You have taken the steps necessary to domesticate an out-of-state or foreign country judgment in New York and are ready to start restraining assets to satisfy the judgment. Before you make your next move, there is a step our firm recommends taking before you execute on a domesticated judgment in NY.
One section often overlooked by some not regularly engaged in New York debt collection is the section in Article 54 of the New York Civil Practice and Rules (CPLR) Enforcement of Judgments entitled to Full Faith and Credit in New York, which requires the judgment creditor to provide notice of the filing of the foreign judgment.
The statute only applies to out-of-state judgments obtained on the merits, which can be domesticated here without the necessity of suing on the judgment to domesticate the judgment. That is because out-of-state judgments obtained on default require suit based upon the judgment, which provides notice of the out-of-state judgment to the judgment debtor. You can learn more about the processes and differentiation between judgments on the merits and those obtained on default here.
The notice of filing of the recently domesticated out-of-state judgment in New York is required at least 30 days before the proceeds of money obtained through an execution on debtors’ assets can be released to a judgment creditor. More specifically:
§5403. Notice of filing. Within thirty days after filing of the judgment and the affidavit, the judgment creditor shall mail notice of filing of the foreign judgment to the judgment debtor at his last known address. The proceeds of an execution shall not be distributed to the judgment creditor earlier than thirty days after filing of proof of service.
Those who have have been chasing debtors across state lines may wonder if providing the requisite notice will frustrate efforts to seize the judgment debtors’ assets and frustrate enforcement of the New York judgment. More important is that the requisite notice is sent to the defendant’s last known address in a timely fashion. Failing to do so can lead to the New York judgment being vacated.
The last known address can’t be an address that the debtor resided at some point within the last decade. If the creditor and/or their collection attorney know that the debtor is out of the country or has a different residence, it would be wise to serve a copy of the judgment with notice of entry on all of the debtors’ residences as to not give rise to a possible defense and/or grounds to vacate the judgment.
If you have a question about a debt collection matter or have a domesticared judgment in NY you wish to execute, contact Frank, Frank, Goldstein and Nager for a consultation.
