NY State Senate Bill 2021-S153

Senate Bill S153

Signed By Governor

2021-2022 Legislative Session

Enacts the "consumer credit fairness act"

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Archive: Last Bill Status - Signed by Governor

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Nov 08, 2021	signed chap.593
Oct 27, 2021	delivered to governor
Jun 02, 2021	returned to senate passed assembly ordered to third reading cal.350 substituted for a2382
May 25, 2021	referred to codes delivered to assembly passed senate
Mar 01, 2021	advanced to third reading
Feb 24, 2021	2nd report cal.
Feb 23, 2021	1st report cal.405
Jan 06, 2021	referred to judiciary

Votes

- May 25, 2021 - Floor Vote
  S153
  
  43
  
  Aye
  
  20
  
  Nay
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Floor Vote: May 25, 2021
      
      aye (43)
      
      Addabbo Jr.
      
      Bailey
      
      Benjamin
      
      Biaggi
      
      Breslin
      
      Brisport
      
      Brooks
      
      Brouk
      
      Comrie
      
      Cooney
      
      Felder
      
      Gaughran
      
      Gianaris
      
      Gounardes
      
      Harckham
      
      Hinchey
      
      Hoylman-Sigal
      
      Jackson
      
      Kaminsky
      
      Kaplan
      
      Kavanagh
      
      Kennedy
      
      Krueger
      
      Liu
      
      Mannion
      
      May
      
      Mayer
      
      Myrie
      
      Parker
      
      Persaud
      
      Ramos
      
      Reichlin-Melnick
      
      Rivera
      
      Ryan
      
      Salazar
      
      Sanders Jr.
      
      Savino
      
      Sepúlveda
      
      Serrano
      
      Skoufis
      
      Stavisky
      
      Stewart-Cousins
      
      Thomas
      
      nay (20)
      
      Akshar
      
      Borrello
      
      Boyle
      
      Gallivan
      
      Griffo
      
      Helming
      
      Jordan
      
      Lanza
      
      Martucci
      
      Mattera
      
      O'Mara
      
      Oberacker
      
      Ortt
      
      Palumbo
      
      Rath III
      
      Ritchie
      
      Serino
      
      Stec
      
      Tedisco
      
      Weik
  Feb 23, 2021 - Judiciary Committee Vote
  S153
  
  10
  
  Aye
  
  4
  
  Nay
  
  1
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Judiciary Committee Vote: Feb 23, 2021
      
      aye (10)
      
      Bailey
      
      Biaggi
      
      Breslin
      
      Gounardes
      
      Hoylman-Sigal
      
      Kaplan
      
      Myrie
      
      Skoufis
      
      Stavisky
      
      Thomas
      
      nay (4)
      
      Boyle
      
      Lanza
      
      O'Mara
      
      Oberacker
      
      aye wr (1)
      
      Palumbo

co-Sponsors

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2021-S153 (ACTIVE) - Details

See Assembly Version of this Bill:: A2382
Law Section:: Civil Practice Law and Rules
Laws Affected:: Amd CPLR, generally; amd §212, Judy L
Versions Introduced in Other Legislative Sessions:: 2013-2014: A2678
2015-2016: A3877, A4438
2017-2018: S8959, A1752
2019-2020: S691, S4827, A6909, A10795

2021-S153 (ACTIVE) - Summary

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

2021-S153 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S153

SPONSOR: THOMAS
 
TITLE OF BILL:

An act to amend the civil practice law and rules and the judiciary law,
in relation to consumer credit transactions

 
PURPOSE OF BILL:

This bill would strengthen consumer protections in consumer debt
collection proceedings.

 
SUMMARY OF PROVISIONS OF BILL:

The bill would amend pleading requirements particular to consumer credit
actions by requiring that the complaint provide the name of the original
creditor, the last four digits of the account number printed on the most
recent monthly statement recording a purchase transaction, last payment,
or balance transfer, the date and amount of the last payment, an itemi-
zation of the amount sought, the account balance printed on the most

recent monthly statement recording a purchase transaction, last payment,
or balance transfer, and whether the plaintiff is the original creditor,
and if not, information about the sale and assignment of the debt. The
bill also requires that a copy of the contract or other written instru-
ment on which the action is based be attached to the complaint.

The bill would reduce the statute of limitations on consumer credit
actions from six years to three years.

The bill would permit defendants in consumer credit actions to raise
improper service as a defense in their answer and preserve that defense
for trial without having to file a separate motion to dismiss within 60
days as under current law.

It would require that an additional notice of a pending consumer credit
action be mailed to the defendant by the clerk of the court, with the
notice and mailing envelope provided by the plaintiff. This notice would
provide important information to the consumer credit defendant, includ-
ing the website address for consumer credit resources maintained by the
New York State Office of Court Administration. The chief administrative
judge would be required to make available Spanish translations of said
additional notices.

Similar in concept to the notice provided to the consumer upon commence-
ment of the action, the bill would require an additional notice advising
defendants in consumer credit actions against whom a summary judgment
motion has been made of the significance and consequence of such a
motion, and how to respond.  It would also include the website address
for consumer credit resources maintained by the New York State Office of
Court Administration to assist consumer credit defendants in responding
to such motions.

To prevent the entry of default judgments on claims that lack merit, the
bill would require applications for default judgments consumer credit
actions to conform with specific requirements. These include (1) an
affidavit by the original creditor of the facts constituting the debt,
the default in payment, the sale or assignment of the debt, and the
amount due at the time of sale or assignment; (2) for each subsequent
assignment or sale of the debt to another entity, an affidavit of sale
of the debt by the debt seller, completed by the seller or assignor;
and(3) an affidavit of a witness of the plaintiff, which includes a
chain of title of the debt, completed by the plaintiff or plaintiff's
witness. The bill will also require that applications for default judg-
ments in consumer credit actions include a statement that after reason-
able inquiry, the plaintiff or its attorney has reason to believe that
the statute of limitations has not expired. Finally, the chief adminis-
trative judge would be required to issue form affidavits for default
motions based upon consumer credit transactions, which would standardize
and make uniform the motion disposition process for the courts.

The bill would provide similarly exacting requirements for consumer
creditors who seek to enter judgment based upon an arbitration award.

Finally, the bill clarifies -§CPLR §5019(c)applies only to judgment
creditors.

 
JUSTIFICATION:

There have been serious concerns reported about the growing problem of
abusive debt collection practices, including filing suit on debts that
are too old to be sued on, are a result of identity theft, or are debts
that have been paid or otherwise discharged. Original creditors, such as
credit card issuers, routinely sell large portfolios of consumer debt
accounts to debt buyers, who regularly re-sell the debts. Minimal infor-
mation or documentation is transferred to debt purchasers. The process
makes it difficult for a consumer to identify the debt, the current
owner, or the amount claimed and results in collection efforts that
continue for years, including lawsuits filed after the statute of limi-
tations has expired. There have been instances in which a consumer paid
a debt, but was later contacted by another debt buyer attempting to
collect it. Other reported concerns include lack of notice to the
defendant of the lawsuit resulting in a default judgment against the
defendant without a requirement to produce proof of the debt sued on.
These default judgments are collected through wage garnishment and bank
account restraints, which is often the first time a consumer learns that
they were sued. Stopping garnishment and unfreezing bank accounts
requires that the consumer take action in court, but rarely do consumers
have attorneys to help. It is especially burdensome given the limita-
tions on daily life and the health challenges related to the COVID-19
pandemic.

The devastating toll that abusive debt collection lawsuits take on
consumers is a longstanding and persistent problem identified by numer-
ous governmental and public policy institutions up through this day. In
its 2010 report, Repairing A Broken System: Protecting Consumers in Debt
Collection Litigation and Arbitration. the Federal Trade. Commission
recommended state-level reforms similar to those contained in this bill.

In 2016, Human Rights Watch made similar recommendations in a study
called Rubber Stamp Justice, which incorporated data supplied by the New
York court system. Most recently, in May 2020 The the PEW Charitable
Trusts issued How Debt Collectors Are Transforming the Business of State
Courts, which noted, among many other things: "Debt collection lawsuits
that end in default judgment can have lasting consequences for consum-
ers' economic stability."(Page 17.) PEW also recommended a review of
state policies to ensure that both sides can effectively present their
cases. This bill responds to these calls for better delivery of justice
to consumer defendants.

Abusive debt collection lawsuits exploit current gaps in our State's
civil procedure laws and rules. The proposed legislation helps to fill
those gaps. In doing so, this legislation will protect all consumers,
and will particularly help ameliorate some of the forms of economic
abuse, including identity theft, suffered by domestic violence victims
at the hands of their abusers.

At a hearing on economic abuse as a form of domestic abuse, held on
December 5, 2012, by the New York State Assembly Committees on Judiciary
and Codes, civil legal service providers, domestic violence prevention
advocates, and the Office of Court Administration highlighted the insid-
ious and pervasive nature of various forms of economic abuse perpetrated
by abusers in the family violence context to exercise power and control
over their victims and their finances.  The types of abuse cited
included incurring debt in the survivor's name through false statements
or coercion, perpetrating identity theft, or otherwise incurring debt
without the survivor's knowledge.  Witnesses at the hearing cited this
legislation as important and helpful to meliorating economic abuse
suffered by domestic abuse survivors.

This legislation requires statewide institution of additional notice
requirements that are presently in place through court rules and which
have indeed been helpful to consumer credit defendants, who rarely have
attorneys to represent them, even when they learn that they have been
sued. The notice provides a basic understanding of the consequences of
legal actions taken against them and the importance of responding to the
lawsuit. It has also reduced the number of default judgments. There is a
significant and documented problem with faulty service that resulting in
default judgments with serious life-altering ramifications. Without
notice, defendants do not appear in court, and debt buyers easily obtain
default judgments.  These judgments are enforced by freezing people's
bank accounts and garnishing their wages, hampering their ability
to_then pay for basic necessities such as food, utilities, medication,
and housing. These judgments appear are public records, making it close
to impossible for a consumer to secure housing or employment, or to take
out a loan. The provisions of this bill would protect all consumers and
domestic abuse survivors in particular, by ensuring that New Yorkers
receive actual notice of debt collection actions.

Current law allows debt collectors to provide minimal and vague informa-
tion in the complaint that initiates the case, making it very difficult
for consumers to identify the debt or the company collecting it. This
bill requires court papers to include more information about the debt
sued upon. This would ensure that all New Yorkers will be better able to
identify the debt on which they are being sued. There are many debts
that result from identity theft or mistaken identity and, in other situ-
ations, the defendant may not recognize the debt as theirs from the
minimal information provided on the initial legal papers and may there-
fore not respond. This legislation will be particularly important for
domestic violence survivors as it will help them identify the debt and
assert defenses in cases involving debts they did not voluntarily incur
but that were incurred by their abusers in the survivor's name.

This legislation will reduce the statute of limitations for consumer
credit actions from six to three years. Reducing the statute of limita-
tions requires creditors to file their claims while memories are fresh
and records are still available. States with three year statutes of
limitation include- Arizona, Arkansas, Delaware, Kansas, Louisiana,
Maryland, Mississippi, Montana, and the District of Columbia. Pennsylva-
nia has a two-year statute of limitation.

Debt collection actions are rife with poor service of process as
confirmed in numerous studies and by New York governmental institutions.
Indeed, questionable service of process is the reason for the exceeding-
ly high number of default judgments in consumer credit actions. Because
consumer defendants rarely have attorneys, improper service is a defense
they often unknowingly waive when they finally discover they have been
sued, even though service of process is a requirement of due process
rights afforded under the United States Constitution. Current law places
time limits on a defendant's right to assert improper service as a
defense or to seek dismissal of the case on this basis. To protect
consumers from unknowingly waiving this legitimate defense, the bill
would allow consumer defendants to assert improper service as a defense
and seek dismissal of the lawsuit beyond the time limits in current law.

Debt collection actions are also rife with faulty documentation and
debts that are too old to be sued on. To ensure that default judgment
applications in debt collection lawsuits are evaluated on the merits and
that default judgments are not entered on time-barred debts, this bill
requires plaintiffs seeking default judgments to provide basic proof of
the debt, its entitlement to judgment, and the timeliness of the
lawsuit. This includes an affidavit from the original creditor with
proof of the debt and the consumer's default in payment. If the debt was
sold, affidavits proving the sale must be submitted to show that the
plaintiff is the current owner entitled to obtain the judgment. To
protect consumers from the entry of judgment on time-barred debts, this
bill would require that applications for default judgments in consumer
credit actions include a statement that the creditor or its attorney has
reason to believe that the statute of limitations has not expired.

This legislation will benefit all consumers and for domestic violence
survivors, it will go a long way toward helping break the cycle of
violence and domestic abuse that enables perpetrators of domestic abuse
to exercise control over their victims and their finances in a manner
that prevents the victim from leaving a dangerous relationship or which
forces them to return to it.

 
LEGISLATIVE HISTORY:

2020:S.4827(Thomas)/A.6909(Weinstein)- Referred to Judiciary.
2019:S.4827(Thomas)/A.6909 (Weinstein) - Judiciary Committee Discharged
and Committed to Rules.
2018:S.8959(Felder)/A.1752(Weinstein)- Referred to Rules.
2017:A.1752(Weinstein)- Reported and Referred to Codes.
2016:A.4438(Weinstein)- Referred to Judiciary.
2015:A.4438(Weinstein)- Reported and Referred to Codes.
2013-14: S.2454 (Savino) / A.9053 (Weinstein) - Referred to Judiciary.
2012: S.677 (Peralta) / A.633 (Weinstein) - Referred to Judiciary.
2011: S.677(Peralta)/A.633(Weinstein)Codes Committee Discharged and
Committed to Judiciary./ A.7558(Weinstein)- Reported and Committed to
2010:S.4398(Schneiderman) Finance.
2009:5.4398(Schneiderman)/ A.7558(Weinstein)- Referred to Codes.

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None.

 
EFFECTIVE DATE:
Immediately; provided, however, that sections two, three, five, six,
seven, eight, nine, ten, eleven and twelve shall take effect on the one
hundred eightieth day after it shall have become a law and shall apply
to actions and proceedings commenced on or after such date; and
provided, further, that section four of this act shall take effect on
the one hundred fiftieth day after this act shall have become a law.

2021-S153 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    153
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 6, 2021
                                ___________
 
 Introduced  by  Sen.  THOMAS -- read twice and ordered printed, and when
   printed to be committed to the Committee on Judiciary
 
 AN ACT to amend the civil practice law and rules and the judiciary  law,
   in relation to consumer credit transactions

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Short title. This act shall be known and may  be  cited  as
 the "consumer credit fairness act".
   §  2.  Section  105  of the civil practice law and rules is amended by
 adding two new subdivisions (h-1) and (q-1) to read as follows:
   (H-1) FINANCE CHARGE. THE TERM "FINANCE  CHARGE"  MEANS  THE  COST  OF
 CONSUMER CREDIT AS A DOLLAR AMOUNT, INCLUDES ANY CHARGE PAYABLE DIRECTLY
 OR  INDIRECTLY BY THE CONSUMER AND IMPOSED DIRECTLY OR INDIRECTLY BY THE
 CREDITOR AS AN INCIDENT TO OR A CONDITION OF THE  EXTENSION  OF  CREDIT,
 AND  DOES  NOT INCLUDE ANY CHARGE OF A TYPE PAYABLE IN A COMPARABLE CASH
 TRANSACTION.
   (Q-1) ORIGINAL CREDITOR. THE TERM "ORIGINAL CREDITOR" MEANS THE ENTITY
 THAT OWNED A CONSUMER CREDIT ACCOUNT AT THE DATE OF DEFAULT GIVING  RISE
 TO A CAUSE OF ACTION.
   § 3. Subdivision 2 of section 213 of the civil practice law and rules,
 as  amended  by  chapter  709 of the laws of 1988, is amended to read as
 follows:
   2. an action upon a contractual obligation or  liability,  express  or
 implied,  except  as  provided  in section two hundred thirteen-a OR TWO
 HUNDRED FOURTEEN-I of this article or article 2 of the  uniform  commer-
 cial code or article 36-B of the general business law;
   §  4.  The  civil  practice  law  and rules is amended by adding a new
 section 214-i to read as follows:
   § 214-I. CERTAIN ACTIONS ARISING OUT OF CONSUMER  CREDIT  TRANSACTIONS
 TO  BE COMMENCED WITHIN THREE YEARS. AN ACTION ARISING OUT OF A CONSUMER
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD00040-01-1

 S. 153                              2
 
 CREDIT TRANSACTION WHERE A PURCHASER, BORROWER OR DEBTOR IS A  DEFENDANT
 MUST  BE COMMENCED WITHIN THREE YEARS, EXCEPT AS PROVIDED IN SECTION TWO
 HUNDRED THIRTEEN-A OF THIS ARTICLE OR ARTICLE 2 OF THE  UNIFORM  COMMER-
 CIAL  CODE  OR ARTICLE 36-B OF THE GENERAL BUSINESS LAW. NOTWITHSTANDING
 ANY OTHER PROVISION OF  LAW,  WHEN  THE  APPLICABLE  LIMITATIONS  PERIOD
 EXPIRES,  ANY  SUBSEQUENT PAYMENT TOWARD, WRITTEN OR ORAL AFFIRMATION OF
 OR OTHER ACTIVITY ON THE DEBT DOES NOT REVIVE OR EXTEND THE  LIMITATIONS
 PERIOD.
   §  5.  The  civil  practice  law  and rules is amended by adding a new
 section 306-d to read as follows:
   § 306-D. ADDITIONAL MAILING OF NOTICE IN AN ACTION ARISING  OUT  OF  A
 CONSUMER CREDIT TRANSACTION. (A) AT THE TIME OF FILING WITH THE CLERK OF
 THE  PROOF  OF SERVICE OF THE SUMMONS AND COMPLAINT IN AN ACTION ARISING
 OUT OF A CONSUMER CREDIT TRANSACTION, THE PLAINTIFF SHALL SUBMIT TO  THE
 CLERK  A  STAMPED, UNSEALED ENVELOPE ADDRESSED TO THE DEFENDANT TOGETHER
 WITH A WRITTEN NOTICE IN CLEAR TYPE OF  NO  LESS  THAN  TWELVE-POINT  IN
 SIZE,  IN  BOTH  ENGLISH  AND  SPANISH,  AND  CONTAINING  THE  FOLLOWING
 LANGUAGE:
                       ADDITIONAL NOTICE OF LAWSUIT
 
 (NAME OF COURT)
 (COUNTY)
 (STREET ADDRESS, ROOM NUMBER)
 (CITY, STATE, ZIP CODE)
 
 (NAME OF DEFENDANT)
 (ADDRESS OF DEFENDANT)
 
 PLAINTIFF:
 DEFENDANT:
 NAME OF ORIGINAL CREDITOR, UNLESS SAME:
 INDEX NUMBER:
 
 ATTENTION: A LAWSUIT HAS BEEN FILED AGAINST YOU CLAIMING  THAT  YOU  OWE
 MONEY FOR AN UNPAID CONSUMER DEBT.
 YOU MAY WISH TO CONTACT AN ATTORNEY.
   YOU  SHOULD  RESPOND  TO  THE LAWSUIT AS SOON AS POSSIBLE BY FILING AN
 "ANSWER" WHICH MAY BE DONE AT THE COURT CLERK'S OFFICE LISTED ABOVE.
   IF YOU DO NOT RESPOND TO THE LAWSUIT, THE  COURT  MAY  ENTER  A  MONEY
 JUDGMENT  AGAINST  YOU. ONCE ENTERED, A JUDGMENT IS GOOD AND CAN BE USED
 AGAINST YOU FOR TWENTY YEARS, AND  YOUR  PERSONAL  PROPERTY  AND  MONEY,
 INCLUDING  A  PORTION OF YOUR PAYCHECK AND/OR BANK ACCOUNT, MAY BE TAKEN
 FROM YOU.  ALSO, A JUDGMENT MAY AFFECT YOUR CREDIT SCORE AND CAN  AFFECT
 YOUR ABILITY TO RENT A HOME, FIND A JOB, OR TAKE OUT A LOAN.
 YOU CANNOT BE ARRESTED OR SENT TO JAIL FOR OWING A DEBT.
 ADDITIONAL  INFORMATION  CAN BE FOUND AT THE NEW YORK STATE COURT SYSTEM
 WEBSITE.
 SOURCES OF INFORMATION AND ASSISTANCE:
 THE COURT ENCOURAGES YOU TO INFORM YOURSELF  ABOUT  YOUR  OPTIONS  AS  A
 DEFENDANT  IN  THIS  LAWSUIT.  IN  ADDITION TO SEEKING ASSISTANCE FROM A
 PRIVATE ATTORNEY OR LEGAL AID OFFICE, THERE ARE  FREE  LEGAL  ASSISTANCE
 COMPUTER PROGRAMS THAT YOU CAN USE ONLINE TO HELP YOU REPRESENT YOURSELF
 IN THIS LAWSUIT.
 FOR  FURTHER INFORMATION, OR TO LOCATE A LEGAL AID PROGRAM NEAR YOU, YOU
 MAY VISIT THE LAWHELPNY WEBSITE OR  THE  NEW  YORK  STATE  COURT  SYSTEM

 S. 153                              3
 
 WEBSITE,  WHICH  HAS  INFORMATION FOR REPRESENTING YOURSELF AND LINKS TO
 OTHER RESOURCES AT: ___________________.
   (B)  THE  FACE  OF THE ENVELOPE SHALL BE ADDRESSED TO THE DEFENDANT AT
 THE ADDRESS AT WHICH PROCESS WAS SERVED, AND SHALL CONTAIN  THE  DEFEND-
 ANT'S  NAME, ADDRESS (INCLUDING APARTMENT NUMBER) AND ZIP CODE. THE FACE
 OF THE ENVELOPE ALSO SHALL STATE THE APPROPRIATE CLERK'S OFFICE  AS  ITS
 RETURN ADDRESS.
   (C)  THE  CLERK  PROMPTLY  SHALL  MAIL  TO  THE DEFENDANT THE ENVELOPE
 CONTAINING THE ADDITIONAL NOTICE SET FORTH IN SUBDIVISION  (A)  OF  THIS
 SECTION.  NO DEFAULT JUDGMENT BASED ON THE DEFENDANT'S FAILURE TO ANSWER
 SHALL BE ENTERED UNLESS THERE HAS BEEN COMPLIANCE WITH THIS SECTION, AND
 AT LEAST TWENTY DAYS HAVE ELAPSED FROM THE DATE OF MAILING BY THE CLERK.
 NO DEFAULT JUDGMENT BASED ON THE DEFENDANT'S FAILURE TO ANSWER SHALL  BE
 ENTERED IF THE ADDITIONAL NOTICE IS RETURNED TO THE COURT AS UNDELIVERA-
 BLE.  RECEIPT  OF THE ADDITIONAL NOTICE BY THE DEFENDANT DOES NOT CONFER
 JURISDICTION ON THE COURT IN THE ABSENCE OF PROPER SERVICE OF PROCESS.
   (D) THE CHIEF ADMINISTRATIVE JUDGE SHALL ISSUE A  SPANISH  TRANSLATION
 OF  THE NOTICE IN SUBDIVISION (A) OF THIS SECTION AND SHALL MAINTAIN AND
 PUBLISH THE URL ADDRESS FOR THE WEB PAGE CONTAINING  CONSUMER  RESOURCES
 FOR UNREPRESENTED LITIGANTS.
   §  6.  Subdivision  (a)  of section 3012 of the civil practice law and
 rules is amended to read as follows:
   (a) Service of  pleadings.  The  complaint  may  be  served  with  the
 summons, EXCEPT THAT IN AN ACTION ARISING OUT OF A CONSUMER CREDIT TRAN-
 SACTION,  THE  COMPLAINT  SHALL BE SERVED WITH THE SUMMONS. A subsequent
 pleading asserting new or additional claims for relief shall  be  served
 upon  a party who has not appeared in the manner provided for service of
 a summons. In any other case, a pleading shall be served in  the  manner
 provided  for service of papers generally. Service of an answer or reply
 shall be made within twenty days after service of the pleading to  which
 it responds.
   §  7.  Rule  3016  of  the  civil practice law and rules is amended by
 adding a new subdivision (j) to read as follows:
   (J) CONSUMER CREDIT TRANSACTIONS.  IN  AN  ACTION  ARISING  OUT  OF  A
 CONSUMER  CREDIT  TRANSACTION WHERE A PURCHASER, BORROWER OR DEBTOR IS A
 DEFENDANT, THE CONTRACT OR OTHER WRITTEN INSTRUMENT ON WHICH THE  ACTION
 IS  BASED  SHALL BE ATTACHED TO THE COMPLAINT, HOWEVER, FOR THE PURPOSES
 OF THIS SECTION, IF THE ACCOUNT WAS  A  REVOLVING  CREDIT  ACCOUNT,  THE
 CHARGE-OFF  STATEMENT  MAY  BE  ATTACHED TO THE COMPLAINT INSTEAD OF THE
 CONTRACT OR OTHER WRITTEN  INSTRUMENT,  AND  THE  FOLLOWING  INFORMATION
 SHALL BE SET FORTH IN THE COMPLAINT:
   (1) THE NAME OF THE ORIGINAL CREDITOR;
   (2)  THE  LAST  FOUR  DIGITS OF THE ACCOUNT NUMBER PRINTED ON THE MOST
 RECENT MONTHLY STATEMENT RECORDING A PURCHASE TRANSACTION, LAST  PAYMENT
 OR BALANCE TRANSFER;
   (3)  THE  DATE  AND  AMOUNT  OF THE LAST PAYMENT OR, IF NO PAYMENT WAS
 MADE, A STATEMENT THAT THE PURCHASER, BORROWER OR DEBTOR MADE NO PAYMENT
 ON THE ACCOUNT;
   (4) IF THE COMPLAINT CONTAINS A CAUSE OF ACTION BASED  ON  AN  ACCOUNT
 STATED,  THE  DATE  ON OR ABOUT WHICH THE FINAL STATEMENT OF ACCOUNT WAS
 PROVIDED TO THE DEFENDANT;
   (5) (A) EXCEPT AS PROVIDED IN SUBPARAGRAPH (B) OF THIS  PARAGRAPH,  AN
 ITEMIZATION  OF THE AMOUNT SOUGHT, BY (I) PRINCIPAL; (II) FINANCE CHARGE
 OR CHARGES; (III) FEES IMPOSED BY THE ORIGINAL CREDITOR; (IV) COLLECTION
 COSTS; (V) ATTORNEY'S FEES; (VI) INTEREST; AND (VII) ANY OTHER FEES  AND
 CHARGES.

 S. 153                              4
 
   (B)  IF  THE ACCOUNT WAS A REVOLVING CREDIT ACCOUNT, AN ITEMIZATION OF
 THE AMOUNT SOUGHT, BY:   (I) THE TOTAL AMOUNT OF  THE  DEBT  DUE  AS  OF
 CHARGE-OFF;  (II) THE TOTAL AMOUNT OF INTEREST ACCRUED SINCE CHARGE-OFF;
 (III) THE TOTAL AMOUNT OF NON-INTEREST CHARGES  OR  FEES  ACCRUED  SINCE
 CHARGE-OFF; AND (IV) THE TOTAL AMOUNT OF PAYMENTS AND/OR CREDITS MADE ON
 THE DEBT SINCE CHARGE-OFF;
   (6)  THE  ACCOUNT BALANCE PRINTED ON THE MOST RECENT MONTHLY STATEMENT
 RECORDING A PURCHASE TRANSACTION, LAST PAYMENT OR BALANCE TRANSFER;
   (7) (A) WHETHER THE PLAINTIFF IS THE ORIGINAL CREDITOR.
   (B) IF THE PLAINTIFF IS NOT THE ORIGINAL CREDITOR, THE COMPLAINT SHALL
 ALSO STATE (I) THE DATE ON WHICH THE DEBT WAS SOLD OR  ASSIGNED  TO  THE
 PLAINTIFF;  (II) THE NAME OF EACH PREVIOUS OWNER OF THE ACCOUNT FROM THE
 ORIGINAL CREDITOR TO THE PLAINTIFF AND THE DATE ON WHICH  THE  DEBT  WAS
 ASSIGNED TO THAT OWNER BY THE ORIGINAL CREDITOR OR SUBSEQUENT OWNER; AND
 (III)  THE  AMOUNT DUE AT THE TIME OF THE SALE OR ASSIGNMENT OF THE DEBT
 BY THE ORIGINAL CREDITOR; AND
   (8) ANY MATTERS REQUIRED TO BE STATED WITH PARTICULARITY  PURSUANT  TO
 RULE 3015 OF THIS ARTICLE.
   § 8. Subdivision (e) of rule 3211 of the civil practice law and rules,
 as  amended  by  chapter  616 of the laws of 2005, is amended to read as
 follows:
   (e) Number, time and waiver of objections; motion to  plead  over.  At
 any  time before service of the responsive pleading is required, a party
 may move on one or more of the grounds set forth in subdivision  (a)  OF
 THIS  RULE,  and  no  more  than one such motion shall be permitted. Any
 objection or defense based upon a ground set forth  in  paragraphs  one,
 three,  four,  five  and  six  of subdivision (a) OF THIS RULE is waived
 unless raised either by such motion or in  the  responsive  pleading.  A
 motion  based  upon a ground specified in paragraph two, seven or ten of
 subdivision (a) OF THIS RULE may be made at any subsequent time or in  a
 later  pleading,  if one is permitted; an objection that the summons and
 complaint, summons with notice, or notice of petition and  petition  was
 not  properly  served is waived if, having raised such an objection in a
 pleading, the objecting party does not move for judgment on that  ground
 within  sixty  days after serving the pleading, unless the court extends
 the time upon the ground of undue hardship. The foregoing sentence shall
 not apply in any proceeding TO COLLECT A DEBT ARISING OUT OF A  CONSUMER
 CREDIT  TRANSACTION WHERE A CONSUMER IS A DEFENDANT OR under subdivision
 one or two of section seven hundred eleven of the real property  actions
 and  proceedings  law.  The  papers  in  opposition to a motion based on
 improper service shall contain a copy of the proof of  service,  whether
 or  not  previously filed. An objection based upon a ground specified in
 paragraph eight or nine of subdivision (a) OF THIS RULE is waived  if  a
 party  moves  on any of the grounds set forth in subdivision (a) OF THIS
 RULE without raising such objection or  if,  having  made  no  objection
 under  subdivision  (a)  OF  THIS  RULE,  he  or she does not raise such
 objection in the responsive pleading WHICH, IN ANY ACTION TO  COLLECT  A
 DEBT  ARISING OUT OF A CONSUMER CREDIT TRANSACTION WHERE A CONSUMER IS A
 DEFENDANT, INCLUDES ANY AMENDED RESPONSIVE PLEADING.
   § 9. Rule 3212 of the civil practice  law  and  rules  is  amended  by
 adding a new subdivision (j) to read as follows:
   (J)  ADDITIONAL NOTICE IN ANY ACTION TO COLLECT A DEBT ARISING  OUT OF
 A CONSUMER CREDIT TRANSACTION WHERE A CONSUMER IS A DEFENDANT.
   1. AT THE TIME OF SERVICE OF A NOTICE OF MOTION ANY  PART  OF    WHICH
 REQUESTS  SUMMARY  JUDGMENT IN WHOLE OR IN PART, WHERE THE  MOVING PARTY
 IS A PLAINTIFF AND THE RESPONDENT IS A CONSUMER DEFENDANT IN  AN  ACTION

 S. 153                              5
 
 TO  COLLECT  A  DEBT  ARISING OUT OF A  CONSUMER CREDIT TRANSACTION, AND
 WHERE THE CONSUMER DEFENDANT AGAINST  WHOM SUMMARY JUDGMENT IS SOUGHT IS
 NOT REPRESENTED BY AN ATTORNEY, THE PLAINTIFF SHALL SUBMIT TO THE  CLERK
 A  STAMPED,  UNSEALED  ENVELOPE ADDRESSED TO THE DEFENDANT TOGETHER WITH
 THE FOLLOWING ADDITIONAL NOTICE IN ENGLISH AND SPANISH TO BE PRINTED  IN
 CLEAR TYPE NO LESS THAN TWELVE-POINT IN SIZE:
                             IMPORTANT NOTICE
 THE  PLAINTIFF  HAS  ASKED  THE  COURT  TO ENTER JUDGMENT AGAINST YOU BY
 MAKING A MOTION FOR SUMMARY JUDGMENT.  KEEP THIS NOTICE AND THE ENVELOPE
 IT CAME IN. THE MOTION FOR SUMMARY JUDGMENT  WAS  SEPARATELY  SERVED  ON
 YOU.  TO AVOID ENTRY OF JUDGMENT:
 (1) YOU MUST APPEAR IN COURT AS DIRECTED BELOW:
 WHERE:  NAME OF COURT, STREET ADDRESS, ROOM NUMBER
 WHEN:  DATE AND TIME
 (2) YOU SHOULD OPPOSE THE MOTION IN WRITING.
 HOW TO OPPOSE THE MOTION:
   (1)  STATE  THE  LEGAL REASONS WHY THE COURT SHOULD NOT ENTER JUDGMENT
 AGAINST YOU, INCLUDING YOUR DEFENSES.
   (2) STATE THE FACTS THAT SUPPORT YOUR DEFENSES.
   (3) ATTACH AFFIDAVITS AND/OR EXHIBITS TO SUPPORT THE FACTS YOU ASSERT.
   (A) AFFIDAVITS ARE SWORN STATEMENTS OF WITNESSES (INCLUDING  YOU)  WHO
 STATE  FACTS THEY KNOW TO BE TRUE.  THE AFFIDAVIT SHOULD STATE THE FACTS
 AND HOW THE WITNESS KNOWS THEM.  ALSO, THE AFFIDAVIT SHOULD EXPLAIN  ANY
 EXHIBITS.    AN AFFIDAVIT OF SERVICE IS AN AFFIDAVIT THAT STATES HOW AND
 WHEN PAPERS WERE SERVED.   AN AFFIDAVIT MUST BE SIGNED  IN  FRONT  OF  A
 NOTARY.  FREE  FORMS  ARE  AVAILABLE  ON THE NEW YORK STATE COURT SYSTEM
 WEBSITE AT: ____________________.
   (B) EXHIBITS ARE COPIES OF DOCUMENTS. EXHIBITS ARE USUALLY ATTACHED TO
 AFFIDAVITS.
   (4) HAVE SOMEONE (NOT YOU OR ANOTHER DEFENDANT IN THE LAWSUIT) MAIL  A
 COPY  OF  YOUR  OPPOSITION TO THE PLAINTIFF'S ATTORNEY BEFORE YOUR COURT
 DATE AND HAVE THEM PREPARE AN AFFIDAVIT OF SERVICE BY MAIL.
   (5) BRING A COPY OF YOUR OPPOSITION AND THE AFFIDAVIT  OF  SERVICE  TO
 YOUR COURT DATE.
   (6) ATTEND YOUR COURT DATE.
 IF YOU NEED MORE TIME:
 IF  YOU  NEED  MORE  TIME  TO  PREPARE YOUR WRITTEN RESPONSE, YOU SHOULD
 APPEAR AT YOUR COURT DATE AND ASK THE JUDGE FOR MORE TIME.  YOU CAN ALSO
 ASK THE JUDGE TO REFER YOU FOR LEGAL HELP.
 IF YOU NEED LEGAL HELP:
 YOU MAY SEEK LEGAL HELP FROM A PRIVATE ATTORNEY OR A LEGAL  AID  OFFICE.
 SOME  COURTS  HAVE  FREE  LEGAL  ASSISTANCE  PROGRAMS FOR PEOPLE WITHOUT
 LAWYERS.  YOU CAN FIND RESOURCES ON THE  NEW  YORK  STATE  COURT  SYSTEM
 WEBSITE AT: ____________________.
   2.  THE  CLERK  PROMPTLY  SHALL  MAIL  TO  THE  DEFENDANT THE ENVELOPE
 CONTAINING THE ADDITIONAL NOTICE SET FORTH  IN  PARAGRAPH  ONE  OF  THIS
 SUBDIVISION  AND  NOTE  THE  DATE OF MAILING IN THE CASE RECORD. SUMMARY
 JUDGMENT SHALL NOT BE ENTERED BASED ON DEFENDANT'S FAILURE TO OPPOSE THE
 MOTION UNLESS THERE HAS BEEN COMPLIANCE WITH THIS SECTION AND  AT  LEAST
 FOURTEEN  DAYS  HAVE  ELAPSED  FROM  THE DATE OF MAILING BY THE CLERK OR
 NINETEEN DAYS IF THE PLAINTIFF'S NOTICE  OF  MOTION  DEMANDS  ADDITIONAL
 TIME UNDER SUBDIVISION (B) OF RULE 2214 OF THIS CHAPTER.
   3. THE CHIEF ADMINISTRATIVE JUDGE SHALL ISSUE A SPANISH TRANSLATION OF
 THE  NOTICE  IN PARAGRAPH ONE OF THIS SUBDIVISION AND SHALL MAINTAIN AND
 PUBLISH THE URL ADDRESS FOR THE  WEB  PAGE  CONTAINING  CONSUMER  CREDIT
 RESOURCES FOR UNREPRESENTED LITIGANTS.

 S. 153                              6
 
   §  10. Section 3213 of the civil practice law and rules, as amended by
 chapter 210 of the laws of 1969, is amended to read as follows:
   §  3213.  Motion  for  summary  judgment in lieu of complaint. When an
 action is based upon an instrument for the payment of money only or upon
 any judgment, the plaintiff may serve  with  the  summons  a  notice  of
 motion  for  summary  judgment  and  the  supporting papers in lieu of a
 complaint. The summons served with such motion papers shall require  the
 defendant  to  submit  answering  papers  on  the motion within the time
 provided in the notice of motion. The minimum time such motion shall  be
 noticed  to be heard shall be as provided by subdivision (a) of rule 320
 for making an appearance, depending upon the method of service.  If  the
 plaintiff  sets  the  hearing  date of the motion later than the minimum
 time therefor, he may require the defendant  to  serve  a  copy  of  his
 answering  papers  upon  him  within  such  extended period of time, not
 exceeding ten days, prior to such hearing date. No default judgment  may
 be  entered  pursuant  to  subdivision  (a) of section 3215 prior to the
 hearing date of the motion. If the motion  is  denied,  the  moving  and
 answering papers shall be deemed the complaint and answer, respectively,
 unless  the  court  orders  otherwise. THE ADDITIONAL NOTICE REQUIRED BY
 SUBDIVISION (J) OF RULE 3212 SHALL BE APPLICABLE TO A MOTION MADE PURSU-
 ANT TO THIS SECTION IN ANY ACTION TO COLLECT A DEBT  ARISING  OUT  OF  A
 CONSUMER CREDIT TRANSACTION WHERE A CONSUMER IS A DEFENDANT.
   §  11.  Subdivision  (f) of section 3215 of the civil practice law and
 rules, as amended by chapter 453 of the laws of 2006, is amended  and  a
 new subdivision (j) is added to read as follows:
   (f)  Proof.  On any application for judgment by default, the applicant
 shall file proof of service of the  summons  and  the  complaint,  or  a
 summons  and  notice  served  pursuant to subdivision (b) of rule 305 or
 subdivision (a) of rule 316 of this chapter,  and  proof  of  the  facts
 constituting the claim, the default and the amount due by affidavit made
 by  the party, or where the state of New York is the plaintiff, by affi-
 davit made by an attorney from the office of the  attorney  general  who
 has  or  obtains knowledge of such facts through review of state records
 or otherwise. Where a verified complaint has been served, it may be used
 as the affidavit of the facts constituting the claim and the amount due;
 in such case, an affidavit as to the default shall be made by the  party
 or  the  party's attorney. IN AN ACTION ARISING OUT OF A CONSUMER CREDIT
 TRANSACTION, IF THE PLAINTIFF IS NOT THE ORIGINAL CREDITOR,  THE  APPLI-
 CANT  SHALL  INCLUDE:  (1)  AN AFFIDAVIT BY THE ORIGINAL CREDITOR OF THE
 FACTS CONSTITUTING THE DEBT, THE DEFAULT IN PAYMENT, THE SALE OR ASSIGN-
 MENT OF THE DEBT, AND THE AMOUNT DUE AT THE TIME OF SALE OR  ASSIGNMENT;
 (2)  FOR EACH SUBSEQUENT ASSIGNMENT OR SALE OF THE DEBT TO ANOTHER ENTI-
 TY, AN AFFIDAVIT OF SALE OF THE DEBT BY THE DEBT  SELLER,  COMPLETED  BY
 THE  SELLER OR ASSIGNOR; AND (3) AN AFFIDAVIT OF A WITNESS OF THE PLAIN-
 TIFF, WHICH INCLUDES A CHAIN OF TITLE OF  THE  DEBT,  COMPLETED  BY  THE
 PLAINTIFF  OR  PLAINTIFF'S WITNESS. THE CHIEF ADMINISTRATIVE JUDGE SHALL
 ISSUE FORM AFFIDAVITS TO SATISFY THE REQUIREMENTS  OF  THIS  SUBDIVISION
 FOR  CONSUMER  CREDIT  TRANSACTIONS.  When  jurisdiction  is based on an
 attachment of property, the  affidavit  must  state  that  an  order  of
 attachment  granted in the action has been levied on the property of the
 defendant, describe the property and state its value. Proof  of  mailing
 the  notice  required by subdivision (g) of this section, where applica-
 ble, shall also be filed.
   (J) AFFIDAVIT. A REQUEST FOR A DEFAULT JUDGMENT ENTERED BY THE  CLERK,
 MUST  BE  ACCOMPANIED  BY  AN  AFFIDAVIT BY THE PLAINTIFF OR PLAINTIFF'S
 ATTORNEY STATING THAT AFTER REASONABLE INQUIRY, HE OR SHE HAS REASON  TO

 S. 153                              7
 
 BELIEVE  THAT  THE  STATUTE  OF LIMITATIONS HAS NOT EXPIRED.   THE CHIEF
 ADMINISTRATIVE JUDGE SHALL ISSUE FORM AFFIDAVITS TO SATISFY THE REQUIRE-
 MENTS OF THIS SUBDIVISION FOR CONSUMER CREDIT TRANSACTIONS.
   §  12.  The  civil  practice  law and rules is amended by adding a new
 section 7516 to read as follows:
   § 7516. CONFIRMATION OF AN AWARD BASED ON  A  CONSUMER  CREDIT  TRANS-
 ACTION.  IN ANY PROCEEDING UNDER SECTION 7510 OF THIS ARTICLE TO CONFIRM
 AN AWARD BASED ON A CONSUMER CREDIT TRANSACTION, THE  PARTY  SEEKING  TO
 CONFIRM  THE  AWARD  SHALL  PLEAD THE ACTUAL TERMS AND CONDITIONS OF THE
 AGREEMENT TO ARBITRATE. THE PARTY SHALL ATTACH TO ITS PETITION  (A)  THE
 AGREEMENT  TO  ARBITRATE;  (B)  THE  DEMAND FOR ARBITRATION OR NOTICE OF
 INTENTION TO ARBITRATE, WITH PROOF OF SERVICE; AND (C)  THE  ARBITRATION
 AWARD,  WITH PROOF OF SERVICE. IF THE AWARD DOES NOT CONTAIN A STATEMENT
 OF THE CLAIMS SUBMITTED FOR ARBITRATION, OF THE CLAIMS RULED UPON BY THE
 ARBITRATOR, AND OF THE CALCULATION OF FIGURES USED BY THE ARBITRATOR  IN
 ARRIVING AT THE AWARD, THEN THE PETITION SHALL CONTAIN SUCH A STATEMENT.
 THE  COURT  SHALL NOT GRANT CONFIRMATION OF AN AWARD BASED ON A CONSUMER
 CREDIT TRANSACTION UNLESS THE PARTY SEEKING TO  CONFIRM  THE  AWARD  HAS
 COMPLIED WITH THIS SECTION.
   §  13. Subdivision 2 of section 212 of the judiciary law is amended by
 adding a new paragraph (aa) to read as follows:
   (AA) NOT LATER THAN  JANUARY  FIRST,  TWO  THOUSAND  TWENTY-TWO,  MAKE
 AVAILABLE  SPANISH  TRANSLATIONS  OF  THE ADDITIONAL NOTICES IN CONSUMER
 CREDIT TRANSACTION ACTIONS AND PROCEEDINGS REQUIRED BY SECTION 306-D AND
 SUBDIVISION (J) OF RULE 3212 OF THE CIVIL PRACTICE LAW  AND  RULES,  AND
 MAKE  AVAILABLE  FORM AFFIDAVITS REQUIRED FOR A MOTION FOR DEFAULT JUDG-
 MENT IN A CONSUMER CREDIT TRANSACTION ACTION OR PROCEEDING  REQUIRED  BY
 SUBDIVISION (F) OF SECTION 3215 OF THE CIVIL PRACTICE LAW AND RULES.
   §  14.  Subdivision  (c) of section 5019 of the civil practice law and
 rules is amended to read as follows:
   (c) Change in judgment creditor.  A person other than the party recov-
 ering a judgment who becomes entitled to enforce it, shall file  in  the
 office  of  the clerk of the court in which the judgment was entered or,
 in the case of a judgment of a court other than the supreme, county or a
 family court which has been docketed by the clerk of the county in which
 it was entered, in the office of  such  county  clerk,  a  copy  of  the
 instrument  on  which  his  authority is based, acknowledged in the form
 required to entitle a deed to be recorded, or, if his authority is based
 on a court order, a certified copy of the order. Upon  such  filing  the
 clerk  shall  make  an  appropriate entry on his docket of the judgment.
 THIS SUBDIVISION SHALL NOT APPLY WHEN THERE IS A CHANGE TO THE OWNER  OF
 A  DEBT  THROUGH A SALE, ASSIGNMENT, OR OTHER TRANSFER WHERE NO JUDGMENT
 EXISTS.
   § 15. This act shall take effect immediately; provided, however,  that
 sections  two,  three,  five,  six,  seven, eight, nine, ten, eleven and
 twelve shall take effect on the one hundred eightieth day after it shall
 have become a law and shall apply to actions and  proceedings  commenced
 on  or after such date; and provided, further, that section four of this
 act shall take effect on the one hundred fiftieth  day  after  this  act
 shall have become a law.

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