December 15, 2004

A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co. (2004 NY Slip Op 51639(U))

Headnote

The relevant facts in the case involved a dispute over first-party no-fault benefits for medical services provided to a patient by the plaintiffs. The main issue decided by the court was whether the defendant insurance company was precluded from raising defenses due to their failure to pay or deny the claim within the 30-day prescribed period. The holding of the court was that the defendant was not precluded from asserting the defense that the collision was in furtherance of an insurance fraud scheme, despite the untimely denial of the claim. The court determined that the defendant's special investigator's affidavit was sufficient to demonstrate a founded belief that the alleged injuries did not arise out of an insured incident, and as a result, the motion for summary judgment by the plaintiffs 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 51639(U))

A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co. (2004 NY Slip Op 51639(U)) [*1]

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

2004 NY Slip Op 51639(U)

Decided on December 15, 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This opinion is uncorrected and will not be published in the printed Official Reports.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 15, 2004

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

PRESENT: PESCE, P.J., PATTERSON and RIOS, JJ.
2004-414 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 ANDRES GONZALEZ, Appellants,
against
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent.

Appeal by plaintiffs from an order of the Civil Court, Kings County (L. Baily-Schiffman, J.), entered January 6, 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 their 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 15, 2004