Demand for payment from your customer can be made from anywhere in the world. But what happens when your customer refuses to make a deal with the collection firm to pay the balance owed on your commercial claim and you need to sue? Suing in New York is beneficial to the creditor. Unlike most states, attorneys in New York are able to enforce judgments with minimal Court intervention. So, how do you take advantage of New York’s “friendliness” to collect from your out of state customer in New York? Can you sue in New York?
Absent an agreement to the contrary, if you or your customer has a connection to New York or if the transaction arose in New York, you can sue in New York. However, suing and winning your case does not necessarily mean collecting the monies owed on your commercial claim. At the end of the day isn’t it all about collecting?
Case study: Our client, a New York company provided equipment and service to a new building in New Jersey. The request for services and equipment came from a New Jersey construction company. The New Jersey company was responsible for payment based upon the signed contract. Both the beneficiary of the contract, the new building and the non-paying construction company were located in New Jersey. Why then did our client choose to sue in New York on their commercial claim as opposed to going across the river to New Jersey?
The answer: convenience, inconvenience and identifiable assets in New York.
Convenience: Client is located in Queens, New York. Why take time out to travel to New Jersey to pursue a bad debt?
Inconvenience: Debtor is located in New Jersey. Have debtor secure counsel in New York and travel to New York to explain why he is not paying a debt just, due and owing.
Identifiable assets: The debtor maintains a bank account in New York. Client kept banking information from past payments which identified an asset in New York. Once judgment was entered we could restrain the bank account.
Debtor, although a New Jersey Corporation, does business in New York. We were able to confirm the names and locations of customers of the debtor construction company. Monies owed by third parties (customers) to the debtor can be restrained and paid to the creditor to be applied to the monies owed on the commercial claim.
If you or your non-paying customer is doing business in New York or if your non-paying customer has or may have assets in New York, consider suit in New York. The New York Courts have liberal policies regarding judgment enforcement allowing creditors maximum chances of recovery on commercial claims. If you are thinking of pursuing a customer for non-payment, call FFGN at (212) 686-0100 or email Jocelyn directly at JNager@ffgnesqs.com.