Summary
denying motion by insurers for a stay pending arbitration proceeding, granting medical services corporation's motion to dismiss the suit, and holding that claim of fraudulent incorporation did not preclude medical services corporation from demanding arbitration pursuant to Insurance Law section 5106(b), since “the defense of fraudulent incorporation is for the arbitrator and not for the courts”
Summary of this case from Liberty Mut. Ins. Co. v. Excel Imaging, P.C.Opinion
No. 5507.
July 7, 2011.
Order, Supreme Court, New York County (Marylin G. Diamond, J.), entered November 30, 2010, which denied the petition to stay arbitration of claims for no-fault insurance benefits and granted respondent's cross motion to dismiss the proceeding, unanimously affirmed, with costs.
Thomas Torto, New York, for appellant.
Ruskin Moscou Faltischek, P.C., Uniondale (Matthew F. Didora of counsel), for respondent.
Before: Concur — Andrias, J.P., Sweeny, Renwick, Freedman and Manzanet-Daniels, JJ.
Petitioner argues that respondent is a fraudulently incorporated medical services provider and therefore is not only ineligible for reimbursement of no-fault payments ( see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313) but is also precluded from demanding arbitration pursuant to Insurance Law § 5106 (b) (and the no-fault policy issued by petitioner). Contrary to this argument, the defense of fraudulent incorporation is "for the arbitrator and not for the courts" ( see Matter of Nassau Ins. Co. v McMorris, 41 NY2d 701, 701; Matter of MVAIC v Interboro Med. Care Diagnostic P.C., 73 AD3d 667). Indeed, it has been the subject of numerous arbitration proceedings ( see e.g. State Farm Mut. Auto. Ins. Co. v Kissena Med. Imaging, P.C., 25 Misc 3d 1214[A], 2009 NY Slip Op 52094[U]; Uptodate Med. Sew., PC. v State Farm Mut. Auto. Ins. Co., 22 Misc 3d 128[A], 2009 NY Slip Op 50046[U], *2 [2009]).
We have considered plaintiffs remaining contentions and find them unavailing.