In order to go to trial in a debt collection case, a few things have to happen. Firstly, all parties must have joined in the case, meaning the defendants, after being served with a complaint, have had time to file an answer and request discovery, if any.
For those parties that are simply looking to stall, they may file an answer with a general denial for the purpose of delay.
Most often, discovery is straightforward, whereby the parties exchange information and documentation that may include: correspondence, statements, invoices, and any other documents relevant to the case. For example, if a company is looking to recover an amount due based on goods sold and delivered, the documents produced in discovery would most likely include purchase orders, invoices, proofs of delivery, demands for payments, and statements.
After documents are exchanged, the parties may conduct depositions, an oral testimony taken down by a court reporter, for clarification of the documents exchanged. After the transcripts of depositions are provided to the parties, more documents can be requested, if needed.
Once discovery is completed, the case can be certified that it is ready for trial. In the lower civil or district courts, it is not necessary for the court to review the case and approve that the case may proceed to trial. In the Supreme Court, the court determines the deadline for the parties to file a note of issue, which certifies that the case is ready to be placed on the trial track.
Once the appropriate form is filed with the court, here’s what happens next:
For Civil or District Court and All Lower Courts
In the civil court for which the jurisdictional limit will be raised to $50,000, some courts automatically send cases for money to arbitration for decision depending on the size of the claim. These cases are not decided by a judge. This is called mandatory arbitration.
The cases must only sue for money, like small claims cases. Cases asking to make someone do something, like return or fix something, do not go to arbitration. The amount of money must be $6,000 or less in a city or district court, or $10,000 or less in one of the boroughs of New York City Civil Court.
For claims higher than these amounts, the court sets a date for a pre-trial conference. In the event a party fails to appear at the conference, the other side may make an application for default, based upon the other side’s non-appearance, which is often granted. In other words, a plaintiff may “win” their case by default based upon a non-appearance of their debtor and proceed to enter judgment without trial.
If all sides appear, and the case can not be resolved, the judge will set a trial date usually within the next six months, and may also order when and how exhibits must be introduced.
For Supreme Court
In the Supreme Court, the process is a bit more complicated and depends upon which of the 62 counties in New York State your case is being heard. But generally, the process is as follows. Only cases that are defended can be tried. If the defendant did not put in an answer, and the plaintiff’s complaint is for a specific sum, then the plaintiff may simply forward a judgment on default to the court clerk for entry.
If the defendant did file an answer, in order to obtain a trial on a defended case – assuming there was discovery – the court would have set deadlines for the parties to file a note of issue. If there was no discovery and you wanted a trial, you would still file a note of issue but you would still need a judge to be assigned to the case.
Once the Note of Issue Is Filed
The Supreme Court will set the case down for a pre-trial or a settlement conference to see if the case can be resolved. Either way, an initial conference will be scheduled for the attorneys to appear to discuss the matter with the court attorney. Then assuming the case is not resolved upon discussion with the court attorney, the court will typically schedule it for an additional conference, with deadlines to exchange witness lists, and more. It should be noted that in the Supreme Court, regardless of county, each judge has their own rules as they relate to trial. Some order speedy schedules with strict deadlines, others do not and are more lenient. (This has certainly more been the trend during the COVID-19 pandemic). At the final conference, the judge and the parties will review each of the exhibits that the parties wish to propose to be introduced at trial and any possible objections to ensure a more efficient trial.
Some Supreme Court counties require mandatory mediation, while others do not. If the mediation fails then the mediator will simply mark the mediation as failed and it will be referred back to the judge for trial scheduling.
The fees are simple.
File the note of issue or notice of trial: $30 plus $95 for RJI (request for judicial intervention) to have a judge assigned. In a lower civil or district court: $40 for a notice of trial.
The process to obtain a trial in civil court is simple and can be quick, but waiting for a judgment can be slow and painstaking. Likewise, in the Supreme Court, the process is slow. But once a judgment is ordered by the judge, the time to obtain an entered judgment is speedy. Despite popular belief, a trial in a debt collection case is not desired. The desired goal is to remove the need for trial through motion practice and the like.
A trial is a serious investment in time by both the parties and their attorneys. That is true especially if you are the defendant defending the case and paying your attorney hourly. But, in some instances, when all else fails, a trial is necessary to move the case along towards a judgment in order to push the defendant to have to pay through execution on a judgment, or finally resolve the case voluntarily after the trial has concluded.
If you have a debt collection matter in need of resolution, contact Frank, Frank, Goldstein and Nager for a consultation.
