date. 2
Defendant’s Affirmation in Opposition to Cross-Motion dated December 13, 2021 (“Opposition to Cross-Motion”) and electronically filed with the court on the same date. 3

In a summons and complaint filed on September 23, 2019, Plaintiff sued Defendant insurance company to recover $385.63 in unpaid first party No-Fault benefits for medical services provided to Plaintiff’s assignor Jackson on July 10, 2018, plus attorneys’ fees and [*2]statutory interest (see Motion, Aff. of Volpe, Ex. A). Defendant moved for summary judgment dismissing the complaint on the ground that Plaintiff failed to attend scheduled Examinations Under Oath (“EUO“). Plaintiff cross-moved for summary judgment on its claims against Defendant. An oral argument and settlement conference by both parties was conducted by this Court.

III. Discussion and Decision

CPLR 3212 provides that “a motion for summary judgment shall be supported by affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions…” (CPLR 3212 [b]). “Mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient” (Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). “A [party] moving for summary judgment has the initial burden of coming forward with admissible evidence, such as affidavits by persons having knowledge of the facts, reciting the material facts and showing that the cause of action has no merit” (GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967 [1985]; Anghel v Ruskin Moscou Faltischek, P.C., 190 AD3d 906, 907 [2d Dept 2021], see Jacobsen v New York City Health & Hosps. Corp., 22 NY3d 824, 833 [2014]). A motion for summary judgment “shall be granted if, upon all the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party” (CPLR 3212[b]; Zuckerman v City of New York, at 562, see GTF Mktg. v Colonial Aluminum Sales, 66 NY2d at 968).

It is well established that insurers must pay or deny No-Fault benefit claims “within thirty (30) calendar days after receipt of the proof of the claim” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 501 [2015]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 563 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]; see Insurance Law § 5106[a]; 11 NYCRR § 65-3.8[c]; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Failure to establish timely payment or denial of the claim precludes the insurer from offering evidence of its defense to non-payment (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v. Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 281-86). Noncompliance with an insurance policy provision requiring disclosure through an EUO is a failure of a condition precedent to an insurer’s duty to indemnify (IDS Prop. Cas. Ins. Co. v Stracar Med. Servs., P.C., 116 AD3d 1005, 1007 [2d Dept 2014]; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 54 Misc 3d 131[A], 2017 NY Slip Op 50028[U] *1 [App Term 2d Dept 2017]) and is a material policy breach precluding recovery of proceeds under the insurance policy (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d 755, 756 [2d Dept 2020]; Interboro Ins. Co. v Clennon, 113 AD3d 596, 597 [2d Dept 2014]).

In opposition to Defendant’s motion in its Cross-Motion, Plaintiff first argued that Defendant’s request for an EUO was untimely. In the Opposition to Cross-Motion, Defendant merely stated in conclusory terms that it timely requested the EUOs. “Subsequent to the receipt of one or more of the completed verification forms, any additional verification required by the insurer to establish proof of claim shall be requested within 15 business days of receipt of the prescribed verification forms” (11 NYCRR 65-3.5[b]). In our instant matter, Defendant’s counsel first requested an EUO of Plaintiff in a letter dated September 21, 2018 (see Motion, [*3]Volpe Aff., Ex. G). Since Defendant’s denial of claim forms, dated February 13, 2019, indicated that Defendant received Plaintiff’s bills on August 27, 2018, Defendant’s first EUO request was untimely because it was made 25 days after receipt of the bill (Eagle Surgical Supply, Inc. v Allstate Indem. Co., 41 Misc 3d 141[A], 2013 NY Slip Op 52012[U] *2 [App Term 2d Dept 2013], see Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 16 [2d Dept 1999]). While Defendant presented a delay letter dated September 6, 2018, it did not suffice to toll the 30 days because it did not request verification from Plaintiff, but only indicated that verification would be sought (Mount Sinai Hosp. v Triboro Coach, 263 AD2d at 17; Parsons Med. Supply Inc. v Progressive Northeastern Ins. Co., 36 Misc 3d 148[A], 2012 NY Slip Op 51649[U] *2 [App Term 2d Dept 2012]; Points of Health Acupuncture, P.C. v Lancer Ins. Co., 28 Misc 3d 133[A], 2010 NY Slip Op 51338[U] *2 [App Term 2d Dept 2010]; Alur Med. Supply, Inc. v Progressive Ins. Co., 21 Misc 3d 134[A], 2008 NY Slip Op 52191[U] *1 [App Term 2d Dept 2008]).

Plaintiff also argued that Defendant was required to pay or deny the claims after Plaintiff failed to attend the second EUO. Defendant maintained that payment or denial of the claims was premature until Plaintiff provided the requested verification. “[A]n insurer shall not issue a denial of claim form (NYS form NF-10) prior to its receipt of verification of all the relevant information requested pursuant to 65-3.5 and 65-3.6 of this Subpart (e.g. medical reports, wage verification, etc.)” (11 NYCRR 65-3.8[b][3]). However, “[t]his subdivision shall not apply to a prescribed form (NF-Form) as set forth in Appendix 13 of this Title, medical examination request, or examination under oath request” (id.) (emphasis added). Therefore, the outstanding verification of Plaintiff’s EUO did not bar Defendant from denying the claims. The failure to attend two scheduled EUOs has been held a sufficient basis for Defendant to deny a No-Fault claim (see Interboro Ins. Co. v Clennon, 113 AD3d 596, 597 [2d Dept 2014]; New Way Med. Supply Corp. v State Farm Mut. Auto. Ins. Co., 64 Misc 3d 136[A], 2019 NY Slip Op 51158[U] *2 [App Term 2d Dept 2019]; Vladenn Med. Supply Corp. v State Farm Mut. Auto. Ins. Co., 52 Misc 3d 129[A], 2016 NY Slip Op 50928[U] *1-2 [App Term 2d Dept 2016]; Palafox PT, P.C. v State Farm Mut. Auto. Ins. Co., 49 Misc 3d 144[A], 2015 NY Slip Op 51653[U] *1 [App Term 2d Dept 2015]).

In our instant case, Defendant scheduled two additional EUOs after Plaintiff objected to them and denied the claim after Plaintiff’s nonappearance at the fourth scheduled EUO. In cases involving a failure to appear for an EUO, “the 30 days to pay or deny the claim begins to run on the date of the second failure to appear — the date that the insurer is permitted to conclude that there was a failure to comply with this condition precedent to coverage” (Chapa Prods. Corp. v MVAIC, 66 Misc 3d 16, 18 [App Term 2d Dept 2019], see Island Life Chiropractic Pain Care, PLLC v 21st Century Ins. Co., 74 Misc 3d 17, 19 [App Term 2d Dept 2021]; Quality Health Supply Corp. v Nationwide Ins., 69 Misc 3d 133[A], 2020 NY Slip Op 51226[U] *1-2 [App Term 2d Dept 2020]). Thus, Defendant’s denial of the claim on February 13, 2019, well beyond 30 days from Defendant’s receipt of the claim on August 27, 2018, was untimely (Quality Health Supply Corp. v Nationwide Ins., 2020 NY Slip Op 51226[U] *2, 69 Misc 3d 133 [App Term 2d Dept 2020]). The requirement to deny a No-Fault claim after nonappearance at a second EUO would not apply if the additional scheduled EUOs pertained to claims other than the first and second scheduled EUOs (see Island Life Chiropractic Pain Care, PLLC v 21st Century Ins. Co., 74 Misc 3d at 20). In contrast, all four EUOs Defendant scheduled in this case related to the same claims. While Defendant argued that our instant case was distinguishable from Quality Health Supply Corp. v Nationwide Ins. (2020 NY Slip Op 51226[U], 69 Misc 3d 133 [App Term [*4]2d Dept 2020]) because Plaintiff objected to the EUOs and Defendant explained the reasons for scheduling the additional EUOs beyond the first two, the Appellate Term did not indicate that either of those factual distinctions impacted its holding in that case, Island Life Chiropractic Pain Care, PLLC v 21 st Century Ins. Co. (74 Misc 3d at 19) or Chapa Prods. Corp. v MVAIC (66 Misc 3d at 18), all of which clearly held that the time to pay or deny ran from the non-appearance at the second scheduled EUO. Finally, while a timely EUO request tolls Defendant’s time to pay or deny a No-Fault claim (Island Life Chiropractic Pain Care, PLLC v 21st Century Ins. Co., 74 Misc 3d at 19), as discussed above, Defendant’s EUO requests were not timely. Defendant’s motion for summary judgement dismissing Plaintiff’s complaint is denied.

Regarding the Cross-Motion, Plaintiff pointed to its bills and Defendant’s denial of claim forms which indicated that Defendant received Plaintiff’s bills totaling $385.63 on August 27, 2018 (see Motion, Volpe Aff., Ex. E). A denial of claim form, however, is insufficient to establish a medical provider’s prima facie case but suffices to establish Defendant’s receipt of Plaintiff’s claim and nonpayment of that claim (Lopes v Liberty Mut. Ins. Co., 24 Misc 3d 127[A], 2009 NY Slip Op 51279[U] *2 [App Term 2d Dept 2009]). As discussed above, since Defendant was required under the circumstances to pay or deny the claim within 30 days of Plaintiff’s failure to attend the second scheduled EUO on November 30, 2018 (see Motion, Volpe Aff., Ex. J), Defendant’s denial on February 13, 2019 was untimely. Therefore, Plaintiff has established its prima facie case demonstrating entitlement to summary judgment on its claim.

IV. Order

Accordingly, it is

ORDERED that Defendant’s Motion for summary judgment dismissing Plaintiff’s complaint is denied; and it is further

ORDERED that Plaintiff’s Cross-Motion for summary judgment is granted; and it is further

ORDERED that the Clerk shall enter a judgment in Plaintiff’s favor against Defendant in the amount of $385.63 together with statutory interest from August 27, 2018 and statutory attorneys’ fees.

This constitutes the Decision and Order of the court.