S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7552

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                              May 23, 2013
                               ___________

Introduced  by  M. of A. WEINSTEIN -- (at request of the Office of Court
  Administration) -- read once and referred to the Committee on  Judici-
  ary

AN ACT to amend the civil practice law and rules, the judiciary law, the
  penal  law  and  the  uniform commercial code, in relation to wrongful
  financing statements filed under the uniform commercial code

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Subdivision  (c) of section 403 of the civil practice law
and rules is amended to read as follows:
  (c) Manner of service. A notice of petition shall  be  served  in  the
same  manner  as a summons in an action EXCEPT THAT A NOTICE OF PETITION
IN A SPECIAL PROCEEDING BROUGHT PURSUANT TO PARAGRAPH ONE OF SUBDIVISION
(D) OF SECTION 9-518 OF THE UNIFORM COMMERCIAL CODE SHALL BE  SERVED  BY
MAILING  IT BY FIRST CLASS MAIL TO THE PERSON TO BE SERVED AT HIS OR HER
LAST KNOWN RESIDENCE, PROOF OF SUCH SERVICE  SHALL  BE  FILED  WITH  THE
CLERK  OF  THE  COURT DESIGNATED IN THE NOTICE OF PETITION WITHIN TWENTY
DAYS OF SUCH MAILING AND SERVICE SHALL BE COMPLETE FIVE DAYS AFTER  SUCH
FILING.
  S  2.  Subdivision 2 of section 212 of the judiciary law is amended by
adding a new paragraph (s) to read as follows:
  (S) ESTABLISH RULES FOR SPECIAL PROCEEDINGS AUTHORIZED BY  SUBDIVISION
(D)  OF  SECTION  9-518  OF  THE UNIFORM COMMERCIAL CODE. SUCH RULES MAY
AUTHORIZE THE COURT IN WHICH SUCH A SPECIAL  PROCEEDING  IS  PENDING  TO
ORDER A REFEREE TO HEAR AND DETERMINE SUCH SPECIAL PROCEEDING.
  S  3.  The penal law is amended by adding a new section 175.37 to read
as follows:
S 175.37 OFFERING A FALSE INSTRUMENT FOR FILING IN RETALIATION  FOR  THE
           PERFORMANCE OF OFFICIAL DUTIES.
  A PERSON IS GUILTY OF OFFERING A FALSE INSTRUMENT FOR FILING IN RETAL-
IATION FOR THE PERFORMANCE OF OFFICIAL DUTIES WHEN HE OR SHE COMMITS THE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08971-01-3
              

A. 7552                             2

OFFENSE  OF  OFFERING A FALSE INSTRUMENT FOR FILING IN THE SECOND DEGREE
AND:
  1.  SUCH INSTRUMENT IS A FINANCING STATEMENT THE CONTENTS OF WHICH ARE
PRESCRIBED BY SECTION 9-502 OF THE UNIFORM COMMERCIAL CODE; AND
  2. THE COLLATERAL COVERED IN SUCH FINANCING STATEMENT IS THE  PROPERTY
OF  A  PUBLIC  SERVANT  WHO  IS  A  STATE OR LOCAL OFFICER AS DEFINED BY
SECTION TWO OF THE PUBLIC OFFICERS LAW OR WHO OTHERWISE IS  A  JUDGE  OR
JUSTICE OF THE UNIFIED COURT SYSTEM; AND
  3.  IT  IS ON ACCOUNT OF THAT PUBLIC SERVANT'S PERFORMANCE OF OFFICIAL
DUTIES IN HIS OR HER CAPACITY AS A STATE OR LOCAL OFFICER  OR  JUDGE  OR
JUSTICE  OF  THE  UNIFIED COURT SYSTEM THAT SUCH FINANCING INSTRUMENT IS
FILED.
  OFFERING A FALSE INSTRUMENT FOR FILING IN RETALIATION FOR THE PERFORM-
ANCE OF OFFICIAL DUTIES IS A CLASS D FELONY.
  S 4. Section 9-518 of the uniform commercial code is amended by adding
a new subdivision (d) to read as follows:
  (D) SPECIAL PROCEEDING TO REDACT OR  EXPUNGE  A  WRONGFULLY  FILED  OR
AMENDED  FINANCING STATEMENT.   (1) PROVIDED HE OR SHE IS AN EMPLOYEE OF
THE STATE OR A POLITICAL SUBDIVISION THEREOF, A PERSON IDENTIFIED  AS  A
DEBTOR IN A FINANCING STATEMENT FILED PURSUANT TO THIS SUBPART MAY BRING
A  SPECIAL  PROCEEDING AGAINST THE FILER OF SUCH STATEMENT OR ANY AMEND-
MENT THEREOF, OR AGAINST THE PERSON ON WHOSE BEHALF  THE  STATEMENT  WAS
FILED  OR  AMENDED,  TO INVALIDATE THE FILING OR AMENDMENT THEREOF WHERE
SUCH STATEMENT WAS WRONGFULLY FILED OR AMENDED. SUCH SPECIAL  PROCEEDING
SHALL  BE  GOVERNED BY ARTICLE FOUR OF THE CIVIL PRACTICE LAW AND RULES,
AND SHALL BE COMMENCED IN THE SUPREME COURT OF ALBANY COUNTY, THE COUNTY
OF THE PETITIONER'S RESIDENCE OR A COUNTY WITHIN THE  JUDICIAL  DISTRICT
IN  WHICH ANY PROPERTY COVERED BY THE FINANCING STATEMENT IS LOCATED. NO
FEE PURSUANT TO ARTICLE EIGHTY OF THE CIVIL PRACTICE LAW AND RULES SHALL
BE COLLECTED IN SUCH SPECIAL PROCEEDING.
  (2) THE PETITION IN A SPECIAL PROCEEDING HEREUNDER SHALL PLEAD THAT:
  (A) THE FINANCING STATEMENT FILED OR AMENDED BY THE RESPONDENT  PURSU-
ANT TO SECTION 9-509 WAS WRONGFULLY FILED OR AMENDED;
  (B)  SUCH  FINANCING  STATEMENT  DOES  NOT  RELATE TO AN INTEREST IN A
CONSUMER-GOODS TRANSACTION OR ANY OTHER COMMERCIAL  TRANSACTION  BETWEEN
THE PETITIONER AND THE RESPONDENT;
  (C)  IT  IS  ON  ACCOUNT  OF  THE PETITIONER'S PERFORMANCE OF OFFICIAL
DUTIES IN HIS OR HER CAPACITY AS AN EMPLOYEE OF THE STATE OR A POLITICAL
SUBDIVISION THEREOF THAT SUCH FINANCING INSTRUMENT WAS FILED; AND
  (D) PROMPT REDACTION OR INVALIDATION OF  THE  FINANCING  STATEMENT  IS
NECESSARY  TO  AVERT  OR  MITIGATE PREJUDICE TO THE PETITIONER OR TO THE
ADMINISTRATION OF GOVERNMENT.
  (3) IF THE COURT DETERMINES THAT THE RESPONDENT  WRONGFULLY  FILED  OR
AMENDED, OR CAUSED TO BE WRONGFULLY FILED OR AMENDED, A FINANCING STATE-
MENT PURSUANT TO SECTION 9-509, THE COURT SHALL ORDER THE EXPUNGEMENT OF
SUCH  STATEMENT  OR ITS REDACTION IN THE PUBLIC RECORDS IN THE OFFICE IN
WHICH SUCH STATEMENT IS FILED, AS APPROPRIATE, AND MAY GRANT  ANY  ADDI-
TIONAL RELIEF AUTHORIZED BY SECTION 9-625. IN SUCH CASE, THE COURT SHALL
CAUSE  A  COPY  OF  ITS ORDER TO BE FILED WITH THE SECRETARY OF STATE OR
OTHER APPROPRIATE FILING OFFICE PURSUANT TO THIS  CHAPTER.    THE  COURT
ALSO  MAY  ENJOIN  THE  RESPONDENT  FROM  FILING OR AMENDING ANY FURTHER
FINANCING STATEMENT PURSUANT TO THIS ARTICLE WITHOUT LEAVE OF THE COURT.
IF THE RESPONDENT IS INCARCERATED AT THE TIME THE COURT ISSUES AN  ORDER
CONTAINING  SUCH  AN  INJUNCTION,  THE COURT SHALL CAUSE THE HEAD OF THE
CORRECTIONAL FACILITY IN WHICH THE RESPONDENT IS INCARCERATED TO RECEIVE
A COPY OF SUCH DETERMINATION.

A. 7552                             3

  (4) FOR PURPOSES OF THIS SUBDIVISION, A FINANCING STATEMENT IS  WRONG-
FULLY FILED OR AMENDED WHERE, AT THE TIME OF ITS FILING OR AMENDMENT, IT
CONTAINS A FALSE STATEMENT OR FALSE INFORMATION.
  S  5.  This  act  shall  take  effect  immediately;  provided that the
provisions of section three of this act shall not take effect until  the
first  of November next succeeding the date on which this act shall have
become a law; provided, further, subdivision 2 of section 175.35 of  the
penal  law, as added by section three of this act, shall apply solely to
the filing or amendment of financing statements under subpart 1 of  part
5 of article 9 of the uniform commercial code on or after such effective
date.