December 14, 2004

A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co. (2004 NY Slip Op 51627(U))

Headnote

The relevant facts considered by the court were that the plaintiffs were seeking to recover first-party no-fault benefits for services rendered to their assignor and that they established their prima facie entitlement to summary judgment by proving that they submitted a claim and that payment of benefits was overdue. The main issue decided was whether the defendant, State Farm Mutual Automobile Insurance Company, was precluded from raising defenses due to their failure to pay or deny the claim within the prescribed 30-day period. The holding of the case was that the defendant was not precluded from asserting the defense of an insurance fraud scheme despite the untimely denial of the claim, as their affidavit demonstrated a founded belief that the alleged injuries did not arise out of an insured incident. Therefore, the plaintiffs' motion for summary judgment was properly denied.

Reported in New York Official Reports at A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co. (2004 NY Slip Op 51627(U))

A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co. (2004 NY Slip Op 51627(U)) [*1]

A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co.

2004 NY Slip Op 51627(U)

Decided on December 14, 2004

Appellate Term, Second Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 14, 2004

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

PRESENT: December 14, 2004 SUPREME COURT OF THE STATE OF NEW YORK APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS PRESENT : PESCE, P.J., PATTERSON and RIOS, JJ.
2004-404 K C

A.B. MEDICAL SERVICES PLLC D.A.V. CHIROPRACTIC P.C. DANIEL KIM’S ACUPUNCTURE P.C. SOMUN ACUPUNCTURE P.C. SQUARE SYNAGOGUE TRANSPORTATION INC. a/a/o CHRISTIAN MAILLOUX, Appellants,
against
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent.

Appeal by plaintiffs from an order of the Civil Court, Kings County (E. Prus, J.), entered February 18, 2004, denying their motion for summary judgment.

Order unanimously affirmed with $10 costs.

In this action to recover first-party no-fault benefits for services rendered to its assignor, plaintiffs established their prima facie entitlement to summary judgment by proof that they submitted a claim, setting forth the fact and the amount of the loss [*2]
sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists]). Inasmuch as defendant failed to pay or deny the claim within the 30-day prescribed period (11 NYCRR 65.15 [g] [3]), it is precluded from raising most defenses (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]).

Nevertheless, defendant is not precluded from asserting the defense that the collision was in furtherance of an insurance fraud scheme, despite the untimely denial of the claim (see Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2002]). The affidavit submitted by defendant’s special investigator was sufficient to demonstrate that defendant’s denial was based upon a “founded belief that the alleged injur[ies] do[] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]). Accordingly, since defendant demonstrated the [*3]
existence of a triable issue of fact as to whether there was a lack of coverage (see id.; Zuckerman v City of New York, 49 NY2d 557 [1980]), plaintiffs’ motion for summary judgment was properly denied.

Decision Date: December 14, 2004