Out of state creditors can effectively litigate debt collection claims in New York State. The creditors need to be aware of specific legal issues that could arise when an out of state creditor litigates a claim in the New York Courts. An experienced New York debt collection litigation attorney is familiar with and knows how to effectively handle the specific complexities of the case.
Whether or not an out of state company is authorized “to do business” with the New York Secretary of State is at the heart of the matter. If the company is authorized, then, the case may be brought in the New York Courts without concern to this legal issue.
What happens when the creditor is NOT authorized with the New York Secretary of State? Perhaps your company is not “doing business” in New York State. You occasionally transact business and sell goods in New York and only a small percentage of your income is derived from customers in New York. Even though you are not authorized with the New York Secretary of State and do not pay New York Taxes, you can still maintain an action here under Long Jurisdiction (as long as the underlying transaction took place in New York). A New York debt collection litigation attorney can help you with this process.
The defendant/debtor may challenge the non-authorized creditor’s right to use the New York State Court claiming the creditor is in fact “doing business” (i.e. a high percentage of your company’s revenue is derived from New York customers). The defendant’s attorney may request that the Court require you to post a bond as security for costs and pay New York State Taxes to continue your case.
To discuss your claim and how the New York Business Corporation Law could affect the recovery of your NY debt collection litigation, please call FFGN at (212) 686-0100 or email jnager@ffgnesqs.com.
