Debt and Judgment Collection

Even after you enter your judgment and send Notice of Entry, you still need to collect from the losing parties.  Unless an insurance company is involved, many times a small business or individual cannot or will not pay a judgment right away.

 

Sometimes, you may want to wait until the time limit to appeal has expired before collecting.  This way, you do not stimulate the losing parties into appealing the case.  However, you also do not want too much time to pass because the more you know about a judgment debtor’s current situation, the better.

 

You can collect in two ways (1) seizure of assets and (2) garnishment of future streams of income.  CPLR Article 52 details how to collect.

 

You should have served a subpoena duces tecum (or, cost permitting, a subpoena ad testificandum) on the judgment debtor, demanding the debtor to procude certain documents such as bank statements and other documentation of assets, as well as answer certain questions about their finances and assets.  In the event the debtor fails to answer, there are possible remedies such as being held in contempt of court.  Make sure the subpoena is served properly!

 

Sometimes, you will want to serve information subpoenas on third parties who may have information about the judgment debtor’s finances, such as employers, family members, friends, or for those who are self-employed, customers or clients. Sometimes, you can even tap into the judgment debtor’s accounts receivable (money owed) by customers or  clients if the judgment debtor is a business or self-employed.  Again, make sure this subpoena is served properly and has the correct language.  If the recipient fails to answer, then contempt of court is possible, including penalties up to and including imprisonment.

 

Another resource is the County Sheriff.  If you provide certain information to the Sheriff’s Department, then it can assist in judgment execution.

 

The judgment debtor may offer to pay part of the judgment immediately in exchange for your waiving the rest of the judgment amount and ceasing collection efforts.  Due to the difficulty in collecting funds, this may be a beneficial option.  Again, it depends on the specifics of the situation.

 

In New York, you generally have 20 years to collect on a judgment.  This office would be happy to help you collect on yours!

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New York State Judges’ Retirement Age

New York State Judges’ Retirement Age

There is not much of a compelling interest to force judges to retire at a certain age.  Rather than have an arbitrary age for judges to retire, why not have the electorate continue to evaluate judges?  If voters think that a judicial candidate is too old or is no longer effective, then they can vote him or her out of office.

Old Putnam County Courthouse

Old Putnam County Courthouse

I pass this on the way to the Court or County Clerk every time-what a beautiful building!

Civil Rights Lawsuit Against Carmel Central School District Has Many Procedural Challenges

Civil Rights Lawsuit Against Carmel Central School District Has Many Procedural Challenges

Most school administrators, teachers, and staff treat students properly.  Once in awhile, there are a few that do not, as the Riveras allege in their Putnam Supreme lawsuit against Carmel (since removed to the United States District Court for the Southern District of New York).  For such claims, the family must defeat immunity and show a pattern or custom for some of the federal claims, and have served a timely Notice of Claim against the District for its state claims.  It is important to have an experienced education law attorney represent you in civil rights claims so that you do not make any procedural mistakes.

Shopping for a Home and Closing on It

The closing is the final step of a home purchase.  Assuming you are not paying cash for the home, the closing takes two steps.

 

The first step is the transfer of a deed from the seller to the buyer.  The deed is a document memorializing the transfer, and in New York State, gets filed in the local County Clerk’s office.

 

The second step is that the buyer grants a mortgage to the lender, or the right to retake the property if the buyer defaults in paying the loan back to the lender.  This too is a property interest and so it gets recorded in the County Clerk’s office.  You will also need to sign a promissory note promising to be personally responsible for the loan (though in reality deficiency judgments are hard to collect on and generally dischargeable in bankruptcy).

 

There are additional documents you need to sign to ensure that the loan and mortgage are binding.  You will also need to purchase title insurance, meaning that if there is a defect in title that causes you to lose the property, you and the lender will be compensated by insurance.

 

You will also likely need to sign an updated loan application confirming your information, an IRS Form W9, and additional disclosures and acknowledgments.  Be sure to review these at the closing with your attorney, and ask if you do not understand something.  You’re paying us to make sure all the documents are correct, so do not hesitate to speak up if there is an issue!

Mortgage Shopping-How to End up with a Great (or Bearable) Mortgage

With mortgage rates still near historical lows many people may be seeking to refinance.  Others may be purchasing a home or taking out a home equity loan or line of credit.  A mortgage is a complex legal transaction that does not necessarily require counsel, but the borrower should understand all of the terms.

 

The difference between a home equity line of credit and a mortgage is that a home equity of line of credit is like a credit card, only your property is the collateral.  This is not a loan for a fixed amount.

 

By contrast, a mortgage is a loan for a fixed amount.  You promise to pay the amount back, usually in monthly installments, plus interest.  Again, the property is collateral.

 

First, you will need to look for a mortgage or loan with low interest rates.  It is my opinion that fixed-rate mortgages are almost always better than variable-rate mortgages, especially when you can fix your rate near historical lows.  If you are absolutely certain that you will be paying off the mortgage within a few years, though, then a variable-rate mortgage may be worth considering.  At least try to obtain a variable-rate that is capped at how much it can increase.

 

The lender will have many questions it needs resolved.  For example, it needs to know that you have the means to pay back the loan and sufficient reserves of assets (cash or investments, but also non-liquid assets).  It will verify your employment most likely too directly with your employer.  It also wants to make sure the property is insured.

 

The lender will usually have an independent appraiser value the property.  It wants to make sure the property is of sufficient value should it have to retake it.

 

Once the lender approves the mortgage, it will usually have conditions that need to be satisfied before it can disburse the money.  For example, you may need to liquidate investments to come up with money for the down payment, if you are taking out a purchase money mortgage (mortgage to purchase property).

 

Once you satisfy the conditions, the lender gives the “clear to close,” permitting the closing to occur.

 

This is a long process, but can be expedited by working closely with the mortgage broker or bank.

Entry of Orders and Judgments-Crucial Steps

Many times, winning your court case is only half the battle.  You still need to enter a Judgment and fulfill all pre-collection requirements, unless the losing party voluntarily pays!

 

First, the judge may need to provide a written order stating that you have won your court case. Sometimes the judge will type it up, and other times the winning attorney must type it, give an advance copy of the proposed order to the adversary or opposing counsel, and then give a copy to the judge to sign (and make any modifications the judge wants by handwriting them into the order).

 

You will also need to provide a proposed judgment for the judge or clerk to sign.  This depends on the forum in which you are proceeding.  Again, in New York you need to provide this to all other parties in advance, with a cover sheet that says “Notice of Settlement.”  Many times, you are entitled to additional out-of-pocket costs and additional fees that are part of a “Bill of Costs.”

 

Once the clerk or judge signs these, you must then make sure they are entered in the County Clerk’s office in the county in which the court is located.  If the judgment is from either a local Justice Court or a court in a different county, then you must obtain a “Transcript of Judgment.”  You need to enter this in the County Clerk’s office.

 

Any time a Judgment or Order is entered in the County Clerk’s office, you should serve a “Notice of Entry” and a copy of the Judgment or Order on the other parties, per CPLR 5513.  This starts the timeframe for the other parties to appeal.  If you do not serve these, then the other parties would have an unlimited time to appeal!  Be sure to file a proof of service of the Notice of Entry with the court (or better yet file it along with a copy of the Notice of Entry itself!).  The Notice of Entry must indicate the date the paper was entered in the County Clerk’s office.