Relates to docketing of adjudications of violations of laws enforced by the New York city department of consumer affairs

Summary of provisions

Section 1: Amends subdivision 4 of section 918 of the County Law to authorize the docketing of final orders issued by the commissioner of Consumer Affairs based upon adjudications by the Department's administrative tribunal.

Section 2: Amends subdivision (g) of section 2203 of the New York City charter to require the Department to include in its notices of violations instructions on how the business may plead or contest the violation and a warning that failure to do so will be deemed an admission, resulting in a default decision. Further, it requires that, before a default judgment can be entered, the Department must notify the business of the default and that the business may request a stay of the default for good cause. The bill requires that Department to include in its civil court notices of entry of money judgments a statement that a business may seek a stay of enforcement of the judgment for up to forty-five days after entry of the judgment to settle the matter. The bill also requires that the Department serve the underlying notice of violation in the manner prescribed by the Civil Practice Law and Rules (CPLR) or the Business Corporation Law (BCL) for all respondents that are not licensees of the Department.

For businesses that are licensed by the Department, the bill requires that the Department serve the violation on an employee of the licensee at the licensee's place of business.

For businesses which by their nature are carried out at-large and not at a fixed location or which are located out-of-state, the bill provides three options for service of the violation. 1.) the Department serve a licensee or employee of those business at the location where the violation Occurred, 2.) on the Secretary of State, or 3.) on an agent designated for service. In all instances, the Department is also required to serve the notice of violation by mailing a copy of the notice to the address the licensee has filed with the Department.

Justification

New York City Program Bill developed by the NYC Department of Consumer Affairs. The NYC Department of Consumer Affairs' (DCA) mission is to ensure a fair and vibrant marketplace for businesses and consumers. Law-abiding businesses and consumers alike benefit from, and have every reason to expect, a competitive marketplace, but competition suffers when some businesses don't play by the rules.

DCA's Administrative Tribunal has the authority to assess fines against businesses that violate the City's rules that protect a competitive marketplace. Some businesses readily comply with the law; others come into compliance and pay the fine; still others ignore the law entirely. Existing law does not, however, allow DCA to docket unpaid fines issued by its Administrative Tribunal as money judgments, without court proceedings. Currently, fines can be collected only by means of costly and time-consuming collection efforts and Civil Court proceedings. As a result, licensees may choose to abandon their licenses to evade fines, while non-licensees ignore their obligation to pay. This deprives DCA of the most effective enforcement mechanism, and the City of much-needed revenue.

By authorizing DCA to directly docket the fines issued by its Administrative Tribunal, this legislation will give teeth to the City's laws and rules protecting a competitive and fair marketplace. At the same time, this legislation includes a number of protections to ensure businesses have adequate notice of violations and default judgments and that they are given a fair opportunity to make their case.

The bill sets strong standards by which an underlying notice of violations must be served if DCA is to enter a judgment. In setting forth how business must be served, the bill distinguishes between businesses by delivering the notice of violation to a person employed at the place of business which gave rise to the violation. The bill provides three options to DCA regarding licensed businesses that are carried out at large or are based out of state. For those businesses, the bill requires DCA to serve violation on an employee at the location which gave rise to the violation, or on the Secretary of State, or on an agent designated for service pursuant to the CPLR or the Business Corporation Law. For all licensees, DCA must also send a copy of all notices of violation to the business at the location on file with the agency pursuant to Administrative Code Section 20-112. Businesses that are not licensees must be served in accordance with the Civil Practice Law and Rules or the Business Corporation Law.

To further protect businesses, the bill requires DCA to provide instructions on how they may plead or contest the violation and a warning that failure to do so will be deemed an admission, resulting in a default decision. The bill takes an additional step to protect businesses by requiring that DCA include in its civil court notices of entry of money judgments a statement that a business may seek a

stay of enforcement of the judgment for up to forty-five days after entry of the judgment to settle the matter.

This bill will strengthen government's ability to apply the laws equally for all businesses and streamline the City's efforts to collect fines that have been duly assessed, while at the same time taking numerous steps to ensure businesses are given a fair chance to contest violations.

Legislative history

Similar to S.5521. This is New York City's revised bill to supplant S.5521.

Fiscal implications

None.

Effective date

This act shall take effect immediately.