RECITATION, AS REQUIRED BY CPLR 2219(A), OF THE PAPERS CONSIDERED IN THE REVIEW OF THIS MOTION:

Notice of Motion 1

Notice of Cross-Motion 2

Answering Affidavit 3

Replying Affidavit 4

In an action to recover assigned first-party no fault insurance benefits, plaintiff moves for an order granting plaintiff summary judgment dismissing defendant's affirmative defenses or finding that the billing forms were mailed to and received by defendant, and that payment of the benefits are overdue. Defendant cross moves for summary judgment, seeking dismissal of the action on the ground of lack of coverage.

On April 8, 2016, the insured Eimy Peguero applied for a Pennsylvania automobile insurance policy for a total of three vehicles affirming that she resided and garaged the vehicles in Pennsylvania. Based upon these representations, defendant issued the insured an automobile insurance policy effective for the three vehicles April 8, 2016 through April 8, 2017.

On June 3, 2016, the assignor Eduardo Olaverria was allegedly injured in an automobile accident which occurred in New York because of which, plaintiff allegedly rendered treatment to the assignor.

On October 10, 2016, defendant conducted an Examination Under Oath, which defendant contends revealed that the insured does not reside, pay rent or utility bills in Pennsylvania, and rather lives in New York with her children. Defendant further claims that the insured garaged the insured vehicles in New York, and falsely represented that one of the vehicles was registered to a person who does not own the vehicle.

On November 4, 2016, defendant retroactively rescinded the policy based on the insured's material misrepresentation. Defendant claims that the rescission of the policy is permissible under Pennsylvania law, and denied all coverage for the alleged loss. Defendant thereafter issued a check, fully refunding the premiums, which the insured cashed on December 9, 2016.

There is no dispute that conflicts exist between New York law and Pennsylvania law regarding the issues raised herein. Plaintiff claims that the matter is governed under New York law, and defendant contends that the law of Pennsylvania applies.

In New York, an insurer may not deny coverage based on an insured's fraudulent misrepresentation, without issuing a denial detailing the basis within 30 days of the receipt of a claim. In Pennsylvania, there are no such requirements.

Under New York law, an insured or assignee of an insured may be denied benefits, where an insurer establishes that the insured had fraudulently procured the insurance policy. In Pennsylvania, challenge to the validity of an insurer's rescission of a policy, may be made only in accordance with the restrictions set forth in the Insurance Company Law of 1921, commonly known as 'Act 68.'

At the outset, this Court must determine whether to apply the law of the State of New York or the law of the State of Pennsylvania to this matter.

New York utilizes the 'grouping of contacts' or 'center of gravity' analysis as the appropriate approach to resolve choice of law questions, in cases premised on breach of contract. The 'grouping of contacts' approach seeks to determine which state has the most significant relationship to the contract or the parties. (See Allstate Ins. Co. v. Hague, 449 U.S. 302, 101 S.Ct. 633, 66 L.Ed.2d 521 [1981]; Matter of Arbitration between Allstate Ins. Co. (Stolarz), 81 NY2d 219, 597 N.Y.S.2d 904 [1993], revg 178 AD2d 899 [3d Dept 1991]. The court must consider the spectrum of significant contacts, rather than a single possible gratuitous event, in its determination as to which state has the most significant relationship to the parties or the contract. (See Matter of Arbitration between Allstate Ins. Co. (Stolarz), 81 NY2d 219, 597 N.Y.S.2d 904 [1993], revg 178 AD2d 899 [3d Dept 1991]; Matter of Eagle Ins. Co. v. Singletary, 279 AD2d 56, 717 N.Y.S.2d 351 [2d Dept 2000]). Among the contacts to be considered are the state where the parties entered into the contract, negotiated and performed the contract, the domicile of the parties, and the place of subject matter of the contract. See Matter of Midland Ins. Co., 16 NY3d 536, 923 N.Y.S.2d 396 (2011), revg 71 AD3d 221 (1st Dept 2010).

In the case at bar, the insured, a Pennsylvania resident, obtained a Pennsylvania policy in Pennsylvania for vehicles registered and garaged in Pennsylvania. In applying the 'grouping of contacts' standards, Pennsylvania clearly has the most significant contacts with the parties, and [*2]the contract. (See Delta Diagnostic Radiology, P.C. v. Infinity Group, 49 Misc 3d 42, 18 N.Y.S.3d 816 [App. Term, 2nd Dept, 2d, 11th and 13th Jud. Dists., 2015], holding that under New York law Pennsylvania law applies to cases where the insured, a resident of Pennsylvania, obtained a Pennsylvania insurance policy for vehicles registered and stored in Pennsylvania).

In its cross motion for summary judgment, defendant argues that (1) Pennsylvania law permits retroactive rescission of a policy based upon the insured's material misrepresentations; (2) defendant met its burden by establishing the policy was properly rescinded ab initio; and (3) plaintiff cannot challenge the rescission of the Pennsylvania policy in New York.

In the insurance policy issued by defendant, coverage was effective from April 8, 2016 until April 8, 2018. The motor vehicle incident occurred on June 3, 2016. The insured's Examination Under Oath was conducted on October 10, 2016. Defendant mailed the insured notice of policy rescission on November 4, 2016.

Defendant correctly contends that under Pennsylvania law, the insurer may rescind an automobile policy freely up until 60 days after issuance. (See Klopp v. Keystone Ins. Cos., 528 Pa. 1, 595 A.2d 1 [1991]; Erie Ins. Exchange v. Lake, 543 Pa. 363, 671 A.2d 681 [1996]). If the insurer does not rescind the policy within 60 days immediately following the issuance, it may still rescind the policy, if the basis of rescission is the insured's material misrepresentation, which could not have been reasonably discovered within 60 days following the issuance. (Id. Erie, 543 Pa. 363)

In the instant matter, the insurer served the policy rescission beyond 60 days following the issuance of the policy. The Court must determine whether defendant met its burden that the policy was properly rescinded ab initio under the laws of Pennsylvania.

Section § 991.2006 of Pennsylvania's Act 68 provides that an insurer may effectively cancel the policy by mailing the rescission notice to the insured. Defendant mailed the notice of rescission to the insured, and thus, complied with this section.

Plaintiff argues that even if this Court applies the laws of Pennsylvania to the instant matter, to grant defendant summary judgment, it must first determine that defendant demonstrated as a matter of law, that the insured perpetrated fraud, or misrepresentations in the insurance application.

This Court however, has no authority under New York law, to assess whether the basis of defendant's rescission of the policy was valid. Defendant's burden is merely to demonstrate that the policy was validly rescinded pursuant to the law of Pennsylvania. (See W.H.O Acupuncture, P.C. v. Infinity Prop. & Cas. Co., 36 Misc 3d 4, 947 N.Y.S.2d 758 [App Term, 2d Dept, 11th and 13th Jud. Dists, 2012]).

Under § 991.2008"any insured" may within 30 days of notice of cancellation challenge the rescission in writing to the Pennsylvania Insurance Commissioner. Other than the insured, the statute does not grant any other person or entity, including the provider, the right to challenge the rescission. If the insured does not challenge "the termination of insurance, the insured has waived that issue." (See O'Hara v. Com., Dept. of Transp., 691 A.2d 1001 [Pa. Commonwealth Court, 1997], "[W]e recognize that, where an insured believes that an insurer has improperly terminated insurance coverage, the insured has an exclusive remedy to challenge the cancellation under the Insurance Act. If the insured does not challenge the termination of insurance, the insured has waived that issue.")

In the case at bar, the insured did not challenge the rescission of the insurance policy within the 30-day period, and accordingly, waived this issue. As the right to challenge the rescission has elapsed, the policy was effectively and retroactively rescinded on October 10, 2016, and this Court has no power to reinstate the policy.

Great Healthcare Chiropractic, however is distinguished from the case at bar. In that case, although defendant's motion papers purported to include an affidavit by defendant's litigation specialist, said affidavit was in fact not included. In lacking the requisite affidavit, the Court found that defendant did not meet its prima facie burden of entitlement to summary judgment and dismissed the complaint, as defendant failed to prove that the policy had been rescinded. In the case at bar, the affidavit of defendant's claim examiner does establish the rescission of the policy.

Plaintiff also cites a decision by a Pennsylvania court which found that the defendant insurer failed to prove that the policy was void due to insured's material misrepresentation. (See Tudor Ins. Co. v. Township of Stowe, 697 A.2d 1010 [Pa. Super. Ct., 1997]). In Tudor, however, the insurer had not rescinded the policy pursuant to Art. 68, and as such, had the burden to prove the insured's malpresentation before a jury to vitiate the policy.

Finally, plaintiff relies on Powell v. Walker, which arises out of a declaratory judgment action in Pennsylvania, which is distinguished from the case at bar. In Walker, the court held that the insurer cannot rescind a policy beyond 60 days of issuance, where the claim was instituted by an innocent third party injured in a motor vehicle accident, as opposed to, an insured who perpetrated the fraud. (See Powell v. Walker, 428 Pa. Super. 31, 630 A.2d 16 [1993]).

Based on the foregoing, defendant's motion for summary judgment to dismiss the complaint is granted.