S T A T E   O F   N E W   Y O R K
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                                  2368

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                            January 14, 2013
                               ___________

Introduced  by  M.  of A. WEINSTEIN, ORTIZ, PERRY, O'DONNELL, GOTTFRIED,
  KAVANAGH -- Multi-Sponsored by -- M. of A. JACOBS,  NOLAN,  WRIGHT  --
  read once and referred to the Committee on Health

AN  ACT  to amend the social services law, in relation to granting resi-
  dents of adult homes, residences for adults, enriched housing programs
  and assisted living programs a cause of action to seek the appointment
  of temporary or permanent receivers of such residential  programs  for
  adults

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

  Section 1. Section 461-c of the social  services  law  is  amended  by
adding a new subdivision 10 to read as follows:
  10.  (A)  AS A MEANS OF PROTECTING THE HEALTH, SAFETY AND WELFARE OF A
RESIDENT OR RESIDENTS OF AN ADULT HOME, RESIDENCE FOR  ADULTS,  ENRICHED
HOUSING  PROGRAM  OR ASSISTED LIVING PROGRAM, SUCH RESIDENT OR RESIDENTS
MAY SEEK JUDICIAL RELIEF. IN ADDITION TO OTHER FORMS OF RELIEF AVAILABLE
UNDER THIS ARTICLE, A RESIDENT OR RESIDENTS OF AN ADULT HOME,  RESIDENCE
FOR  ADULTS,  ENRICHED  HOUSING  PROGRAM OR ASSISTED LIVING FACILITY MAY
SEEK EQUITABLE RELIEF FROM A COURT, INCLUDING, BUT NOT LIMITED  TO,  THE
APPOINTMENT  OF  A  TEMPORARY OR PERMANENT RECEIVER. A RESIDENT OR RESI-
DENTS OF AN ADULT HOME, RESIDENCE FOR ADULTS, ENRICHED  HOUSING  PROGRAM
OR  ASSISTED  LIVING  PROGRAM,  OR  HIS, HER OR THEIR REPRESENTATIVE MAY
COMMENCE AN ACTION IN THE SUPREME COURT  OF  THE  COUNTY  IN  WHICH  THE
FACILITY  IS LOCATED TO SEEK THE APPOINTMENT OF A TEMPORARY OR PERMANENT
RECEIVER.
  (B) UPON THE COMMENCEMENT OF AN ACTION PURSUANT TO  PARAGRAPH  (A)  OF
THIS  SUBDIVISION,  THE COMMISSIONER OF HEALTH SHALL BE SERVED AND GIVEN
THE OPPORTUNITY TO JOIN AS A PARTY TO THE ACTION. IN ADDITION  TO  OTHER
METHODS OF SERVICE AUTHORIZED BY LAW, SERVICE UPON SUCH COMMISSIONER MAY
BE  EFFECTUATED  AT  THE  COMMISSIONER'S OFFICE IN THE CITY OF NEW YORK.
FAILURE OF THE COMMISSIONER OF HEALTH TO JOIN AN ACTION FOR THE APPOINT-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD03822-01-3
              

A. 2368                             2

MENT OF A RECEIVER SHALL NOT BE AN IMPEDIMENT  TO  THE  ACTION.  ON  THE
RETURN  OF  SUCH  ACTION,  DETERMINATION  OF THE PROCEEDING TO APPOINT A
RECEIVER SHALL HAVE PRECEDENCE OVER EVERY OTHER BUSINESS  OF  THE  COURT
UNLESS  THE  COURT SHALL FIND THAT SOME OTHER PENDING PROCEEDING, HAVING
SIMILAR STATUTORY PRECEDENCE, SHALL HAVE PRIORITY. THE COURT MAY CONDUCT
A HEARING AT WHICH ALL INTERESTED PARTIES SHALL HAVE THE OPPORTUNITY  TO
PRESENT  EVIDENCE PERTAINING TO THE APPLICATION. IF THE COURT SHALL FIND
THAT CONDITIONS ENDANGERING THE HEALTH, SAFETY OR WELFARE OF A  RESIDENT
OR  RESIDENTS EXIST, THE COURT MAY MAKE AN ORDER GRANTING SUCH EQUITABLE
RELIEF AS IT  DEEMS  NECESSARY,  INCLUDING,  BUT  NOT  LIMITED  TO,  THE
APPOINTMENT OF A TEMPORARY OR PERMANENT RECEIVER.
  (C)  THE  COURT  APPOINTED  RECEIVER  SHALL  OPERATE  SUCH FACILITY IN
COMPLIANCE WITH ALL OF THE APPLICABLE LAWS, RULES AND REGULATIONS OF THE
DEPARTMENT OF HEALTH, AND SHALL HAVE SUCH ADDITIONAL POWERS, AS APPROVED
BY THE COURT, AS SHALL BE NECESSARY TO SO  OPERATE  THE  FACILITY.  SUCH
RECEIVER  SHALL DISPOSE OF THE RENTS AND OTHER MONIES DEPOSITED WITH HIM
OR HER ACCORDING TO THE FOLLOWING ORDER OF PRIORITY:
  (1) CORRECTION OF VIOLATIONS OF THIS CHAPTER AND THE RULES  AND  REGU-
LATIONS  ADOPTED  PURSUANT THERETO, AND EXPENDITURES NECESSARY TO ENSURE
THAT THE HEALTH, SAFETY AND WELFARE  OF  THE  RESIDENTS  ARE  PROTECTED.
UNTIL  PAYMENT  IN  FULL FOR THE CORRECTION OF VIOLATIONS AND REMOVAL OF
CONDITIONS ENDANGERING THE HEALTH, SAFETY OR WELFARE HAVE BEEN MADE,  NO
OTHER  DISBURSEMENTS SHALL BE PERMITTED, EXCEPT FOR FUEL BILLS, FIRE AND
LIABILITY INSURANCE, AND BILLS FOR ORDINARY REPAIRS AND MAINTENANCE;
  (2) PAYMENT OF A FEE FOR THE RECEIVER'S SERVICES;
  (3) PAYMENT OF OUTSTANDING STATE, CITY AND FEDERAL TAXES AND/OR LIENS;
AND
  (4) PAYMENT TO THE OWNERS OR PRIME LESSORS OF RENT, AS  DETERMINED  BY
THE COURT PURSUANT TO PARAGRAPH (D) OF THIS SUBDIVISION.
  (D) EXCEPT IN THE CASE WHERE THE RECEIVER IS ASSUMING AN EXISTING BONA
FIDE  ARMS  LENGTH LEASE, THE COURT SHALL DETERMINE A REASONABLE MONTHLY
RENTAL FOR THE FACILITY,  BASED  ON  CONSIDERATION  OF  ALL  APPROPRIATE
FACTORS, INCLUDING THE CONDITION OF THE FACILITY. THE RENT AS DETERMINED
BY  THE  COURT  SHALL  BE  PAID  BY  THE RECEIVER TO THE OWNERS OR PRIME
LESSORS FOR EACH MONTH THAT  THE  RECEIVERSHIP  REMAINS  IN  EFFECT,  IF
MONIES  ARE REMAINING AFTER MAKING THE EXPENDITURES PRIORITIZED IN PARA-
GRAPH (C) OF THIS SUBDIVISION. NOTHING CONTAINED IN THIS PARAGRAPH SHALL
BE CONSTRUED TO ALTER OR DIMINISH ANY OBLIGATION THE OPERATOR  MAY  HAVE
UNDER  ANY  CURRENTLY  VALID LEASE. THE RECEIVER SHALL HAVE THE POWER TO
LET CONTRACTS FOR THE FACILITY OR TO INCUR EXPENSES, PROVIDED THAT WHERE
THE INDIVIDUAL ITEMS OF REPAIRS, IMPROVEMENTS OR SUPPLIES  EXCEED  THREE
THOUSAND  DOLLARS,  THE  RECEIVER  SHALL OBTAIN PRICE QUOTATIONS FROM AT
LEAST THREE REPUTABLE SOURCES AND USE THE  LEAST  COSTLY  SOURCE  UNLESS
THERE IS GOOD CAUSE NOT TO USE SUCH SOURCE, WHICH SHALL BE DOCUMENTED IN
WRITING  BY THE RECEIVER. THE RECEIVER SHALL NOT BE REQUIRED TO FILE ANY
BOND. HE OR SHE SHALL COLLECT INCOMING PAYMENTS  FROM  ALL  SOURCES  AND
APPLY  THEM TO THE COSTS INCURRED IN THE PERFORMANCE OF HIS OR HER FUNC-
TIONS AS RECEIVER. AFTER PAYMENT  OF  EXPENDITURES  FOR  THE  PRIORITIES
LISTED  IN  PARAGRAPH  (C) OF THIS SUBDIVISION, THE RECEIVER SHALL HONOR
ALL EXISTING LEASES, MORTGAGES AND CHATTEL MORTGAGES THAT HAD PREVIOUSLY
BEEN UNDERTAKEN AS OBLIGATIONS OF THE OWNERS OR OPERATORS OF THE FACILI-
TY AND COMPENSATE THE OWNERS OF ANY GOODS HELD IN  INVENTORY  FOR  THOSE
GOODS  THAT HE OR SHE USES OR CAUSES TO BE USED BY REIMBURSING THE COSTS
OF SUCH GOODS, EXCEPT THAT NO COMPENSATION SHALL BE MADE  FOR  ANY  SUCH
GOODS FOR WHICH SUCH OWNERS HAVE ALREADY BEEN REIMBURSED.

A. 2368                             3

  (E)  THE  RECEIVER SHALL BE ENTITLED TO SUCH FEE AND REIMBURSEMENT FOR
EXPENSES AS DETERMINED BY THE COURT, BASED  UPON  CONSIDERATION  OF  ALL
APPROPRIATE  FACTORS  RELATING  TO  THE OPERATION OF THE FACILITY, TO BE
PAID AS A CHARGE AGAINST THE OPERATOR, NOT TO EXCEED THE  FEES,  COMMIS-
SIONS  AND  NECESSARY  EXPENSES AUTHORIZED TO BE PAID TO RECEIVERS IN AN
ACTION TO FORECLOSE A MORTGAGE.  THE RECEIVER SHALL NOTIFY THE PETITION-
ER OR PETITIONERS AND THE COURT  OF  ANY  LIEN  OR  CONVEYANCE  MADE  IN
CONTEMPLATION  OF  RECEIVERSHIP WITH AN INTENT TO REMOVE AN ASSET OF THE
FACILITY FROM THE JURISDICTION AND USE OF THE RECEIVER, OR TO HINDER  OR
DELAY  THE  RECEIVER IN THE EXECUTION OF HIS OR HER DUTIES. WITH RESPECT
TO ANY SUCH LIEN OR CONVEYANCE, THE PETITIONER OR  PETITIONERS  AND  THE
RECEIVER  SHALL  HAVE  AVAILABLE  ANY REMEDY AVAILABLE TO A TRUSTEE IN A
BANKRUPTCY PROCEEDING PURSUANT TO THE  FEDERAL  BANKRUPTCY  ACT  OR  ANY
REMEDY AVAILABLE TO A CREDITOR IN A PROCEEDING PURSUANT TO ARTICLE TEN-A
OF  THE  DEBTOR AND CREDITOR LAW, AND THE PETITIONER AND/OR RECEIVER MAY
APPLY TO THE COURT TO HAVE SUCH LIEN OR CONVEYANCE SET ASIDE, OR TO HAVE
THE COURT MAKE ANY  ORDER  WHICH  THE  CIRCUMSTANCES  OF  THE  CASE  MAY
REQUIRE.
  (F)  THE PROVISIONS OF PARAGRAPHS (F), (G) AND (H) OF SUBDIVISION FOUR
OF SECTION FOUR HUNDRED SIXTY-ONE-F OF THIS TITLE SHALL APPLY TO RECEIV-
ERSHIPS COMMENCED UNDER THIS SUBDIVISION.
  (G) A RECEIVER APPOINTED PURSUANT TO THIS SUBDIVISION MAY SEEK PAYMENT
PURSUANT TO THE PROVISIONS OF SUBDIVISION FIVE OF SECTION  FOUR  HUNDRED
SIXTY-ONE-F OF THIS TITLE.
  (H)  WHEN  A  RECEIVER  HAS  BEEN  APPOINTED, THE OPERATOR, OPERATORS,
ADMINISTRATOR AND/OR MANAGEMENT OF THE FACILITY SHALL:
  (1) IMMEDIATELY TRANSFER  ALL  RECORDS  CONCERNING  OPERATION  OF  THE
FACILITY,  INCLUDING RESIDENT RECORDS, FACILITY BUSINESS RECORDS AND ANY
OTHER RECORDS RELATED TO THE OPERATION OF THE FACILITY TO THE RECEIVER;
  (2) BE BARRED FROM ACCESS TO THE  FACILITY  DURING  THE  TERM  OF  THE
RECEIVERSHIP; AND
  (3)  PROVIDE  THE RECEIVER WITH ANY FUNDS RECEIVED BY THE OPERATOR FOR
THE OPERATION OF THE FACILITY.
  (I) THE COURT SHALL DETERMINE AT THE TIME  OF  THE  APPOINTMENT  OF  A
RECEIVER  UNDER THIS SUBDIVISION THE CONDITIONS UPON WHICH OR THE PERIOD
AFTER WHICH THE RECEIVERSHIP WILL TERMINATE. AT THE TIME OF  TERMINATION
OF  THE  RECEIVERSHIP,  THE  RECEIVER  SHALL  RENDER A FULL AND COMPLETE
ACCOUNTING TO THE COURT AND SHALL DISPOSE OF ANY PROFIT OR SURPLUS MONEY
AT THE DIRECTION OF THE COURT.
  (J) THE COURT MAY AWARD THE PREVAILING PARTY  IN  AN  ACTION  FOR  THE
APPOINTMENT  OF A RECEIVER NECESSARY AND REASONABLE EXPENSES INCURRED BY
OR ON BEHALF OF THE PARTY, INCLUDING COSTS AND ATTORNEYS' FEES.
  S 2. This act shall take effect on the one hundred eightieth day after
it shall have become a law, provided  that  any  rules  and  regulations
necessary  to implement the provisions of this act on its effective date
are authorized and directed to be completed on or before such date.