Amd Lien L, generally; amd 199-a & 663, Lab L; amd 6201, 6210 & 6211, R6212, CPLR; amd 624 & 630, BC L; amd
609 & 1102, Lim Lil L
Relates to securing payment of wages for work already performed; creates a lien remedy for all employees; provides grounds for attachment; relates to procedures where employees may hold shareholders of non-publicly traded corporations personally liable for wage theft; relates to rights for victims of wage theft to hold the ten members with the largest ownership interests in a company personally liable for wage theft.
STATE OF NEW YORK
________________________________________________________________________
1977--A
2023-2024 Regular Sessions
IN SENATE
January 17, 2023
___________
Introduced by Sens. RAMOS, BAILEY, BRISPORT, COMRIE, FERNANDEZ, GIANAR-
IS, GONZALEZ, GOUNARDES, HARCKHAM, HOYLMAN-SIGAL, JACKSON, KENNEDY,
KRUEGER, LIU, MYRIE, RIVERA, SALAZAR, SANDERS, SEPULVEDA, SERRANO,
STAVISKY -- read twice and ordered printed, and when printed to be
committed to the Committee on Judiciary -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee
AN ACT to amend the lien law, in relation to employee liens; to amend
the labor law, in relation to employee complaints; to amend the civil
practice law and rules, in relation to grounds for attachment; to
amend the business corporation law, in relation to streamlining proce-
dures where employees may hold shareholders of non-publicly traded
corporations personally liable for wage theft; and to amend the limit-
ed liability company law, in relation to creating a right for victims
of wage theft to hold the ten members with the largest ownership
interests in a company personally liable for wage theft
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 2 of the lien law is amended by adding three new
2 subdivisions 21, 22 and 23 to read as follows:
3 21. Employee. The term "employee", when used in this chapter, shall
4 have the same meaning as "employee" pursuant to articles one, six, nine-
5 teen and nineteen-A of the labor law, as applicable, or the Fair Labor
6 Standards Act, 29 U.S.C. § 201 et. seq., as applicable.
7 22. Employer. The term "employer", when used in this chapter, shall
8 have the same meaning as "employer" pursuant to articles one, six, nine-
9 teen and nineteen-A of the labor law, as applicable, or the Fair Labor
10 Standards Act, 29 U.S.C. § 201 et. seq., as applicable, except that the
11 term "employer" shall not include a governmental agency.
12 23. Wage claim. The term "wage claim", when used in this chapter,
13 means a claim that an employee has suffered a violation of section one
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD00720-02-3
S. 1977--A 2
1 hundred seventy, one hundred ninety-three, one hundred ninety-six-d, six
2 hundred fifty-two or six hundred seventy-three of the labor law or the
3 related regulations and wage orders promulgated by the commissioner, a
4 claim for wages due to an employee pursuant to an employment contract
5 that were unpaid in violation of that contract, or a claim that an
6 employee has suffered a violation of 29 U.S.C. § 206 or 207.
7 § 2. Section 3 of the lien law, as amended by chapter 137 of the laws
8 of 1985, is amended to read as follows:
9 § 3. Mechanic's lien and employee's lien on [real] property. 1.
10 Mechanic's lien. A contractor, subcontractor, laborer, materialman,
11 landscape gardener, nurseryman or person or corporation selling fruit or
12 ornamental trees, roses, shrubbery, vines and small fruits, who performs
13 labor or furnishes materials for the improvement of real property with
14 the consent or at the request of the owner thereof, or of his or her
15 agent, contractor or subcontractor, and any trust fund to which benefits
16 and wage supplements are due or payable for the benefit of such labor-
17 ers, shall have a lien for the principal and interest, of the value, or
18 the agreed price, of such labor, including benefits and wage supplements
19 due or payable for the benefit of any laborer, or materials upon the
20 real property improved or to be improved and upon such improvement, from
21 the time of filing a notice of such lien as prescribed in this chapter.
22 Where the contract for an improvement is made with a husband or wife and
23 the property belongs to the other or both, the husband or wife contract-
24 ing shall also be presumed to be the agent of the other, unless such
25 other having knowledge of the improvement shall, within ten days after
26 learning of the contract give the contractor written notice of his or
27 her refusal to consent to the improvement. Within the meaning of the
28 provisions of this chapter, materials actually manufactured for but not
29 delivered to the real property, shall also be deemed to be materials
30 furnished.
31 2. Employee's lien. An employee who has a wage claim as that term is
32 defined in subdivision twenty-three of section two of this chapter or,
33 in the case of an employee whose wage claim originates from or is
34 covered by a collective bargaining agreement, his or her authorized
35 bargaining representative on behalf of such employee, shall have a lien
36 on his or her employer's interest in property for the value of that
37 employee's wage claim arising out of the employment, including liqui-
38 dated damages pursuant to subdivision one-a of section one hundred nine-
39 ty-eight, section six hundred sixty-three or section six hundred eight-
40 y-one of the labor law, or 29 U.S.C. § 216 (b), from the time of filing
41 a notice of such lien as prescribed in this chapter. An employee's lien
42 based on a wage claim may be had against the employer's interest in real
43 property and against the employer's interest in personal property that
44 can be sufficiently described within the meaning of section 9-108 of the
45 uniform commercial code, except that an employee's lien shall not extend
46 to deposit accounts or goods as those terms are defined in section 9-102
47 of the uniform commercial code. The department of labor and the attor-
48 ney general may obtain an employee's lien for the value of wage claims
49 of the employees who are the subject of their investigations, court
50 actions or administrative agency actions.
51 3. As used in this article and unless otherwise specified, a lien
52 shall mean an employee's lien or a mechanic's lien.
53 § 3. Subdivisions 1 and 2 of section 4 of the lien law, subdivision 1
54 as amended by chapter 515 of the laws of 1929 and subdivision 2 as added
55 by chapter 704 of the laws of 1985, are amended to read as follows:
S. 1977--A 3
1 (1) [Such] A mechanic's or employee's lien and employee's lien against
2 real property shall extend to the owner's right, title or interest in
3 the real property and improvements, existing at the time of filing the
4 notice of lien, or thereafter acquired, except as hereinafter in this
5 article provided. If an owner assigns his or her interest in such real
6 property by a general assignment for the benefit of creditors, within
7 thirty days prior to such filing, the lien shall extend to the interest
8 thus assigned. If any part of the real property subjected to such lien
9 be removed by the owner or by any other person, at any time before the
10 discharge thereof, such removal shall not affect the rights of the
11 lienor, either in respect to the remaining real property, or the part so
12 removed. If labor is performed for, or materials furnished to, a
13 contractor or subcontractor for an improvement, the mechanic's lien
14 shall not be for a sum greater than the sum earned and unpaid on the
15 contract at the time of filing the notice of lien, and any sum subse-
16 quently earned thereon. In no case shall the owner be liable to pay by
17 reason of all mechanic's liens created pursuant to this article a sum
18 greater than the value or agreed price of the labor and materials
19 remaining unpaid, at the time of filing notices of such liens, except as
20 hereinafter provided.
21 (2) [Such] A mechanic's or employee's lien shall not extend to the
22 owner's right, title or interest in real property and improvements,
23 existing at the time of filing the notice of lien if such lien arises
24 from the failure of a lessee of the right to explore, develop or produce
25 natural gas or oil, to pay for, compensate or render value for improve-
26 ments made with the consent or at the request of such lessee by a
27 contractor, subcontractor, materialman, equipment operator or owner,
28 landscaper, nurseryman, or person or corporation who performs labor or
29 furnishes materials for the exploration, development, or production of
30 oil or natural gas or otherwise improves such leased property. Such
31 mechanic's or employee's lien shall extend to the improvements made for
32 the exploration, development and production of oil and natural gas, and
33 the working interest held by a lessee of the right to explore, develop
34 or produce oil and natural gas.
35 § 4. The opening paragraph of section 4-a of the lien law, as amended
36 by chapter 696 of the laws of 1959, is amended to read as follows:
37 The proceeds of any insurance which by the terms of the policy are
38 payable to the owner of real property improved, and actually received or
39 to be received by him because of the destruction or removal by fire or
40 other casualty of an improvement on which lienors have performed labor
41 or services or for which they have furnished materials, or upon which an
42 employee has established an employee's lien, shall after the owner has
43 been reimbursed therefrom for premiums paid by him, if any, for such
44 insurance, be subject to liens provided by this act to the same extent
45 and in the same order of priority as the real property would have been
46 had such improvement not been so destroyed or removed.
47 § 5. Subdivisions 1, 2 and 5 of section 9 of the lien law, as amended
48 by chapter 515 of the laws of 1929, are amended to read as follows:
49 1. The name of the lienor, and either the residence of the lienor or
50 the name and business address of the lienor's attorney, if any; and if
51 the lienor is a partnership or a corporation, the business address of
52 such firm, or corporation, the names of partners and principal place of
53 business, and if a foreign corporation, its principal place of business
54 within the state.
S. 1977--A 4
1 2. The name of the owner of the [real] property against whose interest
2 therein a lien is claimed, and the interest of the owner as far as known
3 to the lienor.
4 5. The amount unpaid to the lienor for such labor or materials, or the
5 amount of the wage claim if a wage claim is the basis for establishment
6 of the lien, the items of the wage claim and the value thereof which
7 make up the amount for which the lienor claims a lien.
8 § 6. Subdivision 1 of section 10 of the lien law, as amended by chap-
9 ter 367 of the laws of 2011, is amended to read as follows:
10 1. (a) Notice of mechanic's lien may be filed at any time during the
11 progress of the work and the furnishing of the materials, or, within
12 eight months after the completion of the contract, or the final perform-
13 ance of the work, or the final furnishing of the materials, dating from
14 the last item of work performed or materials furnished; provided, howev-
15 er, that where the improvement is related to real property improved or
16 to be improved with a single family dwelling, the notice of mechanic's
17 lien may be filed at any time during the progress of the work and the
18 furnishing of the materials, or, within four months after the completion
19 of the contract, or the final performance of the work, or the final
20 furnishing of the materials, dating from the last item of work performed
21 or materials furnished; and provided further where the notice of mechan-
22 ic's lien is for retainage, the notice of mechanic's lien may be filed
23 within ninety days after the date the retainage was due to be released;
24 except that in the case of a mechanic's lien by a real estate broker,
25 the notice of mechanic's lien may be filed only after the performance of
26 the brokerage services and execution of lease by both lessor and lessee
27 and only if a copy of the alleged written agreement of employment or
28 compensation is annexed to the notice of lien, provided that where the
29 payment pursuant to the written agreement of employment or compensation
30 is to be made in installments, then a notice of lien may be filed within
31 eight months after the final payment is due, but in no event later than
32 a date five years after the first payment was made. For purposes of this
33 section, the term "single family dwelling" shall not include a dwelling
34 unit which is a part of a subdivision that has been filed with a munici-
35 pality in which the subdivision is located when at the time the lien is
36 filed, such property in the subdivision is owned by the developer for
37 purposes other than his or her personal residence. For purposes of this
38 section, "developer" shall mean and include any private individual,
39 partnership, trust or corporation which improves two or more parcels of
40 real property with single family dwellings pursuant to a common scheme
41 or plan. [The]
42 (b) Notice of employee's lien may be filed at any time not later than
43 three years following the end of the employment giving rise to the wage
44 claim.
45 (c) A notice of lien, other than for a lien on personal property, must
46 be filed in the clerk's office of the county where the property is situ-
47 ated. If such property is situated in two or more counties, the notice
48 of lien shall be filed in the office of the clerk of each of such coun-
49 ties. The county clerk of each county shall provide and keep a book to
50 be called the "lien docket," which shall be suitably ruled in columns
51 headed "owners," "lienors," "lienor's attorney," "property," "amount,"
52 "time of filing," "proceedings had," in each of which he or she shall
53 enter the particulars of the notice, properly belonging therein. The
54 date, hour and minute of the filing of each notice of lien shall be
55 entered in the proper column. Except where the county clerk maintains a
56 block index, the names of the owners shall be arranged in such book in
S. 1977--A 5
1 alphabetical order. The validity of the lien and the right to file a
2 notice thereof shall not be affected by the death of the owner before
3 notice of the lien is filed. A notice of employee's lien on personal
4 property must be filed, together with a financing statement, in the
5 filing office as set forth in section 9-501 of the uniform commercial
6 code.
7 § 7. Section 11 of the lien law, as amended by chapter 147 of the laws
8 of 1996, is amended to read as follows:
9 § 11. Service of copy of notice of lien. 1. Within five days before
10 or thirty days after filing the notice of a mechanic's lien, the lienor
11 shall serve a copy of such notice upon the owner, if a natural person,
12 (a) by delivering the same to him or her personally, or if the owner
13 cannot be found, to his or her agent or attorney, or (b) by leaving it
14 at his or her last known place of residence in the city or town in which
15 the real property or some part thereof is situated, with a person of
16 suitable age and discretion, or (c) by registered or certified mail
17 addressed to his or her last known place of residence, or (d) if such
18 owner has no such residence in such city or town, or cannot be found,
19 and he or she has no agent or attorney, by affixing a copy thereof
20 conspicuously on such property, between the hours of nine o'clock in the
21 forenoon and four o'clock in the afternoon; if the owner be a corpo-
22 ration, said service shall be made (i) by delivering such copy to and
23 leaving the same with the president, vice-president, secretary or clerk
24 to the corporation, the cashier, treasurer or a director or managing
25 agent thereof, personally, within the state, or (ii) if such officer
26 cannot be found within the state by affixing a copy thereof conspicuous-
27 ly on such property between the hours of nine o'clock in the forenoon
28 and four o'clock in the afternoon, or (iii) by registered or certified
29 mail addressed to its last known place of business. Failure to file
30 proof of such a service with the county clerk within thirty-five days
31 after the notice of lien is filed shall terminate the notice as a lien.
32 Until service of the notice has been made, as above provided, an owner,
33 without knowledge of the lien, shall be protected in any payment made in
34 good faith to any contractor or other person claiming a lien.
35 2. Within five days before or thirty days after filing the notice of
36 an employee's lien, the lienor shall serve a copy of such notice upon
37 the employer, if a natural person, (a) by delivering the same to him or
38 her personally, or if the employer cannot be found, to his or her agent
39 or attorney, or (b) by leaving it as his or her last known place of
40 residence or business, with a person of suitable age and discretion, or
41 (c) by registered or certified mail addressed to his or her last known
42 place of residence or business, or (d) if such employer owns real prop-
43 erty, by affixing a copy thereof conspicuously on such property, between
44 the hours of nine o'clock in the forenoon and four o'clock in the after-
45 noon. The lienor also shall, within thirty days after filing the notice
46 of employee's lien, affix a copy thereof conspicuously on the real prop-
47 erty identified in the notice of employee's lien, between the hours of
48 nine o'clock in the forenoon and four o'clock in the afternoon. If the
49 employer be a corporation, said service shall be made (i) by delivering
50 such copy to and leaving the same with the president, vice-president,
51 secretary or clerk to the corporation, the cashier, treasurer or a
52 director or managing agent thereof, personally, within the state, or
53 (ii) if such officer cannot be found within the state by affixing a copy
54 thereof conspicuously on such property between the hours of nine o'clock
55 in the forenoon and four o'clock in the afternoon, or (iii) by regis-
56 tered or certified mail addressed to its last known place of business,
S. 1977--A 6
1 or (iv) by delivery to the secretary of the department of state in the
2 same manner as required by subparagraph one of paragraph (b) of section
3 three hundred six of the business corporation law. Failure to file
4 proof of such a service with the county clerk within thirty-five days
5 after the notice of lien is filed shall terminate the notice as a lien.
6 Until service of the notice has been made, as above provided, an owner,
7 without knowledge of the lien, shall be protected in any payment made in
8 good faith to any other person claiming a lien.
9 § 8. Section 11-b of the lien law, as amended by chapter 147 of the
10 laws of 1996, is amended to read as follows:
11 § 11-b. Copy of notice of mechanic's lien to a contractor or subcon-
12 tractor. Within five days before or thirty days after filing a notice
13 of mechanic's lien in accordance with section ten of this [chapter]
14 article or the filing of an amendment of notice of mechanic's lien in
15 accordance with section twelve-a of this [chapter] article the lienor
16 shall serve a copy of such notice or amendment by certified mail on the
17 contractor, subcontractor, assignee or legal representative for whom he
18 or she was employed or to whom he or she furnished materials or if the
19 lienor is a contractor or subcontractor to the person, firm or corpo-
20 ration with whom the contract was made. A lienor having a direct
21 contractual relationship with a subcontractor or a sub-subcontractor but
22 not with a contractor shall also serve a copy of such notice or amend-
23 ment by certified mail to the contractor. Failure to file proof of such
24 a service with the county clerk within thirty-five days after the notice
25 of lien is filed shall terminate the notice as a lien. Any lienor, or a
26 person acting on behalf of a lienor, who fails to serve a copy of the
27 notice of mechanic's lien as required by this section shall be liable
28 for reasonable attorney's fees, costs and expenses, as determined by the
29 court, incurred in obtaining such copy.
30 § 9. Subdivision 1 of section 12-a of the lien law, as amended by
31 chapter 1048 of the laws of 1971, is amended to read as follows:
32 1. Within sixty days after the original filing, a lienor may amend his
33 or her lien upon twenty days notice to existing lienors, mortgagees and
34 the owner, provided that no action or proceeding to enforce or cancel
35 the mechanics' lien or employee's lien has been brought in the interim,
36 where the purpose of the amendment is to reduce the amount of the lien,
37 except the question of wilful exaggeration shall survive such amendment.
38 § 10. Subdivision 1 of section 13 of the lien law, as amended by chap-
39 ter 878 of the laws of 1947, is amended to read as follows:
40 (1) [A] An employee's lien, or a lien for materials furnished or labor
41 performed in the improvement of real property, shall have priority over
42 a conveyance, mortgage, judgment or other claim against such property
43 not recorded, docketed or filed at the time of the filing of the notice
44 of such lien, except as hereinafter in this chapter provided; over
45 advances made upon any mortgage or other encumbrance thereon after such
46 filing, except as hereinafter in this article provided; and over the
47 claim of a creditor who has not furnished materials or performed labor
48 upon such property, if such property has been assigned by the owner by a
49 general assignment for the benefit of creditors, within thirty days
50 before the filing of either of such notices; and also over an attachment
51 hereafter issued or a money judgment hereafter recovered upon a claim,
52 which, in whole or in part, was not for materials furnished, labor
53 performed or moneys advanced for the improvement of such real property;
54 and over any claim or lien acquired in any proceedings upon such judg-
55 ment. Such liens shall also have priority over advances made upon a
56 contract by an owner for an improvement of real property which contains
S. 1977--A 7
1 an option to the contractor, his or her successor or assigns to purchase
2 the property, if such advances were made after the time when the labor
3 began or the first item of material was furnished, as stated in the
4 notice of lien. If several buildings are demolished, erected, altered or
5 repaired, or several pieces or parcels of real property are improved,
6 under one contract, and there are conflicting liens thereon, each lienor
7 shall have priority upon the particular part of the real property or
8 upon the particular building or premises where his or her labor is
9 performed or his or her materials are used. Persons shall have no prior-
10 ity on account of the time of filing their respective notices of liens,
11 but all liens shall be on a parity except as hereinafter in section
12 fifty-six of this chapter provided; and except that in all cases labor-
13 ers for daily or weekly wages with a mechanic's lien, and employees with
14 an employee's lien, shall have preference over all other claimants under
15 this article.
16 § 11. Section 17 of the lien law, as amended by chapter 324 of the
17 laws of 2000, is amended to read as follows:
18 § 17. Duration of lien. 1. (a) No mechanic's lien specified in this
19 article shall be a lien for a longer period than one year after the
20 notice of lien has been filed, unless within that time an action is
21 commenced to foreclose the lien, and a notice of the pendency of such
22 action, whether in a court of record or in a court not of record, is
23 filed with the county clerk of the county in which the notice of lien is
24 filed, containing the names of the parties to the action, the object of
25 the action, a brief description of the real property affected thereby,
26 and the time of filing the notice of lien; or unless an extension to
27 such lien, except for a lien on real property improved or to be improved
28 with a single family dwelling, is filed with the county clerk of the
29 county in which the notice of lien is filed within one year from the
30 filing of the original notice of lien, continuing such lien and such
31 lien shall be redocketed as of the date of filing such extension. Such
32 extension shall contain the names of the lienor and the owner of the
33 real property against whose interest therein such lien is claimed, a
34 brief description of the real property affected by such lien, the amount
35 of such lien, and the date of filing the notice of lien. No lien shall
36 be continued by such extension for more than one year from the filing
37 thereof. In the event an action is not commenced to foreclose the lien
38 within such extended period, such lien shall be extinguished unless an
39 order be granted by a court of record or a judge or justice thereof,
40 continuing such lien, and such lien shall be redocketed as of the date
41 of granting such order and a statement made that such lien is continued
42 by virtue of such order. A lien on real property improved or to be
43 improved with a single family dwelling may only be extended by an order
44 of a court of record, or a judge or justice thereof. No lien shall be
45 continued by court order for more than one year from the granting there-
46 of, but a new order and entry may be made in each of two successive
47 years. If a lienor is made a party defendant in an action to enforce
48 another lien, and the plaintiff or such defendant has filed a notice of
49 the pendency of the action within the time prescribed in this section,
50 the lien of such defendant is thereby continued. Such action shall be
51 deemed an action to enforce the lien of such defendant lienor. The fail-
52 ure to file a notice of pendency of action shall not abate the action as
53 to any person liable for the payment of the debt specified in the notice
54 of lien, and the action may be prosecuted to judgment against such
55 person. The provisions of this section in regard to continuing liens
56 shall apply to liens discharged by deposit or by order on the filing of
S. 1977--A 8
1 an undertaking. Where a lien is discharged by deposit or by order, a
2 notice of pendency of action shall not be filed.
3 (b) A lien, the duration of which has been extended by the filing of a
4 notice of the pendency of an action as above provided, shall neverthe-
5 less terminate as a lien after such notice has been canceled as provided
6 in section sixty-five hundred fourteen of the civil practice law and
7 rules or has ceased to be effective as constructive notice as provided
8 in section sixty-five hundred thirteen of the civil practice law and
9 rules.
10 2. (a) No employee's lien on real property shall be a lien for a long-
11 er period than one year after the notice of lien has been filed, unless
12 an extension to such lien is filed with the county clerk of the county
13 in which the notice of lien is filed within one year from the filing of
14 the original notice of lien, continuing such lien and such lien shall be
15 redocketed as of the date of filing such extension. Such extension shall
16 contain the names of the lienor and the owner of the real property
17 against whose interest therein such lien is claimed, a brief description
18 of the property affected by such lien, the amount of such lien, and the
19 date of filing the notice of lien. No lien shall be continued by such
20 extension for more than one year from the filing thereof. In the event
21 an action is not commenced to obtain judgment on the wage claim or to
22 foreclose the lien within such extended period, such lien shall be auto-
23 matically extinguished unless an order be granted by a court of record
24 or a judge or justice thereof, continuing such lien, and such lien shall
25 be redocketed as of the date of granting such order and a statement made
26 that such lien is continued by virtue of such order.
27 (b) No employee's lien on personal property shall be a lien for a
28 longer period than one year after the financing statement has been
29 recorded, unless an extension to such lien, is filed with the filing
30 office in which the financing statement is required to be filed pursuant
31 to section 9-501 of the uniform commercial code within one year from the
32 filing of the original financing statement, continuing such lien. Such
33 extension shall contain the names of the lienor and the owner of the
34 property against whose interest therein such lien is claimed, a brief
35 description of the prior financing statement to be extended, and the
36 date of filing the prior financing statement. No lien shall be contin-
37 ued by such extension for more than one year from the filing thereof. In
38 the event an action is not commenced to obtain judgment on the wage
39 claim or to foreclose the lien within such extended period, such lien
40 shall be automatically extinguished unless an order be granted by a
41 court of record or a judge or justice thereof, continuing such lien, and
42 such lien shall be refiled as of the date of granting such order and a
43 statement made that such lien is continued by virtue of such order.
44 (c) If a lienor is made a party defendant in an action to enforce
45 another lien, and the plaintiff or such defendant has filed a notice of
46 the pendency of the action within the time prescribed in this section,
47 the lien of such defendant is thereby continued. Such action shall be
48 deemed an action to enforce the lien of such defendant lienor. The fail-
49 ure to file a notice of pendency of action shall not abate the action as
50 to any person liable for the payment of the debt specified in the notice
51 of lien, and the action may be prosecuted to judgment against such
52 person. The provisions of this section in regard to continuing liens
53 shall apply to liens discharged by deposit or by order on the filing of
54 an undertaking. Where a lien is discharged by deposit or by order, a
55 notice of pendency of action shall not be filed.
S. 1977--A 9
1 (d) Notwithstanding the foregoing, if a lienor commences a foreclosure
2 action or an action to obtain a judgment on the wage claim within one
3 year from the filing of the notice of lien on real property or the
4 recording of the financing statement creating lien on personal property,
5 the lien shall be extended during the pendency of the action and for one
6 hundred twenty days following the entry of final judgment in such
7 action, unless the action results in a final judgment or administrative
8 order in the lienor's favor on the wage claims and the lienor commences
9 a foreclosure action, in which instance the lien shall be valid during
10 the pendency of the foreclosure action, provided, that the lien will be
11 automatically extinguished if, after a dismissal with prejudice of the
12 wage claims on which it is based, the lienor fails to file a notice of
13 appeal within the prescribed period to file a notice of appeal. If a
14 lien is extended due to the pendency of a foreclosure action or an
15 action to obtain a judgment on the wage claim, the lienor shall file a
16 notice of such pendency and extension with the county clerk of the coun-
17 ty in which the notice of lien is filed, containing the names of the
18 parties to the action, the object of the action, a brief description of
19 the property affected thereby, and the time of filing the notice of
20 lien, or in the case of a lien on personal property shall file such
21 notice with the office authorized to accept financing statements pursu-
22 ant to section 9-501 of the uniform commercial code. For purposes of
23 this section, an action to obtain judgment on a wage claim includes an
24 action brought in any court of competent jurisdiction, the submission of
25 a complaint to the department of labor or the submission of a claim to
26 arbitration pursuant to an arbitration agreement. An action also
27 includes an investigation of wage claims by the commissioner of labor or
28 the attorney general of the state of New York, regardless of whether
29 such investigation was initiated by a complaint.
30 (e) A lien, the duration of which has been extended by the filing of a
31 notice of the pendency of an action as above provided, shall neverthe-
32 less terminate as a lien after such notice has been canceled as provided
33 in section sixty-five hundred fourteen of the civil practice law and
34 rules or has ceased to be effective as constructive notice as provided
35 in section sixty-five hundred thirteen of the civil practice law and
36 rules.
37 § 12. Subdivisions 2 and 4 of section 19 of the lien law, subdivision
38 2 as amended by chapter 310 of the laws of 1962, subdivision 4 as added
39 by chapter 582 of the laws of 2002 and paragraph a of subdivision 4 as
40 further amended by section 104 of part A of chapter 62 of the laws of
41 2011, are amended to read as follows:
42 (2) By failure to begin an action to foreclose such lien or to secure
43 an order continuing it, within one year from the time of filing the
44 notice of lien, unless (i) an action be begun within the same period to
45 foreclose a mortgage or another mechanic's lien upon the same property
46 or any part thereof and a notice of pendency of such action is filed
47 according to law, or (ii) an action is commenced to obtain a judgment on
48 a wage claim pursuant to subdivision two of section seventeen of this
49 article, but a lien, the duration of which has been extended by the
50 filing of a notice of the pendency of an action as [herein] provided in
51 this section, shall nevertheless terminate as a lien after such notice
52 has been cancelled or has ceased to be effective as constructive notice.
53 (4) Either before or after the beginning of an action by the employer,
54 owner or contractor executing a bond or undertaking in an amount equal
55 to one hundred ten percent of such lien conditioned for the payment of
S. 1977--A 10
1 any judgment which may be rendered against the property or employer for
2 the enforcement of the lien:
3 a. The execution of any such bond or undertaking by any fidelity or
4 surety company authorized by the laws of this state to transact busi-
5 ness, shall be sufficient; and where a certificate of qualification has
6 been issued by the superintendent of financial services under the
7 provisions of section one thousand one hundred eleven of the insurance
8 law, and has not been revoked, no justification or notice thereof shall
9 be necessary. Any such company may execute any such bond or undertaking
10 as surety by the hand of its officers, or attorney, duly authorized
11 thereto by resolution of its board of directors, a certified copy of
12 which resolution, under the seal of said company, shall be filed with
13 each bond or undertaking. Any such bond or undertaking shall be filed
14 with the clerk of the county in which the notice of lien is filed, and a
15 copy shall be served upon the adverse party. The undertaking is effec-
16 tive when so served and filed. If a certificate of qualification issued
17 pursuant to subsections (b), (c) and (d) of section one thousand one
18 hundred eleven of the insurance law is not filed with the undertaking, a
19 party may except, to the sufficiency of a surety and by a written notice
20 of exception served upon the adverse party within ten days after
21 receipt, a copy of the undertaking. Exceptions deemed by the court to
22 have been taken unnecessarily, or for vexation or delay, may, upon
23 notice, be set aside, with costs. Where no exception to sureties is
24 taken within ten days or where exceptions taken are set aside, the
25 undertaking shall be allowed.
26 b. In the case of bonds or undertakings not executed pursuant to para-
27 graph a of this subdivision, the employer, owner or contractor shall
28 execute an undertaking with two or more sufficient sureties, who shall
29 be free holders, to the clerk of the county where the premises are situ-
30 ated. The sureties must together justify in at least double the sum
31 named in the undertaking. A copy of the undertaking, with notice that
32 the sureties will justify before the court, or a judge or justice there-
33 of, at the time and place therein mentioned, must be served upon the
34 lienor or his or her attorney, not less than five days before such time.
35 Upon the approval of the undertaking by the court, judge or justice an
36 order shall be made by such court, judge or justice discharging such
37 lien.
38 c. If the lienor cannot be found, or does not appear by attorney,
39 service under this subsection may be made by leaving a copy of such
40 undertaking and notice at the lienor's place of residence, or if a
41 corporation at its principal place of business within the state as stat-
42 ed in the notice of lien, with a person of suitable age and discretion
43 therein, or if the house of his or her abode or its place of business is
44 not stated in said notice of lien and is not known, then in such manner
45 as the court may direct. The premises, if any, described in the notice
46 of lien as the lienor's residence or place of business shall be deemed
47 to be his or her said residence or its place of business for the
48 purposes of said service at the time thereof, unless it is shown affir-
49 matively that the person servicing the papers or directing the service
50 had knowledge to the contrary. Notwithstanding the other provisions of
51 this subdivision relating to service of notice, in any case where the
52 mailing address of the lienor is outside the state such service may be
53 made by registered or certified mail, return receipt requested, to such
54 lienor at the mailing address contained in the notice of lien.
55 d. Except as otherwise provided in this subdivision, the provisions of
56 article twenty-five of the civil practice law and rules regulating
S. 1977--A 11
1 undertakings is applicable to a bond or undertaking given for the
2 discharge of a lien on account of private improvements or of an employ-
3 ee's lien.
4 § 13. Section 24 of the lien law, as amended by chapter 515 of the
5 laws of 1929, is amended to read as follows:
6 § 24. Enforcement of [mechanic's] lien. (1) Real property. The
7 [mechanics'] liens on real property specified in this article may be
8 enforced against the property specified in the notice of lien and which
9 is subject thereto and against any person liable for the debt upon which
10 the lien is founded, as prescribed in article three of this chapter.
11 (2) Personal property. An employee's lien on personal property speci-
12 fied in this article may immediately be enforced against the property
13 through a foreclosure as prescribed in article nine of the uniform
14 commercial code, or upon judgment obtained by the employee, commissioner
15 of labor or attorney general of the state of New York, may be enforced
16 in any manner available to the judgment creditor pursuant to article
17 nine of the uniform commercial code or other applicable laws.
18 § 14. Section 26 of the lien law, as amended by chapter 373 of the
19 laws of 1977, is amended to read as follows:
20 § 26. Subordination of liens after agreement with owner. In case an
21 owner of real property shall execute to one or more persons, or a corpo-
22 ration, as trustee or trustees, a bond and mortgage or a note and mort-
23 gage affecting such property in whole or in part, or an assignment of
24 the moneys due or to become due under a contract for a building loan in
25 relation to such property, and in case such mortgage, if any, shall be
26 recorded in the office of the register of the county where such real
27 property is situated, or if such county has no register then in the
28 office of the clerk of such county, and in case such assignment, if any,
29 shall be filed in the office of the clerk of the county where such real
30 property is situated; and in case lienors having [mechanics'] liens
31 against said real property, notices of which have been filed up to and
32 not later than fifteen days after the recording of such mortgage or the
33 filing of such assignment, and which liens have not been discharged as
34 in this article provided, shall, to the extent of at least fifty-five
35 per centum of the aggregate amount for which such notices of liens have
36 been so filed, approve such bond and mortgage or such note and mortgage,
37 if any, and such assignment, if any, by an instrument or instruments in
38 writing, duly acknowledged and filed in the office of such county clerk,
39 then all mechanics' liens for labor performed or material furnished
40 prior to the recording of such mortgage or filing of such assignment,
41 whether notices thereof have been theretofore or are thereafter filed
42 and which have not been discharged as in this article provided, shall be
43 subordinate to the lien of such trust bond and mortgage or such trust
44 note and mortgage to the extent of the aggregate amount of all certif-
45 icates of interest therein issued by such trustee or trustees, or their
46 successors, for moneys loaned, materials furnished, labor performed and
47 any other indebtedness incurred after said trust mortgage shall have
48 been recorded, and for expenses in connection with said trust mortgage,
49 and shall also be subordinate to the lien of the bond and mortgage or
50 note and mortgage, given to secure the amount agreed to be advanced
51 under such contract for a building loan to the extent of the amount
52 which shall be advanced by the holder of such bond and mortgage or such
53 note and mortgage to the trustee or trustees, or their successors, under
54 such assignment. The provisions of this section shall apply to all bonds
55 and mortgages and notes and mortgages and all assignments of moneys due,
56 or to become due under building loan contracts executed by such owner,
S. 1977--A 12
1 in like manner, and recorded or filed, from time to time as hereinbefore
2 provided. In case of an assignment to trustees under the provisions of
3 this section, the trustees and their successors shall be the agents of
4 the assignor to receive and receipt for any and all sums advanced by the
5 holder of the building loan bond and mortgage or the building loan note
6 and mortgage under the building loan contract and such assignment. No
7 lienor shall have any priority over the bond and mortgage or note and
8 mortgage given to secure the money agreed to be advanced under a build-
9 ing loan contract or over the advances made thereunder, by reason of any
10 act preceding the making and approval of such assignment.
11 § 15. Section 38 of the lien law, as amended by chapter 859 of the
12 laws of 1930, is amended to read as follows:
13 § 38. Itemized statement may be required of lienor. A lienor who has
14 filed a notice of mechanic's lien shall, on demand in writing, deliver
15 to the owner or contractor making such demand a statement in writing
16 which shall set forth the items of labor and/or material and the value
17 thereof which make up the amount for which he or she claims a lien, and
18 which shall also set forth the terms of the contract under which such
19 items were furnished. The statement shall be verified by the lienor or
20 his or her agent in the form required for the verification of notices in
21 section nine of this [chapter] article. If the lienor shall fail to
22 comply with such a demand within five days after the same shall have
23 been made by the owner or contractor, or if the lienor delivers an
24 insufficient statement, the person aggrieved may petition the supreme
25 court of this state or any justice thereof, or the county court of the
26 county where the premises are situated, or the county judge of such
27 county for an order directing the lienor within a time specified in the
28 order to deliver to the petitioner the statement required by this
29 section. Two days' notice in writing of such application shall be served
30 upon the lienor. Such service shall be made in the manner provided by
31 law for the personal service of a summons. The court or a justice or
32 judge thereof shall hear the parties and upon being satisfied that the
33 lienor has failed, neglected or refused to comply with the requirements
34 of this section shall have an appropriate order directing such compli-
35 ance. In case the lienor fails to comply with the order so made within
36 the time specified, then upon five days' notice to the lienor, served in
37 the manner provided by law for the personal service of a summons, the
38 court or a justice or judge thereof may make an order cancelling the
39 lien.
40 § 16. Section 39 of the lien law, as added by chapter 859 of the laws
41 of 1930, is amended to read as follows:
42 § 39. Lien wilfully exaggerated is void. In any action or proceeding
43 to enforce a mechanic's lien upon a private or public improvement or an
44 employee's lien, or in which the validity of the lien is an issue, if
45 the court shall find that a lienor has wilfully exaggerated the amount
46 for which he or she claims a lien as stated in his or her notice of
47 lien, [his] such lien shall be declared to be void and no recovery shall
48 be had thereon. No such lienor shall have a right to file any other or
49 further lien for the same claim. A second or subsequent lien filed in
50 contravention of this section may be vacated upon application to the
51 court on two days' notice.
52 § 17. Section 39-a of the lien law, as added by chapter 859 of the
53 laws of 1930, is amended to read as follows:
54 § 39-a. Liability of lienor where lien has been declared void on
55 account of wilful exaggeration. Where in any action or proceeding to
56 enforce a mechanic's lien upon a private or public improvement or an
S. 1977--A 13
1 employee's lien the court shall have declared said lien to be void on
2 account of wilful exaggeration the person filing such notice of lien
3 shall be liable in damages to the owner or contractor. The damages which
4 said owner or contractor shall be entitled to recover, shall include the
5 amount of any premium for a bond given to obtain the discharge of the
6 lien or the interest on any money deposited for the purpose of discharg-
7 ing the lien, reasonable attorney's fees for services in securing the
8 discharge of the lien, and, in an action or proceeding to enforce a
9 mechanic's lien, an amount equal to the difference by which the amount
10 claimed to be due or to become due as stated in the notice of lien
11 exceeded the amount actually due or to become due thereon.
12 § 18. Section 40 of the lien law, as amended by chapter 515 of the
13 laws of 1929, is amended to read as follows:
14 § 40. Construction of article. This article is to be construed in
15 connection with article two of this chapter, and provides proceedings
16 for the enforcement of employee's liens on real property, as well as
17 liens for labor performed and materials furnished in the improvement of
18 real property, created by virtue of such article.
19 § 19. Section 41 of the lien law, as amended by chapter 807 of the
20 laws of 1952, is amended to read as follows:
21 § 41. Enforcement of mechanic's or employee's lien on real property. A
22 mechanic's lien or employee's lien on real property may be enforced
23 against such property, and against a person liable for the debt upon
24 which the lien is founded, by an action, by the lienor, his or her
25 assignee or legal representative, in the supreme court or in a county
26 court otherwise having jurisdiction, regardless of the amount of such
27 debt, or in a court which has jurisdiction in an action founded on a
28 contract for a sum of money equivalent to the amount of such debt.
29 § 20. Section 43 of the lien law, as amended by chapter 310 of the
30 laws of 1962, is amended to read as follows:
31 § 43. Action in a court of record; consolidation of actions. The
32 provisions of the real property actions and proceedings law relating to
33 actions for the foreclosure of a mortgage upon real property, and the
34 sale and the distribution of the proceeds thereof apply to actions in a
35 court of record, to enforce mechanics' liens and employees' liens on
36 real property, except as otherwise provided in this article. If actions
37 are brought by different lienors in a court of record, the court in
38 which the first action was brought, may, upon its own motion, or upon
39 the application of any party in any of such actions, consolidate all of
40 such actions.
41 § 21. Section 46 of the lien law, as amended by chapter 515 of the
42 laws of 1929, is amended to read as follows:
43 § 46. Action in a court not of record. If an action to enforce a
44 mechanic's lien or employee's lien against real property is brought in a
45 court not of record, it shall be commenced by the personal service upon
46 the owner of a summons and complaint verified in the same manner as a
47 complaint in an action in a court of record. The complaint must set
48 forth substantially the facts contained in the notice of lien, and the
49 substance of the agreement under which the labor was performed or the
50 materials were furnished, or if the lien is based upon a wage claim as
51 defined in section two of this chapter, the basis for such wage claim.
52 The form and contents of the summons shall be the same as provided by
53 law for the commencement of an action upon a contract in such court. The
54 summons must be returnable not less than twelve nor more than twenty
55 days after the date of the summons, or if service is made by publica-
S. 1977--A 14
1 tion, after the day of the last publication of the summons. Service
2 must be made at least eight days before the return day.
3 § 22. Section 50 of the lien law, as amended by chapter 515 of the
4 laws of 1929, is amended to read as follows:
5 § 50. Execution. Execution may be issued upon a judgment obtained in
6 an action to enforce a mechanic's lien or an employee's lien against
7 real property in a court not of record, which shall direct the officer
8 to sell the title and interest of the owner in the premises, upon which
9 the lien set forth in the complaint existed at the time of filing the
10 notice of lien.
11 § 23. Section 53 of the lien law, as amended by chapter 515 of the
12 laws of 1929, is amended to read as follows:
13 § 53. Costs and disbursements. If an action is brought to enforce a
14 mechanic's lien or an employee's lien against real property in a court
15 of record, the costs and disbursements shall rest in the discretion of
16 the court, and may be awarded to the prevailing party. The judgment
17 rendered in such an action shall include the amount of such costs and
18 specify to whom and by whom the costs are to be paid. If such action is
19 brought in a court not of record, they shall be the same as allowed in
20 civil actions in such court. The expenses incurred in serving the
21 summons by publication may be added to the amount of costs now allowed
22 in such court.
23 § 24. Section 59 of the lien law, as amended by chapter 515 of the
24 laws of 1929, is amended to read as follows:
25 § 59. Vacating of a [mechanic's] lien; cancellation of bond; return of
26 deposit, by order of court. 1. A mechanic's lien notice of which has
27 been filed on real property or a bond given to discharge the same may be
28 vacated and cancelled or a deposit made to discharge a lien pursuant to
29 section twenty of this chapter may be returned, by an order of a court
30 of record. Before such order shall be granted, a notice shall be served
31 upon the lienor, either personally or by leaving it as his or her last
32 known place of residence, with a person of suitable age, with directions
33 to deliver it to the lienor. Such notice shall require the lienor to
34 commence an action to enforce the lien, within a time specified in the
35 notice, not less than thirty days from the time of service, or show
36 cause at a special term of a court of record, or at a county court, in a
37 county in which the property is situated, at a time and place specified
38 therein, why the notice of lien filed or the bond given should not be
39 vacated and cancelled, or the deposit returned, as the case may be.
40 Proof of such service and that the lienor has not commenced the action
41 to foreclose such lien, as directed in the notice, shall be made by
42 affidavit, at the time of applying for such order.
43 2. An employee's lien notice of which has been filed on real property
44 or a bond given to discharge the same may be vacated and cancelled or a
45 deposit made to discharge a lien pursuant to section twenty of this
46 chapter may be returned, by an order of a court of record. Before such
47 order shall be granted, a notice shall be served upon the lienor, either
48 personally or by leaving it at his or her last known place of residence
49 or attorney's place of business, with a person of suitable age, with
50 directions to deliver it to the lienor. Such notice shall require the
51 lienor to commence an action to enforce the lien, or to commence an
52 action to obtain judgment on the wage claim upon which the lien was
53 established, within a time specified in the notice, not less than thirty
54 days from the time of service, or show cause at a special term of a
55 court of record, or at a county court, in a county in which the property
56 is situated, at a time and place specified therein, why the notice of
S. 1977--A 15
1 lien filed or the bond given should not be vacated and cancelled, or the
2 deposit returned, as the case may be. Proof of such service and that the
3 lienor has not commenced the action to foreclose such lien or an action
4 to obtain judgment on the wage claim upon which the lien was estab-
5 lished, as directed in the notice, shall be made by affidavit, at the
6 time of applying for such order.
7 § 25. Section 62 of the lien law, as amended by chapter 697 of the
8 laws of 1934, is amended to read as follows:
9 § 62. Bringing in new parties. A lienor who has filed a notice of lien
10 after the commencement of an action in a court of record to foreclose or
11 enforce an employee's lien or a mechanic's lien against real property or
12 a public improvement, may at any time up to and including the day
13 preceding the day on which the trial of such action is commenced, make
14 application upon notice to the plaintiff or his or her attorney in such
15 action, to be made a party therein. Upon good cause shown, the court
16 must order such lienor to be brought in by amendment. If the application
17 is made by any other party in said action to make such lienor or other
18 person a party, the court may in its discretion direct such lienor or
19 other person to be brought in by like amendment. The order to be entered
20 on such application shall provide the time for and manner of serving the
21 pleading of such additional lienor or other person and shall direct that
22 the pleadings, papers and proceedings of the other several parties in
23 such action, shall be deemed amended, so as not to require the making or
24 serving of papers other than said order to effectuate such amendment,
25 and shall further provide that the allegations in the answer of such
26 additional lienor or other person shall, for the purposes of the action,
27 be deemed denied by the other parties therein. The action shall be so
28 conducted by the court as not to cause substantially any delay in the
29 trial thereof. The bringing in of such additional lienor or other
30 person shall be without prejudice to the proceedings had, and if the
31 action be on the calendar of the court, same shall retain its place on
32 such calendar without the necessity of serving a new note of issue and
33 new notices of trial.
34 § 26. Subdivision 3 of section 199-a of the labor law, as amended by
35 chapter 564 of the laws of 2010, is amended to read as follows:
36 3. Each employee and his or her authorized representative shall be
37 notified in writing, of the termination of the commissioner's investi-
38 gation of the employee's complaint and the result of such investigation,
39 of any award and collection of back wages and civil penalties, and of
40 any intent to seek criminal penalties. In the event that criminal penal-
41 ties are sought the employee and his or her authorized representative
42 shall be notified of the outcome of prosecution.
43 § 27. Subdivision 2 of section 663 of the labor law, as amended by
44 chapter 564 of the laws of 2010, is amended to read as follows:
45 2. By commissioner. On behalf of any employee paid less than the wage
46 to which the employee is entitled under the provisions of this article,
47 the commissioner may bring any legal action necessary, including admin-
48 istrative action, to collect such claim, and the employer shall be
49 required to pay the full amount of the underpayment, plus costs, and
50 unless the employer proves a good faith basis to believe that its under-
51 payment was in compliance with the law, an additional amount as liqui-
52 dated damages. Liquidated damages shall be calculated by the commission-
53 er as no more than one hundred percent of the total amount of
54 underpayments found to be due the employee. In any action brought by the
55 commissioner in a court of competent jurisdiction, liquidated damages
56 shall be calculated as an amount equal to one hundred percent of under-
S. 1977--A 16
1 payments found to be due the employee. Each employee or his or her
2 authorized representative shall be notified in writing of the outcome of
3 any legal action brought on the employee's behalf pursuant to this
4 section.
5 § 28. Subdivision 5 of section 6201 of the civil practice law and
6 rules, as amended by chapter 860 of the laws of 1977 and as renumbered
7 by chapter 618 of the laws of 1992, is amended and a new subdivision 6
8 is added to read as follows:
9 5. the cause of action is based on a judgment, decree or order of a
10 court of the United States or of any other court which is entitled to
11 full faith and credit in this state, or on a judgment which qualifies
12 for recognition under the provisions of article 53[.] of this chapter;
13 or
14 6. the cause of action is based on wage claims. "Wage claims," when
15 used in this chapter, shall include any claims of violations of articles
16 five, six, and nineteen of the labor law, section two hundred fifteen of
17 the labor law, and the related regulations or wage orders promulgated by
18 the commissioner of labor, including but not limited to any claims of
19 unpaid, minimum, overtime, and spread-of-hours pay, unlawfully retained
20 gratuities, unlawful deductions from wages, unpaid commissions, unpaid
21 benefits and wage supplements, and retaliation, and any claims pursuant
22 to 18 U.S.C. § 1595, 29 U.S.C. § 201 et seq., and/or employment contract
23 as well as the concomitant liquidated damages and penalties authorized
24 pursuant to the labor law, the Fair Labor Standards Act, or any employ-
25 ment contract.
26 § 29. Section 6210 of the civil practice law and rules, as added by
27 chapter 860 of the laws of 1977, is amended to read as follows:
28 § 6210. Order of attachment on notice; temporary restraining order;
29 contents. Upon a motion on notice for an order of attachment, the court
30 may, without notice to the defendant, grant a temporary restraining
31 order prohibiting the transfer of assets by a garnishee as provided in
32 subdivision (b) of section 6214. When attachment is sought pursuant to
33 subdivision six of section 6201, and if the employer contests the
34 motion, the court shall hold a hearing within ten days of when the
35 employer's response to plaintiffs' motion for attachment is due. The
36 contents of the order of attachment granted pursuant to this section
37 shall be as provided in subdivision (a) of section 6211.
38 § 30. Subdivision (b) of section 6211 of the civil practice law and
39 rules, as amended by chapter 566 of the laws of 1985, is amended to read
40 as follows:
41 (b) Confirmation of order. Except where an order of attachment is
42 granted on the ground specified in subdivision one or six of section
43 6201, an order of attachment granted without notice shall provide that
44 within a period not to exceed five days after levy, the plaintiff shall
45 move, on such notice as the court shall direct to the defendant, the
46 garnishee, if any, and the sheriff, for an order confirming the order of
47 attachment. Where an order of attachment without notice is granted on
48 the ground specified in subdivision one or six of section 6201, the
49 court shall direct that the statement required by section 6219 be served
50 within five days, that a copy thereof be served upon the plaintiff, and
51 the plaintiff shall move within ten days after levy for an order
52 confirming the order of attachment. If the plaintiff upon such motion
53 shall show that the statement has not been served and that the plaintiff
54 will be unable to satisfy the requirement of subdivision (b) of section
55 6223 until the statement has been served, the court may grant one exten-
56 sion of the time to move for confirmation for a period not to exceed ten
S. 1977--A 17
1 days. If plaintiff fails to make such motion within the required period,
2 the order of attachment and any levy thereunder shall have no further
3 effect and shall be vacated upon motion. Upon the motion to confirm, the
4 provisions of subdivision (b) of section 6223 shall apply. An order of
5 attachment granted without notice may provide that the sheriff refrain
6 from taking any property levied upon into his or her actual custody,
7 pending further order of the court.
8 § 31. Subdivisions (b) and (e) of rule 6212 of the civil practice law
9 and rules, subdivision (b) as separately amended by chapters 15 and 860
10 of the laws of 1977 and subdivision (e) as added by chapter 860 of the
11 laws of 1977, are amended to read as follows:
12 (b) Undertaking. [On] 1. Except where an order of attachment is sought
13 on the ground specified in subdivision six of section 6201, on a motion
14 for an order of attachment, the plaintiff shall give an undertaking, in
15 a total amount fixed by the court, but not less than five hundred
16 dollars, a specified part thereof conditioned that the plaintiff shall
17 pay to the defendant all costs and damages, including reasonable attor-
18 ney's fees, which may be sustained by reason of the attachment if the
19 defendant recovers judgment or if it is finally decided that the plain-
20 tiff was not entitled to an attachment of the defendant's property, and
21 the balance conditioned that the plaintiff shall pay to the sheriff all
22 of his or her allowable fees.
23 2. On a motion for an attachment pursuant to subdivision six of
24 section 6201, the court shall order that the plaintiff give an accessi-
25 ble undertaking of no more than five hundred dollars, or in the alterna-
26 tive, may waive the undertaking altogether. The attorney for the plain-
27 tiff shall not be liable to the sheriff for such fees. The surety on the
28 undertaking shall not be discharged except upon notice to the sheriff.
29 (e) Damages. [The] Except where an order of attachment is sought on
30 the ground specified in subdivision six of section 6201, the plaintiff
31 shall be liable to the defendant for all costs and damages, including
32 reasonable attorney's fees, which may be sustained by reason of the
33 attachment if the defendant recovers judgment, or if it is finally
34 decided that the plaintiff was not entitled to an attachment of the
35 defendant's property. Plaintiff's liability shall not be limited by the
36 amount of the undertaking.
37 § 32. Paragraph (b) of section 624 of the business corporation law, as
38 amended by chapter 449 of the laws of 1997, is amended to read as
39 follows:
40 (b) Any person who shall have been a shareholder of record of a corpo-
41 ration, or who is or shall have been a laborer, servant or employee,
42 upon at least five days' written demand shall have the right to examine
43 in person or by agent or attorney, during usual business hours, its
44 minutes of the proceedings of its shareholders and record of sharehold-
45 ers and to make extracts therefrom for any purpose reasonably related to
46 such person's interest as a shareholder, laborer, servant or employee,
47 provided the purpose reasonably related to a person's interest as a
48 laborer, servant or employee shall be to obtain the names, addresses,
49 and value of shareholders' interests in the corporation. Holders of
50 voting trust certificates representing shares of the corporation shall
51 be regarded as shareholders for the purpose of this section. Any such
52 agent or attorney shall be authorized in a writing that satisfies the
53 requirements of a writing under paragraph (b) of section 609 (Proxies).
54 A corporation requested to provide information pursuant to this para-
55 graph shall make available such information in written form and in any
56 other format in which such information is maintained by the corporation
S. 1977--A 18
1 and shall not be required to provide such information in any other
2 format. If a request made pursuant to this paragraph includes a request
3 to furnish information regarding beneficial owners, the corporation
4 shall make available such information in its possession regarding bene-
5 ficial owners as is provided to the corporation by a registered broker
6 or dealer or a bank, association or other entity that exercises fiduci-
7 ary powers in connection with the forwarding of information to such
8 owners. The corporation shall not be required to obtain information
9 about beneficial owners not in its possession.
10 § 33. Section 630 of the business corporation law, paragraph (a) as
11 amended by chapter 5 of the laws of 2016, paragraph (c) as amended by
12 chapter 746 of the laws of 1963, is amended to read as follows:
13 § 630. Liability of shareholders for wages due to laborers, servants or
14 employees.
15 (a) The ten largest shareholders, as determined by the fair value of
16 their beneficial interest as of the beginning of the period during which
17 the unpaid services referred to in this section are performed, of every
18 domestic corporation or of any foreign corporation, when the unpaid
19 services were performed in the state, no shares of which are listed on a
20 national securities exchange or regularly quoted in an over-the-counter
21 market by one or more members of a national or an affiliated securities
22 association, shall jointly and severally be personally liable for all
23 debts, wages or salaries due and owing to any of its laborers, servants
24 or employees other than contractors, for services performed by them for
25 such corporation. [Before such laborer, servant or employee shall charge
26 such shareholder for such services, he shall give notice in writing to
27 such shareholder that he intends to hold him liable under this section.
28 Such notice shall be given within one hundred and eighty days after
29 termination of such services, except that if, within such period, the
30 laborer, servant or employee demands an examination of the record of
31 shareholders under paragraph (b) of section 624 (Books and records;
32 right of inspection, prima facie evidence) of this article, such notice
33 may be given within sixty days after he has been given the opportunity
34 to examine the record of shareholders. An action to enforce such liabil-
35 ity shall be commenced within ninety days after the return of an
36 execution unsatisfied against the corporation upon a judgment recovered
37 against it for such services.] The provisions of this paragraph shall
38 not apply to an investment company registered as such under an act of
39 congress entitled "Investment Company Act of 1940."
40 (b) For the purposes of this section, wages or salaries shall mean all
41 compensation and benefits payable by an employer to or for the account
42 of the employee for personal services rendered by such employee includ-
43 ing any concomitant liquidated damages, penalties, interest, attorney's
44 fees or costs. These shall specifically include but not be limited to
45 salaries, overtime, vacation, holiday and severance pay; employer
46 contributions to or payments of insurance or welfare benefits; employer
47 contributions to pension or annuity funds; and any other moneys properly
48 due or payable for services rendered by such employee.
49 (c) A shareholder who has paid more than his or her pro rata share
50 under this section shall be entitled to contribution pro rata from the
51 other shareholders liable under this section with respect to the excess
52 so paid, over and above his or her pro rata share, and may sue them
53 jointly or severally or any number of them to recover the amount due
54 from them. Such recovery may be had in a separate action. As used in
55 this paragraph, "pro rata" means in proportion to beneficial share
56 interest. Before a shareholder may claim contribution from other share-
S. 1977--A 19
1 holders under this paragraph, he or she shall[, unless they have been
2 given notice by a laborer, servant or employee under paragraph (a),]
3 give them notice in writing that he or she intends to hold them so
4 liable to him or her. Such notice shall be given by him or her within
5 twenty days after the date that [notice was given to him by] he or she
6 became aware that a laborer, servant or employee may seek to hold him or
7 her liable under paragraph (a).
8 § 34. Subdivision (c) of section 609 of the limited liability company
9 law, as amended by chapter 620 of the laws of 2019, is amended to read
10 as follows:
11 (c) Notwithstanding the provisions of subdivisions (a) and (b) of this
12 section, the ten members with the largest percentage ownership interest,
13 as determined as of the beginning of the period during which the unpaid
14 services referred to in this section are performed, of every domestic
15 limited liability company, or of any foreign limited liability company,
16 when the unpaid services were performed in the state, shall jointly and
17 severally be personally liable for all debts, wages or salaries due and
18 owing to any of its laborers, servants or employees, for services
19 performed by them for such limited liability company. [Before such
20 laborer, servant or employee shall charge such member for such services,
21 he or she shall give notice in writing to such member that he or she
22 intends to hold such member liable under this section. Such notice shall
23 be given within one hundred eighty days after termination of such
24 services. An action to enforce such liability shall be commenced within
25 ninety days after the return of an execution unsatisfied against the
26 limited liability company upon a judgment recovered against it for such
27 services.] A member who has paid more than his or her pro rata share
28 under this section shall be entitled to contribution pro rata from the
29 other members liable under this section with respect to the excess so
30 paid, over and above his or her pro rata share, and may sue them jointly
31 or severally or any number of them to recover the amount due from them.
32 Such recovery may be had in a separate action. As used in this subdivi-
33 sion, "pro rata" means in proportion to percentage ownership interest.
34 Before a member may claim contribution from other members under this
35 section, he or she shall give them notice in writing that he or she
36 intends to hold them so liable to him or her.
37 § 35. Section 1102 of the limited liability company law is amended by
38 adding a new subdivision (e) to read as follows:
39 (e) Any person who is or shall have been a laborer, servant or employ-
40 ee of a limited liability company, upon at least five days' written
41 demand shall have the right to examine in person or by agent or attor-
42 ney, during usual business hours, records described in paragraph two of
43 subdivision (a) of this section throughout the period of time during
44 which such laborer, servant or employee provided services to such compa-
45 ny. A company requested to provide information pursuant to this subdivi-
46 sion shall make available such records in written form and in any other
47 format in which such information is maintained by the company and shall
48 not be required to provide such information in any other format. Upon
49 refusal by the company or by an officer or agent of the company to
50 permit an inspection of the records described in this subdivision, the
51 person making the demand for inspection may apply to the supreme court
52 in the judicial district where the office of the company is located,
53 upon such notice as the court may direct, for an order directing the
54 company, its members or managers to show cause why an order should not
55 be granted permitting such inspection by the applicant. Upon the return
56 day of the order to show cause, the court shall hear the parties summar-
S. 1977--A 20
1 ily, by affidavit or otherwise, and if it appears that the applicant is
2 qualified and entitled to such inspection, the court shall grant an
3 order compelling such inspection and awarding such further relief as to
4 the court may seem just and proper. If the applicant is found to be
5 qualified and entitled to such inspection, the company shall pay all
6 reasonable attorney's fees and costs of said applicant related to the
7 demand for inspection of the records.
8 § 36. This act shall take effect on the thirtieth day after it shall
9 have become a law. The procedures and rights created in this act may be
10 used by employees, laborers or servants in connection with claims for
11 liabilities that arose prior to the effective date of this act.
