[*1]

Goldberg, Miller & Rubin, P.C., New York, NY (Harlan R. Schreiber of counsel), for appellant.

Nicoletti Gonson Spinner Ryan Gulino Pinter LLP, New York, NY (Benjamin Gonson of counsel), for respondents.

In an action, inter alia, for certain declaratory relief, the nominal defendant Hereford Insurance Company appeals from an order of the Supreme Court, Kings County (Andrew Borrok, J.), dated March 29, 2018. The order, insofar as appealed from, denied the motion of the nominal defendant Hereford Insurance Company for leave to enter a default judgment on its counterclaim for loss transfer pursuant to Insurance Law § 5105 (a) insofar as asserted against the plaintiff Repwest Insurance Company and deemed the reply of the plaintiff Repwest Insurance Company to the counterclaim to have been served.

Ordered that the order is reversed insofar as appealed from, on the law, with costs to the plaintiff Repwest Insurance Company, and the counterclaim of the nominal defendant Hereford Insurance Company is dismissed for lack of subject matter jurisdiction.

The plaintiff Repwest Insurance Company (hereinafter Repwest) commenced this action for a judgment declaring, inter alia, that it has no duty to provide insurance coverage for any claims arising out of a collision between a livery vehicle insured by the nominal defendant Hereford Insurance Company (hereinafter Hereford) and a vehicle driven by the defendant Nazim Hanif and insured by Repwest. The defendants Dinorah Carmen Anglero, Dario Ferrer de la Cruz, and Ramon Duarte Garcia were passengers in the livery vehicle and no-fault benefits were paid on their behalf by Hereford. Repwest alleged that there is no coverage for the subject incident because it was not an accident, but rather the result of an intentional act/fraudulent scheme. Thereafter, Hereford interposed an answer to the complaint and asserted a counterclaim against Repwest, among others, for loss transfer pursuant to Insurance Law § 5105 (a).

After Repwest failed to timely reply to the counterclaim, Hereford moved for leave to enter a default judgment on its counterclaim insofar as asserted against Repwest. The Supreme Court denied Hereford’s motion and deemed Repwest’s reply to the counterclaim to have been served. Hereford appeals.

Pursuant to Insurance Law § 5105 (b), “[t]he sole remedy of any insurer or compensation provider to recover on a claim arising pursuant to subsection (a) hereof, shall be the submission of the controversy to mandatory arbitration pursuant to procedures promulgated or approved by the superintendent” (see Matter of Infinity Indem. Ins. Co. v Hereford Ins. Co., 149 AD3d 1075, 1076 [2017]; see also State Farm Mut. Auto. Ins. Co. v Nationwide Mut. Ins. Co., 150 AD2d 976, 977 [1989]). Contrary to Hereford’s contention, since its counterclaim is for loss transfer pursuant to section 5105 (a), the counterclaim is subject to mandatory arbitration and the Supreme Court had no subject matter jurisdiction over the counterclaim (see Insurance Law § 5105 [b]; State Farm Mut. Auto. Ins. Co. v Nationwide Mut. Ins. Co., 150 AD2d at 977-978). Repwest’s complaint and its disclaimer of coverage for the subject incident do not dictate a different result (see State Farm Mut. Auto. Ins. Co. v Nationwide Mut. Ins. Co., 150 AD2d at 977-978; DTG Operations, Inc. v American Tr. Ins. Co., 2013 NY Slip Op 30119[U] [Sup Ct, NY County 2013]; 11 NYCRR 65-4.11 [a] [6]).

Although Repwest did not seek dismissal of the counterclaim in the Supreme Court, “a court’s lack of subject matter jurisdiction is not waivable, but may be [raised] at any stage of the action, and the court may, ex mero motu [on its own motion], at any time, when its attention is called to the facts, refuse to proceed further and dismiss the action” (Financial Indus. Regulatory Auth., Inc. v Fiero, 10 NY3d 12, 17 [2008] [internal quotation marks omitted]; see Caffrey v North Arrow Abstract & Settlement Servs., Inc., 160 AD3d 121, 133 [2018]). Since the court lacked subject matter jurisdiction over Hereford’s counterclaim, the counterclaim should have been dismissed (see Empire Ins. Co. v Metropolitan Suburban Bus. Auth., 159 AD2d 312, 312 [1990]; see also State Farm Mut. Auto. Ins. Co. v Nationwide Mut. Ins. Co., 150 AD2d at 978).

In light of our determination, we need not reach the parties’ remaining contentions. Rivera, J.P., Dillon, Roman and Duffy, JJ., concur.

[*1]

The Law Office of Jason Tenenbaum, P.C., Garden City (Talia Beard of counsel), for appellant-respondent.

Gary Tsirelman, P.C., Brooklyn (Gary Tsirelman of counsel), for respondents-appellants.

Order, Supreme Court, Bronx County (Donna Mills, J.), entered February 1, 2019, which granted respondents’ motion to vacate, pursuant to stipulation, an order entered on default vacating an arbitration award, deny the petition to vacate the award, and grant statutory attorneys’ fees, to the extent of dismissing the petition, unanimously modified, on the law, to remand for a determination of respondents’ attorneys’ fees pursuant to 11 NYCRR 65-4.10 (j) (4), and otherwise affirmed, without costs.

Petitioner failed to establish that respondents’ assignor was injured in the course of his employment, and therefore that it properly denied his claim because workers’ compensation benefits were available to him (see Westchester Med. Ctr. v American Tr. Ins. Co., 60 AD3d 848, 849 [2d Dept 2009]). Although the assignor was allegedly injured while driving a livery car, his license from the New York Taxi and Limousine Commission was issued that day. Further, petitioner submitted no evidence that the assignor was on duty or carrying a paying passenger at the time of the incident (cf. Matter of Aminov v New York Black Car Operators Injury Compensation Fund, 2 AD3d 1007, 1007-1008 [3d Dept 2003], lv denied 4 NY3d 709 [2005]).

Supreme Court had the authority to award attorneys’ fees in connection with a “court appeal from a master arbitration award and any further appeals” (11 NYCRR 65-4.10 [j] [4]). Because the court failed to address respondents’ request for attorneys’ fees, the matter is remanded for a determination of the amount of fees to which respondents are entitled (see Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 148 AD3d 703 [2d Dept 2017]), including fees for the instant appeal (see Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C., 167 AD3d 404, 405 [1st Dept 2018]). Concur—Richter, J.P., Manzanet-Daniels, Webber, Gesmer, JJ.

[*1]

The Law Office of Jason Tenenbaum, P.C., Garden City (Talia Beard of counsel), for appellant.

The Rybak Firm, PLLC, Brooklyn (Karina Barska of counsel), for respondents.

Order, Supreme Court, New York County (Tanya R. Kennedy, J.), entered on or about December 5, 2018, which, to the extent appealed from, denied plaintiffs’ motion for summary judgment on their claims seeking a declaration that licensed acupuncturists are entitled to payment of no-fault insurance benefits only as set forth in the workers’ compensation fee schedule for chiropractors, and an order enjoining defendants from claiming payment in litigation or arbitration under the fee schedule for physicians, unanimously affirmed, without costs.

In this action, plaintiff no-fault insurers seek to resolve, as a matter of law, the question of the fee schedule applicable to reimbursement of licensed acupuncturists who provide services to eligible individuals injured in motor vehicle accidents. Under the Insurance Law, no-fault coverage for necessary medical expenses “shall not exceed the charges permissible under the schedules prepared and established by the chairman of the workers’ compensation board for industrial accidents” except under “unique circumstances” (Insurance Law § 5108 [a]). Under applicable regulations, where a service is reimbursable but the superintendent has not adopted or established a fee schedule applicable to the provider, then the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with the charges permissible for similar procedures under schedules already adopted or established (11 NYCRR 68.5 [b]; see Forrest Chen Acupuncture Servs., P.C. v GEICO Ins. Co., 54 AD3d 996, 997 [2d Dept 2008], affg 15 Misc 3d 137[A], 2007 NY Slip Op 50874[U] [App Term, 2d Dept, 2d & 11th Jud Dists 2007]). The superintendent has not adopted a fee schedule applicable to licensed acupuncturists, requiring consideration of “charges permissible for similar procedures under schedules already adopted or established” (11 NYCRR 68.5 [b]).^[FN*]

Plaintiffs did not proffer admissible evidence sufficient to make a prima facie showing of entitlement to judgment on the issue as a matter of law (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]). Plaintiffs rely on a 2004 informal opinion letter of the former Insurance Department, but that letter did not resolve the issue. It allows insurers to pay “the rates established for doctors and chiropractors,” instead of a higher “prevailing fee in the geographic location of the provider,” so long as there is a review “for consistency with [the] charges permissible for similar procedures” under either fee schedule (Ops Gen Counsel NY Ins Dept No. 04-10-03; see 11 NYCRR 68.5 [b]). The opinion letter “did not give any guidance as to which particular fee schedule should be applied to a licensed acupuncturist in any particular instance, although the Department was aware” that “the fee schedules for acupuncture services performed by chiropractors are lower than the fee schedules for such services performed by physicians” (Great Wall Acupuncture v GEICO Gen. Ins. Co., 16 Misc 3d 23, 28 [App Term, 2d Dept, 2d & 11th Jud Dists 2007]; see Andryeyeva v New York Health Care, Inc., 33 NY3d 152, 174 [2019] [requiring judicial deference to an “agency’s rational interpretation of its own regulations”]). While courts have held that “an insurer may use the workers’ compensation fee schedule for acupuncture services performed by chiropractors to determine the amount which a licensed acupuncturist is entitled to receive” (Great Wall Acupuncture, P.C. v Geico Ins. Co., 26 Misc 3d 23, 24 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2009] [emphasis added]; see also Akita Med. Acupuncture, P.C. v Clarendon Ins. Co., 41 Misc 3d 134[A], 2013 NY Slip Op 51860[U] [App Term, 1st Dept 2013]), such holdings do not foreclose the use of the physician fee schedule in all cases (see e.g. Okslen Acupuncture P.C. v Travco Ins. Co., 44 Misc 3d 135[A], 2014 NY Slip Op 51209[U], *1 [App Term, 1st Dept 2014]; Raz Acupuncture, P.C. v AIG Indem. Ins. Co., 28 Misc 3d 127[A], 2010 NY Slip Op 51177[U], *2 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2010]).

Further, plaintiffs did not “proffer sufficient evidence to establish as a matter of law that the claims were improperly billed or were in excess of the amount permitted by the fee schedule” (Easy Care Acupuncture, P.C. v A. Cent. Ins. Co., 48 Misc 3d 129[A], 2015 NY Slip Op 50973[U], *1 [App Term, 1st Dept 2015]).

In any event, defendants raised an issue of fact as to whether the physician fee schedule should apply. They rely on the former Insurance Department’s regulatory impact statement accompanying its proposed 2010 rule amendment, by which it sought to clarify “inconsistent” court rulings, that “acupuncture treatments are the primary service performed and billed by licensed acupuncturists” and “such treatments merit reimbursement at the same rate that medical doctors receive for comparable services” (NY Reg, July 21, 2010 at 12-13). They also proffered, among other things, an affidavit from a licensed acupuncturist who averred that he was consistently reimbursed by workers’ compensation insurers at the physician rates, for over 15 years, which plaintiffs did not rebut.

Further, Supreme Court did not err by finding the motion for summary judgment on the issue of overbilling to be premature prior to discovery (see American Tr. Ins. Co. v Jaga Med. Servs., P.C., 128 AD3d 441, 441 [1st Dept 2015]; see also CPLR 3212 [f]). Concur—Richter, J.P., Manzanet-Daniels, Webber, Gesmer, JJ.

Footnotes

Footnote *:We join the recommendation of the Appellate Term, Second Department, that the Superintendent of Insurance consider adopting a fee schedule including licensed acupuncturists to resolve the issue.

[*1]

Law Office of Peter C. Merani, P.C., New York City (Karen McCloskey of counsel), for respondent-appellant.

The Wright Law Firm, LLC, Rochester (Ron F. Wright of counsel), for petitioner-respondent.

Appeal from an order of the Supreme Court, Monroe County (Ann Marie Taddeo, J.), entered November 27, 2018, in a proceeding pursuant to CPLR article 75. The order, inter alia, granted the petition to vacate the award of the master arbitrator.

It is hereby ordered that the order so appealed from is unanimously affirmed without costs.

Memorandum: This case arises from injuries that Troy Hodge sustained when a motor vehicle struck him while he rode a bicycle. Petitioner thereafter performed surgery on Hodge, who assigned his no-fault insurance claims to petitioner. Respondent, Hodge’s no-fault insurance carrier, denied petitioner’s claims for the cost of the surgery on the ground that the surgery was not medically necessary. Petitioner subsequently submitted the matter for arbitration. An initial arbitrator rendered an award in favor of petitioner, but respondent sought review from a master arbitrator, who vacated the award of the initial arbitrator and issued an award in favor of respondent. In this CPLR article 75 proceeding to review the determination of the master arbitrator, respondent appeals from an order that granted the petition, vacated the award of the master arbitrator, confirmed the award of the initial arbitrator, and denied the cross petition to confirm the master arbitrator’s award. We affirm.

It is well settled that “[t]he ‘role of the master arbitrator is to review the determination of the arbitrator to assure that the arbitrator reached his [or her] decision in a rational manner, that the decision was not arbitrary and capricious . . . , incorrect as a matter of law . . . , in excess of the policy limits . . . or in conflict with other designated no-fault arbitration proceedings’ (Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207, 212 [1981]). This power ‘does not include the power to review, de novo, the matter originally presented to the arbitrator’ ” (Matter of Progressive Cas. Ins. Co. [Elite Med. Supply of N.Y., LLC], 162 AD3d 1471, 1472 [4th Dept 2018]). Here, we agree with petitioner that the master arbitrator impermissibly performed a de novo review of the medical evidence, and thus clearly exceeded his powers. The initial arbitrator concluded that respondent failed to meet its burden of submitting a peer review report setting forth a medical rationale for denying the claim, inasmuch as the peer review report submitted by respondent was conclusory, failed to set forth appropriate medical standards and failed to address the specifics of the case. Contrary to respondent’s contention, the master arbitrator did not conclude that the arbitrator’s determination was incorrect as a matter of law. To the contrary, the master arbitrator reviewed the evidence de novo and concluded that the peer review report submitted by respondent “appears rational.” Thus, contrary to respondent’s contention, Supreme Court properly determined that the master arbitrator exceeded his authority (see generally Matter of Allstate Ins. Co. v Keegan, 201 AD2d 724, 725 [2d Dept 1994]). Present—Whalen, P.J., Smith, DeJoseph, Curran and Winslow, JJ.

[*1]

The Law Office of Jason Tenenbaum, P.C., Garden City (Talia Beard of counsel), for appellant.

Gary Tsirelman, P.C., Brooklyn (Stefan Belinfanti of counsel), for respondent.

Order, Supreme Court, Bronx County (Rubén Franco, J.), entered on or about April 9, 2019, which, as limited by the briefs, denied Global’s motion for summary judgment to declare it does not owe no fault coverage to health care provider defendant SML Acupuncture, P.C. (SML) because defendant-assignor Akeem Evans failed to attend two properly scheduled examinations under oath (EUOs), unanimously affirmed, without costs.

Based on the claims adjuster’s conflicting affidavits and an application for no-fault benefits that was dated September 15, 2015, and stamped as received by facsimile on October 11, 2011, Global failed to provide evidence sufficient to prove that the EUO letters were timely mailed (see Unitrin Advantage Ins. Co. v All of NY, Inc., 158 AD3d 449, 449 [1st Dept 2018]; National Liab. & Fire Ins. Co. v Tam Med. Supply Corp., 131 AD3d 851 [1st Dept 2015]; American Tr. Ins. Co. v Longevity Med. Supply, Inc., 131 AD3d 841, 841 [1st Dept 2015]).

Summary judgment was also correctly denied because issues of facts arise as to why Evans, who appeared at the EUO with counsel, left after counsel abruptly announced that he would no longer represent claimant (see American States Ins. Co. v Huff, 119 AD3d 478, 478-479 [1st Dept 2014]).

SML’s contention that Global failed to provide notice as to the reasons why the claim was delayed “by identifying in writing the missing verification and the party from whom it was requested” (11 NYCRR 65-3.6 [b]) is unpreserved, and its argument that it should be awarded attorneys’ fees is unavailing, as this is an appeal from a declaratory action, not an arbitration (Insurance Law § 5106 [c]; 11 NYCRR 65-4.10 [j] [4]). Concur—Richter, J.P., Gische, Tom, Gesmer, Moulton, JJ.

[*1]

Jaffe & Koumourdas, LLP (Thomas Torto and Jason Levine, New York, NY, of counsel), for appellant.

Gary Tsirelman, P.C., Brooklyn, NY (Stefan Belinfanti and David M. Gottlieb of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an award of a master arbitrator dated January 26, 2016, Country-Wide Ins. Co. appeals from a judgment of the Supreme Court, Kings County (Karen B. Rothenberg, J.), dated October 21, 2016. The judgment, upon an order of the same court dated October 20, 2016, granting the petition, vacating the master arbitrator’s award dated January 26, 2016, and confirming the original arbitrator’s award dated September 22, 2015, is in favor of the petitioner and against Country-Wide Ins. Co. in the total sum of $8,319.61.

Ordered that the judgment is affirmed, with costs, and the matter is remitted to the Supreme Court, Kings County, for a determination of the amount of an additional attorney’s fee to be awarded to the petitioner pursuant to Insurance Department Regulations (see 11 NYCRR 65-4.10 [j] [4]).

V.S. Care Acupuncture, P.C. (hereinafter V.S.), is the assignee of a claim for no-fault benefits for treatment it rendered to Morris Collins. The carrier, Country-Wide Ins. Co. (hereinafter Country-Wide), denied the claim on several grounds. Country-Wide contended that Collins had not appeared at scheduled independent medical examinations and that V.S. had failed to appear at scheduled examinations under oath. Country-Wide also contended that V.S. was fraudulently incorporated (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]). V.S. submitted the claim to arbitration. The arbitrator accepted Country-Wide’s contention regarding Collins’s failure to appear at independent medical examinations, but rejected Country-Wide’s contention regarding V.S.’s failure to appear at examinations under oath. The arbitrator also rejected Country-Wide’s contention as to V.S.’s alleged fraudulent incorporation, finding that Country-Wide had not met its burden of proof. Accordingly, the arbitrator entered an award for the portion of the claim she found Country-Wide had improperly denied.

On Country-Wide’s appeal to a master arbitrator, the master arbitrator found, as relevant to this appeal, that the original arbitrator’s determination to reject the fraudulent incorporation defense was irrational, arbitrary, capricious, and incorrect as a matter of law. The master arbitrator vacated the original arbitrator’s award and remitted the matter to a new arbitrator on the issue of fraudulent incorporation. V.S. commenced this proceeding pursuant to CPLR article 75 to vacate the master arbitrator’s award. The Supreme Court granted the petition, vacated the master arbitrator’s award, confirmed the original arbitrator’s award, and entered a judgment accordingly. Country-Wide appeals.

A master arbitrator may not review the facts by weighing the evidence, assessing the credibility of witnesses, or making independent findings of fact (see Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207, 212 [1981]). A master arbitrator’s review powers, however, do include reviewing the facts to determine “whether or not the evidence is sufficient, as a matter of law, to support the determination of the arbitrator” (id. at 212). Here, there is no rational basis for the determination of the master arbitrator that the original arbitrator committed an error of law in rejecting Country-Wide’s fraudulent incorporation defense (cf. Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 162 AD3d 407 [2018]; Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3d 885, 886-887 [2017]). Accordingly, we agree with the Supreme Court that the master arbitrator’s award should be vacated and the original arbitrator’s award confirmed.

Moreover, as V.S. contends and Country-Wide concedes, V.S. is entitled to an attorney’s fee for this appeal pursuant to 11 NYCRR 65-4.10 (j), to be fixed by the Supreme Court (see Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C., 167 AD3d 404, 405 [2018]; Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 162 AD3d at 408; Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 148 AD3d 703, 706 [2017]). The matter is therefore remitted to the Supreme Court, Kings County, for that purpose. Balkin, J.P., Roman, Brathwaite Nelson and Christopher, JJ., concur.

[*1]

Jaffe & Koumourdas, LLP (Thomas Torto, New York, NY, of counsel), for appellant.

Gary Tsirelman, P.C., Brooklyn, NY (Stefan Belinfanti and David M. Gottlieb of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an award of a master arbitrator dated October 10, 2014, Country-Wide Ins. Co. appeals from a judgment of the Supreme Court, Kings County (Larry D. Martin, J.), dated February 6, 2017. The judgment, upon an order of the same court dated September 23, 2015, granting the petition, vacating the master arbitrator’s award dated October 10, 2014, and directing entry of a judgment in favor of the petitioner in the principal sum of $3,650 plus statutory interest, attorneys’ fees, and costs and disbursements, is in favor of the petitioner and against Country-Wide Ins. Co. in the total sum of $10,469.82.

Ordered that the judgment is reversed, on the law, with costs, the petition is denied, the master arbitrator’s award dated October 10, 2014, is confirmed, and the order dated September 23, 2015, is modified accordingly.

V.S. Care Acupuncture, P.C. (hereinafter V.S.), is the assignee of a claim for no-fault benefits for treatment it rendered to Eric Pascal. After the carrier, Country-Wide Ins. Co. (hereinafter Country-Wide), denied the claim, V.S. submitted the claim to arbitration. The arbitrator denied V.S.’s claim, finding that the evidence established that V.S. was fraudulently incorporated (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]). On appeal, a master arbitrator affirmed the original arbitrator’s award, finding that it was not arbitrary and capricious. V.S. then commenced this proceeding pursuant to CPLR article 75 to vacate the master arbitrator’s award. The Supreme Court granted the petition, vacated the master arbitrator’s award, and entered a judgment in favor of V.S. in the amount of the claim for no-fault benefits plus statutory interest, attorneys’ fees, and costs and disbursements. Country-Wide appeals.

Contrary to the Supreme Court’s determination, V.S. failed to demonstrate any grounds for vacating the master arbitrator’s award. A court reviewing the award of a master arbitrator is limited to the grounds set forth in CPLR article 75, which include, in this compulsory arbitration, the question of whether the determination had evidentiary support, was rational, or had a plausible basis (see Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207, 212 [1981]). Here, as explained in this Court’s decision and order in Matter of Acuhealth Acupuncture, P.C. v Country-Wide Ins. Co. (176 AD3d 800 [2019] [decided herewith]), since the determination of the master arbitrator affirming the original arbitrator’s award had evidentiary support and was not irrational, it is not subject to vacatur by the courts (see Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214, 223-224 [1996]; Matter of Acuhealth Acupuncture, P.C. v New York City Tr. Auth., 167 AD3d 869 [2018]), even if the master arbitrator committed an error of law (see Matter of Falzone [New York Cent. Mut. Fire Ins. Co.], 15 NY3d 530, 535 [2010]; Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d at 223-224; cf. Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3d 885, 886-887 [2017]). Accordingly, the petition should have been denied and the master arbitrator’s award should have been confirmed. Balkin, J.P., Roman, Brathwaite Nelson and Christopher, JJ., concur.

[*1]

Jaffe & Koumourdas, LLP (Thomas Torto, New York, NY, of counsel), for appellant.

Gary Tsirelman, P.C., Brooklyn, NY (Stefan Belinfanti and David M. Gottlieb of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an award of a master arbitrator dated March 18, 2014, Country-Wide Ins. Co. appeals from a judgment of the Supreme Court, Kings County (Peter P. Sweeney, J.), dated July 31, 2015. The judgment, upon an order of the same court dated April 2, 2015, granting the petition, vacating the master arbitrator’s award dated March 18, 2014, and confirming the original arbitrator’s award dated December 13, 2013, is in favor of the petitioner and against Country-Wide Ins. Co. in the total sum of $1,318.91.

Ordered that the judgment is affirmed, with costs, and the matter is remitted to the Supreme Court, Kings County, for a determination of the amount of an additional attorney’s fee to be awarded to the petitioner pursuant to Insurance Department Regulations (see 11 NYCRR 65-4.10 [j] [4]).

Bay Needle Care Acupuncture (hereinafter Bay Needle) is the assignee of a claim for no-fault benefits for treatment it rendered to Kareem Edgar. The carrier, Country-Wide Ins. Co. (hereinafter Country-Wide), denied the claim, and Bay Needle submitted the claim to arbitration. As relevant to this appeal, the arbitrator rejected Country-Wide’s contention that Bay Needle was fraudulently incorporated (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]; Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 150 AD3d 192 [2017], affd 33 NY3d 389 [2019]). The arbitrator stated that he found “no reasonable or credible evidence” establishing the defense, and he found in favor of Bay Needle. On Country-Wide’s appeal, a master arbitrator vacated the original arbitrator’s award and remitted the matter for a new hearing before a new arbitrator. The master arbitrator stated that the evidence of fraudulent incorporation presented by Country-Wide “was substantial.” Bay Needle commenced this proceeding pursuant to CPLR article 75 to vacate the master arbitrator’s award. The Supreme Court granted the petition, vacated the master arbitrator’s award, confirmed the original arbitrator’s award in favor of Bay Needle, and entered a judgment accordingly. Country-Wide appeals.

We agree with the Supreme Court that the master arbitrator exceeded his power in vacating the original arbitrator’s award after, in effect, weighing the evidence and coming to a different conclusion than the original arbitrator as to what that evidence proved (see Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207, 212 [1981]). As such, we agree with the court’s determination to vacate the master arbitrator’s award and to confirm the original arbitrator’s award in favor of Bay Needle (see Matter of Jordan v Liberty Mut. Fire Ins. Co., 309 AD2d 803, 804 [2003]; cf. Matter of Jasser v Allstate Ins. Co., 77 AD3d 751, 752 [2010]).

Moreover, as Bay Needle contends and Country-Wide concedes, Bay Needle is entitled to an attorney’s fee for this appeal pursuant to 11 NYCRR 65-4.10 (j), to be fixed by the Supreme Court (see Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C., 167 AD3d 404, 405 [2018]; Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 162 AD3d 407, 408 [2018]; Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 148 AD3d 703, 706 [2017]). The matter is therefore remitted to the Supreme Court, Kings County, for that purpose. Balkin, J.P., Roman, Brathwaite Nelson and Christopher, JJ., concur.

[*1]

Jaffe & Koumourdas, LLP (Thomas Torto, New York, NY, of counsel), for appellant.

Gary Tsirelman, P.C., Brooklyn, NY (Stefan Belinfanti and David M. Gottlieb of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an award of a master arbitrator dated October 10, 2014, Country-Wide Ins. Co. appeals from a judgment of the Supreme Court, Kings County (Bernard J. Graham, J.), dated July 31, 2015. The judgment, upon an undated order of the same court granting the petition, vacating the master arbitrator’s award dated October 10, 2014, and remitting the matter to arbitration, is in favor of the petitioner and against Country-Wide Ins. Co. in the total sum of $625.

Ordered that the judgment is reversed, on the law, with costs, the petition is denied, the master arbitrator’s award dated October 10, 2014, is confirmed, and the undated order is modified accordingly.

Acuhealth Acupuncture, P.C. (hereinafter Acuhealth), is the assignee of a claim for no-fault benefits for treatment it rendered to Hector Rojos. After the carrier, Country-Wide Ins. Co. (hereinafter Country-Wide), denied the claim, Acuhealth submitted the claim to arbitration. The arbitrator denied Acuhealth’s claim, finding, inter alia, that the evidence established that Acuhealth was fraudulently incorporated and thus not entitled to reimbursement under the No-Fault Law (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 320-321 [2005]).

On appeal, a master arbitrator affirmed the original arbitrator’s award in favor of Country-Wide. Acuhealth then commenced this proceeding pursuant to CPLR article 75 to vacate the master arbitrator’s award. The Supreme Court determined that a prior Supreme Court determination involving the same parties was entitled to preclusive effect. Accordingly, the court granted Acuhealth’s petition, vacated the master arbitrator’s award, remitted the matter to arbitration, and awarded Acuhealth costs and disbursements in the sum of $625. Country-Wide appeals.

We disagree with the Supreme Court’s determination that Acuhealth was entitled to vacatur of the master arbitrator’s award on the ground of collateral estoppel. The prior decision on which the court relied merely stated that Acuhealth’s petition to vacate a master arbitrator’s award was granted, without indicating on what basis the petition was granted or what issues were being decided and in what manner. Under those circumstances, Acuhealth failed to establish that the issue on which it sought collateral estoppel effect in this proceeding was identical to an issue which was raised and necessarily decided in the prior proceeding (see Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343, 349 [1999]; Von Maack v Wyckoff Hgts. Med. Ctr., 140 AD3d 1055, 1056 [2016]).

Acuhealth failed to demonstrate any additional ground for vacating the master arbitrator’s award. “[A]n arbitrator’s rulings, unlike a trial court’s, are largely unreviewable” (Matter of Falzone [New York Cent. Mut. Fire Ins. Co.], 15 NY3d 530, 534 [2010]). A court reviewing the award of a master arbitrator is limited to the grounds set forth in CPLR article 75, which include, in this compulsory arbitration, the question of whether the determination had evidentiary support, was rational, or had a plausible basis (see Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207, 212 [1981]). Notably, the master arbitrator’s review power is broader than that of the courts’ because it includes the power to review for errors of law (see id. at 211-212; 11 NYCRR 65-4.10 [a] [4]). In contrast, the courts “generally will not vacate an arbitrator’s award where the error claimed is the incorrect application of a rule of substantive law, unless it is so irrational as to require vacatur” (Matter of Smith [Firemen’s Ins. Co.], 55 NY2d 224, 232 [1982] [citations and internal quotation marks omitted]; see Matter of Liberty Mut. Ins. Co. v Spine Americare Med., 294 AD2d 574, 576 [2002]).

Here, since Country-Wide submitted evidence tending to support its fraudulent incorporation defense, it cannot be said that the determination of the master arbitrator affirming the original arbitrator’s award lacked evidentiary support. Nor can it be said that the determination to affirm the original arbitrator, who supported her determination with reasons based on the evidence, lacked a rational basis. Thus, even if it was an error of law to conclude that Country-Wide proved its defense as a matter of law (see Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3d 885, 886-887 [2017]), the master arbitrator’s determination is not subject to vacatur by the courts on the mere basis of that error of law (see Matter of Motor Veh. Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214, 223-224 [1996]; Matter of Acuhealth Acupuncture, P.C. v New York City Tr. Auth., 167 AD3d 869 [2018]). Notably, this Court’s decision in Nationwide Affinity, which is contrary to the conclusion of the master arbitrator in this case, was not published until after the master arbitrator’s award was rendered. Moreover, Country-Wide submitted evidence in support of its defense which, while inadmissible, could be considered by the original arbitrator in this case, who, unlike a court deciding a summary judgment motion like that at issue in Nationwide Affinity, was not bound by the rules of evidence (see Matter of Fagan v Village of Harriman, 140 AD3d 868 [2016]).

Accordingly, the petition should have been denied and the master arbitrator’s award should have been confirmed. Balkin, J.P., Roman, Brathwaite Nelson and Christopher, JJ., concur.

[*1]

Jaffe & Koumourdas, LLP (Thomas Torto, New York, NY, of counsel), for appellant.

Gary Tsirelman, P.C., Brooklyn, NY (Stefan Belinfanti and David M. Gottlieb of counsel), for respondent.

In a proceeding pursuant to CPLR article 75 to vacate an award of a master arbitrator dated February 25, 2016, Country-Wide Ins. Co. appeals from a judgment of the Supreme Court, Kings County (Kathy J. King, J.), dated October 27, 2016. The judgment, upon an order of the same court dated October 26, 2016, granting the petition, vacating the master arbitrator’s award dated February 25, 2016, and confirming the original arbitrator’s award dated December 4, 2015, is in favor of the petitioner and against Country-Wide Ins. Co. in the total sum of $13,864.96.

Ordered that the judgment is affirmed, with costs, and the matter is remitted to the Supreme Court, Kings County, for a determination of the amount of an additional attorney’s fee to be awarded to the petitioner pursuant to Insurance Department Regulations (see 11 NYCRR 65-4.10 [j] [4]).

Acuhealth Acupuncture, P.C. (hereinafter Acuhealth), is the assignee of a claim for no-fault benefits for treatment it rendered to Massiel Olsen. After the carrier, Country-Wide Ins. Co. (hereinafter Country-Wide), denied the claim, Acuhealth submitted the claim to arbitration. The arbitrator, upon refusing to consider Country-Wide’s defenses on the ground that Country-Wide’s submissions to the arbitrator were late, with no excuse for their lateness, found in favor of Acuhealth. On Country-Wide’s appeal, the master arbitrator vacated the award and issued a new award in favor of Country-Wide based on the defense that Acuhealth was fraudulently incorporated, which the original arbitrator had refused to consider on the ground that it was untimely submitted. Acuhealth then commenced this proceeding pursuant to CPLR article 75 to vacate the master arbitrator’s award. The Supreme Court granted Acuhealth’s petition, vacated the master arbitrator’s award in favor of Country-Wide, and confirmed the original arbitrator’s award in favor of Acuhealth. Country-Wide appeals.

An arbitrator acts within his or her discretionary authority by refusing to entertain late submissions (see Matter of Global Liberty Ins. Co. v Coastal Anesthesia Servs., LLC, 145 AD3d 644, 645 [2016]; Matter of Mercury Cas. Co. v Healthmakers Med. Group, P.C., 67 AD3d 1017, 1017 [2009]; Matter of Green v Liberty Mut. Ins. Co., 22 AD3d 755, 756 [2005]). Here, in rejecting the original arbitrator’s proper exercise of his discretionary authority, and in passing, de novo, upon factual questions concerning the validity of Country-Wide’s defense that Acuhealth was fraudulently incorporated (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 320-321 [2005]), the master arbitrator exceeded his power (see Matter of Smith [Firemen’s Ins. Co.], 55 NY2d 224, 230-231 [1982]; Matter of Allstate Ins. Co. v Keegan, 201 AD2d 724, 725 [1994]). Accordingly, we agree with the Supreme Court’s determination to vacate the master arbitrator’s award and confirm the original arbitrator’s award in favor of Acuhealth.

Moreover, as Acuhealth contends and Country-Wide concedes, Acuhealth is entitled to an attorney’s fee for this appeal pursuant to 11 NYCRR 65-4.10 (j), to be fixed by the Supreme Court (see Matter of Country-Wide Ins. Co. v Bay Needle Acupuncture, P.C., 167 AD3d 404, 405 [2018]; Matter of Country-Wide Ins. Co. v Bay Needle Care Acupuncture, P.C., 162 AD3d 407, 408 [2018]; Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 148 AD3d 703, 706 [2017]). The matter is therefore remitted to the Supreme Court, Kings County, for that purpose.

Acuhealth’s remaining contention is without merit. Balkin, J.P., Roman, Brathwaite Nelson and Christopher, JJ., concur.