PT PC v. Nationwide Mutual Insurance Company, Defendant. (2025)

I. Recitation of the papers considered in the review of this Motion as required by CPLR 2219(a)

Upon reviewing Defendant's Motion for summary judgment ("Motion #1"), Plaintiff's opposition to Motion #1 and Cross-Motion for summary judgment ("Motion #2") and Defendant's opposition to Motion #2 ("Opposition #2") together with all supporting documents, Motion #1 and #2 are decided as follows.

II. Background

The matter at hand concerns a no-fault benefits reimbursement for medical expenses incurred by Plaintiff, a healthcare provider, from Defendant, an insurance company, arising from an automobile accident that occurred on October 10, 2022, where Plaintiff's assignor, F. L. ("Assignor") allegedly sustained injuries.

On May 3, 2023, Plaintiff commenced the instant action by filing a summons and complaint ("Complaint") seeking money damages in the amount of $858.26, together with statutory interest, attorney's fees of twenty percent (20%) per claim and costs, for purported recovery of unpaid No-Fault medical bills. On July 27, 2023, Defendant interposed an answer ("Answer"). On March 19, 2024, Defendant filed a motion for summary judgment pursuant to CPLR 3212 ("Motion #1"), seeking to dismiss Plaintiff's Complaint. On August 16, 2024, Plaintiff filed an opposition to Motion #1 and a cross-motion for summary judgment for its claims pursuant to CPLR 3212. Defendant opposed. Motion #1 and #2 were subsequently assigned to this Court for a determination.

III. Discussion

To prevail on a motion for summary judgment, the movant must show that "there are no material issues of fact in dispute, and that it is entitled to judgment as a matter of law" (see Dallas-Stephenson v Waisman, 39 AD3d 303, 306, 833 N.Y.S.2d 89 [1st Dept 2007] quoting Winegrad v New York Univ Med Center, 64 NY2d 851, 853, 476 N.E.2d 642, 487 N.Y.S.2d 316 [1985]; Ostrov v Rozbruch, 91 AD3d 147, 152, 936 N.Y.S.2d 31 [1st Dept 2012]). The movant has the initial burden of coming forward with admissible evidence, such as affidavits by persons having knowledge of the facts, reciting the material facts and showing that the cause of action has no merit (CPLR 3212[b]; see Zuckerman v City of New York, 49 NY2d 557, 562 [1980]; GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967 [1985]; see also Kershaw v Hospital for Special Surgery, 114 AD3d 75, 81-82, 978 NYS2d 13 [1st Dept 2013]). "[M]ere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient" (Zuckerman, 49 NY2d 557, 562 [1980]).

Only when the movant meets this burden, does the burden shift to the opposing party to submit proof in admissible form that establishes a triable issue of fact (CPLR 3212[b]; see Zuckerman, 49 NY2d 557, 562 [1980]; Kosson v Algaze, 84 NY2d 1019, 646 N.E.2d 1101, 622 NY2d 674 [1995]; Gonzalez v 98 Mag Leasing Corp., 95 NY2d 124, 128-129, 733 N.E.2d 203, 711 N.Y.S.2d 131 [2000]).

Summary judgment is a drastic remedy and should not be granted where there are material and triable issues of fact present (see Stillman v Twentieth Century Fox F. Corp., 3 NY2d 395 [1957]; F. Garofalo Elec Co v NY Univ, 300 AD2d 186 [1st Dept 2002]). The evidence must be viewed in the light most favorable to the party opposing the motion, including resolving all reasonable inferences in that party's favor (see Jacobsen v New York City Health and Hosps. Corp., 22 NY3d 824, 833, 988 N.Y.S.2d 86, 11 N.E.3d 159 [2014]). Where different conclusions may reasonably be drawn from the evidence, the motion must be denied (see Sommer v Federal Signal Corp., 79 NY2d 540 [1992]; Jaffe v Davis, 214 AD2d 330 [1st Dept 1995]).

1. Defendant's Motion for summary judgment

Defendant's Motion #1 argues that it is entitled to summary judgment to dismiss Plaintiff's Complaint due to Assignor's failure to attend two duly scheduled Examinations Under Oath ("EUO") and Plaintiff's failure to bill in accordance with the fee schedule.

It is well established that insurers must pay or deny No-Fault benefit claims "within thirty (30) calendar days after receipt of the proof of the claim" (see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 501 [2015]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 563 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]; see Insurance Law 5106[a]; 11 NYCRR § 65-3.8[c]; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Failure to establish timely payment or denial of the claim precludes the insurer from offering evidence of its defense to non-payment (see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v. Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 281-86).

If an insurer seeks additional verification, the 30-day timeframe is tolled until it receives the relevant information requested (see 11 NYCRR 65-3.8 [a][1]). "Upon receipt of one or more of the prescribed verification forms used to establish proof of claim . . . an insurer has 15 business days within which to request 'any additional verification required by the insurer to establish proof of claim' " (see Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317, 879 N.E.2d 1291, 849 N.Y.S.2d 473 quoting 11 NYCRR 65-3.5[b]). Such request for additional verification can be in the form of an EUO (see Quality Psychological Services, P.C. v. Utica Mut. Ins. Co., 38 Misc 3d 136[A], 967 N.Y.S.2d 869 [App Term, 1st Dept 2013]). "At a minimum, if any requested verifications has not been supplied to the insurer 30 calendar days after the original request, the insurer shall, within 10 calendar days, follow up with the party from whom the verification was requested" (see 11 NYCRR 65-3.6[b]). "[F]ailure to submit to an EUO and 'subscribe to the same' violates a condition precedent to coverage" (see Hertz Vehicles, LLC v Best Touch PT, P.C., 162 AD3d 617, 618, 80 N.Y.S.3d 33 [1st Dept 2018]), and is a material policy breach precluding recovery of proceeds under the insurance policy (see Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d 755, 756 [2nd Dept 2020]).

For the matter at hand, the Affidavit of C. W., Defendant's Claims Specialist, and M. M., Operation Manager of Auto Injury Solutions, Inc. ("AIS"), authorized agent for receiving bills and/or correspondence for Defendant, sufficiently pleaded to AIS's mailing process and generation of the delay letters in relation to bills at issue, as such affidavits described in detail, based on affiants' personal knowledge, Defendant's standard office practices and procedures used to ensure proper mailing of said denial of claim form (see Amaze Medical Supply, Inc. v Allstate Insurance Company, 3 Misc 3d 133(A), 787 N.Y.S.2d 675 [App Term, 1st Dept 2004]; see also Ortho-Med Surgical Supply, inc. v MVAIC, 28 Misc 3d 139(A), 958 N.Y.S.2d 62 [App Term, 2nd Dept 2010]). Here, Defendant received a bill for service provided on November 8, 2022 through November 10, 2022, totaling $474.35 ("Bill 1") on November 21, 2022. The initial delay letter was timely mailed to Plaintiff on November 30, 2022, advising that Bill 1 was being delayed pending investigation (Motion #1, Exhibit D). Upon Assignor's failure to appear for the first EUO, a second letter was timely mailed to Plaintiff on January 3, 2023 (id.). Assignor failed to appear for the second EUO. Within 30 days of Assignor's second missed EUO, Defendant timely denied Bill 1 for Assignor's failure to appear for the duly scheduled EUOs in a Form NF-10 dated February 1, 2023 (id.).

In regard to a bill for service provided on November 14, 2022 through November 23, 2022, totaling $383.91 ("Bill 2"), Bill 2 was received by Defendant on December 5, 2022. On December 12, 2022, Defendant timely mailed an initial letter to Plaintiff, advising that Bill 2 was being delayed pending investigation (Motion #1, Exhibit E). As stated in the foregoing, Assignor failed to appear for the first EUO, and thereafter a second letter was mailed to Plaintiff on January 13, 2023. Upon Assignor's failure to appear for the second EUO, Defendant timely denied Bill 2 for Assignor's non-appearance of the EUOs in a Form NF-10 dated February 1, 2023 (id.).

In addition, the affidavits of A. H., Esq., counsel for Plaintiff, and the annexed transcripts of the EUO proceedings sufficiently established non-appearance of Assignor for both EUOs (Motion #1, Exhibit G, I). Plaintiff's counsel timely mailed a letter and an Amended Notice to Assignor on November 18, 2022, advising that an EUO was scheduled to take place on December 14, 2022 at 1:00PM requiring Assignor's attendance (Motion #1, Exhibit F). Upon Assignor's failure to appear at the said EUO, Plaintiff's counsel mailed a second letter and an Amended Notice on December 15, 2022, advising that a second EUO was scheduled to take place on January 13, 2023 at 1:00PM requiring Assignor's attendance (Motion #1, Exhibit H). Assignor failed to appear for the second EUO.

Here, Defendant's EUO requests were timely made and properly transmitted to Assignor, and Assignor failed to appear for both EUOs. Therefore, the burden shifts to Plaintiff, the opposing party to submit proof in admissible form to raise a triable issue of fact (CPLR 3212[b]).

For the matter at hand, Plaintiff did not deny Assignor's nonappearance. However, Plaintiff contended that there were issues of fact concerning the underlying basis for Defendant's EUO requests, because Defendant allegedly failed to provide specific justification for its EUOs requests.

The Court first notes that there appears to be a divide between the holdings of the First Department, which requires a denial of an insurer's motion for summary judgments as premature when the insurer fails to specify objective justification to the EUOs, whose approach this Court is bound by (see e.g. Country-Wide Ins. Co. v Alicea, 214 AD3d 530, 183 N.Y.S.3d 848 [1st Dept 2023]; Country-Wide Ins. Co. v Delacruz, 205 AD3d 473, 168 N.Y.S.3d 63 [1st Dept 2022]; Kemper Independence Ins. Co. v AB Med. Supply, Inc., 187 AD3d 671, 671, 131 NYS3d 556 [1st Dept 2020]; American Tr. Ins. Co. v Jaga Med. Servs., P.C., 128 AD3d 441, 6 N.Y.S.3d 480 [1st Dept 2015]), and the holdings of the Second Department, which do not require the insurer to set forth objection reasons for requesting EUOs so as to meet its prima facie burden (see e.g. Interboro Insurance Company v. Clennon, 113 AD3d 596, 979 N.Y.S.2d 83 [2nd Dept 2014]; IDS Property Casualty Insurance Company v. Starcar Medical Services P.C., 116 AD3d 1005, 985 NYS2d 116 [2nd Dept 2004]).

Pursuant to 11 NYCRR 65-3.5(e), "[w]hen an insurer requires an examination under oath of an applicant to establish proof of claim, such requirement must be based upon the application of objective standards so that there is specific objective justification supporting the use of such examination [Emphasis added]". The "absence of any justification for the EUO, [the insurer] cannot establish, as a matter of law, that it complied with the governing regulations" (see Country-Wide Ins. Co. v Delacruz, 205 AD3d 473, 474, 168 N.Y.S.3d 63 [1st Dept 2022]). Here, none of Defendant's delay letters, EUO scheduling letters, nor the affidavits submitted in support of Motion #1 sets forth an objective justification for the EUOs. "[Defendant's] conclusory assertion that it seeks clarification about the facts of the car accident — without indication of what facts are in question, or why — is not sufficient" (id. at 473). "The reason for the EUO request is a fact essential to justify opposition to [Defendant's] summary judgment motion, [that is] exclusively within the knowledge and control of [Defendant]" (see American Tr. Ins. Co. v Jaga Med. Servs., P.C., 128 AD3d 441, 441, 6 N.Y.S.3d 480 [1st Dept 2015]).

As Defendant failed to provide a justification for the EUOs, Motion #1, Defendant's Motion for summary judgment to dismiss the claim is denied as premature. Consequentially, this Court will not address the fee schedule dispute.

2. Plaintiff's Motion for summary judgment

"[A] plaintiff demonstrates prima facie entitlement to summary judgment by submitting evidence that payment of no-fault benefits are overdue, and proof of its claim, using the statutory billing form, was mailed to and received by the defendant insurer" (see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 501, 14 N.Y.S.3d 283, 35 N.E.3d 451 [2015]). Plaintiff's failure to submit an affidavit of an individual with personal knowledge of the facts of the case warrants a denial of Plaintiff's cross-motion for its claim.

IV. Order

Accordingly, it is hereby:

ORDERED that Motion #1, Defendant's motion for summary judgment seeking to dismiss Plaintiff's Complaint is DENIED; and it is further

ORDERED that Motion #2, Plaintiff's cross-motion for summary judgment for its claim is DENIED.

This constitutes the DECISION and ORDER of the Court.

Dated: April 25, 2025

County of New York

Hon. Wendy Changyong Li

Judge of the Civil Court

Wendy Changyong Li, J.