Practical Skills – Judgment Enforcement: A Case Study – Sanchez V. Smith
In this 6-hour CLE, the panel will be working from a hypothetical case study to provide an overview of key steps on how to collect and enforce a judgment.
Topics will include:
- Setting the Table – What is a Judgement and What is a Collection?
- Initial Steps to Take
- Advanced and Problem Areas
- Ethical Considerations – Fair Debt Collection Practices Act and NYS Consumer Protection Law
Attorneys can earn 5.5 credits in skills and 0.5 credit in ethics!
Practical Skills: Judgment Enforcement A Case Study – Sanchez v. Smith
Case Study for the Day
Sanchez Corp., owned by Rick Sanchez, is a portal gun manufacturer (interdimensional travel is bleeding edge tech). Smith Industrials, Ltd. owned by Morty Smith, is a reseller of, among other things, portal guns in the greater New York City metropolitan area with his primary location in Long Island City. Smith Industrials has not been in business for that long, however, and its business credit score – its Dun and Bradstreet score – is not that great. Smith Industrials issued a purchase order to Sanchez Corp. for 10,000 portal guns, with payment terms net 45 days. Because of its low credit score, which indicated a higher credit risk, Sanchez Corp.’s credit department was not comfortable extending that much credit to Smith Industrials. The credit department required Morty Smith, its owner, sign a personal guarantee of the obligations of Smith Industrials to Sanchez Corp.
Ultimately, Smith Industrials failed to pay for all of those portal guns and Sanchez Corp. was required to commence a litigation in the Supreme Court, Queens County to recover the unpaid amounts. Judgment was entered against Smith Industrials and Morty Smith, jointly and severally in the amount of $1.2 million.
You are an attorney at Plumbus Law, LLP and you were given the newly entered judgment to enforce against Smith Industrials and Morty Smith. You have no idea what to do, where to look, or really, anything about collecting on a judgment.
Today, we will walk you through the practical skills of how to collect and enforce the judgment.
- May 14, 2021
- 9:00 AM
- 3:10 PM
- Virtual Participation
9:00 a.m. – 9:10 a.m. (10 minutes)
NYSBA Introductory Remarks
9:10 a.m. – 10:50 a.m. (100 minutes) – [2.0 MCLE Credit – Skills]
I. Setting the Table – What is a Judgment and What is Collections?
a. Judgments – CPLR Article 50
i. Different types
ii. Statute of Limitations – CPLR §211
iii. Which assets can I get to? Which ones are off-limits?
1. Exempt personal property – CPLR §5205
2. Exempt real property – CPLR §5206
3. Intersection of NYS law with federal bankruptcy law
b. What is Collections?
ii. Typical judgment debtor
iii. Achieving settlement – Difficulties and challenges
c. Client Relationship is Paramount
iii. Information about judgment debtor
II. Initial Steps to Take
a. Notice of Entry – CPLR §5513(a)
i. Starts time to appeal
ii. Not necessary if default judgment; do it anyway
iii. Debtor’s perspective
1. Just found out about case
2. Improper service of process – CPLR R. 5015 and CPLR §317
b. Docketing Judgment in Other Jurisdictions – CPLR §5203(a)
i. Lien priority
ii. Transcripts of judgment
iii. Action on judgment – CPLR §3213
iv. Docketing a judgment from another state – CPLR Article 54
v. Domestication of foreign judgment in the U.S. – CPLR Article 53
c. Sheriff’s Execution – CPLR §5230 and §5232
i. Lien priority
ii. Using the right forms
iii. Helping the sheriff help you
iv. New York City marshals
v. Debtor’s perspective
d. Restraining Notices – CPLR §5222
i. Mostly used for banks – Can be used on others
ii. Exemption notice
iii. Using the right forms
iv. Which banks? – Ask your client
v. I found money! Now what? Sheriff should levy – how?
vi. Joint account with non-debtor – Banking Law §675
vii. Debtor’s perspective
1. Exemptions are important
2. Strict statutory compliance
10:50 a.m. – 11:00 a.m. – (10 minutes) Break
11:00 a.m. – 11:50 a.m. – (50 minutes) – [1.0 MCLE Credit – Skills]
e. Income Execution (Wage Garnishment) – CPLR §5231
i. Early option
ii. Two-step process
iii. Debtor’s perspective
f. Subpoena Duces Tecum – CPLR R. 5224
i. Very powerful tool
ii. Who to serve first?
iii. What documents?
iv. What questions to ask?
v. Addressing non-compliance
1. Civil contempt – Judiciary Law §§756-777
2. Arrest warrants
3. Difficulties with the court
vi. Defending Against the Subpoena
1. Limiting documents
2. Limiting inquiry
3. Protective order - CPLR §§5240 and 3103
11:50 a.m. – 12:20 p.m. (30 minutes)
12:20 p.m. – 2:00 p.m. (100 minutes) - [2.0 MCLE Credit – Skills]
g. Real Estate – CPLR §5235
i. Sale procedures – CPLR §5236
ii. Extending lien of judgment – CPLR §5014
iii. Joint ownership by non-debtor
h. Payment of Debts Owed to Judgment Debtor – CPLR §5227
i. Delivery of Property Owned by Judgment Debtor – CPLR §5225
III. Advanced and Problem Areas
a. Bankruptcy Complications – 11 USC §101 et seq.
i. Chapter 7
ii. Chapter 11
iii. Chapter 13
iv. Debtor’s perspective
2:00 p.m. – 2:10 p.m. (10 minutes)
2:10 p.m. – 2:35 p.m. (25 minutes) – [.5 MCLE Credit Skills]
b. Voidable Transfer Complications – Debtor and Creditor Law §270 et seq.
i. Commencing Separate Litigation
ii. Filing Notice of Pendency – CPLR Article 65
iii. Old law and new law run parallel
c. Piercing the Corporate Veil
i. Emerging area
ii. Difficult burden
iii. Must do your homework first 2:35 p.m. – 3:00 p.m. (25 minutes) – [.5 MCLE Ethics]
IV. Ethical Considerations - Fair Debt Collection Practices Act and NYS Consumer Protection Laws
a. FDCPA – 15 USC §§1692 et seq. – Practical guidance
b. NYS Consumer Laws – Practical guidance
c. Traps to avoid
d. Protections for consumers 3:00 p.m. – 3:10 p.m. (10 minutes)
V. Any Additional Questions or Comments
- Robert J. Ansell, Esq., Moderator, Power-Flo Technologies Inc.
- David A. Blansky, Esq., Speaker, LaMonica Herbst & Maniscalco, LLP
- Andrew S. Kazin, Esq., Speaker, Stagg Wabnik Law Group LLP
- Leslie H. Tayne, Esq., Speaker, Tayne Law Group, P.C.
- Stephen Vlock, Esq., Speaker, Vlock & Associates, P.C.
- General Practice Section