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The Rogak Report: 01 May 2006 ** No Fault - Timeliness of Payment **

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  • Lawrence Rogak
    Message 1 of 1 , Apr 30, 2006

      New York Craniofacial Care PC a/a/o Maria Vega, Christopher A.
      Mendez, Daniel Rodriguez, Marsha Rasin, and Julio Suazo v. Allstate
      Ins. Co., NYLJ 4/27/06 (Civil Court, Kings County) (BLUTH, j)

      In this no-fault benefits suits, the Court was called upon to clarify
      what facts a first-party No-Fault plaintiff must set forth in order
      to establish that its claim is "overdue."

      Plaintiff medical provider argued that "overdue" means "not paid,"
      and so the affidavit in support of the motion must only state that
      the bills have not been paid. Allstate's position was that a bill
      is "overdue" only if it has not been paid or properly denied, and
      the affidavit in support of plaintiff's motion must so state.

      Plaintiff argued that its claims were submitted to Allstate, were not
      paid, and were overdue. Allstate countered that plaintiff did not
      make out its prima facie case, and that, in any event, defendant
      timely denied the claims.

      In support of its summary judgment motion, plaintiff submitted two
      affidavits. In the first, Fenelly Olivares stated that he is the
      person responsible for submitting plaintiff's No-Fault claims and
      that he personally mailed the subject claims to defendant on April 3,
      May 15, and May 23 of 2002. Thus, his affidavit established that the
      claims were submitted to defendant.

      The second affidavit was from Rachael Newton, the person responsible
      for handling and tracking whatever response is forthcoming from the
      insurers on the claims. Ms. Newton stated that "[d]efendant did not
      pay plaintiff's claims that are the subject of this lawsuit within
      thirty (30) days. Accordingly, plaintiff's claims are now overdue and

      "Although Ms. Newton would know," stated the Court, "her affidavit is
      absolutely silent as to whether plaintiff received any denials, and
      if so, on which of the claims. These are material omissions because
      if defendant timely issued a valid denial of plaintiff's claims,
      plaintiff would not be entitled to summary judgment simply because
      the claims remained unpaid. A claim that has been timely (and
      validly) denied is not due. Of course, if it is not due, it cannot be
      overdue. If, on the other hand, plaintiff had shown in its moving
      affidavit that there were no denials, or that the denials were late
      or otherwise invalid and thus a nullity, plaintiff's claims would be
      overdue, and plaintiff would be prima facie entitled to judgment.
      None of those facts, however, may be gleaned from Ms. Newton's

      "At oral argument, plaintiff's counsel urged that plaintiff need not
      mention anything about denials at all. Rather, counsel argued, all
      that is necessary is for plaintiff to state that the claims have not
      been paid and thus are overdue. In support of her argument, counsel
      relied upon the language of subsection 65-3.8 (a)(1)... which defines
      an overdue claim as one that has not been paid within 30 days of
      submission. See 11 NYCRR §65-3.8(a)(1). This Court, however, believes
      that 11 NYCRR §65-3.8(a)(1) cannot be read in a vacuum. Subsection 65-
      3.8(c) makes clear that the 30-day rule entails a failure to pay or
      deny the claim within 30 days. To wit, within 30 calendar days after
      proof of claim is received the insurer shall either pay or deny the
      claim in whole or in part. 11 NYCRR §65-3.8(c). The problem with
      plaintiff's counsel's approach is that it invites providers to bring
      disingenuous summary judgment motions alleging that their claims are
      overdue even when they are well aware that they received valid,
      timely denials."

      "Since a claim is overdue only if it has been neither paid nor
      properly denied, and plaintiff states only that its claims were not
      paid, plaintiff has not made out its prima facie case."

      "By its holding, this Court is not increasing the burden of a
      plaintiff healthcare provider moving for summary judgment in a No-
      Fault case. Indeed, once the plaintiff sets forth that its claim has
      not been paid or timely denied, the defendant must still come forward
      with competent proof to rebut that assertion in order to defeat the
      motion. All this Court is requiring is that the plaintiff make clear
      in its moving papers that it is entitled to judgment on its claims.
      The fact that the plaintiff's claims have not been paid does not, in
      and of itself, entitle the plaintiff to summary judgment as a matter
      of law."

      "The Court recognizes that a statement that 'the claim has not been
      paid or timely denied' is boilerplate, and the absence of such a
      statement may seem like a mere technicality. But it is not. Every
      statement in an affidavit is sworn to under the penalties of perjury.
      If the affiant knows that there was a timely denial of the unpaid
      claim, then it would be perjurious to state that 'the claim has not
      been . . . timely denied.' Indeed, under that circumstance, it would
      be improper for the provider to seek summary judgment based on
      untimeliness of the denial, although it would be free to move based
      upon some other ground."

      "Ms. Newton's affidavit neither states nor shows that there is no
      defense or that the defenses have no merit. Indeed, since proper
      denials would constitute a defense to the action, plaintiff's failure
      to address whether the claims were denied makes the moving affidavit
      not only insufficient but disingenuous as well."

      "Ms. Newton's affidavit is deficient in several other respects as
      well.... When a suit combines multiple claims and/or assignors, it is
      incumbent upon the moving party to identify in the affidavit each
      claim and/or assignor to which the motion is directed, and the reason
      the movant is entitled to judgment upon each one. Rather than do so
      here, plaintiff submitted an affidavit that could have been attached
      to any motion for summary judgment between these parties."

      "Based on all of the foregoing, the Court finds that plaintiff has
      not made out its prima facie case for entitlement to summary judgment
      as a matter of law. Therefore, the Court need not reach the
      sufficiency of defendant's opposition. Accordingly, plaintiff's
      motion is denied."

      Larry Rogak
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