NY State Assembly Bill 2009-A2874

Assembly Bill A2874

2009-2010 Legislative Session

Provides that for settlements that require a court order the order shall provide for the payment of interest on the settlement amount at the statutory rate

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Archive: Last Bill Status - On Floor Calendar

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
May 04, 2010	3rd reading cal.435 substituted for s7035
Mar 24, 2010	referred to codes delivered to senate passed assembly
Jan 06, 2010	ordered to third reading cal.238 returned to assembly died in senate
Feb 23, 2009	referred to judiciary delivered to senate passed assembly
Feb 19, 2009	advanced to third reading cal.103
Feb 11, 2009	reported
Feb 10, 2009	reported referred to codes
Jan 21, 2009	referred to judiciary

2009-A2874 (ACTIVE) - Details

See Senate Version of this Bill:: S7035
Law Section:: Civil Practice Law and Rules
Laws Affected:: Amd §§1207 & 5003-a, R1208, CPLR; amd §2220, SCPA
Versions Introduced in Other Legislative Sessions:: 2011-2012: A634
2013-2014: A999
2015-2016: A281
2017-2018: A1499
2019-2020: A5620
2021-2022: A2547
2023-2024: A3773

2009-A2874 (ACTIVE) - Summary

Provides that for settlements that require a court order, the order, or the judgment in a special proceeding, shall provide for the payment of interest on the settlement amount at the statutory interest rate on judgments.

2009-A2874 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:A2874               REPLACEMENT 5/21/10

TITLE  OF BILL:   An act to amend the civil practice law and rules and
the surrogate's court procedure act, in relation to  addressing  delay
in  payment  of  a  settlement  where  the  settlement  requires court
approval

PURPOSE OF BILL:   This proposal  amends  the  CPLR  (§§  1207,  1208,
5003-a)  and  the  Surrogate's  Court Procedure Act (§ 2220) to permit
interest to accrue where there is a delay in a proposed settlement  of
claims  by  an  infant,  incompetent,  or  in a wrongful death action,
caused by the need for court approval.

JUSTIFICATION:  Section 5003-a of the CPLR  sets  forth  times  within
which  a settling defendant must pay all sums due following the tender
of  a  release  and  stipulation  of  discontinuance  in  an   action.
Difficulties  arise,  however,  with  cases  involving  an  infant, an
incompetent or the death of a plaintiff, where the release  cannot  be
tendered  without  prior  court  approval.  Usually  it takes at least
several weeks (occasionally, several months  or  longer)  between  the
proposed  settlement and court approval. Thus, the anomaly exists that
the  only  litigants  who  do  not  receive  their  settlement  monies
"promptly" are those who are under the courts' protection.

The  interest  rate  set  forth  in  the  proposed  amendments  is the
statutory rate of interest on a judgment, Interest begins to run  from

the  fifteenth day, or in the case of a state or municipal entity from
the sixty-first day, following the day that the proposed settlement is
entered into and continues to run until the  day  that  the  order  or
judgment  is signed. Provision is also made for annuity payments. Once
the order or judgment is signed, the defendant then will have 14  days
or,  in  the  case  of  a  state or.municipal entity, 61 days, to make
payment.

The date and terms of the proposed settlement shall be set forth in  a
writing  or court transcript, a copy of which shall be provided to the
court in order to calculate the days of interest.

LEGISLATIVE HISTORY:
2009: A.2874 - Passed Assembly
2007-08: A.3059 - Passed Assembly
2005-06: A.5852 - Passed Assembly
2003-04: A.7902 - Passed Assembly
2001-02: A.4743 - Passed Assembly
2000: A.10425 - Passed Assembly

FISCAL IMPLICATIONS FOR STATE AND LOCAL  GOVERNMENTS:    This  measure
will  have  a  negligible fiscal impact on the State, limited to those
instances where the State has entered into a settlement of claims with
a minor, an incompetent, or a plaintiff who has died.

EFFECTIVE DATE:  This act shall take effect on the  first  of  January
next  succeeding the date on which it shall have become law, and shall
apply to all actions settled on or after that date.

2009-A2874 (ACTIVE) - Bill Text download pdf

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

                                  2874

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            January 21, 2009
                               ___________

Introduced  by  M. of A. WEINSTEIN, ORTIZ -- Multi-Sponsored by -- M. of
  A. BOYLAND, BRENNAN, CLARK, COOK, CYMBROWITZ, DINOWITZ, GLICK, HOOPER,
  JAFFEE, JOHN -- read once and referred to the Committee on Judiciary

AN ACT to amend the civil practice law and  rules  and  the  surrogate's
  court  procedure  act, in relation to addressing delay in payment of a
  settlement where the settlement requires court approval

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

  Section  1.  Section  1207  of  the  civil  practice law and rules, as
amended by chapter 355 of the laws  of  1986,  is  amended  to  read  as
follows:
  S  1207.  Settlement of action or claim by infant, judicially declared
incompetent or conservatee, by whom  motion  made;  special  proceeding;
notice;  order of settlement. (A) Upon motion of a guardian of the prop-
erty or guardian ad litem of an infant or, if there is no such guardian,
then of a parent having legal custody of an infant, or if  there  is  no
such parent, by another person having legal custody, or if the infant is
married,  by an adult spouse residing with the infant, or of the commit-
tee of the property of a person judicially declared to  be  incompetent,
or  of  the  conservator of the property of a conservatee, the court may
order settlement of any action commenced by or on behalf of the  infant,
incompetent  or  conservatee. If no action has been commenced, a special
proceeding may be commenced upon petition of such a  representative  for
settlement of any claim by the infant, incompetent or conservatee in any
court  where  an  action for the amount of the proposed settlement could
have been commenced.  Unless otherwise provided by  rule  of  the  chief
administrator  of  the courts, if no motion term is being held and there
is no justice of the supreme court  available  in  a  county  where  the
action  or an action on the claim is triable, such a motion may be made,
or special proceeding may be commenced, in a county court and the county
judge shall act with the same power as a justice of  the  supreme  court

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01548-01-9

A. 2874                             2

even  though  the amount of the settlement may exceed the jurisdictional
limits of the county court. Notice of the motion or  petition  shall  be
given as directed by the court. An order on such a motion shall have the
effect  of a judgment. Such order, or the judgment in a special proceed-
ing, shall be entered without costs and shall approve the  fee  for  the
infant's, incompetent's or conservatee's attorney, if any.
  (B) SUCH ORDER, OR THE JUDGMENT IN A SPECIAL PROCEEDING, SHALL PROVIDE
FOR  THE  PAYMENT  OF INTEREST ON THE SETTLEMENT AMOUNT AT THE STATUTORY
INTEREST RATE ON JUDGMENTS, TO BE COMPUTED COMMENCING THE FIFTEENTH DAY,
OR WHERE THE SETTLING DEFENDANT IS A MUNICIPAL OR STATE  ENTITY  AS  SET
FORTH IN SUBDIVISION (B) OR (C) OF SECTION FIVE THOUSAND THREE-A OF THIS
CHAPTER  THEN COMMENCING FROM THE SIXTY-FIRST DAY FOLLOWING THE DAY THAT
THE PROPOSED SETTLEMENT IS ENTERED INTO AND  CONTINUING  UNTIL  THE  DAY
THAT  THE  ORDER  OR  JUDGMENT  IS SIGNED. WHERE THE PROPOSED SETTLEMENT
INCLUDES AN ANNUITY TO PROVIDE FOR PERIODIC PAYMENTS, INTEREST SHALL NOT
BE COMPUTED ON THE PRESENT  VALUE  OF  THE  ANNUITY  PROVIDED  THAT  THE
DEFENDANT  TIMELY  FUNDS  THE  ANNUITY, BUT INTEREST SHALL ACCRUE ON ANY
PERIODIC PAYMENT MADE LATER THAN THE PAYMENT SCHEDULE SET FORTH  IN  THE
PROPOSED SETTLEMENT. THE DATE AND TERMS OF THE PROPOSED SETTLEMENT SHALL
BE  SET  FORTH TO ALL COUNSEL OR PARTIES IN WRITING, OR IN A COURT TRAN-
SCRIPT, AND A COPY OF THE WRITING OR TRANSCRIPT SHALL BE PROVIDED TO THE
COURT IN ORDER TO CALCULATE THE DAYS OF INTEREST.
  S 2. Paragraphs 7 and 8 of subdivision (a) of rule 1208 of  the  civil
practice  law and rules, paragraph 7 as amended and paragraph 8 as added
by chapter 844 of the laws of 1968, are amended and a new paragraph 9 is
added to read as follows:
  7. whether reimbursement  for  medical  or  other  expenses  has  been
received from any source; [and]
  8.  whether the infant's or incompetent's representative or any member
of the infant's or incompetent's family has made  a  claim  for  damages
alleged  to have been suffered as a result of the same occurrence giving
rise to the infant's or incompetent's claim and, if so, the amount  paid
or  to be paid in settlement of such claim or if such claim has not been
settled the reasons therefor[.]; AND
  9. THE DAILY RATE OF INTEREST ON THE SETTLEMENT COMPUTED  PURSUANT  TO
SUBDIVISION  (B)  OF  SECTION TWELVE HUNDRED SEVEN OF THIS ARTICLE AND A
COPY OF THE COURT TRANSCRIPT OR WRITING SETTING FORTH THE DATE AND TERMS
OF THE PROPOSED SETTLEMENT.
  S 3. Rule 1208 of the civil practice  law  and  rules  is  amended  by
adding a new subdivision (g) to read as follows:
  (G)  UPON  SIGNING THE ORDER, OR JUDGMENT IN A SPECIAL PROCEEDING, THE
COURT SHALL SEND A COPY OF THE ORDER OR JUDGMENT TO THE ATTORNEY REPRES-
ENTING THE INFANT OR INCOMPETENT, OR IF THERE IS  NO  ATTORNEY,  TO  THE
REPRESENTATIVE OF THE INFANT OR INCOMPETENT.
  S  4.  Subdivisions  (a),  (b)  and (c) of section 5003-a of the civil
practice law and rules, as added by chapter 269 of the laws of 1992, are
amended to read as follows:
  (a) When an action to recover damages has been settled,  any  settling
defendant,  except  those defendants to whom subdivisions (b) and (c) of
this section apply, shall pay all sums due  to  any  settling  plaintiff
within  twenty-one  days,  OR IF IT IS AN ACTION WHICH REQUIRES JUDICIAL
APPROVAL OF SETTLEMENT, WITHIN FOURTEEN DAYS of tender, by the  settling
plaintiff  to  the  settling defendant, of a duly executed release and a
stipulation discontinuing action executed  on  behalf  of  the  settling
plaintiff.

A. 2874                             3

  (b)  When an action to recover damages has been settled and the settl-
ing defendant is a municipality  or  any  subdivision  thereof,  or  any
public  corporation  that  is not indemnified by the state, it shall pay
all sums due to any settling plaintiff within ninety days, OR IF  IT  IS
AN  ACTION  WHICH REQUIRES JUDICIAL APPROVAL OF SETTLEMENT, WITHIN SIXTY
DAYS of tender, by the  settling  plaintiff  to  it,  of  duly  executed
release and a stipulation discontinuing action executed on behalf of the
settling plaintiff. The provisions of this [paragraph] SUBDIVISION shall
not  inure to the benefit of any insurance carrier for a municipality or
any subdivision thereof, or any public corporation that  is  not  indem-
nified  by  the state. Any such insurance carrier shall pay all sums due
to any settling plaintiff in accordance with the provisions of  subdivi-
sion (a) of this section.
  (c)  When an action to recover damages has been settled and the settl-
ing defendant is the state, an officer or employee of the state entitled
to indemnification pursuant to section seventeen of the public  officers
law,  or  a public benefit corporation indemnified by the state, payment
of all sums due to any settling plaintiff shall be  made  within  ninety
days,  OR IF IT IS AN ACTION WHICH REQUIRES JUDICIAL APPROVAL OF SETTLE-
MENT, WITHIN SIXTY DAYS of  the  comptroller's  determination  that  all
papers  required  to effectuate the settlement have been received by him
OR HER.  The provisions of this [paragraph] SUBDIVISION shall not  inure
to  the  benefit  of  any insurance carrier for the state, an officer or
employee of the state entitled to indemnification  pursuant  to  section
seventeen  of  the  public officers law, or a public benefit corporation
indemnified by the state. Any such insurance carrier shall pay all  sums
due  to  any  settling  plaintiff  in  accordance with the provisions of
subdivision (a) of this section.
  S 5. Section 2220 of the surrogate's court procedure act is amended by
adding a new subdivision 6 to read as follows:
  6. THE ORDER OR DECREE SHALL PROVIDE FOR THE PAYMENT  OF  INTEREST  ON
THE  SETTLEMENT  AMOUNT  AT  THE STATUTORY INTEREST ON JUDGMENT RATE PER
ANNUM, TO BE COMPUTED FROM THE FIFTEENTH  DAY,  OR  WHERE  THE  SETTLING
DEFENDANT IS A MUNICIPAL OR STATE ENTITY AS SET FORTH IN SUBDIVISION (B)
OR  (C)  OF  SECTION FIVE THOUSAND THREE-A OF THE CIVIL PRACTICE LAW AND
RULES, THEN FROM THE SIXTY-FIRST DAY FOLLOWING THE DAY THAT THE PROPOSED
SETTLEMENT IS ENTERED INTO AND CONTINUING UNTIL THE DAY THAT  THE  ORDER
OR JUDGMENT IS SIGNED. WHERE THE PROPOSED SETTLEMENT INCLUDES AN ANNUITY
TO  PROVIDE  FOR PERIODIC PAYMENT, INTEREST SHALL NOT BE COMPUTED ON THE
PRESENT VALUE OF THE ANNUITY PROVIDED THAT THE  DEFENDANT  TIMELY  FUNDS
THE  ANNUITY,  BUT  INTEREST  SHALL  ACCRUE ON ANY PERIODIC PAYMENT MADE
LATER THAN THE PAYMENT SCHEDULE SET FORTH IN  THE  PROPOSED  SETTLEMENT.
THE  DATE AND TERMS OF THE PROPOSED SETTLEMENT SHALL BE SET FORTH TO ALL
COUNSEL OR PARTIES IN WRITING, OR IN A COURT TRANSCRIPT, AND A  COPY  OF
THE  WRITING  OR  TRANSCRIPT  SHALL BE PROVIDED TO THE COURT IN ORDER TO
CALCULATE THE DAYS OF INTEREST.
  S 6. This act shall take effect on the first of January next  succeed-
ing the date on which it shall have become a law, and shall apply to all
actions settled on or after such effective date.

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