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.
STATE OF NEW YORK
________________________________________________________________________
3875
2025-2026 Regular Sessions
IN SENATE
January 30, 2025
___________
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 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:
1 Section 1. Section 1207 of the civil practice law and rules, as
2 amended by chapter 355 of the laws of 1986, is amended to read as
3 follows:
4 § 1207. Settlement of action or claim by infant, judicially declared
5 incompetent or conservatee, by whom motion made; special proceeding;
6 notice; order of settlement. (a) Upon motion of a guardian of the prop-
7 erty or guardian ad litem of an infant or, if there is no such guardian,
8 then of a parent having legal custody of an infant, or if there is no
9 such parent, by another person having legal custody, or if the infant is
10 married, by an adult spouse residing with the infant, or of the commit-
11 tee of the property of a person judicially declared to be incompetent,
12 or of the conservator of the property of a conservatee, the court may
13 order settlement of any action commenced by or on behalf of the infant,
14 incompetent or conservatee. If no action has been commenced, a special
15 proceeding may be commenced upon petition of such a representative for
16 settlement of any claim by the infant, incompetent or conservatee in any
17 court where an action for the amount of the proposed settlement could
18 have been commenced. Unless otherwise provided by rule of the chief
19 administrator of the courts, if no motion term is being held and there
20 is no justice of the supreme court available in a county where the
21 action or an action on the claim is triable, such a motion may be made,
22 or special proceeding may be commenced, in a county court and the county
23 judge shall act with the same power as a justice of the supreme court
24 even though the amount of the settlement may exceed the jurisdictional
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD07097-01-5
S. 3875 2
1 limits of the county court. Notice of the motion or petition shall be
2 given as directed by the court. An order on such a motion shall have the
3 effect of a judgment. Such order, or the judgment in a special proceed-
4 ing, shall be entered without costs and shall approve the fee for the
5 infant's, incompetent's or conservatee's attorney, if any.
6 (b) Such order, or the judgment in a special proceeding, shall provide
7 for the payment of interest on the settlement amount at the statutory
8 interest rate on judgments, to be computed commencing the fifteenth day,
9 or where the settling defendant is a municipal or state entity as set
10 forth in subdivision (b) or (c) of section five thousand three-a of this
11 chapter then commencing from the sixty-first day following the day that
12 the proposed settlement is entered into and continuing until the day
13 that the order or judgment is signed. Where the proposed settlement
14 includes an annuity to provide for periodic payments, interest shall not
15 be computed on the present value of the annuity provided that the
16 defendant timely funds the annuity, but interest shall accrue on any
17 periodic payment made later than the payment schedule set forth in the
18 proposed settlement. The date and terms of the proposed settlement shall
19 be set forth to all counsel or parties in writing, or in a court tran-
20 script, and a copy of the writing or transcript shall be provided to the
21 court in order to calculate the days of interest.
22 § 2. Paragraphs 7 and 8 of subdivision (a) of rule 1208 of the civil
23 practice law and rules, paragraph 7 as amended and paragraph 8 as added
24 by chapter 844 of the laws of 1968, are amended and a new paragraph 9 is
25 added to read as follows:
26 7. whether reimbursement for medical or other expenses has been
27 received from any source; [and]
28 8. whether the infant's or incompetent's representative or any member
29 of the infant's or incompetent's family has made a claim for damages
30 alleged to have been suffered as a result of the same occurrence giving
31 rise to the infant's or incompetent's claim and, if so, the amount paid
32 or to be paid in settlement of such claim or if such claim has not been
33 settled the reasons therefor[.]; and
34 9. the daily rate of interest on the settlement computed pursuant to
35 subdivision (b) of section twelve hundred seven of this article and a
36 copy of the court transcript or writing setting forth the date and terms
37 of the proposed settlement.
38 § 3. Rule 1208 of the civil practice law and rules is amended by
39 adding a new subdivision (g) to read as follows:
40 (g) Delivery of order. Upon signing the order, or judgment in a
41 special proceeding, the court shall send a copy of the order or judgment
42 to the attorney representing the infant or incompetent, or if there is
43 no attorney, to the representative of the infant or incompetent.
44 § 4. Subdivisions (a), (b) and (c) of section 5003-a of the civil
45 practice law and rules, as added by chapter 269 of the laws of 1992, are
46 amended to read as follows:
47 (a) When an action to recover damages has been settled, any settling
48 defendant, except those defendants to whom subdivisions (b) and (c) of
49 this section apply, shall pay all sums due to any settling plaintiff
50 within twenty-one days, or if it is an action which requires judicial
51 approval of settlement, within fourteen days of tender, by the settling
52 plaintiff to the settling defendant, of a duly executed release and a
53 stipulation discontinuing action executed on behalf of the settling
54 plaintiff.
55 (b) When an action to recover damages has been settled and the settl-
56 ing defendant is a municipality or any subdivision thereof, or any
S. 3875 3
1 public corporation that is not indemnified by the state, it shall pay
2 all sums due to any settling plaintiff within ninety days, or if it is
3 an action which requires judicial approval of settlement, within sixty
4 days of tender, by the settling plaintiff to it, of duly executed
5 release and a stipulation discontinuing action executed on behalf of the
6 settling plaintiff. The provisions of this [paragraph] subdivision shall
7 not inure to the benefit of any insurance carrier for a municipality or
8 any subdivision thereof, or any public corporation that is not indem-
9 nified by the state. Any such insurance carrier shall pay all sums due
10 to any settling plaintiff in accordance with the provisions of subdivi-
11 sion (a) of this section.
12 (c) When an action to recover damages has been settled and the settl-
13 ing defendant is the state, an officer or employee of the state entitled
14 to indemnification pursuant to section seventeen of the public officers
15 law, or a public benefit corporation indemnified by the state, payment
16 of all sums due to any settling plaintiff shall be made within ninety
17 days, or if it is an action which requires judicial approval of settle-
18 ment, within sixty days of the comptroller's determination that all
19 papers required to effectuate the settlement have been received by [him]
20 the comptroller. The provisions of this [paragraph] subdivision shall
21 not inure to the benefit of any insurance carrier for the state, an
22 officer or employee of the state entitled to indemnification pursuant to
23 section seventeen of the public officers law, or a public benefit corpo-
24 ration indemnified by the state. Any such insurance carrier shall pay
25 all sums due to any settling plaintiff in accordance with the provisions
26 of subdivision (a) of this section.
27 § 5. Section 2220 of the surrogate's court procedure act is amended by
28 adding a new subdivision 6 to read as follows:
29 6. The order or decree shall provide for the payment of interest on
30 the settlement amount at the statutory interest rate on judgments, to be
31 computed from the fifteenth day, or where the settling defendant is a
32 municipal or state entity as set forth in subdivision (b) or (c) of
33 section five thousand three-a of the civil practice law and rules, then
34 from the sixty-first day following the day that the proposed settlement
35 is entered into and continuing until the day that the order or judgment
36 is signed. Where the proposed settlement includes an annuity to provide
37 for periodic payment, interest shall not be computed on the present
38 value of the annuity provided that the defendant timely funds the annui-
39 ty, but interest shall accrue on any periodic payment made later than
40 the payment schedule set forth in the proposed settlement. The date and
41 terms of the proposed settlement shall be set forth to all counsel or
42 parties in writing, or in a court transcript, and a copy of the writing
43 or transcript shall be provided to the court in order to calculate the
44 days of interest.
45 § 6. This act shall take effect on the first of January next succeed-
46 ing the date on which it shall have become a law, and shall apply to all
47 actions settled on or after such effective date.
