S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3265
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 30, 2023
                                ___________
 
 Introduced  by Sen. HOYLMAN-SIGAL -- read twice and ordered printed, and
   when printed to be committed to the Committee on Judiciary
 
 AN ACT to amend the lien law, the general business law and the  adminis-
   trative  code  of  the  city of New York, in relation to liens against
   commercial towing companies for illegal and improper towing practices;
   to amend the civil practice law and rules, in relation to grounds  for
   attachment;  to  amend  the  business  corporation law, in relation to
   holding shareholders of non-publicly  traded  corporations  personally
   liable  for  certain  judgments;  and  to  amend the limited liability
   company law, in relation to holding the ten members with  the  largest
   ownership  interests  in a company personally liable for certain judg-
   ments
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The lien law is amended by adding a new article 7-A to read
 as follows:
                                ARTICLE 7-A
        LIEN ON COMMERCIAL TOWING COMPANIES FOR IMPROPER PRACTICES
 SECTION 170. LIEN  FOR  VIOLATIONS  ASSOCIATED  WITH ILLEGAL OR IMPROPER
                PRACTICES RELATING TO THE TOWING OF MOTOR VEHICLES.
         171. ENFORCEMENT OF LIEN.
   § 170. LIEN FOR VIOLATIONS ASSOCIATED WITH ILLEGAL OR  IMPROPER  PRAC-
 TICES RELATING TO THE TOWING OF MOTOR VEHICLES. 1. A PERSON SHALL HAVE A
 LIEN  AGAINST  ANY  INTEREST  IN PROPERTY OF A COMMERCIAL TOWING COMPANY
 ARISING OUT OF ANY CLAIM OF ILLEGAL OR IMPROPER  PRACTICES  RELATING  TO
 THE  TOWING OF MOTOR VEHICLES, AS DEFINED IN SECTION ONE HUNDRED SEVEN-B
 OF THE VEHICLE AND TRAFFIC LAW, INCLUDING  BY  NOT  LIMITED  TO  SECTION
 19-169.1  OF  THE  ADMINISTRATIVE  CODE OF THE CITY OF NEW YORK, FOR THE
 AGREED PRICE OF SUCH TOWING OR, IF THE  TOWING  WAS  WITHOUT  THE  PRIOR
 CONSENT OR AUTHORIZATION OF SUCH MOTOR VEHICLE OWNER, THE AMOUNT CHARGED
 FOR  THE  SERVICE,  FROM  THE  TIME  OF  FILING A NOTICE OF SUCH LIEN AS
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD00585-01-3
              

 S. 3265                             2
 
 PRESCRIBED IN THIS CHAPTER. IN A CITY WITH A POPULATION OF  ONE  MILLION
 OR  MORE, CHARGES FOR TOWING AND ASSOCIATED STORAGE SHALL NOT EXCEED THE
 AMOUNTS SET FORTH IN SECTION 20-509 OF THE ADMINISTRATIVE  CODE  OF  THE
 CITY  OF  NEW  YORK. A LIEN UNDER THIS SECTION MAY BE HAD FOR ANY AMOUNT
 OVER THE LIMITS SET FORTH IN SUCH SECTION. A LIEN UNDER THIS ARTICLE MAY
 BE HAD AGAINST AN INTEREST IN REAL PROPERTY AND AGAINST AN  INTEREST  IN
 PERSONAL  PROPERTY THAT CAN BE SUFFICIENTLY DESCRIBED WITHIN THE MEANING
 OF SECTION 9-108 OF THE UNIFORM COMMERCIAL  CODE,  EXCEPT  THAT  A  LIEN
 UNDER  THIS  ARTICLE  SHALL  NOT  EXTEND TO DEPOSIT ACCOUNTS OR GOODS AS
 THOSE TERMS ARE DEFINED IN SECTION 9-102  OF    THE  UNIFORM  COMMERCIAL
 CODE.
   2.  NOTICE  OF  A LIEN UNDER THIS SECTION MAY BE FILED AT ANY TIME NOT
 LATER THAN THREE YEARS FOLLOWING VIOLATION GIVING RISE TO THE  CLAIM.  A
 NOTICE  OF  LIEN  ON  PERSONAL  PROPERTY  MUST BE FILED, TOGETHER WITH A
 FINANCING STATEMENT, IN THE FILING OFFICE AS SET FORTH IN SECTION  9-501
 OF THE UNIFORM COMMERCIAL CODE.
   3. WITHIN FIVE DAYS BEFORE OR THIRTY DAYS AFTER FILING THE NOTICE OF A
 LIEN  AUTHORIZED PURSUANT TO THIS ARTICLE, THE LIENOR SHALL SERVE A COPY
 OF SUCH NOTICE UPON THE OWNER OF THE COMMERCIAL  TOWING  COMPANY,  IF  A
 NATURAL  PERSON, (A) BY DELIVERING THE SAME TO HIM OR HER PERSONALLY, OR
 IF THE OWNER CANNOT BE FOUND, TO HIS OR HER AGENT OR ATTORNEY, OR (B) BY
 LEAVING IT AS HIS OR HER LAST KNOWN PLACE OF RESIDENCE OR BUSINESS, WITH
 A PERSON OF SUITABLE AGE AND DISCRETION, OR (C) BY REGISTERED OR  CERTI-
 FIED MAIL ADDRESSED TO HIS OR HER LAST KNOWN PLACE OF RESIDENCE OR BUSI-
 NESS, OR (D) IF SUCH PERSON OWNS REAL PROPERTY, BY AFFIXING A COPY THER-
 EOF CONSPICUOUSLY ON SUCH PROPERTY, BETWEEN THE HOURS OF NINE O'CLOCK IN
 THE  FORENOON  AND FOUR O'CLOCK IN THE AFTERNOON. THE LIENOR ALSO SHALL,
 WITHIN THIRTY DAYS AFTER FILING THE NOTICE OF LIEN, AFFIX A COPY THEREOF
 CONSPICUOUSLY ON THE REAL PROPERTY IDENTIFIED IN  THE  NOTICE  OF  LIEN,
 BETWEEN  THE  HOURS  OF NINE O'CLOCK IN THE FORENOON AND FOUR O'CLOCK IN
 THE AFTERNOON. IF THE COMMERCIAL TOWING COMPANY BE A  CORPORATION,  SAID
 SERVICE  SHALL  BE  MADE  (I) BY DELIVERING SUCH COPY TO AND LEAVING THE
 SAME WITH THE PRESIDENT,  VICE-PRESIDENT,  SECRETARY  OR  CLERK  TO  THE
 CORPORATION,  THE  CASHIER,  TREASURER  OR  A DIRECTOR OR MANAGING AGENT
 THEREOF, PERSONALLY, WITHIN THE STATE, OR (II) IF SUCH OFFICER CANNOT BE
 FOUND WITHIN THE STATE, BY AFFIXING A COPY THEREOF CONSPICUOUSLY ON SUCH
 PROPERTY BETWEEN THE HOURS OF NINE O'CLOCK  IN  THE  FORENOON  AND  FOUR
 O'CLOCK  IN  THE  AFTERNOON,  OR  (III)  BY REGISTERED OR CERTIFIED MAIL
 ADDRESSED TO ITS LAST KNOWN PLACE OF BUSINESS, OR (IV)  BY  DELIVERY  TO
 THE  SECRETARY OF THE DEPARTMENT OF STATE IN THE SAME MANNER AS REQUIRED
 BY SUBPARAGRAPH ONE OF PARAGRAPH (B) OF SECTION THREE HUNDRED SIX OF THE
 BUSINESS CORPORATION LAW. FAILURE TO FILE PROOF OF SUCH A  SERVICE  WITH
 THE  COUNTY  CLERK  WITHIN  THIRTY-FIVE DAYS AFTER THE NOTICE OF LIEN IS
 FILED SHALL TERMINATE THE NOTICE AS A LIEN. UNTIL SERVICE OF THE  NOTICE
 HAS  BEEN  MADE,  AS  ABOVE PROVIDED, AN OWNER, WITHOUT KNOWLEDGE OF THE
 LIEN, SHALL BE PROTECTED IN PAYMENT MADE IN  GOOD  FAITH  TO  ANY  OTHER
 PERSON CLAIMING A LIEN.
   4. (A) NO LIEN ON REAL PROPERTY UNDER THIS SECTION SHALL BE A LIEN FOR
 A  LONGER  PERIOD THAN ONE YEAR AFTER THE NOTICE OF LIEN HAS BEEN FILED,
 UNLESS AN EXTENSION TO SUCH LIEN IS FILED WITH THE COUNTY CLERK  OF  THE
 COUNTY  IN  WHICH  THE  NOTICE OF LIEN IS FILED WITHIN ONE YEAR FROM THE
 FILING OF THE ORIGINAL NOTICE OF LIEN, CONTINUING  SUCH  LIEN  AND  SUCH
 LIEN  SHALL  BE REDOCKETED AS OF THE DATE OF FILING SUCH EXTENSION. SUCH
 EXTENSION SHALL CONTAIN THE NAMES OF THE LIENOR AND  THE  OWNER  OF  THE
 REAL  PROPERTY  AGAINST  WHOSE  INTEREST THEREIN SUCH LIEN IS CLAIMED, A
 BRIEF DESCRIPTION OF THE PROPERTY AFFECTED BY SUCH LIEN, THE  AMOUNT  OF
 S. 3265                             3
 
 SUCH  LIEN,  AND THE DATE OF FILING THE NOTICE OF LIEN. NO LIEN SHALL BE
 CONTINUED BY SUCH EXTENSION FOR MORE THAN ONE YEAR FROM THE FILING THER-
 EOF. IN THE EVENT AN ACTION IS NOT COMMENCED TO OBTAIN JUDGMENT  ON  THE
 CLAIM  OR  TO  FORECLOSE THE LIEN WITHIN SUCH EXTENDED PERIOD, SUCH LIEN
 SHALL BE EXTINGUISHED UNLESS AN ORDER BE GRANTED BY A COURT OF RECORD OR
 A JUDGE OR JUSTICE THEREOF, CONTINUING SUCH LIEN, AND SUCH   LIEN  SHALL
 BE REDOCKETED AS OF THE DATE OF GRANTING SUCH ORDER AND A STATEMENT MADE
 THAT SUCH LIEN IS CONTINUED BY VIRTUE OF SUCH ORDER.
   (B)  NO  LIEN  ON PERSONAL PROPERTY UNDER THIS SECTION SHALL BE A LIEN
 FOR A LONGER PERIOD THAN ONE YEAR AFTER THE FINANCING STATEMENT HAS BEEN
 RECORDED, UNLESS AN EXTENSION TO SUCH LIEN, IS  FILED  WITH  THE  FILING
 OFFICE IN WHICH THE FINANCING STATEMENT IS REQUIRED TO BE FILED PURSUANT
 TO SECTION 9-501 OF THE UNIFORM COMMERCIAL CODE WITHIN ONE YEAR FROM THE
 FILING  OF  THE ORIGINAL FINANCING STATEMENT, CONTINUING SUCH LIEN. SUCH
 EXTENSION SHALL CONTAIN THE NAMES OF THE LIENOR AND  THE  OWNER  OF  THE
 PROPERTY  AGAINST  WHOSE  INTEREST THEREIN SUCH LIEN IS CLAIMED, A BRIEF
 DESCRIPTION OF THE PRIOR FINANCING STATEMENT TO  BE  EXTENDED,  AND  THE
 DATE OF FILING THE PRIOR FINANCING STATEMENT. NO LIEN SHALL BE CONTINUED
 BY SUCH EXTENSION FOR MORE THAN ONE YEAR FROM THE FILING THEREOF. IN THE
 EVENT  AN ACTION IS NOT COMMENCED TO OBTAIN JUDGEMENT ON THE CLAIM OR TO
 FORECLOSE THE LIEN WITHIN SUCH  EXTENDED  PERIOD,  SUCH  LIEN  SHALL  BE
 EXTINGUISHED  UNLESS AN ORDER BE GRANTED BY A COURT OF RECORD OR A JUDGE
 OR JUSTICE THEREOF, CONTINUING SUCH LIEN, AND SUCH LIEN SHALL BE REFILED
 AS OF THE DATE OF GRANTING SUCH ORDER AND A  STATEMENT  MADE  THAT  SUCH
 LIEN IS CONTINUED BY VIRTUE OF SUCH ORDER.
   (C)  IF  A  LIENOR  IS  MADE A PARTY DEFENDANT IN AN ACTION TO ENFORCE
 ANOTHER LIEN, AND THE PLAINTIFF OR SUCH DEFENDANT HAS FILED A NOTICE  OF
 THE  PENDENCY  OF THE ACTION WITHIN THE TIME PRESCRIBED IN THIS SECTION,
 THE LIEN OF SUCH DEFENDANT IS THEREBY CONTINUED. SUCH  ACTION  SHALL  BE
 DEEMED AN ACTION TO ENFORCE THE LIEN OF SUCH DEFENDANT LIENOR. THE FAIL-
 URE TO FILE A NOTICE OF PENDENCY OF ACTION SHALL NOT ABATE THE ACTION AS
 TO ANY PERSON LIABLE FOR THE PAYMENT OF THE DEBT SPECIFIED IN THE NOTICE
 OF  LIEN,  AND  THE  ACTION  MAY  BE PROSECUTED TO JUDGMENT AGAINST SUCH
 PERSON. THE PROVISIONS OF THIS SECTION IN  REGARD  TO  CONTINUING  LIENS
 SHALL  APPLY TO LIENS DISCHARGED BY DEPOSIT OR BY ORDER ON THE FILING OF
 AN UNDERTAKING. WHERE A LIEN IS DISCHARGED BY DEPOSIT  OR  BY  ORDER,  A
 NOTICE OF PENDENCY OF ACTION SHALL NOT BE FILED.
   (D) NOTWITHSTANDING THE FOREGOING, IF A LIENOR COMMENCES A FORECLOSURE
 ACTION  OR  AN  ACTION TO OBTAIN A JUDGMENT ON THE CLAIM WITHIN ONE YEAR
 FROM THE FILING OF THE NOTICE OF LIEN ON REAL PROPERTY OR THE  RECORDING
 OF  THE FINANCING STATEMENT CREATING LIEN ON PERSONAL PROPERTY, THE LIEN
 SHALL BE EXTENDED DURING THE PENDENCY OF THE ACTION AND FOR ONE  HUNDRED
 TWENTY DAYS FOLLOWING THE ENTRY OF FINAL JUDGMENT IN SUCH ACTION, UNLESS
 THE  ACTION  RESULTS  IN A FINAL JUDGMENT OR ADMINISTRATIVE ORDER IN THE
 LIENOR'S FAVOR ON THE CLAIMS AND  THE  LIENOR  COMMENCES  A  FORECLOSURE
 ACTION, IN WHICH INSTANCE THE LIEN SHALL BE VALID DURING THE PENDENCY OF
 THE  FORECLOSURE  ACTION. IF A LIEN IS EXTENDED DUE TO THE PENDENCY OF A
 FORECLOSURE ACTION OR AN ACTION TO OBTAIN A JUDGMENT ON THE  CLAIM,  THE
 LIENOR SHALL FILE A NOTICE OF SUCH PENDENCY AND EXTENSION WITH THE COUN-
 TY  CLERK OF THE COUNTY IN WHICH THE NOTICE OF LIEN IS FILED, CONTAINING
 THE NAMES OF THE PARTIES TO THE   ACTION, THE OBJECT OF  THE  ACTION,  A
 BRIEF  DESCRIPTION  OF  THE  PROPERTY  AFFECTED THEREBY, AND THE TIME OF
 FILING THE NOTICE OF LIEN, OR IN THE CASE OF A LIEN ON PERSONAL PROPERTY
 SHALL FILE SUCH NOTICE WITH THE OFFICE AUTHORIZED  TO  ACCEPT  FINANCING
 STATEMENTS PURSUANT TO SECTION 9-501 OF THE UNIFORM COMMERCIAL CODE.
 S. 3265                             4
 
   (E) A LIEN, THE DURATION OF WHICH HAS BEEN EXTENDED BY THE FILING OF A
 NOTICE  OF  THE PENDENCY OF AN ACTION AS ABOVE PROVIDED, SHALL NEVERTHE-
 LESS TERMINATE AS A LIEN AFTER SUCH NOTICE HAS BEEN CANCELED AS PROVIDED
 IN SECTION SIXTY-FIVE HUNDRED FOURTEEN OF THE  CIVIL  PRACTICE  LAW  AND
 RULES  OR  HAS CEASED TO BE EFFECTIVE AS CONSTRUCTIVE NOTICE AS PROVIDED
 IN SECTION SIXTY-FIVE HUNDRED THIRTEEN OF THE  CIVIL  PRACTICE  LAW  AND
 RULES.
   §  171.  ENFORCEMENT  OF  LIEN.  1. A LIEN ON REAL PROPERTY AUTHORIZED
 UNDER THIS ARTICLE MAY BE ENFORCED AGAINST SUCH PROPERTY, AND AGAINST  A
 PERSON  LIABLE  FOR  THE  JUDGMENT UPON WHICH THE LIEN IS FOUNDED, BY AN
 ACTION, BY THE LIENOR, HIS ASSIGNEE  OR  LEGAL  REPRESENTATIVE,  IN  THE
 SUPREME  COURT  OR  IN  A  COUNTY  COURT  OTHERWISE HAVING JURISDICTION,
 REGARDLESS OF THE AMOUNT OF SUCH JUDGMENT,  OR  IN  A  COURT  WHICH  HAS
 JURISDICTION  IN  AN  ACTION  FOUNDED  ON  A CONTRACT FOR A SUM OF MONEY
 EQUIVALENT TO THE AMOUNT  OF  SUCH  JUDGMENT,  IN  THE  SAME  MANNER  AS
 PRESCRIBED IN ARTICLE THREE OF THIS CHAPTER.
   2.  A  LIEN  ON  PERSONAL PROPERTY SPECIFIED IN THIS ARTICLE MAY IMME-
 DIATELY BE ENFORCED  AGAINST  THE  PROPERTY  THROUGH  A  FORECLOSURE  AS
 PRESCRIBED IN ARTICLE NINE OF THE UNIFORM COMMERCIAL CODE, OR UPON JUDG-
 MENT OBTAINED BY THE OWNER OF THE MOTOR VEHICLE, OR THE ATTORNEY GENERAL
 OF THE STATE OF NEW YORK, AND MAY BE ENFORCED IN ANY MANNER AVAILABLE TO
 THE JUDGMENT CREDITOR PURSUANT TO ARTICLE NINE OF THE UNIFORM COMMERCIAL
 CODE OR OTHER APPLICABLE LAWS.
   3.  A  LIEN,  WHERE  NOTICE  HAS BEEN FILED ON REAL PROPERTY OR A BOND
 GIVEN TO DISCHARGE THE SAME, MAY BE VACATED AND CANCELLED OR  A  DEPOSIT
 MADE  TO DISCHARGE A LIEN PURSUANT TO SECTION TWENTY OF THIS CHAPTER MAY
 BE RETURNED, BY AN ORDER OF A COURT OF RECORD. BEFORE SUCH  ORDER  SHALL
 BE  GRANTED, A NOTICE SHALL BE SERVED UPON THE LIENOR, EITHER PERSONALLY
 OR BY LEAVING IT AT HIS LAST KNOWN  PLACE  OF  RESIDENCE  OR  ATTORNEY'S
 PLACE  OF  BUSINESS,  WITH  A PERSON OF SUITABLE AGE, WITH DIRECTIONS TO
 DELIVER IT TO THE LIENOR.  SUCH  NOTICE  SHALL  REQUIRE  THE  LIENOR  TO
 COMMENCE  AN  ACTION  TO  ENFORCE  THE LIEN, OR TO COMMENCE AN ACTION TO
 OBTAIN JUDGMENT ON THE CLAIM UPON WHICH THE LIEN WAS ESTABLISHED, WITHIN
 A TIME SPECIFIED IN THE NOTICE, NOT LESS THAN NINETY DAYS FROM THE  TIME
 OF  SERVICE, OR SHOW CAUSE AT A SPECIAL TERM OF A COURT OF RECORD, OR AT
 A COUNTY COURT, IN A COUNTY IN WHICH THE PROPERTY IS SITUATED, AT A TIME
 AND PLACE SPECIFIED THEREIN, WHY THE NOTICE OF LIEN FILED  OR  THE  BOND
 GIVEN  SHOULD  NOT BE VACATED AND CANCELLED, OR THE DEPOSIT RETURNED, AS
 THE CASE MAY BE. PROOF OF SUCH SERVICE  AND  THAT  THE  LIENOR  HAS  NOT
 COMMENCED THE ACTION TO FORECLOSE SUCH LIEN OR AN ACTION TO OBTAIN JUDG-
 MENT  ON  THE  CLAIM UPON WHICH THE LIEN WAS ESTABLISHED, AS DIRECTED IN
 THE NOTICE, SHALL BE MADE BY AFFIDAVIT, AT THE TIME OF APPLYING FOR SUCH
 ORDER.
   § 2. Subdivision 2 of section 399-xx of the general business  law,  as
 added by chapter 690 of the laws of 2004, is amended to read as follows:
   2. Requirements. A commercial tower who responds to a call for assist-
 ance from an owner or operator of a vehicle that is inoperable or cannot
 be  safely operated or who offers to transport, repair, or render safely
 operable such a vehicle shall, in compliance with any reasonable request
 of an owner or operator of such vehicle, repair the vehicle or transport
 the vehicle and its  occupants  to  a  reasonably  safe  location  where
 repairs  can  be  made.  The  commercial  tower shall not be required to
 transport all vehicle occupants if the number of occupants  exceeds  the
 number of passengers that can be safely transported. The owner or opera-
 tor  of the vehicle shall be liable to the commercial tower for the cost
 of towing and repair services provided.  A WRITTEN INVOICE  STATING  THE
 S. 3265                             5

 COST  OF THE TOWING AND/OR SERVICES, SIGNED BY BOTH THE COMMERCIAL TOWER
 AND THE OWNER OR AUTHORIZED USER OF THE MOTOR VEHICLE, SHALL BE PROVIDED
 PRIOR TO ANY TOWING OR SERVICES BEING PERFORMED.  The  commercial  tower
 shall  accept  cash  and all other forms of payment that such commercial
 tower accepts in the ordinary course of business, including  credit  and
 debit cards as those terms are defined in section five hundred eleven of
 this  chapter  as  payment for all or part of the charges for towing and
 repair services accepted and provided. The commercial tower may  require
 such proof of identification from persons making payments in forms other
 than  cash  as  the  commercial  tower requires for such payments in the
 ordinary course of business. If the  owner  or  operator  of  a  vehicle
 declines  services of the commercial tower or cannot or will not provide
 payment and identification for towing or repair services,  a  commercial
 tower shall notify law enforcement about the location and identification
 of  the vehicle and its occupants. The provisions of this section do not
 apply to a vehicle which is lawfully parked at the home of the vehicle's
 owner or operator.
   § 3. Section 20-509 of the administrative code of the city of New York
 is amended by adding a new subdivision e to read as follows:
   E. A WRITTEN INVOICE STATING THE COST  OF  THE  TOWING  AND/OR  REPAIR
 SERVICES,  SIGNED  BY BOTH THE COMMERCIAL TOWER AND THE OWNER OR AUTHOR-
 IZED USER OF THE MOTOR VEHICLE, SHALL BE PROVIDED PRIOR TO ANY TOWING OR
 REPAIR SERVICES BEING PERFORMED, EXCEPT WHERE THE TOWING WAS WITHOUT THE
 PRIOR CONSENT OR AUTHORIZATION OF SUCH MOTOR VEHICLE OWNER.    UPON  THE
 RELEASE  OF  A  TOWED  MOTOR  VEHICLE THE OWNER SHALL RECEIVE AN INVOICE
 STATING THE AMOUNT CHARGED AND THE AMOUNT PAID.
   § 4. Subdivision 5 of section 6201  of  the  civil  practice  law  and
 rules,  as  amended by chapter 860 of the laws of 1977 and as renumbered
 by chapter 618 of the laws of 1992, is amended and a new  subdivision  6
 is added to read as follows:
   5.  the  cause  of action is based on a judgment, decree or order of a
 court of the United States or of any other court which  is  entitled  to
 full  faith  and  credit in this state, or on a judgment which qualifies
 for recognition under the provisions of article 53[.] OF  THIS  CHAPTER;
 OR
   6. THE CAUSE OF ACTION IS BASED ON CLAIMS OF ILLEGAL OR IMPROPER PRAC-
 TICES RELATING TO THE TOWING OF MOTOR VEHICLES, INCLUDING BUT NOT LIMIT-
 ED  TO  VIOLATIONS OF SECTION 19-169.1 OF THE ADMINISTRATIVE CODE OF THE
 CITY OF NEW YORK.
   § 5. The business corporation law is amended by adding a  new  section
 631 to read as follows:
 § 631. LIABILITY  OF  SHAREHOLDERS  OF  COMMERCIAL  TOWING COMPANIES FOR
          CLAIMS OF ILLEGAL OR IMPROPER TOWING PRACTICES.
   (A) THE TEN LARGEST SHAREHOLDERS, AS DETERMINED BY THE FAIR  VALUE  OF
 THEIR  BENEFICIAL  INTEREST  IN  EVERY  DOMESTIC  CORPORATION  OR OF ANY
 FOREIGN CORPORATION, NO SHARES OF WHICH ARE LISTED ON A NATIONAL SECURI-
 TIES EXCHANGE OR REGULARLY QUOTED IN AN OVER-THE-COUNTER MARKET  BY  ONE
 OR  MORE  MEMBERS OF A NATIONAL OR AN AFFILIATED SECURITIES ASSOCIATION,
 SHALL JOINTLY AND SEVERALLY BE PERSONALLY LIABLE FOR ALL CLAIMS DUE  AND
 OWING  TO  ANY  PERSON  AS  A RESULT OF AN ACTION TO RECOVER DAMAGES FOR
 VIOLATIONS ASSOCIATED WITH ILLEGAL OR IMPROPER PRACTICES RELATING TO THE
 TOWING OF MOTOR VEHICLES, INCLUDING BUT NOT  LIMITED  TO  VIOLATIONS  OF
 SECTION 19-169.1 OF THE ADMINISTRATIVE CODE OF THE CITY OF NEW YORK.
   (B)  A  SHAREHOLDER  WHO  HAS PAID MORE THAN HIS OR HER PRO RATA SHARE
 UNDER THIS SECTION SHALL BE ENTITLED TO CONTRIBUTION PRO RATA  FROM  THE
 OTHER  SHAREHOLDERS LIABLE UNDER THIS SECTION WITH RESPECT TO THE EXCESS
 S. 3265                             6
 
 SO PAID, OVER AND ABOVE HIS OR HER PRO RATA  SHARE,  AND  MAY  SUE  THEM
 JOINTLY  OR  SEVERALLY  OR  ANY NUMBER OF THEM TO RECOVER THE AMOUNT DUE
 FROM THEM.  SUCH RECOVERY MAY BE HAD IN A SEPARATE ACTION.  AS  USED  IN
 THIS  PARAGRAPH,  "PRO  RATA"  MEANS  IN  PROPORTION TO BENEFICIAL SHARE
 INTEREST. BEFORE A SHAREHOLDER MAY CLAIM CONTRIBUTION FROM OTHER  SHARE-
 HOLDERS  UNDER THIS PARAGRAPH, HE OR SHE SHALL GIVE THEM NOTICE IN WRIT-
 ING THAT HE OR SHE INTENDS TO HOLD THEM SO LIABLE TO HIM  OR  HER.  SUCH
 NOTICE  SHALL  BE  GIVEN BY HIM OR HER WITHIN TWENTY DAYS AFTER THE DATE
 THAT NOTICE WAS GIVEN UNDER PARAGRAPH (A) OF THIS SECTION.
   § 6. Section 609 of the limited liability company law  is  amended  by
 adding a new subdivision (e) to read as follows:
   (E) NOTWITHSTANDING THE PROVISIONS OF SUBDIVISIONS (A) AND (B) OF THIS
 SECTION,  THE TEN MEMBERS WITH THE LARGEST PERCENTAGE OWNERSHIP INTEREST
 OF EVERY LIMITED LIABILITY  COMPANY,  SHALL  JOINTLY  AND  SEVERALLY  BE
 PERSONALLY LIABLE FOR ALL CLAIMS DUE AND OWING TO ANY PERSON AS A RESULT
 OF  AN  ACTION TO RECOVER DAMAGES FOR VIOLATIONS ASSOCIATED WITH ILLEGAL
 OR IMPROPER PRACTICES RELATING TO THE TOWING OF MOTOR VEHICLES,  INCLUD-
 ING BUT NOT LIMITED TO VIOLATIONS OF SECTION 19-169.1 OF THE ADMINISTRA-
 TIVE CODE OF THE CITY OF NEW YORK.
   §  7.  This  act shall take effect on the thirtieth day after it shall
 have become a law.