Bill Text: NY S04827 | 2019-2020 | General Assembly | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Enacts the "consumer credit fairness act"; establishes a 3 year statute of limitations for commencement of a cause of action arising out of a consumer credit transaction where the defendant is a purchaser, borrower or debtor; establishes a notice of lawsuit which must be mailed to the defendant in such a cause of action; establishes certain requirements for the complaint in such an action; provides for arbitration of such actions.
Spectrum: Partisan Bill (Democrat 11-0)
Status: (Introduced - Dead) 2020-07-22 - PRINT NUMBER 4827E [S04827 Detail]
Download: New_York-2019-S04827-Introduced.html
Bill Title: Enacts the "consumer credit fairness act"; establishes a 3 year statute of limitations for commencement of a cause of action arising out of a consumer credit transaction where the defendant is a purchaser, borrower or debtor; establishes a notice of lawsuit which must be mailed to the defendant in such a cause of action; establishes certain requirements for the complaint in such an action; provides for arbitration of such actions.
Spectrum: Partisan Bill (Democrat 11-0)
Status: (Introduced - Dead) 2020-07-22 - PRINT NUMBER 4827E [S04827 Detail]
Download: New_York-2019-S04827-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ S. 4827 A. 6909 2019-2020 Regular Sessions SENATE - ASSEMBLY March 26, 2019 ___________ IN SENATE -- Introduced by Sen. THOMAS -- read twice and ordered print- ed, and when printed to be committed to the Committee on Judiciary IN ASSEMBLY -- Introduced by M. of A. WEINSTEIN, JAFFEE, COLTON, GALEF, ABINANTI, ZEBROWSKI, O'DONNELL, FAHY, PEOPLES-STOKES, L. ROSENTHAL, M. G. MILLER, DINOWITZ, SEAWRIGHT, GLICK, WEPRIN, MOSLEY, TAYLOR -- Multi-Sponsored by -- M. of A. CAHILL, COOK, CYMBROWITZ, EPSTEIN, GOTTFRIED, McDONOUGH, PERRY -- read once and referred to the Committee on Judiciary AN ACT to amend the civil practice law and rules, in relation to consum- er credit transactions The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "consumer credit fairness act". 3 § 2. Subdivision 2 of section 213 of the civil practice law and rules, 4 as amended by chapter 709 of the laws of 1988, is amended to read as 5 follows: 6 2. an action upon a contractual obligation or liability, express or 7 implied, except as provided in section two hundred thirteen-a or two 8 hundred fourteen-h of this article or article 2 of the uniform commer- 9 cial code or article 36-B of the general business law; 10 § 3. The civil practice law and rules is amended by adding a new 11 section 214-h to read as follows: 12 § 214-h. Certain actions arising out of consumer credit transactions 13 to be commenced within three years. An action arising out of a consumer 14 credit transaction where a purchaser, borrower or debtor is a defendant 15 must be commenced within three years, except as provided in section two 16 hundred thirteen-a of this article or article 2 of the uniform commer- 17 cial code or article 36-B of the general business law. When the period 18 within which an action may be commenced under this section has expired, EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD00927-06-9S. 4827 2 A. 6909 1 the right to collect consumer credit debt is extinguished as well as the 2 remedy. 3 For purposes of this section, "the right to collect consumer credit 4 debt" shall mean any attempts by the creditor, third party purchaser, or 5 other authorized third party to collect such debt including, but not 6 limited to, calls, mail or other attempts to collect. 7 § 4. The civil practice law and rules is amended by adding a new 8 section 306-d to read as follows: 9 § 306-d. Additional mailing of notice in an action arising out of a 10 consumer credit transaction. (a) At the time of filing with the clerk of 11 the proof of service of the summons and complaint in an action arising 12 out of a consumer credit transaction, the plaintiff shall submit to the 13 clerk a stamped unsealed envelope addressed to the defendant together 14 with a written notice in clear type of no less than twelve-point in 15 size, in both English and Spanish, and containing the following 16 language: 17 ADDITIONAL NOTICE OF LAWSUIT 18 (NAME OF COURT) 19 (COUNTY) 20 (STREET ADDRESS, ROOM NUMBER) 21 (CITY, STATE, ZIP CODE) 22 (NAME OF DEFENDANT) 23 (ADDRESS OF DEFENDANT) 24 Plaintiff:__________________________________ 25 Defendant:__________________________________ 26 Name of original creditor, unless same:______________________________ 27 Index number:_______________________________ 28 Attention: a lawsuit has been filed against you claiming that you owe 29 money for an unpaid consumer debt. 30 You may wish to contact an attorney. 31 You should respond to the lawsuit as soon as possible by filing an 32 "answer" which may be done at the court clerk's office listed above. 33 If you do not respond to the lawsuit, the court may enter a money 34 judgment against you. Once entered, a judgment is good and can be used 35 against you for twenty years, and your personal property and money, 36 including a portion of your paycheck and/or bank account, may be taken 37 from you. Also, a judgment may affect your credit score and can affect 38 your ability to rent a home, find a job, or take out a loan. 39 You CANNOT be arrested or sent to jail for owing a debt. 40 Additional information can be found at the court system website at: 41 www.nycourts.gov 42 Sources of information and assistance: 43 The court encourages you to inform yourself about your options as a 44 defendant in this lawsuit. In addition to seeking assistance from a 45 private attorney or legal aid office, there are free legal assistance 46 programs that you can use online to help you represent yourself in this 47 lawsuit. 48 For further information, or to locate an entity or program near you, you 49 may visit the New York state unified court system's "resources for 50 unrepresented litigants" website at: 51 http://ww2.nycourts.gov/RULES/CCR/resources.shtmlS. 4827 3 A. 6909 1 (b) The face of the envelope shall be addressed to the defendant at 2 the address at which process was served, and shall contain the defend- 3 ant's name, address (including apartment number) and zip code. The face 4 of the envelope also shall state the appropriate clerk's office as its 5 return address. 6 (c) The clerk promptly shall mail to the defendant the envelope 7 containing the additional notice set forth in subdivision (a) of this 8 section. No default judgment based on the defendant's failure to answer 9 shall be entered unless there has been compliance with this section, and 10 at least twenty days have elapsed from the date of mailing by the clerk. 11 No default judgment based on the defendant's failure to answer shall be 12 entered if the additional notice is returned to the court as undelivera- 13 ble. Receipt of the additional notice by the defendant does not confer 14 jurisdiction on the court in the absence of proper service of process. 15 § 5. Subdivision (a) of section 3012 of the civil practice law and 16 rules is amended to read as follows: 17 (a) Service of pleadings. The complaint may be served with the 18 summons, except that in an action arising out of a consumer credit tran- 19 saction, the complaint shall be served with the summons. A subsequent 20 pleading asserting new or additional claims for relief shall be served 21 upon a party who has not appeared in the manner provided for service of 22 a summons. In any other case, a pleading shall be served in the manner 23 provided for service of papers generally. Service of an answer or reply 24 shall be made within twenty days after service of the pleading to which 25 it responds. 26 § 6. Rule 3016 of the civil practice law and rules is amended by 27 adding a new subdivision (j) to read as follows: 28 (j) Consumer credit transactions. In an action arising out of a 29 consumer credit transaction where a purchaser, borrower or debtor is a 30 defendant, the contract or other written instrument on which the action 31 is based shall be attached to the complaint and the following informa- 32 tion shall be set forth in the complaint: 33 1. The name of the original creditor; 34 2. The last four digits of the original account number; 35 3. The date and amount of the last payment; 36 4. If the complaint contains a cause of action based on an account 37 stated, the date that the final statement of account was mailed to the 38 defendant; 39 5. An itemization of the amount sought, by (i) principal; (ii) finance 40 charge or charges; (iii) fees imposed by the original creditor; (iv) 41 collection costs; (v) attorney's fees; (vi) interest; and (vii) any 42 other fees and charges. The term "finance charge" means a finance charge 43 as defined in Regulation Z, 12 C.F.R. § 226.4; 44 6. Whether the plaintiff is the original creditor. If the plaintiff is 45 not the original creditor, the complaint shall also state (i) the date 46 on which the debt was sold or assigned to the plaintiff; (ii) the name 47 of each previous owner of the account and the date on which the debt was 48 assigned to that owner; and (iii) the amount due at the time of the sale 49 or assignment of the debt by the original creditor; and 50 7. Any matters required to be stated with particularity pursuant to 51 rule three thousand fifteen of this article. 52 § 7. Subdivision (e) of rule 3211 of the civil practice law and rules, 53 as amended by chapter 616 of the laws of 2005, is amended to read as 54 follows: 55 (e) Number, time and waiver of objections; motion to plead over. At 56 any time before service of the responsive pleading is required, a partyS. 4827 4 A. 6909 1 may move on one or more of the grounds set forth in subdivision (a) of 2 this rule, and no more than one such motion shall be permitted. Any 3 objection or defense based upon a ground set forth in paragraphs one, 4 three, four, five and six of subdivision (a) of this rule is waived 5 unless raised either by such motion or in the responsive pleading. A 6 motion based upon a ground specified in paragraph two, seven or ten of 7 subdivision (a) of this rule may be made at any subsequent time or in a 8 later pleading, if one is permitted; an objection that the summons and 9 complaint, summons with notice, or notice of petition and petition was 10 not properly served is waived if, having raised such an objection in a 11 pleading, the objecting party does not move for judgment on that ground 12 within sixty days after serving the pleading, unless the court extends 13 the time upon the ground of undue hardship. The foregoing sentence shall 14 not apply in any proceeding to collect a debt arising out of a consumer 15 credit transaction where a consumer is a defendant or under subdivision 16 one or two of section seven hundred eleven of the real property actions 17 and proceedings law. The papers in opposition to a motion based on 18 improper service shall contain a copy of the proof of service, whether 19 or not previously filed. An objection based upon a ground specified in 20 paragraph eight or nine of subdivision (a) of this rule is waived if a 21 party moves on any of the grounds set forth in subdivision (a) of this 22 rule without raising such objection or if, having made no objection 23 under subdivision (a) of this rule, he or she does not raise such 24 objection in the responsive pleading which, in any action to collect a 25 debt arising out of a consumer credit transaction where a consumer is a 26 defendant, includes any amended responsive pleading. 27 § 8. Rule 3212 of the civil practice law and rules is amended by 28 adding a new subdivision (j) to read as follows: 29 (j) Additional notice in any action to collect a debt arising out of 30 a consumer credit transaction where a consumer is a defendant. 31 1. At the time of service of a notice of motion any part of which 32 requests summary judgment in whole or in part, where the moving party 33 is a plaintiff and the respondent is a consumer defendant in an action 34 to collect a debt arising out of a consumer credit transaction, and 35 where the consumer defendant against whom summary judgment is sought is 36 not represented by an attorney, the plaintiff shall serve, together with 37 the notice of motion, the following additional notice to be printed in 38 clear type no less than twelve-point in size: 39 Important notice to pro se defendants 40 (Name of court) 41 (Street address, room number) 42 (City, state, zip code) 43 Plaintiff: 44 Defendant: 45 Index number: 46 Motion return date and time: 47 Attention CPLR Rule 3212 motion for summary judgment 48 This notice is to advise you that the plaintiff in this case has filed a 49 motion for summary judgment against you pursuant to CPLR Rule 3212, 50 which means that summary judgment will be granted if the court finds 51 that there is no genuine issue as to any material fact and that the 52 plaintiff is entitled to judgment as a matter of law.S. 4827 5 A. 6909 1 Failure to respond to this motion for summary judgment may result in a 2 money judgment being entered against you in favor of the plaintiff. 3 Once entered, a judgment is good and can be used against you for twenty 4 years, and your personal property and money, including a portion of your 5 paycheck and/or bank account, may be taken from you. Also, a judgment 6 may affect your credit score and can affect your ability to rent a 7 home, find a job, or take out a loan. You CANNOT be arrested or sent to 8 jail for owing a debt. 9 Opposing this motion for summary judgment: 10 If you wish to oppose the plaintiff's request for judgment, you should 11 set forth in a written response the reasons that the plaintiff has not 12 shown that it is entitled to judgment as a matter of law, and any facts 13 that you believe show that you are not liable to the plaintiff or have a 14 defense. You should submit affidavits or exhibits supporting any facts 15 that you assert show that you are not liable or have a defense. Each 16 affidavit should set forth relevant facts and show that the person 17 submitting the affidavit has personal knowledge of those facts. If you 18 rely on exhibits, you should attach copies of them to an affidavit that 19 explains what they are and how they show that you are not liable or have 20 a defense. You should bring your opposition papers to court on the 21 court date and mail a copy to the plaintiff's attorney in advance of the 22 court date. You should also attend court on the return date. 23 Sources of information and assistance: 24 The court encourages you to inform yourself about your options as a 25 defendant in this lawsuit. In addition to seeking assistance from a 26 private attorney or legal aid office, there may be free legal assist- 27 ance programs that you may contact for help in representing yourself in 28 this lawsuit. 29 For further information, or to locate an entity or program near you, you 30 may visit the New York state unified court system's "resources for 31 unrepresented litigants" website at: 32 http://ww2.nycourts.gov/RULES/CCR/resources.shtml 33 2. The plaintiff seeking summary judgment shall file proof of service 34 of the additional notice with the court, and no motion for which this 35 additional notice is required shall be granted unless such proof of 36 service has been filed. 37 § 9. Section 3213 of the civil practice law and rules, as amended by 38 chapter 210 of the laws of 1969, is amended to read as follows: 39 § 3213. Motion for summary judgment in lieu of complaint. When an 40 action is based upon an instrument for the payment of money only or upon 41 any judgment, the plaintiff may serve with the summons a notice of 42 motion for summary judgment and the supporting papers in lieu of a 43 complaint. The summons served with such motion papers shall require the 44 defendant to submit answering papers on the motion within the time 45 provided in the notice of motion. The minimum time such motion shall be 46 noticed to be heard shall be as provided by subdivision (a) of rule 320 47 for making an appearance, depending upon the method of service. If the 48 plaintiff sets the hearing date of the motion later than the minimum 49 time therefor, he may require the defendant to serve a copy of his 50 answering papers upon him within such extended period of time, notS. 4827 6 A. 6909 1 exceeding ten days, prior to such hearing date. No default judgment may 2 be entered pursuant to subdivision (a) of section 3215 prior to the 3 hearing date of the motion. If the motion is denied, the moving and 4 answering papers shall be deemed the complaint and answer, respectively, 5 unless the court orders otherwise. The additional notice required by 6 subdivision (j) of rule thirty-two hundred twelve of this article shall 7 be applicable to a motion made pursuant to this section in any action to 8 collect a debt arising out of a consumer credit transaction where a 9 consumer is a defendant. 10 § 10. Subdivision (f) of section 3215 of the civil practice law and 11 rules, as amended by chapter 453 of the laws of 2006, is amended and a 12 new subdivision (j) is added to read as follows: 13 (f) Proof. On any application for judgment by default, the applicant 14 shall file proof of service of the summons and the complaint, or a 15 summons and notice served pursuant to subdivision (b) of rule 305 or 16 subdivision (a) of rule 316 of this chapter, and proof of the facts 17 constituting the claim, the default and the amount due by affidavit made 18 by the party, or where the state of New York is the plaintiff, by affi- 19 davit made by an attorney from the office of the attorney general who 20 has or obtains knowledge of such facts through review of state records 21 or otherwise. Where a verified complaint has been served, it may be used 22 as the affidavit of the facts constituting the claim and the amount due; 23 in such case, an affidavit as to the default shall be made by the party 24 or the party's attorney. In an action arising out of a consumer credit 25 transaction, if the plaintiff is not the original creditor, the appli- 26 cant shall include: (1) an affidavit by the original creditor of the 27 facts constituting the debt, the default in payment, the sale or assign- 28 ment of the debt, and the amount due at the time of sale or assignment; 29 (2) for each subsequent assignment or sale of the debt to another enti- 30 ty, an affidavit of sale of the debt by the debt seller, completed by 31 the seller or assignor; and (3) an affidavit of a witness of the plain- 32 tiff, which includes a chain of title of the debt, completed by the 33 plaintiff or plaintiff's witness. When jurisdiction is based on an 34 attachment of property, the affidavit must state that an order of 35 attachment granted in the action has been levied on the property of the 36 defendant, describe the property and state its value. Proof of mailing 37 the notice required by subdivision (g) of this section, where applica- 38 ble, shall also be filed. 39 (j) A request for a default judgment entered by the clerk, must be 40 accompanied by an affidavit by the plaintiff or plaintiff's attorney 41 stating that after reasonable inquiry, he or she has reason to believe 42 that the statute of limitations has not expired. 43 § 11. The civil practice law and rules is amended by adding a new 44 section 7516 to read as follows: 45 § 7516. Confirmation of an award based on a consumer credit trans- 46 action. In any proceeding under section 7510 of this article to confirm 47 an award based on a consumer credit transaction, the party seeking to 48 confirm the award shall plead the actual terms and conditions of the 49 agreement to arbitrate. The party shall attach to its petition (a) the 50 agreement to arbitrate; (b) the demand for arbitration or notice of 51 intention to arbitrate, with proof of service; and (c) the arbitration 52 award, with proof of service. If the award does not contain a statement 53 of the claims submitted for arbitration, of the claims ruled upon by the 54 arbitrator, and of the calculation of figures used by the arbitrator in 55 arriving at the award, then the petition shall contain such a statement. 56 The court shall not grant confirmation of an award based on a consumerS. 4827 7 A. 6909 1 credit transaction unless the party seeking to confirm the award has 2 complied with this section. 3 § 12. This act shall take effect on the first of January next succeed- 4 ing the date on which it shall have become a law, except that section 5 three of this act shall take effect on the one hundred fiftieth day 6 after this act shall have become a law.
