Supreme Court, Queens County

8934 2004

Jaime A. Rios, J.

By order dated November 23, 2004 this court (Rios, J.) determined, inter alia, that the petitioner Government Employees Insurance Company (Geico) was aware of the respondents’ uninsured motorist (UM) claim in June, 2003, yet failed to request discovery for 10 months, until after the respondents demanded arbitration. As a result, the court denied Geico’s petition to permanently or temporarily stay the UM arbitration demanded by the respondents pending their provision of such discovery. [*2]

Geico moves to reargue asserting, inter alia, that: (1) upon the receipt of the respondents’ application for no-fault benefits, it sent a letter dated June 24, 2003, reserving its right to discovery; (2) although the respondents filed a Notice of Intention to Make Claim dated June 10, 2003, that notice did not indicate that the respondents intended to make a claim for UM benefits and was served with no-fault paperwork; (3) the respondents never made a formal claim for UM benefits until they demanded arbitration by demand dated March 16, 2004; (4) notice of the no-fault claim did not constitute notice of the UM claim; (5) as a result, in connection with the UM claim, it timely requested discovery by letter dated April 5, 2004; and, (6) its policy obligates the respondents to provide discovery prior to arbitration.

The respondents oppose the motion contending, inter alia, that they served a notice of intention to make a claim for UM benefits in June, 2003, and Geico failed to request any discovery until after they demanded arbitration.

The respondents’ Notice of Intention to Make Claim, sworn to on June 10, 2003, appears to be on a form provided by Geico. Section 10 of that form asks the person making a claim to indicate the reason for the application. The reasons listed on the form are: “Uninsured Car,” “Denial of Coverage” “Disclaimer,” “Stolen Car,” “Unidentified Car,” “Uninsured Automobile Endorsement on your Policy” and “Qualified Person.”

The respondents placed an “x” mark next to each such listed reason, and returned the Notice of Intention to Make Claim with the no-fault authorizations requested by Geico. In response, by letter dated June 24, 2003, Geico advised the respondents’ attorney that because it believed the tortfeasor carried a policy of liability insurance with Allstate on the date of the accident, “it does not appear that your client has a valid claim for uninsured motorist benefits at this time.”

In the same letter, Geico stated that if the respondents obtained proof that the tortfeasor was uninsured, they should provide Geico with documentation to substantiate the UM claim. Geico added that once it confirmed the validity of the respondents’ SUM or UM claim, it might require them to provide certain discovery.

Geico did not request discovery from the respondents for 10 months, until April 5, 2004, after it was served with the respondents ‘ demand for arbitration.

In view of these facts, the court grants the motion to reargue and, upon reargument, adheres to its original determination set forth in the order dated November 23, 2004 (see New York Cent. Mut Fire Ins. Co. v Gershovich, 1 AD3d 364 [2003]; Matter of Allstate Ins. Co. v Faulk, 250 AD2d 674 [1998]; Matter of Allstate Ins. Co. v Urena, 208 AD2d 623 [1994]; cf. Allstate Ins. Co. v Moya, 288 AD3d 309 [2001]; Metropolitan Prop & Cas. Ins. Co. v Keeney, 241 AD3d 455 [1997]). [*3]

Dated: March 7, 2005

J.S.C.

[*1]

Supreme Court, Appellate Term, Second Department, March 1, 2005

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellant. Bruno Gerbino & Macchia LLP, Melville, and Rivkin Radler LLP, Uniondale (Evan H. Krinick, Stuart M. Bodoff and Rosemarie Bruno of counsel), for respondent.

{**9 Misc 3d at 74} OPINION OF THE COURT

Memorandum.

On the court’s own motion, the decision and order of this court entered December 8, 2004 in the above-entitled matter is recalled and vacated and the following decision and order is substituted therefor.

Order insofar as appealed from affirmed without costs.

In this action to recover first-party no-fault benefits for medical treatment provided its assignor, plaintiff established its prima facie case for summary judgment “by submitting evidentiary proof that the prescribed statutory billing forms had been . . . received, and that payment of the no-fault benefits was overdue” (Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742, 742-743 [2004]; see Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]). Defendant’s opposition to the motion failed to rebut plaintiff’s proof of an untimely claim denial, an event that precludes most defenses (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]). However, defendant was not precluded from asserting the defense that the collision was in furtherance of an insurance fraud scheme, despite the untimely denial of plaintiff’s claim (see Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2002]). The affidavit submitted by defendant’s special investigator was sufficient to demonstrate that defendant’s denial was based upon a[*2]“founded belief that the alleged injur[ies] do[ ] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d at 199). Accordingly, since defendant demonstrated the existence of a triable issue of fact as to whether there was a lack of coverage (see id.; Zuckerman v City of New York, 49 NY2d 557 [1980]), plaintiff’s motion for summary judgment was properly denied.{**9 Misc 3d at 75}

We note that to the extent that defendant’s opposition to plaintiff’s motion for summary judgment was based on the assignor’s failure to attend examinations under oath (EUOs), it is without merit. Plaintiff submitted its claim on April 3, 2002, two days prior to the effective date of Insurance Regulation 68 which for the first time provided in the mandatory personal injury protection endorsement that an eligible injured person shall submit to EUOs as may reasonably be required (11 NYCRR 65-1.1 [d]). Consequently, under the applicable prior regulations (11 NYCRR 65.12 [e]), defendant had no right to request an EUO (see Kings Med. Supply Inc. v GEICO Ins., 4 Misc 3d 138[A], 2004 NY Slip Op 50904[U] [App Term, 2d & 11th Jud Dists 2004]) and, thus, such request did not toll the 30-day period in which an insurer must act upon a claim or be precluded. Even if the claim had been submitted subsequent to the effective date of the new regulations, “[c]onsistent with the Insurance Department’s interpretation of the new regulation, which is entitled to great deference . . . the insurer must include the revised prescribed endorsement with new or renewal policies issued on or after April 5, 2002, and the claim rules are to be governed by the policy endorsement in effect (see Circular Letter No. 9 [2002])” (S&M Supply v State Farm Mut. Auto. Ins. Co., 4 Misc 3d 130[A], 2004 NY Slip Op 50693[U], *2 [App Term, 9th & 10th Jud Dists 2004]). Thus, an insurer may not, in any event, invoke the new regulations as a basis to defend the claim upon an assignor’s failure to comply with its EUO requests where its opposition papers fail to prove that it had issued an endorsement, effective April 5, 2002, that contained the new regulation (see S&M Supply v Lancer Ins. Co., 4 Misc 3d 131[A], 2004 NY Slip Op 50695[U] [App Term, 9th & 10th Jud Dists 2004]).

Patterson and Golia, JJ., concur; Aronin, J.P., taking no part.

[*1]

Supreme Court, Appellate Term, Second Department, January 20, 2005

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellants. Stern & Montana, LLP, New York City (Richard Montana of counsel), for respondent.

{**7 Misc 3d at 15} OPINION OF THE COURT

Memorandum.

Order insofar as appealed from unanimously affirmed without costs.

In this action to recover first-party no-fault benefits for medical services rendered to its assignor, plaintiff health care providers established a prima facie entitlement to summary judgment by proof of submission of the statutory claim forms, setting forth the fact and the amount of the loss sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]). Furthermore, defendant’s delay letters, acknowledging receipt of the bills submitted by plaintiff Daniel Kim’s Acupuncture P.C. totaling $1,860.56, adequately established that said plaintiff sent, and that defendant received, these respective claims (see A.B. Med. Servs. v New York Cent. Mut. Fire Ins. Co., 3 Misc 3d 136[A], 2004 NY Slip Op 50507[U] [App Term, 2d & 11th Jud Dists 2004]).{**7 Misc 3d at 16} There was also proper proof of mailing of the claim for $935 submitted by plaintiff Somun Acupuncture P.C. (see Amaze Med. Supply v Allstate Ins. Co., 3 [*2]Misc 3d 133[A], 2004 NY Slip Op 50447[U] [App Term, 2d & 11th Jud Dists 2004]).

While an insurer’s failure to timely pay or deny the claim within the 30-day statutory period precludes it from asserting most defenses (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]), the apparently timely denial of plaintiff A.B. Medical’s claim for $1,972.08 does not relieve defendant from the necessity of submitting proof in admissible form in opposition to plaintiff’s motion for summary judgment (see e.g. A.B. Med. Servs. PLLC v Lumbermens Mut. Cas. Co., 4 Misc 3d 86 [App Term, 2d & 11th Jud Dists 2004]).

The court denied plaintiffs’ motion for summary judgment on the ground that plaintiffs did not submit admissible proof authenticating the signature of plaintiffs’ assignor on the assignment forms. However, the lack of authentication of the assignor’s signature, in and of itself, does not constitute a defect in the absence of any statutory or regulatory requirement for the same (A.B. Med. Servs. PLLC v Nationwide Mut. Ins. Co., 6 Misc 3d 70 [App Term, 2d & 11th Jud Dists 2004]). Even assuming arguendo that a lack of authentication constitutes a cognizable defect, defendant’s failure to seek verification of the assignments, or to allege any deficiency in the assignments in its denial of claim forms, constitutes a waiver of any defenses with respect thereto (see id.; New York Hosp. Med. Ctr. of Queens v New York Cent. Mut. Fire Ins. Co., 8 AD3d 640 [2004]; Presbyterian Hosp. v Aetna Cas. & Sur. Co., 233 AD2d 433 [1996]; Park Health Ctr. v Eveready Ins. Co., 2001 NY Slip Op 40665[U] [App Term, 2d & 11th Jud Dists 2001]).

We note that the revised insurance regulations, applicable to claims submitted on or after April 5, 2002, “no longer permit the assignment to health care providers of benefits for non-health-related services (typically housekeeping and transportation expenses) (11 NYCRR 65-3.11 [a]; Insurance Law § 5102 [a] [1])” (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854, 871 [2003]). Accordingly, while “[s]uch reasonable and necessary expenses remain reimbursable (see Insurance Law § 5102 [a] [3] . . . [they are] nonassignable” (id.). The record herein indicates that plaintiff Square Synagogue Transportation Inc. submitted its transportation costs prior to the effective date of the revised regulations.

Despite its untimely denial of most of plaintiffs’ claims, defendant is not precluded from asserting the defense that the alleged injuries do not arise out of a covered accident (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]). The affidavit submitted by defendant’s litigation coordinator, and the accompanying examinations under oath, were sufficient to demonstrate that defendant’s denial was based upon a “founded belief that the alleged injur[ies] do[ ] not arise out of an insured incident” (Central Gen. Hosp., 90 NY2d at 199). Accordingly, since defendant demonstrated the existence of a triable issue of fact as to whether there was a lack of coverage {**7 Misc 3d at 17}(see id.; Zuckerman v City of New York, 49 NY2d 557 [1980]), plaintiffs’ motion for summary judgment was properly denied.

Pesce, P.J., Patterson and Rios, JJ., concur.

[*1]

Supreme Court, Appellate Term, Second Department, December 22, 2004

APPEARANCES OF COUNSEL

Freiberg & Peck, LLP, New York City (Yilo J. Kang of counsel), for appellant. Baker & Barshay, LLP, Hauppauge (David M. Barshay of counsel), for respondent.

{**7 Misc 3d at 19} OPINION OF THE COURT

Memorandum.

Order modified by deleting the portion of the order which granted plaintiff summary judgment; as so modified, affirmed without costs.

In this action to recover $969.61 in assigned first-party no-fault benefits, defendant insurer denied plaintiff health provider’s claim on the ground that the eligible injured person failed to appear for independent medical examinations (IMEs) which defendant scheduled before plaintiff filed its statutory claim forms. Defendant moved for summary judgment contending that its proof of plaintiff’s assignor’s nonappearance established a defense to the action.

The insurance regulations provide for IMEs as part of an insurer’s entitlement to “additional verification” following the insurer’s receipt of a provider’s statutory claim forms in order to determine, inter alia, the medical necessity of the health benefits provided the injured person (11 NYCRR 65.15 [d] [3], now 11 NYCRR 65-3.5 [d]; see also 11 NYCRR 65.15 [g] [1], now 11 NYCRR 65-3.8 [a] [1] [IME “verification” deemed received “on the day the examination was performed”]). An insurer need not pay or deny a claim until demanded verification is [*2]provided (11 NYCRR 65.15 [g] [1] [i]; [2] [iii], now 11 NYCRR 65-3.8 [a] [1]; [b] [3]; Montefiore Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 9 AD3d 354 [2004]; Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533, 534 [2004]; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 570 [2004]). Where an eligible injured person fails to comply with an insurer’s timely postclaim IME verification request, {**7 Misc 3d at 20}the insurer’s time to respond to the claim does not begin to run, which may entitle the insurer to dismissal of the action seeking no-fault benefits (Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533 [2004], supra; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568 [2004], supra; St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338, 340 [2002]; see also 11 NYCRR 65.15 [g] [2] [i], now 11 NYCRR 65-3.8 [b] [1]).

The first question presented is whether an insurer has a right to an IME following an oral or written notice of claim (11 NYCRR 65.15 [c] [1], [2], now 11 NYCRR 65-3.4 [a], [b]) and prior to the insurer’s receipt of the statutory claim forms or their functional equivalent (11 NYCRR 65.15 [d] [1], [5], now 11 NYCRR 65-3.5 [a], [f]), the event which, under the regulations, triggers the verification process (11 NYCRR 65.15 [d] [1], now 11 NYCRR 65-3.5 [a]). If such a right exists, we must determine the consequences, if any, of the injured person’s failure to attend an IME sought before any claim form has been submitted.

The insurance regulations provide, in the mandatory personal injury protection endorsement, which is independent of the verification protocols, that “[t]he eligible injured person shall submit to medical examination . . . when, and as often as, the Company may reasonably require” (11 NYCRR 65.12 [e], now 11 NYCRR 65-1.1 [d] [emphasis added]). In light of this broad language, and because this provision is included in the mandatory endorsement and not in the verification protocols, there appears to be no reason to preclude an insurer from requesting an IME prior to its receipt of the statutory claim form. This analysis is particularly reasonable given the fact that the insurer, upon receipt of an oral or written notice of claim, is under an obligation to commence the claim processing procedure (see 11 NYCRR 65.15 [b], [c] [1]-[2], now 11 NYCRR 65-3.3, 65-3.4 [a]-[b]). Accordingly, we conclude that an insurer is entitled to request an IME upon the receipt of a notice of claim, whether orally or in writing. This conclusion was implicit in Millennium Med. Diagnostics v Liberty Mut. Ins. Co. (2001 NY Slip Op 40654[U] [App Term, 2d & 11th Jud Dists 2001], affd 306 AD2d 388 [2003]) which also involved an IME sought before the submission of the statutory claim forms (see also Informal Op, NY State Ins Dept, Apr. 12, 2002). In so concluding, we recognize the importance of a timely held IME in the detection of fraudulent claims, the sharply rising incidence of which has drawn attention from law enforcement agencies and the courts{**7 Misc 3d at 21} (see Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854, 867 [2003]), and has stimulated significant revisions in the insurance regulations.

However, the right to an IME at this juncture is not afforded by the verification procedures and timetables (see 11 NYCRR 65.15 [d], [e], [g], now 11 NYCRR 65-3.5, 65-3.6, 65-3.8), because 11 NYCRR 65.12 (e) (now 11 NYCRR 65-1.1 [d]) is not, on its face or contextually, a “verification” provision, and because the detailed and narrowly construed verification protocols are not amenable to application at a stage prior to submission of the claim form (but see Bronx Med. Servs. v Windsor Ins. Co., 2003 NY Slip Op 50885[U] [App Term, 1st Dept 2003]). Such a rewriting of the regulations is a matter for the Legislature or the Insurance [*3]Department, and indeed, a comprehensive response to the Court of Appeals’ call for the enactment of “more synchronized provisions in the highly technical and regulated . . . no-fault universe[ ]” is awaited (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]).

Having determined that the insurer has a right to request an IME prior to the submission of the claim form, we now turn to the second inquiry: What are the consequences of the injured person’s failure to attend an IME sought before the statutory claim form is submitted? As an insurer’s rights and/or remedies upon nonreceipt of matter sought pursuant to the postclaim verification procedures (11 NYCRR 65.15 [g], now 11 NYCRR 65-3.8; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d at 570) are inapplicable (but see Bronx Med. Servs. v Windsor Ins. Co., 2003 NY Slip Op 50885[U] [2003], supra), the consequences of an insured’s failure to attend a preclaim IME must be sought in the general principles of no-fault claims determinations.^[FN*] Generally, a plaintiff health provider’s proof of a properly submitted statutory claim form, or its substantial equivalent, establishes a prima facie case of medical necessity on a plaintiff’s motion for summary judgment (Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A],{**7 Misc 3d at 22} 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]; see also Damadian MRI in Elmhurst v Liberty Mut. Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51700[U] [App Term, 9th & 10th Jud Dists 2003]). The burden then shifts to defendant who, if not precluded, may rebut the presumption and establish the lack of medical necessity by submitting proof, such as a detailed peer review report or the results of an IME, that the health benefits provided were not medically necessary (Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [2003], supra; see also Damadian MRI in Elmhurst v Liberty Mut. Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51700[U] [2003], supra). However, when an insurer timely asserts in its claim denial form an injured person’s failure to comply with a reasonable and proper preclaim IME request, and establishes such failure in admissible form in opposition to a plaintiff’s motion for summary judgment, the presumption of medical necessity which attaches to the claim form is rebutted. While not establishing the lack of medical necessity so as to warrant reverse summary judgment in its favor, such proof defeats the motion. As the courts disapprove of a movant seeking to submit proof for the first time in a reply paper (see Ritt v Lenox Hill Hosp., 182 AD2d 560 [1992]), a plaintiff should not be permitted to submit its independent proof of medical necessity for the first time at such juncture. Of course plaintiff, having been alerted to the insurer’s assertion of the eligible injured person’s failure to attend such IME in the claim denial form, may support its motion with proof of medical necessity (independent of the presumption of medical necessity that attaches to the claim form), or may explain the eligible injured person’s failure to attend the IME by offering a valid excuse for such nonappearance, or proof that, under the circumstances, the IME request was unreasonable and, thus, not authorized by 11 NYCRR 65.12 (now 11 NYCRR 65-1.1). In such case, plaintiff may [*4]be entitled to prevail on its summary judgment motion should defendant’s opposition papers otherwise fail to raise a triable issue of fact.

Where, as here, an insurer moves for summary judgment (or cross-moves for summary judgment) to dismiss the action on the sole ground that the eligible injured person failed to appear for an IME which was reasonably and properly requested prior to its receipt of any claim form (assuming such ground was preserved by having been previously asserted in the insurer’s denial of claim form), the insurer’s motion will not warrant a dismissal of the action, since such ground, as noted above, does not establish a lack of medical necessity. Rather, its effect is only a procedural one: it negates the presumption of medical necessity {**7 Misc 3d at 23}which otherwise attaches to plaintiff’s claim forms, thereby raising a triable issue as to the medical necessity of the health benefits provided (Millennium Med. Diagnostics v Liberty Mut. Ins. Co., 2001 NY Slip Op 40654[U] [App Term, 2d & 11th Jud Dists 2001], affd 306 AD2d 388 [2003], supra). For plaintiff to ultimately prevail in its action, it must then independently establish medical necessity by admissible evidence at trial. Of course, plaintiff may successfully oppose such motion by the insurer and avoid the negation of the presumption of medical necessity which attaches in the first instance to its claim form by establishing in its opposition papers that the eligible injured person’s failure to attend the IME was excusable or that the request was unreasonable in light of all the surrounding circumstances existing at the time of the request.

Since, in the instant case, it was uncontroverted that the eligible injured person failed to comply with a preclaim form IME request, the reasonableness of which was not challenged, plaintiff should not have been granted summary judgment. However, defendant’s motion for summary judgment was properly denied inasmuch as questions of fact exist, including whether the benefits provided were medically necessary.

Golia, J., concurs in part and dissents in part, and votes to reverse the order and grant defendant’s motion for summary judgment in the following memorandum: We all agree that “plaintiff should not have been granted summary judgment.” I regret to say that is where we part company. I dissent as to the reasoning behind the majority’s holding and as to the refusal to grant judgment to the defendant dismissing the complaint.

A careful reading exposes the inaccuracies, misstatements and misunderstandings relied upon by the majority.

The majority presents a two-tiered question. The first question is, does an insurer have the right to demand an independent medical examination (IME) prior to receipt of a formal claim? If so, does the eligible injured person’s failure to attend an IME sought before any claim form has been submitted result in any consequences? My answer to both questions is “yes.”

The majority found that a demand for an IME is permitted pursuant to the mandatory personal injury protection endorsement, which is set forth in the insurance regulations as well as the contract of insurance, and is independent of the verification protocols which are only in the insurance regulations.

Having made the finding that the IME in question does not fall under the verification protocols, the majority then concludes that {**7 Misc 3d at 24}the failure to attend an IME does not carry any sanctions under the regulations. They do say, however, that it creates an issue of fact sufficient to overcome the presumption of medical necessity and to deny a motion for summary judgment by the eligible injured person or his assignee. Well, that is not the regulation.

Consequently, I disagree with that premise, and their conclusion. [*5]

To begin with, 11 NYCRR 65-1.1 (d) provides for the mandatory personal injury protection endorsement. The purpose of this regulation is to mandate the terms of the [*6]personal injury protection endorsement that is permitted in automobile insurance contracts in New York State.

Within that regulation is the subheading “Conditions,” which provides: “Action Against Company. No action shall lie against the Company unless, as a condition precedent thereto, there shall have been full compliance with the terms of the coverage.” (Emphasis added.)

Within that subheading is the following provision: “The eligible . . . person shall submit to medical examination by physicians selected by, or acceptable to, the Company, when, and as often as, the Company may reasonably require.” (Id.; emphasis added.)

It is abundantly clear to me that if an eligible injured person fails to submit to an independent medical examination, as provided, then the eligible injured person or his assignee cannot prosecute an action against the company. To me this is a simple reading of the regulations. It is not confusing or complex.

There is also a section that is entitled “Claim Procedure” (11 NYCRR 65-3.5) which contains a detailed set of provisions for the filing of claims and for the verification procedure. This section also addresses the request for an IME, but only as the result of the eligible injured person or their assignee filing a demand for payment.

Although the majority makes it appear that a demand for an IME can be requested immediately upon receipt of a formal claim, in fact this is not so. A request for an IME is denominated as “additional verification” and can only be requested after a request for “verification” of a claim and the response thereto has been received.

Specifically, subdivision (a) of 11 NYCRR 65-3.5 provides that the insurer shall forward to the parties required to complete them {**7 Misc 3d at 25}the “prescribed verification forms” needed prior to payment. Subdivision (b) provides that subsequent to the receipt of the completed verification forms, “any additional verification” required may be requested. IMEs are, in fact, deemed to be “additional verification” (see 11 NYCRR 65-3.4 [c]).

While this is a highly technical and precise reading of the regulations, it is an example of the majority’s restrictive interpretations of the regulations.

While the holding of the majority results in a plenary trial on the issue of lack of medical necessity, the insurer will have no evidence to present on the issue of “medical necessity,” as the eligible injured person never appeared for the IME and consequently the company never examined that person. The eligible injured person would not be entitled to summary judgment but the insurer has no possibility to defend at trial. This, of course, ignores 11 NYCRR 65-1.1 (d) which provides that “[n]o action shall lie against the Company . . . .” [*7]

In my opinion, the mandatory personal injury protection endorsement conditions the right to commence an action against the insurer upon an eligible injured person’s compliance with the terms of coverage. Where an eligible injured person fails to submit to a reasonably requested IME, the insurance policy, by its terms, as provided by the insurance regulations, affords no coverage for the otherwise eligible injured person (see e.g. Orr v Continental Cas. Co., 205 AD2d 599 [1994] [breach of a condition precedent in an insurance contract permits the insurer to declare the contract terminated due to the breach]). In other words, the assertion by an insurer that the eligible injured person failed to comply with a reasonable request for an IME at the preclaim form stage, which was not opposed or adequately refuted, constitutes a complete defense to the claim warranting dismissal of the action (see e.g. St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338 [2002]). Indeed, to hold, as does the majority, that the mandatory personal injury protection endorsement requires an eligible injured person to submit to a reasonably requested IME, but that the failure or refusal to submit to such an IME does not bar coverage under the insurance policy is inconsistent as noted earlier. Having determined that the mandatory personal injury protection endorsement obligates eligible injured persons to submit to reasonably requested IMEs, the majority offers no good reason for failing to give effect to the [*8]provision which expressly conditions coverage upon the eligible injured person submitting to a reasonably requested IME.{**7 Misc 3d at 26}

To the extent the majority suggests that its holding is governed by the Appellate Term’s opinion in Millennium Med. Diagnostics v Liberty Mut. Ins. Co. (2001 NY Slip Op 40654[U] [App Term, 2d & 11th Jud Dists 2001], affd 306 AD2d 388 [2003]), I note that I was not a member of the panel which decided said case. Nor was I member of the panels which also decided the Park Health Ctr. v Liberty Mut. Ins. Co. (191 Misc 2d 91 [App Term, 2d & 11th Jud Dists 2001]) and Urban Med. Diagnostics v Liberty Mut. Ins. Co. (2001 NY Slip Op 40655[U] [App Term, 2d & 11th Jud Dists 2001]) cases which were decided the same day as the Millennium Med. Diagnostics case and which employed the same analysis. In said cases, those courts properly held that an insurer was entitled to an IME which was sought prior to the submission of claim forms; however, those courts then mistakenly failed in the aforementioned cases, as it also does in the instant case, to hold that the unexcused nonappearance of an eligible injured person for a reasonably requested preclaim stage IME bars coverage. In light of my analysis set forth herein and the rapid increase in the number of no-fault claims tainted by fraud (see Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854, 861 [2003]), it is my hope that the Appellate Division would reconsider the position it adopted in the Millennium Med. Diagnostics case and, in the future, award summary judgment to similarly situated insurers if there was no reasonable excuse for the eligible injured person’s failure to appear at a reasonably and properly requested preclaim stage IME.

Although the majority declares that the failure of an eligible injured person to appear for a reasonably requested IME shall have consequences, the consequences adopted by the majority fall far short of barring an action against the insurer. Rather, if an insurer satisfies its obligation to timely and properly deny a claim for payment, based upon, at a minimum, the nonattendance of the eligible injured person at a reasonably requested IME, and establishes such fact by presenting sufficient evidence upon a motion for summary judgment, the majority will merely deem the presumption of a prima facie case of medical necessity which flows from the eligible injured person’s presentation of properly completed claim forms (see Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]) to have been rebutted. As noted in the majority’s opinion, in such a situation, the eligible injured person, or his or her assignee, may only prevail if sufficient{**7 Misc 3d at 27} evidence is proffered to demonstrate that the health benefits provided to the eligible injured person, and for which payment is being sought, was medically necessary. As stated earlier, this would be impossible for the insurer to defend because there was no medical examination of the eligible injured person upon which to rely. [*9]

Notwithstanding the fact that it is becoming apparent to the courts, law enforcement agencies and the media that many people are engaged in fraudulent criminal activity so as to obtain money to which they are not entitled for treatment which was never rendered and that such activity adds to the costs borne by law abiding citizens (see Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d at 861; Jail Officers in Crash Scams, New York Post, Sept. 29, 2004; DA: Queens Clinics Filed $1 Million in Fake Claims, NYLJ, Sept. 23, 2004, at 4, col 5; DA: Queens Clinics Filed $1 Million in Fake Claims, Newsday, Sept. 23, 2004), the majority is willing to, in effect, overlook the failure or perhaps the refusal of an eligible injured person to submit to a reasonably requested IME. Under the majority’s position, however, an insurer will never be able to obtain summary judgment dismissing an action based solely upon the failure of an eligible injured person to submit to a reasonably requested IME. This is so notwithstanding the fact that the eligible injured person thwarts the insurer’s ability to establish a defense to the action, to wit, a lack of medical necessity which could be established through a medical examination conducted when such examination might yield the most pertinent information relevant to such issue at an earlier stage. Indeed, a medical examination conducted after submission of the claim form as additional verification (see 11 NYCRR 65.15 [d] [3], now 11 NYCRR 65-3.5 [d]) often only occurs after the treatment is complete and the injury has been resolved.

In sum, while the “primary aims of [the no-fault] system were to ensure prompt compensation for losses incurred by accident victims without regard to fault or negligence, to reduce the burden on the courts and to provide substantial premium savings to New York motorists” (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d at 860), at least two of its three goals have not been achieved. Moreover, although the no-fault system contains relatively quick deadlines to ensure the prompt resolution of claims, in the instant case, the majority’s willingness to, in effect, overlook the failure or refusal of an eligible injured person to submit to a reasonably requested independent medical {**7 Misc 3d at 28}examination thwarts attempts by insurers to investigate claims faster and inhibits insurers’ efforts to ascertain whether the eligible injured person is genuinely injured or is a participant in a criminal scheme.

As a result, while I agree that plaintiff is not entitled to summary judgment, I would grant defendant’s motion for summary judgment dismissing the action.

Aronin, J.P., and Patterson, J., concur; Golia, J., concurs in part and dissents in part in a separate memorandum.

Footnotes

Footnote *: We are aware that the mandatory personal injury protection endorsement (11 NYCRR 65-1.1 [d]) bars an action against an insurer “unless, as a condition precedent thereto, there shall have been full compliance with the terms of this coverage.” However, we are of the opinion that this provision applies solely to an insured’s cooperation with the postclaim verification protocols with regard to IMEs.

[*1]

Supreme Court, Appellate Term, Second Department, December 22, 2004

APPEARANCES OF COUNSEL

Meiselman, Denlea, Packman & Eberz, P.C., White Plains (James G. Eberz of counsel), for appellant. Baker & Barshay LLP, Hauppauge (Gil McLean of counsel), for respondent.

{**8 Misc 3d at 34} OPINION OF THE COURT

Memorandum.

Order, insofar as appealed from, reversed without costs and defendant’s motion to dismiss the complaint granted.

Plaintiff medical provider commenced this action to recover first-party no-fault benefits in the sum of $4,126.89 for medical services rendered to plaintiff’s assignor for injuries she allegedly sustained in an automobile accident which occurred in the Bronx on December 7, 2001. Plaintiff’s assignor was a passenger in a U-Haul vehicle insured by defendant, an Arizona corporation. Service of the summons and complaint was made on the New York State Department of Insurance. An answer was interposed denying the allegations of the complaint which asserted that defendant was licensed and authorized to do business in the State of New York and that it transacted business in{**8 Misc 3d at 35} the City of New York, and which included an affirmative defense that the court lacked jurisdiction over defendant. In support of a subsequent motion to dismiss for lack of jurisdiction, based on CCA 404 (a), defendant’s New York claims manager submitted an affidavit in which he averred that [*2]defendant was an Arizona corporation which neither wrote nor sold insurance in the State of New York, nor had any agent in the State of New York, that defendant was the sole insurer for U-Haul, Inc., an Arizona corporation, and that the policy was written and sold in Arizona. Defendant had a claims office in Westchester County. He further stated that defendant did not write, sell or solicit any insurance policies to any entities within New York City, did not provide goods or services within New York City, and did not transact business in New York City.

In its opposition papers, plaintiff’s counsel argued that “upon information and belief,” defendant actively engaged in the solicitation of business and the writing of insurance policies to residents of New York City, which activities constituted the transaction of business as well as the contracting to supply goods and services in New York City. Documentation purported to be in support of its argument consisted of various police accident reports from other accidents where U-Haul vehicles were involved as well as several no-fault denial of claim forms where the “policy holder” was identified as defendant.

After the return date of the motion, the court requested that the parties send to it additional documentation which included the police report pertaining to the instant accident, the addresses of the assignee and its assignor, registration information for the U-Haul vehicle at issue, a copy of the insurance policy between defendant and U-Haul’s parent company, Amerco, the insurance identification card for the U-Haul vehicle, and a copy of the U-Haul rental contract with a computerized printout regarding the lease transaction between U-Haul and the lessee. These materials showed that both plaintiff’s assignor and the lessee were Bronx residents and that the accident occurred in the Bronx. U-Haul Co. of Arizona was listed in the police report as the registered owner of the vehicle. A business automobile insurance policy had been issued by defendant, an Arizona corporation, to its named insured, Amerco, also an Arizona corporation, indicating that there was a New York specific endorsement providing no-fault coverage. The Arizona automobile insurance card for the vehicle showed that defendant was its insurer and that the insured was “Amerco et al, including{**8 Misc 3d at 36} U-Haul.” The U-Haul rental contract stated that its customers were insured by a business auto policy providing the minimal limits of the state where the accident occurred.

In its decision and order denying the motion to dismiss, the court below made numerous findings of fact based not upon the submissions of counsel but rather upon its own Internet research. Among those findings, from defendant’s own Web site, were that defendant was a wholly owned subsidiary of Amerco, whose other major subsidiaries included, inter alia, U-Haul, and that defendant was a “full service insurance company” which specialized, in part, in vehicular liability, operated in 49 states, and received approximately $170 million in premiums annually. From U-Haul’s Web site, the court found, among other things, that U-Haul was the largest consumer truck and trailer rental operation in the world, and operated in all 50 states, that there were at least nine Queens U-Haul facilities, and that U-Haul promoted career opportunities for defendant, its sibling corporation. Finally, the court found, by going to the Web site of the New York State Department of Insurance, that, contrary to counsel’s denial, defendant had been “licensed to do insurance business” in this state since April of 1980.

The court below did not make a specific finding as to whether defendant, under CCA 404 (a) (1), either in person or through an agent “transacts any business within the city of New York or contracts anywhere to supply goods or services in the city of New [*3]York.” Instead, it based its decision to deny the motion to dismiss on the policy considerations behind sections 1212 and 1213 of the Insurance Law, as well as the No-Fault Law.

In our opinion, the court below erred in denying defendant’s motion to dismiss.

Generally, where a defendant moves to dismiss an action on jurisdictional grounds, and where such jurisdictional challenge appears to have merit, the plaintiff has the burden of proving that jurisdiction has been properly obtained. So long as plaintiff has made a discernible showing that some basis for jurisdiction exists, the court in which the action has been brought has the power to determine whether it has jurisdiction. Whenever a plaintiff makes a “sufficient start,” i.e., a nonfrivolous showing that facts pertinent to an acceptable basis for jurisdiction may exist, a plaintiff is entitled to jurisdictional discovery, and thus need not make a prima facie showing of jurisdiction at the prediscovery stage (see Weinstein-Korn-Miller, NY Civ Prac ¶ 301.07; see also Peterson v Spartan Indus., 33 NY2d 463{**8 Misc 3d at 37} [1974]). Indeed, CPLR 3211 (d) permits a court to deny a motion to dismiss made under CPLR 3211 (a) or to order a continuance to enable a plaintiff to secure additional proof or to conduct further discovery, where “facts essential to justify opposition may exist” but are not available to it.

By serving process on the Superintendent of Insurance, plaintiff was aware that it was basing jurisdiction over defendant by virtue of either section 1212 or section 1213 of the Insurance Law, both of which provide that such service is deemed to have been made “within the territorial jurisdiction of any court in this state” (Insurance Law § 1212 [b]; § 1213 [b] [2]). Indeed, in its complaint, plaintiff alleged that defendant was “licensed and authorized to do business in the State of New York,” thereby implicitly alleging jurisdiction under Insurance Law § 1212. In addition, the complaint alleged that defendant “transacts business in the City of New York,” apparently claiming, in the alternative, that jurisdiction could be based on Insurance Law § 1213.

In opposition to defendant’s motion, plaintiff alleged that it needed to conduct jurisdictional discovery in order to obtain information about defendant’s sale and underwriting of insurance policies to New York City residents in order to establish that defendant did in fact transact business and contract to sell goods and services within the City of New York. It thereby implicitly abandoned its claim of jurisdiction based upon defendant’s status as an authorized insurer, since it could have demonstrated that status without the benefit of discovery, i.e., by submitting a certified document from the New York State Department of Insurance attesting to the fact that defendant was an authorized insurer. It chose not to do so, and instead proceeded to address the alternative jurisdictional basis of “transacting business” under Insurance Law § 1213. In order to demonstrate that “facts essential to justify opposition [to the motion to dismiss] may exist” (CPLR 3211 [d]), plaintiff needed to make more than conclusory allegations, and needed to submit some tangible evidence to substantiate its allegations that defendant, while unauthorized to do business, was either issuing or delivering insurance contracts to state residents or corporations authorized to do business in the state (Insurance Law § 1213 [b] [1] [A]) or was engaged in “any other transaction of business” (Insurance Law § 1213 [b] [1] [D]) and that the cause of action arose out of that transaction of business (see Farm Family Mut. Ins. Co. v Nass, [*4]126 Misc 2d 329 [1984], affd 121{**8 Misc 3d at 38} AD2d 498 [1986]). Plaintiff did not do so and thus did not make the “sufficient start” necessary to warrant further discovery (see e.g. Mandel v Busch Entertainment Corp., 215 AD2d 455 [1995]; see also Granat v Bochner, 268 AD2d 365 [2000]; Bissinger v DiBella, 141 AD2d 595 [1988]; Schumacher v Sea Craft Indus., 101 AD2d 707 [1984]). Accordingly, plaintiff’s complaint should have been dismissed at that juncture, and it was error for the court below not to have done so.

This error was further exacerbated by the court’s conduct in initiating its own investigation into the facts when, based upon the insufficient submissions of plaintiff, the court should have dismissed the complaint. In conducting its own independent factual research, the court improperly went outside the record in order to arrive at its conclusions, and deprived the parties an opportunity to respond to its factual findings. In effect, it usurped the role of counsel and went beyond its judicial mandate of impartiality. Even assuming the court was taking judicial notice of the facts, there was no showing that the Web sites consulted were of undisputed reliability, and the parties had no opportunity to be heard as to the propriety of taking judicial notice in the particular instance (see Prince, Richardson on Evidence § 2-202 [Farrell 11th ed]).

We note that defendant moved for reargument of the subject motion, and the court below, in a subsequent decision/order dated April 12, 2004, and officially reported at 3 Misc 3d 925 (2004), in effect, granted reargument and, upon reargument, adhered to its original determination. We have not reviewed that decision/order pursuant to CPLR 5517 (b) because defendant did not include in the record on appeal the motion papers upon which the decision/order was based (see Matter of Donato v Board of Educ. of Plainview-Old Bethpage Cent. School Dist., 286 AD2d 388 [2001]; Matter of Merendino v Herman, 15 AD2d 818 [1962]). However, in light of the fact that the subsequent decision/order adhered to the original determination set forth in the order appealed from, which has now been reversed, to the extent that the decision/order of April 12, 2004 supports a result contrary to the result herein, it should not be followed.

Pesce, P.J., dissents and votes to affirm the order in the following memorandum: In my opinion, the motion court’s use of the Web site of the New York State Department of Insurance in order to verify that defendant insurer was in fact licensed to do{**8 Misc 3d at 39} business in the State of New York was proper. Accordingly, the court did not err in denying defendant’s motion to dismiss based upon lack of jurisdiction.

Although New York cases do not clearly define the procedure for taking judicial notice of facts, in practice, sometimes judicial notice is taken at the request of a party, and sometimes it is taken sua sponte (see Prince, Richardson on Evidence § 2-202 [Farrell 11th ed]). Courts frequently take judicial notice of matters which, at a given moment, may be personally unknown to them. In such cases, recourse may be had to “such documents, references and other repositories of information as are worthy of belief and confidence” even in the absence of a specific request of a party (id. [internal quotation marks omitted]; see also People v Langlois, 122 Misc 2d 1018 [1984]). The use of reference works such as calendars, dictionaries and encyclopedias has been found to be acceptable (see Fisch, New York Evidence § 1068 [2d ed]).

Moreover, it is well settled that a court may take judicial notice of matters of public record or other “reliable documents, the existence and accuracy of which are not disputed” (see Brandes Meat Corp. v Cromer, 146 AD2d 666, 667 [1989] [certificate of dissolution of corporation issued by Secretary of State]; Associated Gen. Contrs. of Am., N.Y. State Ch. v Lapardo Bros. Excavating Contrs., 43 Misc 2d 825, 826 [1964] [“indisputable public records of the Secretary of State” showed that plaintiff was a domestic membership corporation]) and of data culled from those public records (see Matter of Siwek v Mahoney, 39 NY2d 159 [1976]; see also Russian Socialist Federated Soviet Govt. v Cibrario, 198 App Div 869 [1921], affd 235 NY 255 [1923] [in action brought by plaintiff in its alleged capacity of a sovereign state, said allegation was not conclusive upon the court, and it was appropriate for the court to call upon the State Department of the United States for information regarding the question of our recognition of that foreign government]).

Thus, in my opinion, it was a proper exercise of discretion for the court below to have sua sponte referred to a matter of public record, in order to ascertain the fact of defendant’s status as an insurer. There is no logical reason not to include within the category of public records such records when they are available from reliable sources on the Internet (see e.g., Glorius v Siegel, 5 Misc 3d 1015[A], 2004 NY Slip Op 51378[U] [Civ Ct, NY County 2004] [court verified multiple dwelling registration of premises on Web site of Department of Housing Preservation{**8 Misc 3d at 40} and Development]; see also Samson Moving & Stor. Corp. v Drake Bus. School, 2000 NY Slip Op 40023[U] [Civ Ct, NY County 2000] [court verified defendant’s corporate status by referring to Web site of Department of State’s Division of Corporations]). The Web site of the New York State Department of Insurance provides an insurer search list of “our licensed, regulated companies,” and, in an opinion letter, recommends its Web site in order to find a “directory of licensed insurers” (see Ops Gen Counsel NY Ins Dept No. 03-10-25). That same opinion letter indicates that the term “authorized insurer” includes an insurer that is licensed to do the business of insurance in New York State. The defendant insurer, “Republic Western Insurance [*5]Company,” is included in the directory of licensed insurers.

Defendant was authorized to do insurance business in New York State by virtue of its having been issued a license to do such business. The question of whether defendant was an authorized insurer was important in determining whether there was jurisdiction over it. Insurance Law § 1212 (a) provides that an insurer authorized to do business in the state must appoint the Superintendent of Insurance as its agent for service of process “in any proceeding against it on a contract delivered or issued for delivery, or on a cause of action arising, in the state.” Inasmuch as the cause of action in the instant case clearly arose in New York, and since defendant was, according to the records of the New York State Department of Insurance, authorized to do business in New York, service of process upon the Superintendent of Insurance was proper, and constituted valid service within the territorial jurisdiction of the Civil Court of the City of New York (Insurance Law § 1212 [b]), sufficient to confer personal jurisdiction over defendant.

Aronin and Patterson, JJ., concur; Pesce, P.J., dissents in a separate memorandum.

[*1]

Supreme Court, Appellate Term, Second Department, December 10, 2004

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellants. McDonald, Carroll, Cohen & Rayhill, New York City (Thomas J. Reilly of counsel), for respondent.

{**6 Misc 3d at 71} OPINION OF THE COURT

Memorandum.

Order insofar as appealed from unanimously affirmed without costs.

In this action to recover assigned no-fault benefits, plaintiffs submitted the affidavit of David Safir, wherein he states that he is the “practice and medical billing manager of plaintiff.” The affidavit is insufficient to establish that plaintiffs provided defendant with properly completed claim forms (see A.B. Med. Servs. v Allstate Ins. Co., 3 Misc 3d 129[A], 2004 NY Slip Op 50373[U] [App Term, 2d & 11th Jud Dists 2004]). Accordingly, plaintiffs failed to establish a prima facie entitlement to no-fault benefits and their motion for summary judgment was properly denied.

We note that the trial court denied plaintiffs’ motion for summary judgment on the ground that plaintiffs did not submit admissible proof authenticating the signature of plaintiffs’ assignor on the assignment form. The insurance regulations, however, do not require that a claimant’s signature be authenticated. Pursuant to the insurance regulations, a health care provider is only required to submit to the insurer a “properly executed assignment” on (1) the [*2]prescribed verification of treatment by the attending physician or other provider of service form (NYS form NF-3), or (2) the prescribed verification of hospital treatment form (NYS form NF-4), or the prescribed hospital facility form (NYS form NF-5), or (3) the prescribed no-fault assignment of benefits form (NYS form NF-AOB) (11 NYCRR 65-3.11 [b] [2]). A health care provider thus satisfies its burden by proof of submission of an assignment to the insurer that conforms to the regulations.

We further observe that defendant’s failure to seek verification of the assignment, or to allege any deficiency in the assignment in its denial of claim form, constitutes a waiver of any defenses with respect thereto (see New York Hosp. Med. Ctr. of Queens v New York Cent. Mut. Fire Ins. Co., 8 AD3d 640 [2004]; Presbyterian Hosp. v Aetna Cas. & Sur. Co., 233 AD2d 433 [1996]; Diagnostic Rehab. Med. Serv. P.C. v Travelers Indem. Co., {**6 Misc 3d at 72}6 Misc 3d 68 [2004]; Park Health Ctr. v Eveready Ins. Co., 2001 NY Slip Op 40665[U] [App Term, 2d & 11th Jud Dists 2001]).

Pesce, P.J., Aronin and Patterson, JJ., concur.

[*1]

Supreme Court, Appellate Term, Second Department, December 8, 2004

APPEARANCES OF COUNSEL

June D. Reiter, Garden City, for appellant. Amos Weinberg, Great Neck, for respondent.

{**6 Misc 3d at 63} OPINION OF THE COURT

Memorandum.

Order affirmed without costs.

Plaintiff health care provider made out a prima facie showing of entitlement to recover no-fault benefits for services rendered to its assignor by the submission of proof that the statutory claim forms had been mailed and received, and that defendant did not pay or deny the claims within the prescribed 30-day period (see Insurance Law § 5106 [a]; New York Hosp. Med. Ctr. of Queens v New York Cent. Mut. Fire Ins. Co., 8 AD3d 640 [2004]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]). In opposition to plaintiff’s motion for summary judgment, defendant has failed to raise a triable issue of fact.

Defendant’s denial of benefits form indicates that defendant received plaintiff’s claim on October 5, 2001, and that it did not deny the claim until December 19, 2001, which was beyond [*2]the statutorily prescribed 30-day period (see 11 NYCRR 65.15 [g] [3]; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Although the 30-day statutory period may be extended by a verification request (11 NYCRR 65.15 [d] [1], [2]), there was no proof submitted in admissible form that the alleged verification requests were mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Amaze Med. Supply v Colonial Penn Ins. Co., 3 Misc 3d 135[A], 2004 NY Slip Op 50471[U] [App Term, 2d & 11th Jud Dists 2004]).

Despite the untimely denial of plaintiff’s claim, defendant is not precluded from asserting the defense that the alleged injuries were not causally related to the accident, which was the sole ground for defendant’s denial of no-fault benefits (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 18-19 [1999]). The affidavit of defendant’s claims representative, however, was insufficient to demonstrate that defendant’s denial was based upon a “founded belief that the alleged injur[ies] do[ ] not arise out of an insured incident” (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d at 199). Moreover, the unsworn “Automotive Engineering Report,” attached thereto, did not constitute competent proof in admissible form (see Dotzel v Allstate Ins. Co., 2003 NY Slip Op 50853[U] [App Term, 9th & 10th Jud Dists 2003]), and defendant failed to proffer {**6 Misc 3d at 64}an acceptable excuse for failure to tender such proof in admissible form (see Friends of Animals v Associated Fur Mfrs., 46 NY2d 1065, 1068 [1979]; Allstate Ins. Co. v Keil, 268 AD2d 545 [2000]). Accordingly, since defendant failed to raise any triable issue of fact, plaintiff’s motion for summary judgment was properly granted.

Golia, J., dissents and votes to reverse the order and deny plaintiff’s motion for summary judgment in the following memorandum: Plaintiff (health care provider) moved for summary judgment and made out a prima facie showing of entitlement thereto upon alleging that it filed a claim for payment of no-fault benefits which was received by the carrier on October 5, 2001, and that a denial was not issued until December 19, 2001. Since the denial was well past the 30 days, the plaintiff asserts that any denial is ineffective pursuant to 11 NYCRR 65.15 (g) (3) (see also Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274 [1997]). Plaintiff further asserted that although the 30-day period may be extended by a request for verification pursuant to 11 NYCRR 65.15 (d) (1) and (2), no such requests were made in the case at bar.

Although I am not in full agreement with those assertions, my dissent is grounded firmly in the findings of the Court of Appeals in the matter of Central Gen. Hosp. v Chubb Group of Ins. Cos. (90 NY2d 195 [1997]) and followed by Mount Sinai Hosp. v Triboro Coach (263 AD2d 11 [1999]).

The Court of Appeals clearly and unequivocally stated that if the alleged injuries were not causally related to the accident, the strict 30-day time limit (11 NYCRR 65.15 [g] [3]) for filing a denial would not apply. That Court wisely reasoned that the no-fault regulations could not be used to mandate that an automobile insurance policy be used to pay for alleged injuries that did not arise from the automobile accident claimed.

It is evident to me that the defendant’s denial of the claim sufficiently raised that issue. Furthermore, contrary to the holding of the majority, I find that the papers submitted in opposition to the plaintiff’s motion for summary judgment were also sufficient to raise that issue of fact.

The instant case involves a minor accident between a large chartered bus in which the respondent was a passenger and a 1999 Ford Taurus, a mid-sized passenger automobile. Indeed the only damage to the bus was a one-inch crack in the front bumper which did not even warrant any repair. The passenger car suffered a shattered rear windshield and a buckled rear tailgate. {**6 Misc 3d at 65}There has been no reported injuries of any kind from the occupants of the passenger car. The tour guide on the bus stated that all the occupants of the bus fully participated in the recreational events of the day. Indeed the police report did not note any injuries by any occupants of either the bus or the passenger car. The insurance carrier engaged the services of an automotive engineering expert who investigated the accident and determined that the plaintiff could not have suffered the injuries complained of.

Under all the facts and circumstances, it is abundantly clear that there is an issue of fact as to whether the injuries alleged resulted from the accident claimed.

In support of their opinion the majority relies solely on the fact that the “Automotive Engineering Report” was unsworn and therefore did not constitute competent proof in admissible form. The majority argues that the failure to submit a sworn affidavit or a valid reason for failing to do so is fatal to this position.

However, I find that such unsworn report is sufficient for the purpose of raising a triable issue of fact. There is a long line of cases from the Court of Appeals and lower courts that [*3]support the proposition, that for the purpose of defending a summary judgment motion, statements that may be subject to objections should not be precluded from consideration by the court if they are otherwise relevant and competent (see Phillips v Kantor & Co., 31 NY2d 307 [1972]; Narvaez v NYRAC, 290 AD2d 400 [2002]; Kwi Bong Yi v JNJ Supply Corp., 274 AD2d 453 [2000]; Eitner v 119 W. 71st St. Owners Corp., 253 AD2d 641 [1998]; Guzman v Strab Constr. Corp., 228 AD2d 645 [1996]).

This is especially true, as it is here, where the witness who prepared the unsworn “Automotive Engineering Report” is presumably available to testify (Levbarg v City of New York, 282 AD2d 239, 241 [2001]).

Accordingly, I would reverse the holding of the lower court and would deny the plaintiff’s motion for summary judgment.

Pesce, P.J., and Rios, J., concur; Golia, J., dissents in a separate memorandum.

[*1]

Supreme Court, Appellate Term, Second Department, December 1, 2004

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellant. Samuel K. Rubin, Bethpage, for respondent.

{**6 Misc 3d at 57} OPINION OF THE COURT

Memorandum.

Order unanimously reversed without costs, plaintiff’s motion for summary judgment granted and matter remanded to the court below for a calculation of statutory interest and an assessment of attorney’s fees.

In this action to recover first-party no-fault benefits for medical services rendered to its assignor, plaintiff health care provider established a prima facie entitlement to summary judgment by proof that it submitted the statutory claim form setting forth the fact and the amount of the loss sustained and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]; A.B. Med. Servs. PLLC v Lumbermens Mut. Cas. Co., 4 Misc 3d 86 [App Term, 2d & 11th Jud Dists 2004]).

In opposition to plaintiff’s motion, defendant failed to raise triable issues of fact. Defendant denied plaintiff’s claim on the ground that plaintiff’s assignor failed to appear for examinations under oath (EUOs). The revised insurance regulations, which took effect on April [*2]5, 2002, include EUOs in the mandatory personal injury protection endorsement, providing that an eligible injured person submit to EUOs “as may reasonably be required” (11 NYCRR 65-1.1 [d]). It is uncontroverted that plaintiff’s claim was submitted subsequent to April 5, 2002. However, “[c]onsistent with the Insurance Department’s interpretation of the new regulation, which is entitled to great deference . . . the insurer must include the revised prescribed endorsement with new or renewal policies issued on or after April 5, 2002, and the claim rules are to be governed by the policy endorsement in effect” (S & M Supply v State Farm Mut. Auto. Ins. Co., 4 Misc 3d 130[A], 2004 NY Slip Op 50693[U], *2 [App Term, 9th & 10th Jud Dists 2004]). In the instant case, defendant’s submissions failed to establish in the first instance that the insurance policy contained an endorsement authorizing EUOs (see S & M Supply Inc. v Lancer Ins. Co., 4 Misc 3d 131[A], 2004 NY Slip Op 50695[U] [App Term, 9th & 10th Jud Dists 2004]). Accordingly, plaintiff’s failure to appear for EUOs cannot constitute a basis for denial of the claim.{**6 Misc 3d at 58}

Therefore, plaintiff’s motion for summary judgment should have been granted, and the matter is remanded for the calculation of statutory interest and attorney’s fees pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder.

Pesce, P.J., Patterson and Rios, JJ., concur.

Supreme Court, Kings County

25595/03

Ira Harkavy, J.

defendant Country-Wide Insurance Company (Countrywide) moves, pursuant to CPLR 3212, for an order granting summary judgment dismissing the complaint of plaintiff Ketly Lavaud as Assignee of the Rights of Don N. Nixon a/k/a Donnon N. Nixon (plaintiff). Plaintiff cross-moves for an order awarding her summary judgment against Countrywide on her complaint.

The Underlying Accident

On November 13, 1995, plaintiff and non-party Martha Domfe (Ms. Domfe) were pedestrians crossing Caton Avenue, at its intersection with Flatbush Avenue, in Brooklyn. When they started crossing the street, Don N. Nixon (Mr. Nixon) was stopped for a red light at the intersection in a vehicle insured by Countrywide under a liability policy with limits of $10,000 per person/$20,000 [*2]per accident. Before plaintiff and Ms. Domfe finished crossing the street, the light turned green and Mr. Nixon proceeded toward the intersection and struck plaintiff and Ms. Domfe in the cross-walk. As a result of this accident, plaintiff sustained various injuries including a fractured patella and a torn lateral and medial meniscus.

The Domfe Action

On or about February 6, 1996, Ms. Domfe commenced an action against Mr. Nixon in Kings County Supreme Court. On September 4, 1996, Mr. Nixon appeared for an examination before trial and testified that his vehicle struck both plaintiff and Ms. Domfe and that he did not see these pedestrians before contact was made. In a letter dated October 21, 1996, Ms. Domfe demanded that Countrywide tender its full policy limits. In a letter dated January 23, 1997, Ms. Domfe’s counsel notified Countrywide that his client was prepared to settle the case for the policy limits and that he would consider Countrywide’s failure to accept this offer to be in bad faith. On February 14, 1997, Ms. Domfe filed a note of issue and certificate of readiness. In or about September, 1997, the Domfe action was settled for $9,500.00.

Plaintiff’s Action

By letter dated January 10, 1996, plaintiff’s attorney notified Countrywide of the accident. On May 22, 1996, plaintiff’s attorney provided Countrywide with a copy of the police report of the accident, as well as a medical report from the hospital that initially treated plaintiff for her injuries. On March 25, 1997, plaintiff provided Countrywide with authorizations for her MRI films and no-fault records.

On or about August 11, 1998 (11 months after the Domfe action was settled), plaintiff commenced an action against Mr. Nixon. In a letter dated August 13, 1998, plaintiff’s attorney notified Countrywide that his client was prepared to settle the action for $10,000. Plaintiff’s attorney attached various records to the letter including plaintiff’s emergency room record, two operative reports, as well as her employer’s wage verification report. Finally, plaintiff’s attorney stated:

“The offer to accept the sum of herein mentioned in full settlement of the above entitled action is made without prejudice and is to be deemed withdrawn if not accepted within ten (10) days from the date of this letter. In the event I do not receive a response from your office within said time period, and upon an excess verdict in favor of my client being rendered, your company may be held responsible for said excess as well as your insured by reason of the fact that you failed to proceed in good faith.”

In a letter dated November 5, 1998, Countrywide advised plaintiff’s attorney that it was in receipt of his August 13, 1998 letter. Countrywide also advised plaintiff’s attorney that it was missing plaintiff’s no-fault file and asked that a copy of this file be sent to it in order to “expedite settlement” of plaintiff’s claim. Finally, Countrywide stated that it was “ready, willing, and able to discuss all claims,” but first needed to review the missing no-fault file. Following the exchange of these letters, the case proceeded through the discovery process. Although plaintiff’s counsel claims that he attempted to negotiate a settlement during this period, the only firm settlement offer made by plaintiff during the pendency of her action was set forth in the August 13, 1998 letter, which, by its own terms, expired on August 23, 1998. [*3]

On December 13, 2001, at the commencement of jury selection, Countrywide tendered its first settlement offer in the amount of $8,000 and plaintiff rejected this offer. The following day, Countrywide tendered a settlement offer in the amount of $10,000, the full policy limit. Plaintiff also rejected this offer. After a trial on liability and damages, the jury found Mr. Nixon 70% responsible for the accident, and plaintiff 30% responsible. The jury awarded plaintiff $750,000 for past pain and suffering and $250,000 for future pain and suffering. On appeal, the Appellate Division, Second Department upheld the jury’s determination on liability but reduced damages for past pain and suffering to $350,000 and future pain and suffering to $105,000. Ultimately, plaintiff entered a judgment against Mr. Nixon in the total amount of $459,796.75, inclusive of interest. On May 30, 2002, plaintiff and Mr. Nixon entered into an agreement whereby plaintiff relinquished her right to enforce the judgment against Mr. Nixon personally in exchange for an assignment of Mr. Nixon’s right to pursue a claim against Countrywide for an alleged bad faith refusal to accept plaintiff’s settlement offer.

The Instant Bad-Faith Action

By summons and complaint dated July 10, 2003, plaintiff commenced the instant action against Countrywide alleging that it acted in bad faith and in gross disregard of the insured’s interests when it failed to accept plaintiff’s August 13, 1998 settlement offer. The instant motions are now before the court.

“To establish a prima facie case of bad faith refusal to settle, a plaintiff must demonstrate that the insurance carrier’s conduct constituted a gross disregard of the policyholder’s interests-that is, a deliberate or reckless failure to place on an equal footing its own interests and those of the policyholder when considering a settlement offer” (Vecchione v Amica Mut. Ins. Co., 274 AD2d 576, 578 [2000]). “In other words, a bad-faith plaintiff must establish that the defendant insurer engaged in a pattern of behavior evincing a conscious or knowing indifference to the probability that an insured would be held personally accountable for a large judgment if a settlement offer within the policy limits were not accepted” (Pavia v State Farm Mut. Auto. Ins. Co., 82 NY2d 445, 453-454 [1993]).

“Factors that enter into the bad faith equation include the likelihood of success on the liability issue in the underlying action, the potential magnitude of damages and resulting financial burden each party may be exposed to as a result of a refusal to settle, and the information available to the insurance carrier at the time the demand for settlement is made” (Vecchione, 274 AD2d at 578-579). “Naturally, proof that a demand for settlement was made is a prerequisite to a bad-faith action for failure to settle” (Pavia, 82 NY2d at 454). Furthermore, a bad-faith plaintiff must demonstrate that, at the time such a settlement demand was offered, “all serious doubts about the insured’s liability were removed” (id. at 454).

It is clear from the record before the court that Countrywide’s conduct in this matter was hardly a model of diligence. For example, Countrywide has failed to offer a satisfactory excuse for waiting some three months before responding to plaintiff’s August 13, 1998 settlement offer. However, the fact of the matter is, the only settlement demand that plaintiff made in this case was contained in the August 13, 1998 letter. Thus, plaintiff’s entire case rests upon a settlement demand that was only open for ten days and was made a mere two days after she commenced the underlying [*4]action. In Pavia, the Court of Appeals expressed strong disapproval of such time-limited settlement offers on public policy grounds. Specifically, the Court noted that:

“[p]ermitting an injured plaintiff’s chosen timetable for settlement to govern the bad-faith inquiry would promote the customary manufacturing of bad-faith claims, especially in cases where an insured of meager means is covered by a policy of insurance which would finance only a fraction of the damages in a serious personal injury case. Indeed, insurers would be bombarded with settlement offers imposing arbitrary deadlines and would be encouraged to prematurely settle their insureds’ claims at the earliest possible opportunity in contravention of their contractual right and obligation of thorough investigation.”^[FN1] (Pavia, 82 NY2d at 455).

Besides the public policy concerns which are implicated with plaintiff’s time-limited settlement offer, there are other factors which weigh against plaintiff’s bad faith claim. As the court noted above, plaintiff’s settlement offer was made nearly simultaneously with the filing of the underlying complaint. While it is true that Countrywide was on notice as to the circumstances of the accident given its involvement in the Domfe action, it had no opportunity to conduct an independent medical exam or to depose plaintiff regarding her injuries. Finally, plaintiff’s claim that all serious doubts about Mr. Nixon’s liability were removed at the time of the settlement offer is belied by the jury’s finding that plaintiff was 30% responsible for the accident.

Accordingly, Countrywide’s motion for summary judgment dismissing plaintiff’s complaint is granted and the action is hereby dismissed. Plaintiff’s cross motion for summary judgment against Countrywide is denied.

This constitutes the decision, order, and judgment of the court.

Dated: October 18, 2004E N T E R,

J. S. C.

Footnotes

Footnote 1:In Pavia, the settlement offer was valid for 30 days, three times longer than plaintiff’s offer.

[*1]

Supreme Court, Appellate Term, Second Department, September 20, 2004

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellant. Eric H. West, Long Island City, for respondent.

{**5 Misc 3d at 56} OPINION OF THE COURT

Memorandum.

Order unanimously affirmed without costs.

Plaintiff commenced this action to recover first-party no-fault benefits for medical supplies provided to its assignor. Thereafter, plaintiff moved for summary judgment in the amount of $980, which motion was denied by order entered September 10, 2003.

Contrary to the determination of the court below, plaintiff’s billing manager did not have to allege in his supporting affidavit that he had personal knowledge that the equipment was furnished to plaintiff’s assignor. Said affidavit set forth the billing manager’s duties so as to support the conclusion that the attached exhibits were sufficiently accurate and trustworthy to merit their admission into evidence pursuant to the business record exception to the hearsay rule (see CPLR 4518 [a]; People v Kennedy, 68 NY2d 569 [1986]), and said exhibits established that the supplies were furnished to the assignor.

A review of the record indicates that plaintiff established its prima facie entitlement to summary judgment by showing that it submitted a properly completed claim form to defendant for $980 (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]; Damadian MRI in Elmhurst v Liberty Mut. Ins. Co., 2 Misc 3d 128[A], [*2]2003 NY Slip Op {**5 Misc 3d at 57}51700[U] [App Term, 9th & 10th Jud Dists 2003]). It is uncontroverted that defendant had until July 17, 2003 to pay or deny plaintiff’s claim. The plaintiff’s billing manager asserted that the defendant’s denial was untimely and he submitted a photocopy of an envelope, postmarked August 29, 2003, which allegedly contained the denial form. Defendant, however, submitted the affidavit of its claims adjuster who attested to the routine procedure and practice of her office, in the regular course of its business, which indicates that the denial had been duly addressed and mailed to plaintiff on July 17, 2003. In view of the foregoing, we find that the court below properly determined that a triable issue of fact existed (see Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). Accordingly, plaintiff’s motion for summary judgment was properly denied.

McCabe, P.J., Covello and Tanenbaum, JJ., concur.