City Bar Calls for Reform of Process Service in New York City

May 2010

Regulatory offices, the judiciary, organized bars and the process service industry must work together to reform process service in New York City, states a new report prepared by the Committee on New York Civil Court and the Committee on Consumer Affairs. A recent law passed by the City Council took significant steps in cracking down on ‘sewer service,’ in which individuals facing court for consumer debt are not served their notice of appearance.  However, the City Bar proposes reforms that go beyond the City Council’s bill to include all parties involved in the process.

“The high default rate in consumer debt cases in New York City Civil Court, caused in large part by unlawful service of process, is nothing short of a miscarriage of justice,” states the report.  “In 2009, 66% of the 241,195 consumer debt cases initiated resulted in default judgments, often after ‘sewer service,’” according to the Report.  “As a result, each year tens of thousands of New York City residents are deprived of their due process right to be heard before judgments are issued against them, resulting in frozen bank accounts, ruined credit ratings, and other devastating consequences.”

The City Bar makes the following recommendations:
•    Increase enforcement by the New York City Department of Consumer Affairs (DCA), with an annual report on the industry and compliance with the law
•    A more active role by the judiciary in ensuring that process servers abide by the law, including creation of a standing task force on process service by the court system and DCA
•    Require law firms that file consumer debt lawsuits to exercise due diligence in determining the accuracy of a defendant’s address
•    Improve wages and labor law enforcement for process servers to eliminate the incentive to cut corners and violate the law
•    Require continuing education as a condition of license renewal

The report also congratulates the City for taking the following steps in the recently-passed legislation, which was supported by DCA:
•    Enacting a bonding requirement for process servers and process serving agencies
•    Requiring that applicants for process service licenses pass a qualifying exam
•    Implementing a global positioning system (GPS) requirement to verify process servers’ locations
•    Make process service companies accountable for the conduct of process servers they hire as employees or as independent contractors.

A copy of the full report is available here.

 

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