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
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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.