Relates to process servers

In addition to the submission of the usual license application information, such as business name, address and telephone number, applicants would be required to submit a description of the methods or practices used to ensure that its employees act in compliance with applicable laws in carrying out the service of process.

The Secretary of State would be authorized to refuse to issue a license to any applicant found to have been convicted of larceny of have failed to pay any civil judgment relating to work as a process server. The Department of State would be authorized to revoke or suspend a license or to impose a fine upon proof that the licensee has engaged in violative conduct including fraud or misrepresentation. The Secretary would also be authorized to perform investigations and compel the attendance of witness and review the licensed process server's books and records.

Certain process servers would be required to obtain surety bonding. The amount of the bond would be between $10,000 and $75,000, depending on the number of people employed by the licensee. The bond would be conditioned on compliance with this article and the payment of all fines or investigatory costs. Process Servers would also be required to include the license number issued by the DOS on any advertisement, letterhead, receipt or other printed matter produced by the process server. The DOS would be required to publish a registry of all licensed process servers on its website.

The Attorney General would be authorized to enforce the provisions of this article by seeking an injunction against a violator. The bill also provides for a civil penalty of between $100 and $10,000 for each violation.

The bill provides for a private right of action for an injunction or actual damages or one thousand dollars, whichever is greater. The court may, in its discretion, increase the award of damages to an amount not to exceed three times the actual damages up to ten thousand dollars, if the court finds the defendant willfully violated this article.

Justification

Notice is a critical part of achieving justice in the courts. Without proper service of process, individuals may never be aware that they are party to litigation and thus, may never get their day in court.

While the majority of those engaged in the business of serving are honest and ethical in their dealings, there is a minority of unscrupulous actors who have engaged in "sewer service" as has been documented in recent media reports. These reports have illustrated large scale fraud by certain actors where individuals never received notice that consumer cases had been filed against them and as a result, they were subjected to default judgments.

For the reasons above, it is imperative that the State protect the interests, of its citizens against those process servers that abuse their privilege of operation.

Prior legislative history

FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS : To be determined.

Effective date

This act shall take effect on the one hundred eightieth day after it shall have become a law; provided, however, that effective immediately, the addition, amendment and/or repeal of any rule or regulation necessary for the implementation of this act on its effective date is authorized and directed to be made and completed on or before such effective date.