Pay off a New York Judgment? Creditor is Obligated to File Satisfaction or Pay Penalty.

So your paychecks have been reduced by 10% (plus statutory interest and poundage fees) to pay off a judgment. Or, your creditor's lawyer seized your bank account bringing you to your knees forcing you to pay the full amount of a judgment[1]. Or, you've diligently complied with a settlement agreement and have paid off a judgment. Assuming you want move on – and not seek that money back – what are your rights in terms of ensuring that the court properly marks this judgment paid ("satisfied") so that you can move forward and ensure that your credit file is updated?

New York CPLR § 5020 answers this question. In short, when you have paid the entire judgment amount or even part[2] of it, the judgment creditor is required to execute and file a "satisfaction piece"[3] within 20 days. The judgment creditor must not only file the satisfaction in the home county where the judgment was entered, but also in each county where the judgment was docketed.

Within 10 days after its filing of the satisfaction in any applicable court, the judgment creditor is required to mail you a copy. CPLR § 5020a.

Any judgment creditor[4] who "refuses" to execute a satisfaction and/or file it is liable to you for a penalty of $100. While this penalty alone may not cause a judgment creditor a terrible degree of anxiety, this violation may be joined with potential violations of the Fair Debt Collection Practices Act, and who knows, may even save any claim you may have against the judgment creditor that may have otherwise been barred by the statute of limitations.

If you need help with addressing any judgment, or obtaining a satisfaction, call me immediately to discuss your options.



[1] Do not pay under these circumstances unless you've consulted me about the applicability of exemptions to potentially immunize that money.

[2] Partial satisfactions, however, do not require the judgment creditor to file partial satisfaction certificates in all counties where the judgment is docketed.

[3] A "satisfaction piece" is the full legal term describing the acknowledged instrument attesting to satisfaction.

[4] Any judgment creditor other than a city with a population exceeding million.

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