[*1]

Civil Court of the City of New York, Kings County, February 8, 2006

APPEARANCES OF COUNSEL

Baker, Strauss, Barshay & Grossman for plaintiff. Rubin & Fiorella, LLP, for defendant.

OPINION OF THE COURT

Eileen N. Nadelson, J.

This matter presents an issue of first impression with respect to civil procedure in New York. The question concerns the ability of a court to declare a mistrial sua sponte over a party’s objections when it becomes impossible for the trial judge at a bench trial to continue hearing the matter.

The instant action was commenced as a first-party claim for benefits under New York’s No-Fault Insurance Law. Although the original claim involved multiple bills, during the proceedings all but one bill were settled out by the parties. After the close of plaintiff’s case-in-chief, during a recess in the proceedings for the end-of-year holidays, the presiding judge was informed by the Office of Court Administration (OCA) that she was being reassigned from civil to criminal court, and that all pending matters were to be turned over to the supervising judge of the civil court for reassignment to other judges. This reassignment was unexpected and unanticipated.

Because evidence had already been heard, the judge was given permission to remain in civil court for an extra week to complete the trial; however, despite the best efforts of all the participants, it was impossible to conclude the case. The trial judge was then required by OCA to assume her duties in the criminal court. A mistrial was then declared by the court.

CPLR 4402 states that “[a]t any time during the trial, the court, on motion of any party, may order a continuance or a new trial in the interest of justice on such terms as may be just.”

In the instant matter, neither party moved for a new trial or a mistrial, and the determination that a mistrial was necessary was made by the court. With respect to motions for mistrials, the law is clear that the decision as to whether or not to grant a new trial lies in the [*2]discretion of the court, when it appears that owing to some accident or surprise, defect of proof, unexpected and difficult questions of law, or like reason, a trial cannot proceed without injustice to a party. (Matter of Bank of N.Y. v Assessor of Vil. of Bronxville, 4 Misc 3d 1014[A], 2004 NY Slip Op 50874[U] [Sup Ct, Westchester County 2004].) Unfortunately, there are no judicial decisions, with regard to civil law matters, that provide guidance as to which circumstances would require or permit a court to declare a mistrial on its own initiative. However, there are several criminal law cases that do address this knotty problem.

In People ex rel. Brinkman v Barr (248 NY 126 [1928]), the New York Court of Appeals permitted the court to declare a mistrial when the judge before whom a criminal case was pending became too ill to appear in court or continue the trial. The request for the mistrial came from the judge himself. Therefore, it appears a judge’s physical incapacity may be a valid basis for the court to declare a mistrial.

In Matter of Romero v Justices of Supreme Ct., Queens County (237 AD2d 292 [2d Dept 1997]), the court was permitted to declare a mistrial when a juror failed to return for deliberations and could not be contacted. The appellate court stated that the trial court could not reasonably be required to order an indefinite continuance, but was justified in concluding that there was no acceptable alternative to a mistrial. In this instance, because the trier of fact was unavailable to complete the trial, a mistrial was deemed to be the appropriate course of action.

Pursuant to Federal Rules of Criminal Procedure rule 25, if by reason of death, sickness or other disability the judge before whom a jury trial has commenced is unable to proceed with the trial, any other judge regularly sitting in or assigned to the court, upon certifying familiarity with the record, may proceed with and finish the trial.

New York has no rule comparable to this federal rule. However, according to section 21 of the Judiciary Law, a judge “shall not decide or take part in the decision of a question, which was argued orally in the court, when he [or she] was not present and sitting therein as a judge.”

This section of the Judiciary Law has been interpreted, with respect to criminal matters, to prohibit a substitution of judges at hearings where testimony is presented, not to a jury, but to the court, and the substituted judge is called upon to render a decision based on an evaluation of testimony which he or she did not hear. (See, e.g., People v Cameron, 194 AD2d 438 [1st Dept 1993].) Consequently, it would appear that the Judiciary Law would prevent a substitution of judges after evidence has begun at a nonjury trial. (People v Thompson, 158 Misc 2d 397 [Sup Ct, Queens County 1993].) [*3]

In the instant case, because it is a bench trial, it would be seemingly improper for a substituted judge to render a decision based on evidence he or she did not hear, given by witnesses whose credibility he or she could not evaluate. Therefore, because a different judge could not be allowed to continue the trial, the only question is whether the trial judge’s reassignment constitutes a sufficient unexpected disability to warrant the declaration of a mistrial.

At least one court has determined that the fact that the court’s term was shortly to end did not require the declaration of a mistrial, because there were several other courses of action available. (That court failed to enumerate exactly what those courses of action might be.) That court stated that in order to declare a mistrial, a court must find a manifest necessity not founded upon its own convenience. (Matter of Delcol v Dillon, 173 AD2d 704 [2d Dept 1991].) This case is distinguishable from the instant matter, in which the trial judge requested to remain with the case but was unable to do so because of administrative exigencies.

In the case at bar, the trial judge was able to stay her reassignment for one week, which the parties asserted would be a sufficient amount of time in which to conclude the presentation of all of the evidence. Unfortunately, the parties were mistaken, and the trial could not be completed within this time frame. No other judge could be substituted, it was not possible for the judge to further delay her duties in a different court, although she was willing to do so, and an indefinite continuance until the judge might be reassigned back to civil court would be impracticable. As a consequence, in the interests of justice, the court had no alternative but to declare a mistrial.

[*1]

Civil Court of the City of New York, Kings County, January 3, 2006

APPEARANCES OF COUNSEL

Alden Banniettis, Brooklyn, for plaintiff. Tell, Cheser & Breitbart, L.L.P., for defendant.

OPINION OF THE COURT

Arlene P. Bluth, J.

When defending a claim for first-party no-fault benefits, an insurer may raise at any time the defense that the alleged injuries do not arise out of an insured incident. What must the insurer present at trial when asserting that the injuries are the result of an accident staged in furtherance of an insurance fraud scheme? As explained more fully below, this court holds that the term “fraud” as used in that context is a red herring. This is because it does not matter whether the accident was staged in furtherance of an insurance fraud scheme or was deliberately caused under some other circumstances. The relevant inquiry is whether the collision was a true accident—that is, was it unintentional? Quite simply, if it was not an accident, then it falls outside the scope of the no-fault policy.

In these actions, plaintiff V.S. Medical Services, P.C. seeks to recover first-party no-fault benefits for medical services rendered to its assignors. At issue is $2,242.87 for treatment rendered to Carlos Gaviria and $12,997.06 for treatment rendered to Ysidro Liriano. Both assignors were involved in the same alleged accident, and plaintiff’s claims for the treatment rendered to them were all denied based on defendant’s claim that the alleged accident was staged. Therefore, since there were common questions of law and fact, the trials were held jointly before this court on November 16, 2005. Defendant Allstate Insurance Company [*2]presented three witnesses: the insured, Victor Herasme; an outside investigator, Robert J. Sasso; and a claims examiner, Sandra Pryce. Plaintiff did not present any witnesses.

In the action pertaining to assignor Ysidro Liriano (Index No. 55821/04), a prior decision/order issued by Honorable Ellen M. Spodek on March 21, 2005 denied cross motions for summary judgment and found that although plaintiff had made out its prima facie case, defendant had raised an issue of fact as to whether the accident was staged. Therefore, the trial on the claims for Mr. Liriano was limited to the issue of whether the collision was an insured incident. As to the other assignor, Mr. Gaviria, plaintiff was still required to make out its prima facie case.

Based upon the testimony and evidence introduced at trial and having had the opportunity to observe the demeanor and credibility of the witnesses’ testimony, the court finds as follows:

Findings of Fact

The assignors herein were involved in an alleged accident on May 8, 2001. One of the assignors, Mr. Gaviria, was driving, and the other, Mr. Liriano, was one of his passengers. The car, a 1985 Nissan, was owned and insured by Victor Herasme, who was defendant’s first witness. Mr. Herasme credibly testified that he frequently loaned out his car to people in the neighborhood. He testified that he had gotten into an accident with the car in or about January 2001, while he was driving; and that just prior to the accident in May 2001 which gave rise to this suit, he had lent the car to Mr. Gaviria (known to him only as “Carlos”), whom he knew casually from around the neighborhood. Mr. Herasme testified that Mr. Gaviria returned the car to him with a “small scratch”; when Mr. Herasme questioned him about it, Mr. Gaviria admitted that he had “scraped by a car” but refused to give details. Mr. Herasme also testified that he is known as Victor, that Mr. Gaviria only called him Victor, and that he was not called Jose by anyone, including Mr. Gaviria. However, when Mr. Gaviria was questioned by defendant in an examination under oath (EUO), the signed transcript of which was introduced into evidence as exhibit A, Mr. Gaviria flatly denied knowing Victor Herasme or anyone named Victor, and claimed to have borrowed the car from a man named Jose.

Defendant’s second witness was Robert J. Sasso, chief executive officer (CEO) of Above Average Investigations, Inc. He was hired by defendant to locate the following witnesses and serve them with subpoenas to testify at the trial: Mr. Gaviria (the driver and an assignor), Mr. Herasme (the owner and insured), Mr. Liriano (a passenger and an assignor), and the treating physician, Dr. Leonid Livchits. Mr. Sasso was unable to serve Mr. Gaviria, but successfully served the other three individuals. Of those, only Mr. Herasme appeared.

Finally, defendant presented Sandra Pryce, a claims representative who works in defendant’s special investigations unit. Ms. Pryce testified that she has been employed for 38 years by defendant, and for 11 years in her current position. Her job includes the review of files referred by the claims department for suspicion of fraud (meaning a noncovered incident), and making the ultimate determination of whether to pay or deny those claims after investigation. Ms. Pryce testified she was referred the file because another Allstate employee had spoken to the driver, Mr. Gaviria, who denied any involvement in an accident. (As described above, he later changed his story when questioned by defendant under oath.) Ms. Pryce testified that the investigation revealed the following facts, and based thereon she determined that the accident [*3]was staged and that the claims should be denied:

(1) In his EUO, Mr. Gaviria denied knowing Mr. Herasme, the insured and owner of the vehicle he was driving.

(2) The alleged accident occurred on May 8, 2001, just under one month after the policy was taken out on April 9, 2001, and the policy was terminated for nonpayment on June 9, 2001, just over a month later.

(3) In a similar pattern, Mr. Herasme had taken out a policy on the car on December 28, 2000, the car was involved in an alleged accident less than a month later on January 19, 2001, and that policy was terminated for nonpayment on February 27, 2001.^[FN1]

(4) In both accidents, there was minimal damage to the car, there were several passengers in the car, and no one was taken to the emergency room, although medical treatments were started later. In addition, both accidents occurred on Seventh Avenue in Manhattan—the first at 19th Street, and the second at 32nd Street.

(5) There were several inconsistencies in the EUO testimony of Mr. Gaviria, the driver, and Mr. Torres, one of the passengers (and the only one of the four passengers who appeared for an EUO). Ms. Pryce noted that they conflicted in very basic ways, including the number and gender of the passengers, whether the police witnessed the accident or were called to the scene, the purpose of the trip and destination of the car. In his EUO, Mr. Gaviria stated that besides him, there were three other people in the car, all male, and one whom he could not even identify; Mr. Torres said there were four other people, and that one was female. Mr. Gaviria said the police were on the scene to witness the accident; Mr. Torres said they were called and arrived later. Mr. Gaviria’s testimony on this point was contradicted by the police report, which Ms. Pryce reviewed as part of defendant’s file. Mr. Gaviria also said that they had been on their way to pick up the mother of one of the passengers, while Mr. Torres said they were just cruising aimlessly. Ms. Pryce credibly testified that, in her experience, these types of inconsistencies—especially as to the number and identity of people in the vehicle—are indicative of a staged accident.

Based on all of these factors, and after consultation with Hazel Johnson, the original claims representative who had forwarded the file to her, Ms. Pryce determined that the accident was staged and therefore not a covered incident, and had the subject claims denied on that basis. She also duly notified the National Insurance Crime Bureau and the New York State Insurance Fraud Bureau.

Conclusions of Law

A. “Fraud” Is Not the Issue

No-fault insurance policies only cover vehicular accidents. An accident is, by definition, unintentional; a deliberate collision is not an accident. Therefore, damages resulting from a deliberate collision are not covered by no-fault insurance. (See Matter of Allstate Ins. Co. v Massre, 14 AD3d 610 [2d Dept 2005] [no coverage where claimant was injured in an intentional collision]; Matter of Government Empls. Ins. Co. v Robbins, 15 AD3d 484 [2d Dept 2005] [no [*4]coverage for claimant where collision was deliberately caused by the driver of the other vehicle]; Westchester Med. Ctr. v Travelers Prop. Cas. Ins. Co., 309 AD2d 927 [2d Dept 2003] [no coverage where wife was injured when her husband tried to kill her by deliberately driving their car over an embankment while he exited the vehicle]; Matter of Progressive Northwestern Ins. Co. v Van Dina, 282 AD2d 680 [2d Dept 2001] [no coverage where claimant was injured when she was mugged by driver of another car while loading packages into her trunk and was pulled under offender’s car].) This line of cases makes clear that even where the individual claiming benefits had no involvement in causing the collision but was merely an innocent injured party, coverage is properly denied because the collision was not an accident.

Moreover, it does not matter “whether the intentional collision was motivated by fraud or malice.” (Matter of Government Empls. Ins. Co. v Shaulskaya, 302 AD2d 522, 523 [2d Dept 2003]; see also Progressive N. Ins. Co. v Rafferty, 17 AD3d 888, 889 [3d Dept 2005] [no coverage where claimant deliberately rammed his car into person with whom he had been fighting].) While some intentional collisions are the products of insurance fraud schemes, others are not. In all such cases, it is the deliberate, nonaccidental character of the incident that makes it ineligible for no-fault coverage. Put another way, the no-fault policy only covers accidents; it does not cover deliberate incidents. It does not matter whether the incident was a deliberate mugging, an attempted murder, a product of road rage, or a cold, calculated scheme to defraud the insurance company—if it was deliberate, it is not a covered incident under the no-fault policy.

Nevertheless, our appellate courts commonly invoke the term “fraud” when discussing the defense of lack of coverage; this may be because so many cases involving allegedly noncovered incidents center on accidents purportedly staged for the purpose of generating fraudulent insurance claims. (See State Farm Mut. Auto. Ins. Co. v Laguerre, 305 AD2d 490, 491 [2d Dept 2003] [“A deliberate collision caused in furtherance of an insurance fraud scheme is not a covered accident”]; see also Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2d Dept 2002]; A.B. Med. Servs. PLLC v Encompass Ins., 10 Misc 3d 127[A], 2005 NY Slip Op 51892[U] [App Term, 2d & 11th Jud Dists 2005]; Ocean Diagnostic Imaging, P.C. v Utica Mut. Ins. Co., 9 Misc 3d 138[A], 2005 NY Slip Op 51745[U] [App Term, 9th & 10th Jud Dists 2005]; Careplus Med. Supply Inc. v Allstate Ins. Co., 9 Misc 3d 131[A], 2005 NY Slip Op 51598[U] [App Term, 2d & 11th Jud Dists 2005]; A.B. Med. Servs. PLLC v State-Wide Ins. Co., 7 Misc 3d 136[A], 2005 NY Slip Op 50785[U] [App Term, 2d & 11th Jud Dists 2005]; Melbourne Med., P.C. v Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004]; A.B. Med. Servs. v Eagle Ins. Co., 3 Misc 3d 8 [App Term, 2d Dept 2003].) Perhaps the seminal embodiment of this formulation is the Second Department’s pronouncement that “[a] deliberate collision caused in furtherance of an insurance fraud scheme is not a covered accident.” (State Farm v Laguerre, 305 AD2d at 491.) No-fault insurers and practitioners (including the parties and their counsel in this case) have also adopted the nomenclature of fraud when litigating claims involving allegedly staged accidents. This is true even though the no-fault regulations do not mention “fraud” as a defense to payment, but rather refer only to noncovered incidents. (See, e.g., 11 NYCRR 65-3.8 [e] [2].)

Unfortunately, the “fraud” label has created the mistaken impression that the insurance [*5]company must prove that the “accident” was the product of a fraudulent motive or scheme. But the fraud label is merely a distraction, since the focus for a “lack of coverage” defense must always be whether the collision was deliberate or a true accident. That is, the court must determine whether the incident was unintentional (i.e., a true accident) or whether at least one driver intended to make contact (i.e., a deliberate event).

B. Establishing a Staged Accident Defense

In the no-fault context, the plaintiff need not prove coverage as part of its prima facie case. (See, e.g., Amaze Med. Supply Inc. v Lumbermens Mut. Cas. Co., 10 Misc 3d 127[A], 2005 NY Slip Op 51898[U] [App Term, 2d & 11th Jud Dists 2005]; Contemp. Med. Diag. & Treatment, P.C. v Government Empls. Ins. Co., 6 Misc 3d 137[A], 2005 NY Slip Op 50254[U] [App Term, 2d & 11th Jud Dists 2005]; Triboro Chiropractic & Acupuncture v Electric Ins. Co., 2 Misc 3d 135[A], 2004 NY Slip Op 50215[U] [App Term, 2d & 11th Jud Dists 2004] [setting forth the elements of the plaintiff’s prima facie case, namely, that the statutory claim form, setting forth the fact and the amount of the loss sustained, was submitted to the defendant, and that payment of no-fault benefits is overdue].) Instead, the plaintiff’s prima facie case establishes a presumption of coverage. (See A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 7 Misc 3d 822, 825 [Civ Ct, Kings County 2005].)

Before trial, it is well established that to defeat a plaintiff’s motion for summary judgment for first-party no-fault benefits, a defendant asserting a lack of coverage defense must set forth admissible evidence of “the fact or [a] founded belief that the alleged injury does not arise out of an insured incident.” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]; St. Luke’s Roosevelt Hosp. v Allstate Ins. Co., 303 AD2d 743 [2d Dept 2003]; Diagnostic Rehab. Medicine Serv., P.C. v Farm Family Cas. Ins. Co., 7 Misc 3d 137[A], 2005 NY Slip Op 50826[U] [App Term, 1st Dept 2005]; Ocean Diagnostic Imaging P.C. v Allstate Ins. Co., 6 Misc 3d 134[A], 2005 NY Slip Op 50189[U] [App Term, 9th & 10th Jud Dists 2005].) In other words, when the defense is based on lack of coverage, to defeat plaintiff’s motion for summary judgment, the defendant must come forward with evidence in admissible form that creates an issue of fact and rebuts that presumption of coverage.

Once the plaintiff’s motion for summary judgment is denied, however, there is a dearth of case law to address what showing the insurer must make at the trial to defeat the claim for first-party no-fault benefits. This court found only two published decisions addressing this issue, and they conflict with each other. In one, the court extrapolated the standard for defeating a summary judgment motion into the trial context. In A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., Judge Jack M. Battaglia of this court held that if the insurer raises a lack of coverage defense, it is its burden at trial to come forward with evidence of ” ‘the fact’ [of lack of coverage or the] ‘found[ation for its] belief’ that there is no coverage.” (A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 7 Misc 3d 822, 824 [Civ Ct, Kings County 2005], quoting Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 19-20 [2d Dept 1999].) A completely different approach was taken by Judge Loren Baily-Schiffman of this court. In JSI Expert Serv. v Liberty Mut. Ins. Co. (7 Misc 3d 1009[A], 2005 NY Slip Op 50513[U] [Civ Ct, Kings County 2005]), Judge Baily-Schiffman rejected the approach of the A.B. Med. court. Instead, she focused on the fraud aspect and applied the “clear and convincing evidence” standard, the unusually high standard required to prove an independent cause of action for fraud. “This Court holds that the insurer’s defense of fraud, whether it be a staged accident or other fraud, requires [*6]proof by clear and convincing evidence.” (JSI Expert Serv. v Liberty Mut. Ins. Co., 7 Misc 3d 1009[A], 2005 NY Slip Op 50513[U], *3 [Civ Ct, Kings County 2005].)

Besides these two posttrial decisions, the issue of whether the incident was a true accident or a deliberate event also arises in another context. In cases where an insurer petitions the Supreme Court to permanently stay arbitration of a claimant’s no-fault claim on the ground that the collision was not a covered incident, the Supreme Court holds a framed issue hearing on that sole issue. In those posthearing decisions, the case law from the Second Department makes clear that whether a collision is a covered incident depends upon whether it was intentionally caused. (See Matter of Allstate Ins. Co. v Massre, 14 AD3d 610 [2d Dept 2005]; Matter of Government Empls. Ins. Co. v Robbins, 15 AD3d 484 [2d Dept 2005]; Westchester Med. Ctr. v Travelers Prop. Cas. Ins. Co., 309 AD2d 927 [2d Dept 2003]; Matter of Government Empls. Ins. Co. v Shaulskaya, 302 AD2d 522, 523 [2d Dept 2003]; Matter of Progressive Northwestern Ins. Co. v Van Dina, 282 AD2d 680 [2d Dept 2001].) If the collision was an intentional occurrence, then it is outside the scope of the no-fault policy regardless of why or how it occurred or who was behind it.

That does not mean that an insurer cannot or should not put forth evidence of a fraudulent scheme in order to prove that the collision was not an accident; it does mean, however, that the insurer need not prove fraud. In Matter of Eagle Ins. Co. v Davis (22 AD3d 846 [2d Dept 2005]), the Second Department held that the Supreme Court should have considered evidence proffered on the issue of fraud, insofar as it bore on the question of whether the collision was a covered incident. “When [the insurer] raises an issue of fact as to whether the automobile collision . . . was deliberate or intentional, the issue of fraud is subsumed under the coverage issue. Evidence of such fraud should be considered in determining the broader coverage issue.” (Id. at 847 [citations omitted]; see also Matter of Government Empls. Ins. Co. v Spence, 23 AD3d 466 [2d Dept 2005].) Thus, the insurer may introduce evidence of a fraudulent scheme or motive to the extent that it is probative of the question of whether the collision was a true accident. In other words, evidence of fraud can serve as circumstantial evidence that this was not a covered incident. While “unsubstantiated hypotheses and suppositions” are not enough to make out a lack of coverage defense (see Amstel Chiropractic v Omni Indem. Co., 2 Misc 3d 129[A], 2004 NY Slip Op 50088[U], *1 [App Term, 2d & 11th Jud Dists 2004]), an insurer’s evidence of a purposeful collision will often be circumstantial. This is to be expected; in the absence of a mea culpa from one of the participants, the insurer—and ultimately the court—must examine the facts and circumstances of the incident to determine whether they give rise to an inference of lack of coverage. (See, e.g., A.B. Med. Servs., 7 Misc 3d 822.) Circumstantial evidence is sufficient if a party’s conduct “may be reasonably inferred based upon logical inferences to be drawn from the evidence.” (Benzaken v Verizon Communications, Inc., 21 AD3d 864, 865 [2d Dept 2005].)

C. Burdens of Proof at Trial

As set forth in section B above, the plaintiff need not prove coverage as part of its prima facie case. Instead, the plaintiff’s prima facie case establishes a presumption of coverage. When the defense is based on lack of coverage, therefore, the defendant need only come forward with evidence that rebuts that presumption of coverage. That is, once the plaintiff has made out its prima facie case, the burden of production (also called the burden of going forward) on the issue [*7]of coverage falls upon the defendant, and the defendant must demonstrate that it has a founded basis for believing that the alleged collision was intentionally caused. The burden of persuasion, however, remains on the plaintiff, who must prove its case by a fair preponderance of the credible evidence. (See Kalra v Kalra, 149 AD2d 409, 411 [2d Dept 1989]; Prince, Richardson on Evidence § 3-206 [Farrell 11th ed].) “[I]f the insurer carries its burden of coming forward, plaintiff must rebut it or succumb.” (A.B. Med. Servs., 7 Misc 3d at 825 [internal quotation marks and citation omitted].) How much evidence must defendant produce to satisfy its burden of production? There is no magic formula, but clearly it must be enough to rebut the presumption that the injuries were caused by a covered incident, that is, a true accident. (See Prince, Richardson on Evidence § 3-202.) After all the evidence has been presented, the court must decide whether the evidence of coverage preponderates in favor of the plaintiff, the party who bears the burden of persuasion. If the evidence weighs against the plaintiff, or is so evenly balanced that it is impossible to determine the matter, then judgment must be given for the defendant. (See Roberge v Bonner, 185 NY 265 [1906].)

D. Conclusion

Addressing the issue of plaintiff’s prima facie case, the court finds that plaintiff made out its prima facie case as to assignor Ysidro Liriano on its summary judgment motion; at trial, plaintiff made out its prima facie case as to the other assignor, Carlos Gaviria, via the admissions of defendant, through the testimony of Ms. Pryce, that it received the claims submitted for Mr. Gaviria.

In this trial, defendant came forward with sufficient evidence to rebut the presumption of coverage by showing that it had a founded belief that the injuries did not arise from a covered incident—that is, that the accident was staged because at least one driver intended to make contact.^[FN2] The court finds that the insurer, by Ms. Pryce, testified credibly that its denials of plaintiff’s claims were based, or founded, upon the results of her investigation—including the profile and claim history of the car (older model, accident shortly after insurance taking effect and policy cancelled shortly thereafter for nonpayment on two separate occasions), several passengers in the car, no emergency room treatment for any passenger, several material discrepancies in the car’s occupants’ stories as to the number and gender of people in the car, where they were going, and the driver denying knowing the owner of the car. At trial, defendant also presented Mr. Herasme’s unrebutted testimony that his car suffered only a “small scratch” in the alleged accident—an event which sent no one to the emergency room, but which allegedly resulted in over $15,000 in treatment for these assignors alone.^[FN3] Thus, the evidence produced by defendant rebutted the presumption of coverage which attached to plaintiff’s prima facie case, and shifted the burden of production back to plaintiff. [*8]

Plaintiff wholly failed to carry that burden. Plaintiff produced no evidence to rebut any of defendant’s proof; plaintiff did not even produce its assignors or any other witnesses to the alleged incident. Instead, plaintiff relied on its counsel’s vigorous cross-examination of defendant’s witnesses. The tactic did not succeed, and defendant’s credible proof stands unrefuted. Thus, based upon a fair preponderance of the evidence, this court finds that the subject collision was not a covered incident.

Accordingly, judgment is for defendant, and the complaints are hereby dismissed.

Footnotes

Footnote 1: Ms. Pryce explained that defendant was obligated to reinsure the vehicle because it was in the assigned risk pool, and due to the luck of the draw, Allstate got the vehicle twice.

Footnote 2: In this case, defendant denied the subject claims because, inter alia, the injuries were not caused by an accident. However, even if the denials were not premised upon lack of coverage, the outcome would be the same since at trial defendant established the defense of lack of coverage, and said defense is not subject to preclusion.

Footnote 3: In finding that the alleged injuries were not the result of a covered incident, this court does not suggest that fraud was committed by the medical provider with regard to the billed-for treatment, an issue not before the court in this trial.

Civil Court, Kings County

95623/04

Delores J. Thomas, J.

In this action brought by a health care provider to recover no-fault benefits as assignee of Alex Zubaty, plaintiff moves for an order granting summary judgment against defendant in the sum of $540.00 plus statutory interest together with statutory attorney’s fees.

The No-Fault Law provides for payments for medical supplies provided to a person injured as a result of an accident arising out of the use or operation of a motor vehicle. To recover first-party benefits, a claimant must demonstrate a prima facie entitlement to summary judgment by setting forth proof that it submitted a claim, the fact and amount of losses sustained and that payment of benefits is overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v. Allstate Ins. Co., 5 AD3d 742 [2d Dept 2004]).

It is undisputed that defendant did not pay or deny the claim within the required 30-[*2]day period. Plaintiff contends there was no extension of the time period through verification requests. Although defendant requested an examination under oath (EUO), unless defendant can establish that the policy in effect entitled defendant to conduct an EUO and that it made a timely and proper verification request, tolling does not occur. Policies issued on or after April 5, 2002 must contain the revised prescribed endorsement to entitle the insurer to conduct an EUO (see, SZ Medical P.C. v. State Farm Mutual Auto Ins. Co., 9 Misc 3d 139 [A], 2005 NY Slip Op 51842 [U] [App Term, 1st Dept 2005]). Here, defendant has not demonstrated any basis to toll the 30-day period.

An untimely denial precludes defendant from interposing most defenses including the defense of lack of medical necessity (Amaze Med. Supply Inc. v. Eagle Ins. Co., 2 Misc 3d 139 [A], 2004 NY Slip Op 050279 [U] [App Term, 2d & 11th Jud Dists 2004]). However, defendant is not precluded from asserting the defense that the injuries do not arise out of a covered accident or a defense premised on staged accident fraud (see, Central Gen. Hosp. v. Chubb Group of Ins. Cos., 90 NY2d 195 [1997]; Metro Med. Diagnostics v. Eagle Ins. Co., 293 AD2d 751 [2nd Dept 2002]). However, to withstand a motion for summary judgment, defendant must raise a triable issue of fact (Alvarez v. Prospect Park Hospital, 68 NY2d 320 [1986]).

The denial of claim form (Exhibit A, annexed to Notice of Motion) states: “All no fault benefits denied based in part on A) the EUO; B) failure to establish proof of claim; C) failure to establish that the injuries arose out of the use and operation of the insured vehicle; and D) the treatment was not causally related to the claimed injuries.” In addition, in support of its fraud defense defendant submits the affidavit of Jeffrey Billington, claims adjuster in the no-fault department of defendant insurer. Billington does not state that he is a special insurance investigator or that he is trained in fraud detection. He asserts that plaintiff received aggressive medical treatment for a “relatively minor collision” as a basis for the EUO and to support a fraud claim. Billington concludes there is a “discernable pattern of circumstances and conduct consistent with staging of an accident.” He refers to the fact that the assignor sought treatment six days after the accident from a provider other than his personal doctor, that he was referred to get an MRI on an initial visit and that he was involved in a prior accident (four years ago) which was settled by the same attorney now representing plaintiff.

The insurer has the burden to come forward with proof in admissible form to establish the basis for its belief that there is no coverage (see, Mount Sinai Hospital v. Triboro Coach Inc., 263 AD2d 11 [2d Dept 1999]). An insurer’s “founded belief” that an accident was staged cannot be based upon unsubstantiated hypotheses and supposition (see, A.B. Medical Services v. Eagle Ins. Co., 3 Misc 3d 8 [App Term, 2d Dept 2003]). The statements made by defendant’s counsel in the affirmation in opposition, that the injuries did not arise from the accident and/or that the accident was staged, are not based on personal knowledge and are of no probative value. In addition, the Court finds the assertions made by the claims representative are insufficient to support his finding of a pattern of circumstances and conduct which constitutes fraud. Defendant’s belief that treatments were unduly “aggressive” or unnecessary might have been addressed through a defense of lack of medical necessity if there had been a timely denial. Defendant has not submitted any proof specific to the circumstances of the accident to support a “founded belief” that the accident was staged.

Accordingly, plaintiff’s motion for summary judgment is granted. The clerk is directed to enter judgment in favor of plaintiff in the sum of $540.00 together with statutory interest and attorney’s fees. [*3]

This constitutes the decision and order of the Court.

DATED: December 30, 2005

Brooklyn, New York

DELORES J. THOMAS

Judge Civil Court

Civil Court of the City of New York, Kings County

095837/04

Delores J. Thomas, J.

Petitioner, a medical services provider seeks to vacate a master arbitration award pursuant to CPLR § 7511.

Petitioner alleges that the lower arbitrator denied its claim in a decision rendered on or about March 29, 2004. Thereafter, petitioner sought to have that determination reviewed and in a decision dated June 17, 2004, the Master Arbitrator denied the request for review on the basis that the appeal was untimely. Specifically, the Master Arbitrator found that petitioner’s Notice of Appeal was postmarked April 20, 2004 (evidenced by the post mark on the envelope sent to defendant enclosing petitioner’s April 13, 2004 Notice of Intent to Appeal the lower arbitrator’s decision) and stamped received by the American Arbitration Association (“AAA”) on April 26, 2004. The Arbitrator found that as the lower award was mailed to the parties on March 29, 2004, both the April 20th mailing and the April 26th receipt date by AAA were past the twenty one (21) calendar days time frame in which the appeal had to be filed (11 N.Y.C.R.R.§ 65-4.10 [d] [2]).

Attached to the Notice of Petition is an affirmation from petitioner’s legal counsel. Counsel argues that the Notice of Appeal was timely “deposited” on April 19, 2004 and that the case should be determined on the merits. The remainder of petitioner’s counsel’s affirmation concerns the standard for reviewing arbitration awards, the necessary prima facie showing for health benefit claims and the effect of late or unsubstantiated denials by insurance carrier.

Respondent opposes the Notice of Petition and seeks its denial on several basis. First, the [*2]papers are defective in that there is no petition in support of the Notice of Petition; second, petitioner has failed to set forth valid grounds under CPLR § 7511 to review and vacate the decision; third, petitioner accepted partial payments rendered by the lower arbitrator (i.e. accord and satisfaction); and fourth, petitioner has not exhausted its administrative remedies and offers no excuse as to why it filed a late intent to appeal. In the alternative, respondent argues that in the event the lower arbitrator’s award can be reviewed, there is no basis to disturb it as the finding of facts was neither arbitrary or capricious and was supported by the weight of the evidence.

Regulations promulgated under New York State Insurance law require any request for review of an arbitration award by a Master Arbitrator be made “within 21 calendar days of the mailing of the appealable award” (11 N.Y.C.R.R. §65.-4.10[d][2]. The regulations provide that: “[t]he parties shall accept as delivery of the [arbitrator’s] award the placing of the award or a true copy thereof in the mail, addressed to the parties or their designated representatives at their last known address, or by any other form of service permitted by law. The AAA shall note on such award or transmittal letter thereof the date of mailing and keep a record of same” (11 N.Y.C.R.R.§ 65.17[b][5][xix]; see also, Calandro v. Home Insurance Co., 199 AD2d 262 [2d Dept 1993]).

Undeniably, the Master Arbitrator must initially determine if a request for review was timely made (see, Calandro v. Home Insurance Co., supra; Custen v. General Accident Fire and Life Ins. Co., 126 AD2d 256 [2d Dept. 1987]; Better Health Medical, P.C. v. M.V.A.I.C., 6 Misc 3d 1021 [A][Civ. Ct., Kings Co., 2005]; see also, Berent v. Erie County, 86 AD2d 764 [4th Dept. 1982]) and, if it was not timely, the Master Arbitrator must deny the request for review (Id.).

Since the Master Arbitrator clearly has the authority to deny the request to review upon the ground that it is untimely, in such a case “the Master Arbitrator shall in lieu of rendering an award, deny the request for review” (see, Berent v. Erie County, supra). Therefore, a precondition to judicial review pursuant to CPLR Article 75 is review of a no-fault arbitrator’s award by a Master Arbitrator (see, Ins. Law 5106[c]; Custen v. General Accident Fire and Life Ins. Co., supra). Furthermore, the Courts have recognized that the failure of a party to a “no-fault” arbitration to timely appeal to a Master Arbitrator constitutes a failure to exhaust his or her administrative remedies thereby precluding that party from obtaining judicial review of the arbitrator’s award (Custen v. General Accident Fire and Life Ins. Co., supra).

In the instant case, prior to issuing his decision, the Master Arbitrator via letter dated May 11, 2004 (Affirmation In Opposition, Exhibit E) gave petitioner an opportunity to submit a legal basis for extending the time requirements set forth in 11 N.Y.C.R.R. § 65-4.10(d)(2). Petitioner’s response was a letter dated May 26, 2004 (Affirmation In Opposition, Exhibit F) in which petitioner set forth no legal basis for extending the time or made any allegation that the request to review/appeal was mailed other than the date indicated by the post mark on the envelop submitted to the Master Arbitrator. Instead, petitioner argued a lack of authentication as to the date the lower arbitration decision was dated. More specifically, petitioner responded, “…there is no evidence to suggest that the Appellant in this case did not comply with the applicable no-fault regulations.”

Based upon the May 26, 2004 response, petitioner never averred as it does now to the Court that the request to review was “deposited” for mailing on April 19, 2004 instead of the April 20, 2004 postmark on the envelope in which the request was mailed to defendant, [*3]therefore, even assuming that this bare self serving assertion was sufficient to raise a question of mailing, this Court could not consider it as evidence because the allegation was not raised before the Master Arbitrator (see generally, Calandro v. Home Ins. Co, supra; Berent v. Country of Erie, supra).

The Court finds that petitioner has failed to demonstrate a ground pursuant to CPLR

§ 7511 to vacate the Master Arbitrator’s decision. The Court further finds that the Master Arbitrator’s determination that petitioner failed to timely appeal the lower arbitration award was not arbitrary or capricious nor a violation of petitioner’s due process rights. As petitioner failed to exhaust administrative remedies by timely appealing to the Master Arbitrator, the Court may not consider whether the lower arbitrator’s award was incorrect as a matter of law (Calandro v. Home Ins. Co., supra; Better Health Medical, P.C. v. M.V.A.I.C., supra).

Accordingly, the petition to vacate the Master Arbitrator’s award is dismissed. Notably as pointed out by respondent the Notice of Petition must be accompanied by a Petition and any supporting affidavits /affirmation’s (see CPLR § 403); however, even assuming petitioner had complied with the statutory requirements, the petition based upon the facts asserted herein would be denied for the reasons stated above; therefore the Court resolves this matter on its stated reasons and need not further address the other arguments raised by respondent.

This constitutes the decision and order of the Court.

DATED: December 22, 2005

Brooklyn, New York

DELORES J. THOMAS

Judge Civil Court

Civil Court of the City of New York, Kings County

119832/05

Eric Gil, Esq. of Gary Tsirelman, PC, 4022 18th Avenue, Brooklyn, NY 11218, appeared for petitioners.

Sandy Jainauth-Barone, Esq. of Chesney & Murphy, LLP, 2305 Grand Avenue, Baldwin, NY 11510, appeared for the respondent.

Delores J. Thomas, J.

Petitioner, a provider of medical goods seeks to recover first party no-fault benefits for medical equipment provided to its assignor. Petitioner filed a request for Arbitration. An arbitrator designated by the American Arbitration Association (“AAA”) issued a decision April 12, 2004 with the date of mailing shown as April 26, 2004 whereby the claim was denied without prejudice pending a determination of the issue of employment by the Worker’s Compensation Board.

At issue before the Arbitrator was petitioner’s claim for reimbursement for medical supplies provided to treat its assignor for injuries sustained in an automobile accident on March 4, 2001. At the hearing, respondent, after failing to deny the claim or to make timely evidentiary submission, raised the question as to whether the assignor was working at the time of the accident. Respondent also sought to submit a police accident report. Both parties were given the opportunity to make a post-hearing submission in regards to whether good cause existed to permit respondent’s late submission. Respondent made the submission but petitioner did not.

Upon reviewing the documents submitted by petitioner in support of its claims and those submitted by respondent, the arbitrator determined that the workers’ compensation defense was a [*2]well recognized exception to the rule precluding defenses if not raised in a timely denial of claim. The arbitrator further determined that the evidence presented “at least minimal proof of the indicia of employment (citing Arvatz v. Empire Mutual Ins. Co., 171 AD2d 262 [1st Dept. , 1991] which held that upon proper showing, Worker’s Compensation Board and not arbitration is the proper forum for deciding the issue of whether the insured was injured in the course of employment).

Petitioner, thereafter filed a timely request for review by a Master Arbitrator alleging that the lower arbitrator’s decision was arbitrary, capricious, irrational and without a plausible basis.

In a decision dated September 20, 2004 and showing a mailing date of September 30, 2004, the Master Arbitrator upheld the lower arbitration decision finding that the arbitrator had a sufficient basis to deny the claim pending a determination of the employment issue by the Worker’s Compensation Board. The Master Arbitrator therefore determined that the lower decision had a rational basis and was neither arbitrary or capricious nor incorrect as a matter of law. The lower arbitration decision was affirmed.

Petitioner argues that the lower arbitrator erred in allowing respondent to raise at the hearing the defense that the assignor was working at the time of the accident where petitioner had established its prima facie case, i.e. proper submission of its bills and respondent had failed to timely deny the bills. Petitioner argues respondent was therefore precluded from raising that defense at the hearing.

In its Affirmation in Opposition and Notice o Motion to Dismiss the Petition, respondent argues that its defense that the assignor was injured while engaged in employment is a denial of coverage defense and therefore not precluded by the fact that it failed to timely deny the claim. Respondent further asserts that as issues of employment must first be decided by the Worker’s Compensation Board, the lower arbitrator acted properly in determining that it had presented sufficient proof to require that the claim be denied pending a determination of the issue by the Worker’s Compensation Board. Respondent further argues that the Master Arbitrator’s award affirming this decision was based upon a proper exercise of discretion and was grounded on a rational application of the law and the decision was neither arbitrary or capricious.

Judicial review of a Master Arbitrator’s award “is restricted, by the terms of the statute, to the grounds for review set forth in article seventy five’ of the CPLR, specifically § 7511 (Petrofsky v. Allstate Insurance Company, 54 NY2d 207 [1981]).

Section 7511 (6) sets forth the following grounds for vacating an award:

(i)corruption, fraud or misconduct in procuring the award; or

(ii)partiality of an arbitrator appointed as a neutral; except where the award was by conversion; or

(iii)an arbitrator, or agency or person making the award exceeded his power or so imperfectly executed it that a final and definite award upon the subject matter submitted was not made; or

(iv)failure to follow the procedures of this article, unless the party applying to vacate the award continued with the arbitration with notice of the defect [*3]and without objection.

In cases of compulsory arbitration, such as no-fault claims, the court has held that CPLR Article 75 includes review of whether the award is supported by evidence or other basis in reason (Mount St. Mary’s Hosp. of Niagara Falls v. Catherwood, 26 NY2d 493, 508 [1970]); arbitrary and capricious (Caso v. Coffy, 41 NY2d 153, 158 [1976]) ; and whether the decision was rational or had a plausible basis (Caso v. Coffy, supra ).

Unlike the court, a Master Arbitrator in reviewing the award rendered by the lower arbitrator is not limited to the grounds set forth in CPLR § 7511 but may look to rules promulgated by the Superintendent of Insurance in 11 N.Y.C.R.R. 65.17 and developed by case law (see, Petrofsky v. Allstate Ins. Co., supra ; Mount St. Mary’s Hosp. of Niagara Falls v. Catherwood, supra ,; Caso v. Coffy, supra ,).

The role of the Master Arbitrator is to review the determination of the lower arbitrator to assure that the arbitrator reached his decision in a rational manner; and, that the decision was not arbitrary and capricious, or incorrect as a matter of law (Petrofsky v. Allstate Insurance Co., supra ).

A view of the arbitration award from both the lower and Master Arbitrator shows that there is no basis to vacate the award. Both arbitrators determined that the workers compensation defense was not precluded by respondent’s failure to timely deny the claim. This holding and thus the arbitrator’s award was based upon the resolution of factual and legal determinations reached after reviewing the evidence submitted; such a determination may not be set aside by this Court even were the court to disagree with those findings. The Master Arbitrator’s award therefore was neither arbitrary, capricious, irrational or without a substantial or plausible basis.

Accordingly, the petition is dismissed. Respondent’s motion to dismiss the petition is granted to that extent only.

This constitutes the decision and order of the Court.

DATED: December 16, 2005

Brooklyn, New York

DELORES J. THOMAS

Judge Civil Court

Civil Court of the City of New York, Kings County

33857/04

Arlene P. Bluth, J.

Upon the foregoing cited papers and after oral argument, plaintiff moves for summary judgment pursuant to CPLR § 3212. For the following reasons, plaintiff’s motion is denied. [*2]

In this action, plaintiff First Help Acupuncture, P.C. seeks to recover first-party No-Fault benefits in the amount of $3,000.00, plus statutory, interest, costs, and attorneys’ fees, for healthcare services allegedly rendered to its assignor, Zach Glot. Plaintiff argues that defendant failed to timely deny its No-Fault claims. However, because of deficiencies in its supporting affidavit, plaintiff fails to put admissible evidence before this Court sufficient to make out its prima facie case.

The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law by tendering sufficient evidence in admissible form to demonstrate the absence of any material issues of fact. See Alvarez v. Prospect Hospital, 68 NY2d 320, 508 NYS2d 923 [1986]. The motion must be supported by an affidavit from a person with knowledge of the facts, setting forth all material facts. See CPLR § 3212(b). If the moving party fails to make such a showing, the motion must be denied, irrespective of the sufficiency of the opposing papers. See De Santis v Romeo, 177 AD2d 616, 576 NYS2d 323 [2nd Dept 1991]. If, however, the moving party sustains its burden, the opposing party must submit evidence of a triable issue of fact in order to defeat the motion. See Rebecchi v. Whitmore, 172 AD2d 600, 568 NYSd 423 [2nd Dept 1991].

In the No-fault context, a healthcare provider establishes prima facie entitlement to summary judgment as a matter of law by submitting proof in admissible form demonstrating that the prescribed statutory claim form, setting forth the fact and amount of the loss sustained, was submitted to the defendant, and that payment of no-fault benefits is overdue. See NYCRR § 65-3.8(c); Careplus Med. Supply, Inc. v Allstate Ins. Co., 9 Misc 3d 128(A), 2005 NY Slip Op 51525(U), [App Term, 2nd & 11th Jud Dists]; Contemp. Med. Diag. & Treatment, P.C. v. GEICO, 6 Misc 3d 137(A), 800 NYS2d 344 [App Term, 2d and 11th Jud Dists 2005]. If and only if the plaintiff makes out its prima facie case, the burden shifts to the defendant to raise a triable issue of fact.

In support of this motion, plaintiff submits the affirmation of its attorney and an affidavit from an employee of plaintiff. Also annexed to the motion are various bills and an assignment of benefits for the assignor, and two NF-10 denial forms. These documents are critical to plaintiff’s prima facie case: First, plaintiff needs to submit its completed proof of claims that it alleges have not been paid or timely denied. See Amstel Chiropractic, P.C. v. Omni Indem. Co., 2 Misc 3d 129(A), 784 NYS2d 918 [App Term, 2d and 11th Jud Dists 2004]; Triboro Chiropractic and Acupuncture P.L.L.C. ex rel. Tacopino v. Electric Ins. Co., 2 Misc 3d 135(A), 784 NYS2d 924 [App Term, 2d & 11th Jud Dists 2004]. Second, plaintiff must establish that it actually mailed its claims to defendant. Absent direct proof of mailing, defendant’s denials once properly before the Court are an admission by the insurer that it received the bills, and thus are proof that the bills were mailed. See A.B. Med. Servs. P.L.L.C. v. New York Cent. Mut. Fire Ins. Co., 3 Misc 3d 136(A), 787 NYS2d 675 [App Term, 2nd & 11th Jud Dists 2004]; Willis Acupuncture, P.C. v. GEICO, 6 Misc 3d 1002(A), 800 NYS2d {6 Misc 3d 1002(A)} 359 [Civ Ct, Kings County 2004].

In order for plaintiff’s exhibits to be considered by this Court, the supporting affidavit must lay a proper foundation for their admissibility. “Foundation requirements to qualify a document as a business record fully apply on a motion for summary judgment.” A.B. Med. Servs., P.L.L.C. et al. v Travelers Prop. Cas. Corp., 5 Misc 3d 214, 215, 783 NYS2d 244, 246 [Civ Ct, Kings County 2004]. Plaintiff’s bills are a type of medical office records, and “[m]edical office records are admissible under the business records exception to the hearsay rule, provided a proper foundation is laid for their admissibility.” Faust v McPherson, 4 Misc 3d 89, 91, 783 NYS2d 197, 199 [App Term, 2nd & 11th Jud Dists 2004]. See also Hefte v Bellin, 137 AD2d 406, 524 NYS2d 42 [1st Dept 1988].

A business record is admissible upon proof that (1) it was made in the regular course of business; (2) it was in the regular course of such business to make the record; and (3) the record was made at the time of or shortly after the subject event or transaction. See CPLR § 4518(a); People v. DiSalvo, 284 AD2d 547, 727 NYS2d 146 [2nd Dept 2001]. Only a qualified individual can lay the necessary foundation. See Carrion v McNally & McNally, Inc., 18 AD3d 312, 794 NYS2d 339 [1st Dept 2005]; West Valley Fire District No. 1 v Village of Springville, 294 AD2d 949, 743 NYS2d 215 [4th Dept 2002]; People v DiSalvo, 284 AD2d at 548; Hefte, 137 AD2d at 408. “While it is not necessary that the foundation witness have made the records, or even that he or she be familiar with the particular records in question, it must be shown that the witness has had some familiarity with the doctor’s business practices and procedures.” Faust, 4 Misc 3d at 91. See also Careplus Med. Supply, Inc. v Allstate Ins. Co., 9 Misc 3d 128(A), 2005 NY Slip Op 50525(U) [App Term, 2nd & 11th Jud Dists] (holding that the affidavit of plaintiff’s officer and [*3]billing manager sufficiently “sufficiently set forth his duties so as to support the conclusion that the attached exhibits were sufficiently accurate and trustworthy” to be admitted as business records).

In support of the motion, plaintiff presents the affidavit of Andrey Anikeyev. Although the last paragraph of the affidavit recites that the records were made in the regular course of business at the time the services were rendered, and that it is and was plaintiff’s regular course of business to make such records and submit them to the insurer for payment, Mr. Anikeyev does not describe his familiarity with plaintiff’s record-keeping practices and procedures, or explain his role, if any, in the rendering and mailing of bills and the processing of insurance company payments and denials. He does not even provide his job description or actual job title. Mr. Anikeyev simply writes that he is “an employee of Plaintiff.” That is patently insufficient to establish his competency to lay a foundation for the admission of plaintiff’s bills as business records.^[FN1] For all this Court knows, Mr. Anikeyev could be a security guard in plaintiff’s employ.

A court cannot be expected to assume, trust, or infer from an affidavit that the affiant is qualified to lay a foundation for annexed exhibits. The conclusory statement “I have personal knowledge” is not enough particularly where, as here, the affiant is not an individual litigant (i.e., a party to the lawsuit) but an undenominated employee of a party. The witness or affiant must disclose not only what he knows but also the source of his knowledge. See Carrion v McNally & McNally, Inc., 18 AD2d 312, 794 NYS2d 339 [1st Dept 2005]; A.B. Med. Servs., P.L.L.C., et al. v Travelers Prop. Cas. Corp., 6 Misc 3d 53, 791 NYS2d 264 [App Term, 2nd & 11th Jud Dists 2004]; Ocean Diag. Imaging, P.C. v State Farm Mut. Auto. Ins. Co., 4 Misc 3d 141(A), 798 NYS2d 346 [App Term, 9th & 10th Jud Dists 2004]. The affidavit submitted by plaintiff falls short of what is required.

Nor is the affirmation of plaintiff’s counsel to any avail. It is axiomatic that the affirmation of a party’s attorney “who lacks personal knowledge of the essential facts, is of no probative value and is insufficient to support an award of summary judgment . . . .” Peters v. City of New York, 5 Misc 3d 1020(A), 799 NYS2d 163 [Sup Ct, Kings County 2004]. See also Zuckerman v. City of New York, 49 NY2d 557, 427 NYS2d 595 [1980]; Lupinsky v. Windham Constr. Corp., 293 AD2d 317, 739 NYS2d 717 [1st Dept 2002]; Amaze Med. Supply, Inc. v. Allstate Ins. Co., 3 Misc 3d 133(A), 787 NYS2d 675 [App Term, 2nd and 11th Jud Dists 2004]. Plaintiff’s attorney has not claimed any personal knowledge regarding the rendering or mailing of the plaintiff’s bills and the receipt of the denials. Moreover, while an attorney’s affirmation may serve as a vehicle for introducing documents which themselves are in admissible form, such as deposition transcripts (see Zuckerman, 49 NY2d at 563), those are not the circumstances here.

For the foregoing reasons, plaintiff has failed to make out its prima facie case. Therefore, plaintiff is not entitled to summary judgment and the Court need not reach the sufficiency of defendant’s opposition.

Accordingly, plaintiff’s motion is denied.

This is the Decision and Order of the Court.

Dated:

ARLENE P. BLUTH

Judge, Civil Court

[*4]ASN by__________ on __________

Footnotes

Footnote 1: Although the Court need not reach the issue of whether plaintiff has laid a proper foundation to admit defendant’s denials, the Court notes that Mr. Anikeyev cannot possibly be said to have laid a foundation for their admission since his affidavit makes no reference to them. Instead, it merely states: “Defendant failed to issue timely denials and/or timely verification requests.”

Civil Court, Kings County

96502/04

Eileen N. Nadelson, J.

Plaintiff, a medical provider, instituted this action to recover first party No-Fault benefits from Defendant insurer. Plaintiff moved for summary judgment, alleging that Defendant neither paid nor denied the claim within the statutorily mandated thirty-day period after receipt of the claims. Ins. Law sec. 5106; Regulations sec. 65-3.8. Plaintiff further alleged that the Denial of Claim form (NF-10) was defective in that it did not indicate the reason for the denial with specificity as is required by section 65-3.4( c) of the Regulations.

Defendant, in opposition, claimed that the denials were timely and that the grounds for the denial are sufficiently specific to apprise Plaintiff as to the reasons for not paying the claim.

After argument, the court has concluded that the NF-10 form was properly mailed within the statutory time frame. Consequently, the only issue remaining for the court is whether Defendant’s reason for the denial, as stated in its Denial of Claim form, is legally sufficient to forestall Plaintiff’s motion for summary judgment. [*2]

The explanation for Defendant’s denial of the first party benefits, as stated in section 33 of its NF-10, is: “The Claim is Denied Based On An Examination Under Oath.”

In 1979, the New York Court of Appeals established the general guidelines for insurers when denying coverage. According to General Accident insurance Group v. Cirucci, 46 NY2d 862, 414 N.Y.S. 2d 512 (1979):

...the notice of disclaimer must promptly apprise the claimant with a high

degree of specificity of the ground or grounds on which the disclaimer is

predicated. Absent such specific notice, a claimant might have difficulty

assessing whether the insurer will be able to disclaim successfully. This

uncertainty could prejudice the claimant’s ability to ultimately obtain

recovery. In addition, the insurer’s responsibility to furnish notice of the

specific ground on which the disclaimer is based is not unduly burdensome,

the insurer being highly experienced and sophisticated in such matters.

Therefore, a timely denial alone does not avoid preclusion of a provider’s motion for summary judgment where said denial is factually deficient, conclusory, vague or otherwise involves a defense which has no merit as a matter of law. Nyack Hospital v. Metropolitan Property & Casualty Ins. Co., 16 AD3d 564, 791 N.Y.S. 2d 658 (2d Dept. 2005); Nyack Hospital v. State Farm Mut, Auto. Ins. Co., 11 AD3d 664, 784 N.Y.S. 2d 136 (2d Dept. 2004).

The blanket statement of Defendant on its NF-10 is too vague and ambiguous to alert Plaintiff as to the actual grounds for the denial of benefits. Stating that a denial is based on an Examination Under Oath, without indicating what about that examination merits denial of first-party benefits under No-fault law, does not set forth a factual basis on which to mount a meritorious legal defense. Park Neurological Services, P.C. v. Geico Insurance, 4 Misc 3d 95, 782 N.Y.S. 2d 507 (Sup. Ct. App. Term 2004). Therefore, because Defendant’s explanation of its reasons for denying Plaintiff’s claim on its NF-10 form was not stated with a high degree of specificity, it is insufficient to overcome Plaintiff’s summary judgment motion. All-Country Medical & Diagnostic P.C. v. Progressive Casualty Insurance Co., 8 Misc 3d 616, 795 N.Y.S. 2d 434 (Nassau County 2005).

The clerk is ordered to enter judgment in favor of Plaintiff in the amount of $1024.00, plus statutory interest, costs and attorneys’ fees.

Dated: October 3, 2005

__________________________

EILEEN N. NADELSON, J.C.C.

[*1]

Civil Court of the City of New York, Kings County, October 3, 2005

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for plaintiffs. Jaffe & Nohavicka, New York City, for defendant.

OPINION OF THE COURT

Peter P. Sweeney, J.

In this action to recover assigned first-party no-fault benefits, the novel issue presented is whether it is appropriate to grant leave to a plaintiff billing provider to amend a fatally defective proof of claim once the action to recover on the claim has been commenced. For the reasons set forth below, the court concludes such a motion should be denied.

Factual Background

The four plaintiff assignees, A.B. Medical Services PLLC, DAV Chiropractic P.C., Daniel Kim’s Acupuncture P.C. and G.A. Physical Therapy P.C., commenced this action seeking to recover on multiple unpaid claims for assigned first-party no-fault benefits for medical services provided to their mutual assignor, Nelson Vargas.

The matter appeared before the undersigned for trial on June 16, 2005. Prior to the commencement of the trial, the parties entered into a written stipulation of admitted facts. Pursuant to the stipulation, the defendant admitted that it received all the proofs of claim at issue (the NF-3 claim forms). Defendant further admitted that it did not pay the claims in full within 30 days of their receipt and that the only payments it made on the claims were those referenced in plaintiffs’ complaint. Defendant admitted that it never requested verification of the claims following their receipt thereby tolling the 30-day period in which it had to pay or deny the claims.

Although the defendant claims to have issued timely denials of the claims asserting lack of medical necessity as its only defense, pursuant to the stipulation, defendant withdrew the denials and the defenses raised therein.

Defendant’s counsel correctly pointed out that in all of the NF-3s, copies of which were stipulated into evidence, the “treating providers” were identified as “independent contractors” of the plaintiff billing providers. Defendant maintained that, for this reason alone, the entire action must be dismissed. In support of its position, defendant cited A.B. Med. Servs. PLLC v Liberty Mut. Ins. Co. (9 Misc 3d 36[*2][App Term, 2d & 11th Jud Dists 2005]). Therein, the court held that a billing provider is ineligible to recover assigned first-party benefits where the medical services were provided by an independent contractor.

Plaintiffs maintained that defendant waived the independent contractor defense recognized in A.B. Med. Servs. PLLC by failing to timely object to plaintiffs’ claim forms and by failing to assert the defense in a timely denial. Plaintiffs further maintained that the treating providers identified in the NF-3s were actually employees of the plaintiffs and that plaintiffs simply made a mistake by identifying them as independent contractors. Plaintiffs moved at trial for leave to amend the NF-3s to correct the mistake and asked for the opportunity to introduce evidence at trial to establish the treating providers’ correct status.

The court reserved decision on all issues and gave the parties permission to submit memorandums of law supporting their respective positions. The court permitted plaintiffs to offer evidence at trial on the issue of whether the treating providers were independent contractors or employees but ruled that such evidence would be considered only if plaintiffs’ motion to amend the proofs of claim were granted.

After due consideration and having had the opportunity to review the memorandums of law submitted by the parties, the court hereby denies plaintiffs’ motion to amend the NF-3 proof of claim forms and directs that judgment be entered in favor of the defendant dismissing the action on the ground that the proofs of claim identified the treating providers as independent contractors thus rendering the claims fatally defective on their face.

Discussion

In A.B. Med. Servs. PLLC (supra), the court held that 11 NYCRR 65.15 (j) (1) (now 11 NYCRR 65-3.11 [a]) prohibits a billing provider from recovering assigned first-party no-fault benefits where the medical services were performed by an independent contractor. 11 NYCRR 65.15 (j) (1) (now 11 NYCRR 65-3.11 [a]) provides that “[a]n insurer shall pay benefits . . . directly to the applicant or . . . upon assignment by the applicant . . . [to] the providers of services.” The court interpreted the phrase “providers of services” to mean an actual provider of medical services and held that a “billing provider seeking recovery of assigned no-fault benefits for medical services which were not performed by it or its employees, but by an independent contractor identified as the ‘treating provider’ on NF-3 claim forms, is not a ‘provider’ of . . . services . . . and is hence not entitled to recover ‘direct payment’ of assigned no-fault benefits” (9 Misc 3d at 37).

Plaintiffs’ contention that defendant waived the independent contractor defense by failing to timely object to plaintiffs’ claim forms and by failing to assert the defense in a timely denial is well taken. Indeed, it is well established that an insurer’s failure to object to the adequacy of plaintiff’s proof of claim within 10 days of receipt (now 15 business days) “constitutes a waiver of any defenses with respect thereto” (see A.B. Med. Servs. PLLC v Nationwide Mut. Ins. Co., 6 Misc 3d 70, 71 [App Term, 2d & 11th Jud Dists 2004]; Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564 [2d Dept 2005]; New York Hosp. Med. Ctr. of Queens v New York Cent. Mut. Fire Ins. Co., 8 AD3d 640 [2d Dept 2004]). It is also well established that, except for the defense that there is no coverage at all for a claim, “preclusion of the insurance company’s ability to deny the claim is the appropriate remedy where, as here, the insurance company neither denies a claim within 30 days after receiving it nor seeks to extend that time by requesting verification in the prescribed forms” (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997] [internal quotation marks deleted]; see also Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195 [1997]).

Notwithstanding these principles, in a case decided on July 7, 2005, the Supreme Court, Appellate Term, held that the independent contractor defense is “nonwaivable and not subject to the preclusion rule” (Rockaway Blvd. Med. P.C. v Progressive Ins., 9 Misc 3d 52, 54 [App Term, 2d & 11th Jud Dists 2005]). The court must therefore conclude that the principles of waiver and preclusion do not apply where the proof of claim, on its face, demonstrates the applicant’s nonentitlement to payment of the claim. Turning to plaintiffs’ motion for leave to amend their proofs of claim, it is the opinion of the court that the motion must be denied. CPLR 3025 (b) provides that “[a] party may amend his pleading . . . at any time by leave of court” (emphasis added). A proof of claim is not a pleading and the court is unaware of any statute or constitutional provision permitting the amendment of a proof of claim by leave of court, especially where an action is pending that is predicated upon the submission of the proof of claim. Unlike the Supreme Court, this court’s equitable jurisdiction is very limited (Parker v Rich, 140 AD2d 177 [1st Dept 1988]) and absent a particular constitutional or statutory empowerment, this court lacks subject matter jurisdiction to grant equitable relief (see Goldstein v Stephens, 118 Misc 2d 614, 615 [App Term, 1st Dept 1983]). The relief plaintiffs are requesting can only be viewed as equitable in nature and, as stated above, the court is unaware of any statute or constitutional provision empowering this court to grant the relief.

Even if it were within the court’s power to grant plaintiffs’ motion, it would decline to do so. The Insurance Law and the regulations promulgated thereunder give an insurer “30 calendar days after proof of claim is received . . . [to] either pay or deny the claim in whole or in part” (11 NYCRR 65-3.8 [c]; Insurance Law § 5106 [a]). Furthermore, within 10 days of receipt of a claim (now 15 business days), an insurer is entitled to request verification of a claim (11 NYCRR 65.15 [d] [1], now 11 NYCRR 65-3.5 [a]). It would be fundamentally unfair to permit the plaintiffs to cure their fatally defective proofs of claim and then allow them to proceed to trial on the amended claims without giving the defendant an opportunity to pay or deny the amended claims within the allotted time period or an opportunity to request further verification of the claims.

For the above reasons, it is hereby ordered that judgment be entered in favor of the defendant dismissing the entire action.

Supreme Court, Kings County

28371/04

Yvonne Lewis, J.

Mr. Richard Martinez and Geico Insurance Company have moved this court, pursuant to CPLR 3211 (a) (5), for an order to dismiss the within action on the ground that the action is barred by the applicable three year statute of limitations for personal injury and subrogation actions (CPLR 214[5]). The defendants contend that the accident underlying the within action unquestionably occurred on August 17, 2001, and that “[t]he present action [against Mr. Martinez] was commenced on September 8, 2004, well over three years past from the date of the accident on [said] August 17, 2001.” Mr. Martinez received the summons and complaint in the mail on September 25, 2004. Geico was served on October 12, 2004. The defendants also assert that the subrogation action is fatally flawed inasmuch as “[t]he complaint only alleges that the defendant GEICO provided insurance coverage to the defendant Martinez on the date of the accident[;] and New York State Insurance Law section 3420 (b) states that no action can be brought on the liability portion of a policy against an insurer until a judgment has been entered against the covered party.” In this instance, Palisades Insurance Company, not Geico, paid Grigory Belovskiy ($61,500.00) under the uninsured (sic) provisions of his policy. Lastly, the defendants state that the action against Mr. Martinez should additionally be dismissed since he was only served by regular mail, and not as specified for proper service in CPLR 308.

In opposition, the plaintiff (Palisades) notes that prior to settling with its insured (Mr. Belovskiy’s), Mr. Martinez’ insurer, Geico, had offered to settle Mr. Belovskiy’s personal injury claims for twenty-five thousand dollars; however, the “. . .same was not accepted so that PALISADES would preserve its subrogation rights.” With regards to the remaining points raised by the defendants, the plaintiff asserts that 1. “[b]ased.on the tolling provisions of CPLR §204 (b), this action was tolled on November 11, 2002 when Mr. Belovskiy’s attorney, Barry Feldman, filed and served his demand for arbitration. . . .until September 17, 2003 when the underinsured arbitration was held and an award was rendered (citing, Joseph Francese, Inc. v. Enlarged City School District of Troy, 95 NY2d 59, 710 NYS2d 315 [2000])[;] ” 2. Mr. Martinez was served with process pursuant to CPLR §308(4) on September 24, 2004 and January 5, 2005; and,

3. “. . .an insurer’s subrogation rights accrue upon payment of the loss and at that point the insurer who has paid the policy limits possesses derivative and limited rights of the insured and may proceed directly against the negligent third-party to recoup the amount paid.” [*2]

The defendants’ reply to the foregoing points out that CPLR 204(b) is herein inapplicable inasmuch as the parties and claims in the New Jersey arbitration proceeding to which the plaintiff referred were different from those present in the within action. A fortiori, the defendants assert that not only were they not parties to the arbitration, but the “[p]laintiff’s own papers clearly show that there was a judicial determination that there was no jurisdiction over defendant Martinez in

New Jersey.” In other words, since the demand to arbitrate between Gregory Belovskiy (the insured) and Palisades (his insurer) is different from the now subrogated common-law negligence action by Mr. Belovskiy against Mr. Martinez, the tolling provisions of CPLR 204(b) do not apply. Lastly, the defendants argue that Geico’s offer of settlement was of no consequence herein since the Court of Appeals has made it clear that it is “. . .incumbent on a carrier to pay its insured so as to commence any subrogation action before the statute of limitations passes or to be sure that its subrogation rights are protected in any action already brought by its subrogor” (citing, Allstate Ins. Co. v. Stein, 1 NY3d 416, 775 NYS2d 219).

The matter of Allstate Ins. Co. v. Stein, supra, is dispositive of the main issue herein presented, inasmuch as the Court of Appeals’ aptly noted therein that “a subrogatin claim is derivative of the underlying claim and that the subrogee possesses only such rights as the subrogor possessed, with no enlargement or diminution. It is likewise consistent with the principle that a defendant in a subrogation action has against the subrogee all defenses that he would have against the subrogor, including the same statute of limitations defense that could have been asserted against the subrogor.” The court went on to elucidate between traditional equitable subrogation [governed by the three (3) year statute of limitation for personal injury actions pursuant to CPLR 214(5)] in contrast to entitlements established or imposed by statute (eg. No-fault MVIAC benefits) which create new and independent statutory rights and obligations [governed by the three (3) year statute of limitations for an action to recover upon a liability, penalty, or forfeiture created or imposed by statute, pursuant to CPLR 214(2)]. Finally, the court made the following caveat; to wit, that “. . .the subrogee acquires only the rights that the subrogor had, and so any subrogee may

find its claim defeated by a defense based on the subrogor’s action or inaction. In such case, the subrogee’s remedy is against the subrogor, for conduct that has prejudiced the subrogee’s right.

In the matter sub judice, the defendants have clearly established that the plaintiffs are seeking common law subrogation relief, not any statutorily derived benefit. Since it is a matter of general construction that a statute of limitations begins to run the day after a cause of action accrues (Gen. Const. L. §20), and since a cause of action for personal injury that is predicated on negligence accrues when the injury is sustained (Vigilant Ins. Co. of America v. Housing Authority of El Paso, 87 NY2d 36), it irrefutably follows that the plaintiffs’ claims are indeed time barred by the three year statute of limitations which commenced to run as of the date of the underlying accident [CPLR 214(5)].

The assertion by the plaintiffs that the statute of limitations was tolled is also unavailing.

“The purpose of the CPLR 204(b) tolling statute is to preserve a remedy to a litigant who has [*3]mistaken his forum (See D’Angiolillo v. Singh, 2002 WL 31940753 (NY Supp App. Term), 2002 NY Slip Op. 450511, citing Francese, Inc. v. Enlarged City School Dist. Of Troy, supra). Therefore a claimant who makes a demand concerning her contractual rights to uninsured motorist benefits under her insurer’s policy, who thereafter commences a common law negligence action against the defendant tortfeasor and/or his insurer cannot be said to be pursuing an action upon such [initial] claim within the meaning of CPLR 204(b) [See D’Angiolillo v. Singh,, supra, citing Bright v. Pagan, 236 AD2d 350, 653 NYS2d 645]. Lastly, the plaintiffs’ have neither offered nor has this court uncovered any legal or equitable basis to support their contention that an offer of settlement would somehow invoke the tolling provisions of CPLR 204(b).

WHEREFORE, Mr. Richard Martinez and Geico Insurance Company’s motion, pursuant to CPLR 3211 (a) (5), for an order to dismiss the within action on the ground that the action is barred by the applicable three year statute of limitations for personal injury and subrogation actions (CPLR 214[5]) is granted. This constitutes the decision and Order of this Court.

___________________________________

JSC

Civil Court of the City of New York, Kings County

121508/04

Jack M. Battaglia, J.

Recitation in accordance with CPLR 2219(a) of the papers considered on Plaintiff’s motion for an order granting summary judgment against Defendant; and Defendant’s cross-motion for an order granting summary judgment dismissing the claim:

Notice of Motion for Summary Judgment

Attorney’s Affirmation in Support of Motion for Summary Judgment

(affidavit)

Exhibits A-M

Notice of Cross-Motion

Affirmation in Support and in Opposition

Affidavit

Exhibits A-C

Reply

The parties appeared as follows: Plaintiff by Alden Banniettis, Esq. and Defendant by Netanel Benchaim, Esq. of the Law Offices of Stacy R. Seldin.

These competing motions require the Court to consider the relationship between an opposer’s showing of a triable issue of fact sufficient to deprive the initial movant of summary judgment and the opposer’s prima facie showing of an entitlement to judgment as a matter of law sufficient to warrant summary judgment on the opposer’s cross-motion. This in the context of an action for first-party no-fault benefits after the insurer denied payment for lack of medical necessity.

Bedford Park Medical Practice, P.C. submitted ten bills to American Transit Insurance Company for physical medical and rehabilitation services rendered to its assignor,Sandra Berger, from October 23, 2002 through April 15, 2003. The bills total $6,091.78. At oral argument on the return date, American Transit stipulated that Bedford Park had submitted proper proof of claim for each of the bills, and Bedford Park stipulated that American Transit had made timely denial of each of the bills for lack of medical necessity based upon a medical examination of [*2]Bedford Park’s assignor.

The medical examination of Sandra Berger was conducted on July 9, 2002 by Dr. Irving Liebman, a board-certified orthopedic surgeon, and the findings and opinions of Dr. Liebman are summarized in an affirmed report of the same date. A copy of Dr. Liebman’s report was apparently sent to Bedford Park on July 22, 2003, three months before it rendered the services billed for and subject to this action. Dr. Liebman’s affirmed report is provided by American Transit on its motion. Bedford Park provides no evidence of medical necessity other than its Verification of Treatment forms.

In similar opinions issued on the same day, Appellate Term for the Second and Eleventh Judicial Districts and Appellate Term for the Ninth and Tenth Judicial Districts made clear that the burden of production, at least, on the issue of medical necessity rests on the insurer.

“[A] provider’s proof of a properly-completed claim makes out a prima facie case upon its motion for summary judgment…thereby shifting the burden to the insurer who, if not precluded, may rebut the inference by proof in admissible form establishing that the health benefits were not medically necessary…If not refuted by the no-fault benefits claimant, such proof may entitle the insurer to summary judgment.”(Amaze Medical Supply Inc. v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U], *3 [App Term, 2d and 11th Jud Dists]; Damadian MRI In Elmhurst, P.C. v Liberty Mutual Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51700[U], *2 [App Term, 9th and 10th Jud Dists]; see also A.B. Medical Services PLLC v Lumbermens Mutual Casualty Co., 4 Misc 3d 86, 87 [App Term, 2d and 11th Jud Dists 2004].)

And subsequently:

“[W]here the plaintiff relies solely on its proof of claim to establish a prima facie showing, without any additional submission of proof of medical necessity in admissible form, and, in opposition, the defendant provides proof in admissible form of the lack of medical necessity, summary judgment may, in appropriate circumstances, be awarded to the defendant unless the plaintiff comes forward with admissible proof in reply to create a triable issue of fact.” (A.B. Medical Services v New York Central Mutual Fire Ins. Co., 3 Misc 3d 136[A], 2004 NY Slip Op 50507[U], *2 [App Term, 2d and 11th Jud Dists]; see also CPLR 3212[b].)

In Stephen Fogel Psychological, P.C. v Progressive Casualty Ins. Co. (7 Misc 3d 18 [App Term, 2d and 11th Jud Dists 2004]), an opinion addressing the effect of an insured’s failure [*3]to attend a pre-claim medical examination, the court stated that the failure to attend “negates the presumption of medical necessity which otherwise attaches to [the provider’s] claim forms” (Id., at 22-23).

There is no appellate decision that explicitly addresses the burden of persuasion on medical necessity in the no-fault context, and one court’s survey of decisions rendered under general medical insurance policies did not reveal any that explicitly addressed the question. (See Oceanside Medical Healthcare, P.C. v Progressive Ins., 2002 NY Slip Op 50188[U], *15-*16 [Civ Ct, Kings County]; but see Igor Shtarkman, Neurologist, P.C. v Allstate Ins. Co., 2002 NY Slip Op 50568[U][App Term, 9th and 10th Jud Dists]). Although this Court once held otherwise (see Elm Medical, P.C. v American Home Assurance Co., 2003 NY Slip Op 51357[U], *8-*9 [Civ Ct, Kings County]), the Court is now of the view that the insured / provider bears the burden of persuasion on the question of medical necessity. Specifically, once the insurer makes a sufficient showing to carry its burden of coming forward with evidence of lack of medical necessity, “plaintiff must rebut it or succumb.” (See Baumann v Long Island Railroad, 110 AD2d 739, 741 [2d Dept 1985].)

Courts have recognized, however, that a proffer that is sufficient to raise a triable issue of fact may not be sufficient to establish an entitlement to judgment as a matter of law. (See American Honda Finance Corp. v Progressive Casualty Ins. Co., 290 AD2d 850, 852 [3d Dept 2002]; Ocean Diagnostic Imaging P.C. v State Farm Mutual Automobile Ins. Co., 7 Misc 3d 130[A], 2005 NY Slip Op 50535[U][App Term, 9th and 10th Jud Dists]; Ocean Diagnostic Imaging, Inc. v Utica Mut. Ins. Co., 6 Misc 3d 131[A], 2005 NY Slip Op 50081[U][App Term, 2d and 11th Jud Dists].) This Court is unaware of an explicit articulation of the difference, except where a triable issue might be found by reason of the more “flexible” evidentiary requirements imposed on the opposer. (See Zuckerman v City of New York, 49 NY2d 557, 562 [1980]; Kwi Bong Yi v JNJ Supply Corp., 274 AD2d 453, 453 [2d Dept 2000]; A.B. Medical Services PLLC v State-Wide Ins. Co., 7 Misc 3d 136[A], 2005 NY Slip Op 50785[U], *2 [App Term, 2d and 11th Jud Dists].)

On a provider’s motion for summary judgment, the insurer may meet its burden of production with “affirmed reports based upon independent medical examinations (IMEs) conducted by the [the insurer’s] physicians, which sufficiently raise issues of fact as to the necessity of the medical services and treatment provided.” (Park Health Center v Prudential Property & Casualty Ins. Co., 2001 NY Slip Op 40650[U], *2 [App Term, 2d and 11th Jud Dists].) Presumably, the medical examination report must, like a peer review report submitted for the same purpose, “set forth a factual basis and medical rationale” for the claim’s rejection. (See S & M Supply Inc. v Kemper Auto & Home Ins. Co., 2 Misc 3d 134[A], 2004 NY Slip Op

50209[U], *1 [App Term, 2d and 11th Jud Dists].)

Here, Dr. Irving Liebman concluded in the report of his July 9, 2002 examination of Bedford Park’s assignor that there was “no necessity for further treatment” and “no necessity for household help or a special transportation allowance.” Specifically, he found “no orthopedic [*4]objective evidence of disability.”

Dr. Liebman notes that x-rays of Sandra Berger’s cervical and lumbar spine were negative, but that an MRI of her left shoulder revealed a “supraspinatus tendinopathy”. He found no muscle spasm in her cervical, dorsal or lumbosacral spine; “full range of motion” throughout the spine; in both shoulders and hips; her elbows, wrists and hands; her knees, ankles and feet; and that the “straight leg raising test was unrestricted bilaterally.” He also reports that there was “no sensory loss” and that “cranial nerves were intact.”

The Court finds sufficient “factual basis and medical rationale” in Dr. Liebman’s report to raise a triable issue as to medical necessity, and to warrant, therefore, denial of Bedford Park’s motion. Does the report, however, establish prima facie that any subsequent treatment was not medically necessary? Are these the “appropriate circumstances” where the provider’s failure to come forward with admissible proof in reply warrant granting summary judgment to the insurer? (See A.B. Medical Services v New York Central Mutual Fire Ins. Co., 2004 NY Slip Op 50507[U], at *2.)

It seems to this Court that, in the absence of any specific direction from the appellate courts, an appropriate reference would be to caselaw describing the insurer’s prima facie burden on a motion to dismiss for absence of “serious injury” as defined in Insurance Law §5102(d). If the evidence submitted on lack of medical necessity would not be sufficient to preclude a claim for non-economic loss, it is difficult to see why it should suffice for cessation of benefits. After all, the no-fault scheme is intended to provide “prompt payment for basic economic loss…in exchange for a limitation on litigation to cases involving serious injury.” (See Pommells v Perez, 4 NY3d 566, 571 [2005].)

In this case, the Court finds that Dr. Liebman’s report would not establish prima facie the absence of “serious injury”, in that it fails to describe the “objective tests” he performed that support his findings and opinions, including his findings that Ms. Berger exhibited “full range of motion”. (See Edwards v New York City Transit Authority, 17 AD3d 628 [2d Dept 2005]; Korpalski v Lau, 17 AD3d 536 [2d Dept 2005]; Hanna v Alverado, 16 AD3d 624 [2d Dept 2005]; Nembhard v Delatorre,16 AD3d 390 [2d Dept 20005]; Remekie v Atileh, 6 Misc 3d 134[A], 2005 NY Slip Op 50191[U][App Term, 2d and11th Jud Dists].) Moreover, Dr. Liebman does not describe the significance of the MRI finding of “supraspinatus tendinopathy” in Ms. Berger’s left shoulder.

Under these circumstances, the “presumption of medical necessity which…attaches to [the provider’s] claim forms” (see Stephen Fogel Psychological, P.C. v Progressive Casualty Ins. Co., 7 Misc 3d at 22-23), in particular that attaches to the treating doctor’s order for additional treatment, is not sufficiently rebutted to establish prima facie that the insurer is entitled to judgment as a matter of law. As in the “threshold” cases, even in the absence of specific, additional evidence of medical necessity, American Transit’s motion must be denied. (See Hanna v Alverado, 16 AD3d 624; Nembhard v Delatorre,16 AD3d 390; Qu v Doshna, 12 AD3d 578 [2d [*5]Dept 2004].)

Plaintiff’s motion for summary judgment is denied. Defendant’s cross-motion for summary judgment is denied.

Defendant shall serve a copy of this order with Notice of Entry upon Plaintiff within 20 days after entry.

August 12, 2005

Judge, Civil Court