New York City Debt Collection Defense Attorney

Vacating a Default Judgment in New York: 8 Fine Points with Law

Receive notice of a wage garnishment? Is your bank account frozen?

Below are some points to consider when considering a motion to vacate (overturn) the judgment. Under that is the full text of the two main statutes in play: CPLR § 5015 and CPLR § 317. 

8 Points to Cover in Your Motion to Vacate a Default Judgment

  1. Although both statutes (CPLR §§ 5015 and 317) may not explicitly require showing a "meritorious defense," always raise as many defenses as possible to the underlying case. For example, did you pay all or part of the debt? Did you dispute the charges? Does a spouse owe it? Is it too old? Were you paying a settlement? Were you a victim of fraud or identity theft?
  2. Requiring a meritorious defense under both statutes is considered a "gloss added to the statutes by the courts."[1]
  3. Always provide a list of excuses and hardships for not defending your case. The more excuses, the better. You need to obtain leniency based on your excuses and hardships. See this blog post for a list of possible excuses.
  4. Time limits:
    • Under CPLR § 317, you must move to vacate the judgment within one year of obtaining "knowledge of the entry of the judgment." Be specific about why you did not receive "knowledge" of the judgment until later. For example, did you move? Were you traveling?
    • Under CPLR § 5015, a similar one-year deadline runs from when the plaintiff serves you a copy of the judgment with "written notice of its entry." This is harder to disprove if the plaintiff produces an affidavit of service showing such a mailing to your correct address. Produce all reasons you may not have received the mail.
    • Courts have discretionary authority to extend these one-year deadlines.
  5. It helps to attack the sufficiency of the plaintiff's papers in your motion to vacate. Always try to obtain the court file and challenge all weaknesses in the file. Is the plaintiff's witness affidavit suspiciously vague, odd, or untrustworthy? If the case was brought after October 1, 2014, does the plaintiff have all the required affidavits discussed in this blog post, "New York Court Rules will Undoubtedly Impact Debt-Litigation Market"?
  6. Does the plaintiff's papers accurately reflect a "sum certain" as discussed in this blog, "Smart Way to Attack your Creditor's Default Judgment: The Sum Certain Element." In other words, does the creditor's evidence have holes that create ambiguity or uncertainty?
  7. Could you point to some kind of fraud (perjured affidavit, maybe) serving as the basis to vacate under CPLR § 5015(a)(3)? The lesson here is that good investigation and good arguments go a long way when challenging creditors' —especially debt buyers'—default judgments.
  8. Do not forget to simply ask the plaintiff's attorney to "stipulate" (agree) to vacate the judgment and allow you to answer the complaint. That is provided for under CPLR § 5015(b) below. 

Ten Compelling Meritorious Defenses to Challenge a Default Judgment Under CPLR 5015

  1. Payment Proof: If you've paid all or part of the debt, provide documentation or evidence of payment.

  2. Disputed Charges: Present records or correspondence that demonstrate you disputed the charges for which you are being sued.

  3. Third-Party Responsibility: Show evidence that the debt is owed by a spouse or another party, not you.

  4. Statute of Limitations: Argue that the debt is too old to be collected based on New York's statute of limitations for debt collection.

  5. Settlement Compliance: If you were adhering to a settlement agreement, provide the terms and proof of compliance.

  6. Fraud or Identity Theft: Offer evidence if you were a victim of fraud or identity theft related to the debt in question.

  7. Excusable Neglect: Explain any reasonable excuse or hardship that prevented you from responding to the lawsuit, such as extended travel or relocation.

  8. Service Issues: Question the validity of the plaintiff's affidavit of service if there's reason to believe you did not receive proper notice.

  9. Insufficient Plaintiff Evidence: Scrutinize the plaintiff’s evidence and affidavits for vagueness or lack of trustworthiness, especially regarding the sum certain required for a default judgment.

  10. Procedural Fraud: Investigate and present any indications of fraud, such as perjured affidavits, which could be the basis to vacate the judgment under CPLR § 5015(a)(3).

Intake Form-The Langel Firm

The Five Legal Bases to Vacate a Judgment under CPLR § 5015

("Relief from Judgment or Order")

  1. Excusable default: Under NY CPLR 5015(a)(1), you can argue that the default was due to excusable neglect. This means you had a reasonable excuse for missing the deadline or not appearing. You will also need to demonstrate a meritorious defense of the action. The excuse for the default must be reasonable under the circumstances, such as an unexpected illness or an accident.

  2. Lack of jurisdiction: Under NY CPLR 5015(a)(4), you can argue that the court didn't have personal jurisdiction over you. This could occur, for instance, if you were improperly served with the summons and complaint.

  3. Newly Discovered Evidence: Under NY CPLR 5015(a)(2), you can argue that since the entry of a judgment, new evidence has been discovered which would probably change the outcome and which could not have been discovered in time to move for a new trial.

  4. Fraud, misrepresentation, or other misconduct of an adverse party: Under NY CPLR 5015(a)(3), you can argue that the judgment was procured by fraud, misrepresentation, or other misconduct of the adverse party. For example, this could involve situations where the opposing party deliberately lied about a critical fact.

  5. Reversal, modification or vacatur of a prior judgment or order: Under NY CPLR 5015(a)(5), you can argue that a prior judgment or order upon which the judgment is based has been reversed, vacated, or otherwise modified.

Below is the full text of the statutes discussed above:

CPLR § 5015. Relief from judgment or order (Actual Text)

(a) On motion. The court which rendered a judgment or order may relieve a party from it upon such terms as may be just, on motion of any interested person with such notice as the court may direct, upon the ground of:

  1. excusable default, if such motion is made within one year after service of a copy of the judgment or order with written notice of its entry upon the moving party, or, if the moving party has entered the judgment or order, within one year after such entry; or
  2. newly-discovered evidence which, if introduced at the trial, would probably have produced a different result and which could not have been discovered in time to move for a new trial under section 4404; or
  3. fraud, misrepresentation, or other misconduct of an adverse party; or
  4. lack of jurisdiction to render the judgment or order; or
  5. reversal, modification or vacatur of a prior judgment or order upon which it is based.

(b) On stipulation. The clerk of the court may vacate a default judgment entered pursuant to section 3215 upon the filing with him of a stipulation of consent to such vacatur by the parties personally or by their attorneys.

(c) On application of an administrative judge.  An administrative judge, upon a showing that default judgments were obtained by fraud, misrepresentation, illegality, unconscionability, lack of due service, violations of law, or other illegalities or where such default judgments were obtained in cases in which those defendants would be uniformly entitled to interpose a defense predicated upon but not limited to the foregoing defenses, and where such default judgments have been obtained in a number deemed sufficient by him to justify such action as set forth herein, and upon appropriate notice to counsel for the respective parties, or to the parties themselves, may bring a proceeding to relieve a party or parties from them upon such terms as may be just.  The disposition of any proceeding so instituted shall be determined by a judge other than the administrative judge.

(d) Restitution.  Where a judgment or order is set aside or vacated, the court may direct and enforce restitution in like manner and subject to the same conditions as where a judgment is reversed or modified on appeal.

§ 317. Defense by person to whom summons not personally delivered (Actual Text)

A person served with a summons other than by personal delivery to him or to his agent for service designated under rule 318, within or without the state, who does not appear may be allowed to defend the action within one year after he obtains knowledge of entry of the judgment, but in no event more than five years after such entry, upon a finding of the court that he did not personally receive notice of the summons in time to defend and has a meritorious defense. If the defense is successful, the court may direct and enforce restitution in the same manner and subject to the same conditions as where a judgment is reversed or modified on appeal. This section does not apply to an action for divorce, annulment or partition.

The Differences Between CPLR § 5015 and § 317

In New York, there are two primary legal pathways for vacating a default judgment when a defendant fails to appear in court: CPLR 5015(a)(1) and CPLR 317. While both require the defendant to show they have a valid defense, they differ in other requirements.

CPLR 5015(a)(1) necessitates a reasonable excuse for the absence, whereas CPLR 317 simply requires demonstrating lack of notice about the lawsuit due to alternate service methods, such as through the Secretary of State for corporations. For CPLR 317, the motion to vacate must be made within one year of learning about the judgment but not more than five years after its entry. Moreover, if the method of service is in question, CPLR 317 may provide a more lenient route for vacating the default.

Case Holdings for Reference:

  • CPLR 5015(a)(1) and 317 require a potentially meritorious defense: Progressive Casualty Insurance Co. v. Excel Products, Inc., 171 A.D.3d 812, 98 N.Y.S.3d 87 (2nd Dep't 2019).
  • Under CPLR 317, the defendant must not have received notice of the suit for the default to be vacated: HSBC Bank USA, N.A. v. Eliyahu, 170 A.D.3d 1130, 97 N.Y.S.3d 259 (2nd Dep't. 2019).
  • A mere denial of receipt of the summons and complaint is insufficient for CPLR 317: Dwyer Agency of Mahopac, LLC v. Dring Holding Corp., 164 A.D.3d 1214, 82 N.Y.S.3d 118 (2nd Dep't 2018).
  • The Secretary of State is not considered an “agent” for CPLR 317 purposes: Eugene Di Lorenzo, Inc. v. A.C. Dutton Lumber Co., Inc., 67 N.Y.2d 138, 501 N.Y.S.2d 8, 492 N.E.2d 116 (1986); Acqua Capital, LLC v. Camarella Contracting Co., Inc., 164 A.D.3d 1197, 82 N.Y.S.3d 122 (2nd Dep't 2018).
  • Deliberate avoidance of notice disqualifies a corporation from CPLR 317 relief: Pina v. Jobar, 104 A.D.3d 544, 961 N.Y.S.2d 150 (1st Dep't 2013).
  • Courts may treat motions as made under the appropriate statute regardless of citation: Eugene Di Lorenzo, Inc. v. A.C. Dutton Lumber Co., Inc., supra.
  • CPLR 5015(a)(4) cannot be applied sua sponte if lack of jurisdiction is claimed: Caba v. Rai, 63 A.D.3d 578, 882 N.Y.S.2d 56 (1st Dep't 2009).

By understanding these statutes and the relevant case law, parties can better navigate the process of contesting default judgments. Whether through CPLR 5015 or CPLR 317, presenting a solid defense and proving lack of proper notice are key to vacating a default judgment.