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The Maslow specificity rule went up in a plume of smokeMarch 16, 2017

Matter of Global Liberty Ins. Co. v Therapeutic Physical Therapy, P.C., 2017 NY Slip Op 01833 (1st Dept. 2017)

“Respondent sought recovery for physical therapy services provided to its assignor before April 1, 2013, and petitioner insurer disclaimed parts of the claim on the ground that it had already reimbursed a different provider for “eight units” for services on some of the same dates. Respondent checked the box on the prescribed disclaimer form indicating that it was relying on a “fee schedule” defense, specifically the “eight unit rule.” The lower arbitrator held that respondent was precluded from asserting its defense because the disclaimer was insufficiently specific in that the other provider was not named. Respondent appealed to the master arbitrator, arguing that it adequately preserved its defense. The master arbitrator, without addressing the issue of preservation, incorrectly found that the lower arbitrator had “considered the fee schedule defense” and “determined that [r]espondent failed to provide evidence as to the other provider.”

The master arbitrator’s award was arbitrary, because it irrationally ignored the controlling law presented on the preservation issue (Matter of Global Liberty Ins. Co. v Professional Chiropractic Care, P.C., 139 AD3d 645, 646 [1st Dept 2016]; see generally Matter of Smith [Firemen’s Ins. Co.], 55 NY2d 224, 232 [1982]) — namely, that an insurer adequately preserves its fee schedule defense “by checking box 18 on the NF—10 denial of claim form to assert that plaintiff’s fees [were] not in accordance with the fee schedule” (Megacure Acupuncture PC v Lancer Ins Co., 41 Misc 3d 139[A], 2013 NY Slip Op 51994[U], *3 [App Term, 2d Dept 2013] [internal quotation marks omitted] [alteration in original]; Surgicare Surgical v National Interstate Ins. Co., 46 Misc 3d 736, 745-746 [Civ Ct, Bronx County 2014], affd sub nom. Surgicare Surgical Assoc. v National Interstate Ins. Co., 50 Misc 3d 85 [App Term, 1st Dept 2015]). Accordingly, we remand the matter to the extent indicated.”

So the arbitrator and master arbitrator are nameless, but you can look them up if you are curious – this was an e-filed case.   I  remember this case vividly.  I appeared at the arbitration.  The lower arbitrator told me she follows the Maslow rule which states that the disclaimer must set forth a prima facie defense.  I told the lower arbitrator (who I never met before) that she was wrong, and I remember she was indignant at my comment.  Perhaps I came off too strong.  I was furious and stated that I did not care what she did because I will take the case up to the Appellate Division.  She followed through on her promise and I followed through on mine.  Man did I eat my words because the Master Arbitrator gave me the Petrofsky treatment and Justice Tapia said he thought the lower arbitrator’s analysis was spot on.  I was starting to feel as though I did not understand the law anymore.  Sometimes you read affirmations and opinions and you get the feeling that perhaps it is you, not them.

Again, the loss of Norman Dachs (prior to his illness) could be felt in the master arbitration system, as  the master failed to address controlling case law on the box #18 issue.

As happens all too frequently, it took the Appellate Division to straighten this out   If I only had Geico’s resources and volume, I would probably own half the docket at the Appellate Division, First Department (kidding, well kind of… not really).

The lesson here is that if you feel you have a solid legal argument, do not let AAA or a Supreme Court judge let you down.  You will win some and lose some.  Just make sure your papers are in order.

8 Responses

  1. Anonymous says:

    Nice job. now i must go see which arbitrator you yelled at. lol

    • jtlawadmin says:

      It is frustrating when you appear, the law is settled (or relatively well-settled) and you are being told you are wrong. More frustrating is losing three times on a $2500 case before the Appellate Division summarily says, heck you got a point there Mr. Tenenbaum. I kind of wish I was allowed to be a master arbitrator while being able to keep my practice, sans conflicts.

  2. Sun says:

    My thoughts. First, the AT is wrong that checking a box preserves a defense. Megacure utterly slaughters Court of Appeals authority. Insurers are raising defenses they have never considered previously for the first time in litigation and cases that otherwise should settle are not settling. Rule is a joke in the first instance and is antithetical to no-fault practice. Bad law that should not exist. Would love for someone to debate me on this.

    SEcond, the AD is wrong on the law. Preserving a defense is not sufficient to establish the defense. The master arb determined that, in effect, it was irrelevant that the insurer preserved the defense since they failed to prove up the defense at the hearing– i.e. that the eight Units was used by another provider. The master arb found another basis in the facts to support the award.
    “CPLR 7511 (b) (1) (iii), in authorizing review of whether the arbitrator has exceeded his power, includes review in the case of compulsory arbitration of whether the award is supported by evidence or other basis in reason appearing in the record (Mount St. Mary’s Hosp. v Catherwood, supra; Matter of Petrofsky [Allstate Ins. Co.], 54 N.Y.2d 207, 211).” Matter of Nyack Hospital v. GEICO, 139 A.D.2d 515 (2nd Dept. 1988) (emphasis added).

    Third, why is the AD first apparently only shredding Petrosky for the insurer’s benefit? Pattern is troubling. Shit is going down in the defense bar that is not being corrected. Carriers now are routinely lying about policy limits in arbitration and litigation. Court’s and AAA are PROTECTING them or, at least, not calling them out. Yet this court feels the need to correct the provider’s bar at this particular moment?

    Clearly, I need to get a shit ton of Art. 75’s before the App Div first so they can see a little of what I see. If that doesn’t work, The court of Appeals will see what I see.

  3. Your posts are starting to sound like that idiot that wanted to sue me for what i did to him on zuppa’s pit after he attacked me on his garbage blog.

    who was he … he kept crying out to the world … take notice of me … roy mura.

    he actually filed a complaint about me to the disciplinary committee because i hit him back hard.

    idiot had no idea that i already filed suit against him in suffolk so his suit in buffalo would have come to suffolk. long trip.

    any way you are starting to sound like that loser. reminds me of trump.

    “look at me … i won a no fault case at the appellate term” kind of like beating iraq in a war … or beating the buffalo bills in the super bowl … sorry roy … ass clown.

  4. And furthermore isn’t Maslow the guy that would routinely starve his dogs.

    is that what you and mura are doing now.

  5. Or is Maslow the shrink that came up with the hierarchy of Needs principle.

    Leave the guy alone jason

  6. Oh and did you read about the indiana restaurant owner who was a big trump supporter.

    hey businessman to businessman

    He just got deported.

    his wife is outraged and says she no longer likes trump

    tear jerker

  7. Where the fuck is sun?

    Where the hell is kurt?

    hell i’ll even take sponge bob square badge … or dare i say rogak would be a welcome sight.

    all my crazy friends have settled down

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