Bill Text: NY S07256 | 2019-2020 | General Assembly | Introduced
Bill Title: Relates to securing payment of wages for work already performed; creates a lien remedy for all employees; provides grounds for attachment; relates to procedures where employees may hold shareholders of non-publicly traded corporations personally liable for wage theft; relates to rights for victims of wage theft to hold the ten members with the largest ownership interests in a company personally liable for wage theft.
Spectrum: Partisan Bill (Democrat 15-0)
Status: (Engrossed - Dead) 2020-07-23 - referred to codes [S07256 Detail]
Download: New_York-2019-S07256-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 7256 IN SENATE January 14, 2020 ___________ Introduced by Sens. RAMOS, BAILEY, BIAGGI, GIANARIS, GOUNARDES, HOYLMAN, JACKSON, KRUEGER, LIU, RIVERA, SALAZAR, SANDERS, STAVISKY -- read twice and ordered printed, and when printed to be committed to the Committee on Judiciary AN ACT to amend the lien law, in relation to employee liens; to amend the labor law, in relation to employee complaints; to amend the civil practice law and rules, in relation to grounds for attachment; to amend the business corporation law, in relation to streamlining proce- dures where employees may hold shareholders of non-publicly traded corporations personally liable for wage theft; and to amend the limit- ed liability company law, in relation to creating a right for victims of wage theft to hold the ten members with the largest ownership interests in a company personally liable for wage theft The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 2 of the lien law is amended by adding three new 2 subdivisions 21, 22 and 23 to read as follows: 3 21. Employee. The term "employee", when used in this chapter, shall 4 have the same meaning as "employee" pursuant to articles one, six, nine- 5 teen and nineteen-A of the labor law, as applicable, or the Fair Labor 6 Standards Act, 29 U.S.C. § 201 et. seq., as applicable. 7 22. Employer. The term "employer", when used in this chapter, shall 8 have the same meaning as "employer" pursuant to articles one, six, nine- 9 teen and nineteen-A of the labor law, as applicable, or the Fair Labor 10 Standards Act, 29 U.S.C. § 201 et. seq., as applicable, except that the 11 term "employer" shall not include a governmental agency. 12 23. Wage claim. The term "wage claim", when used in this chapter, 13 means a claim that an employee has suffered a violation of sections one 14 hundred seventy, one hundred ninety-three, one hundred ninety-six-d, six 15 hundred fifty-two or six hundred seventy-three of the labor law or the 16 related regulations and wage orders promulgated by the commissioner, a 17 claim for wages due to an employee pursuant to an employment contract 18 that were unpaid in violation of that contract, or a claim that an 19 employee has suffered a violation of 29 U.S.C. § 206 or 207. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD00946-07-0S. 7256 2 1 § 2. Section 3 of the lien law, as amended by chapter 137 of the laws 2 of 1985, is amended to read as follows: 3 § 3. Mechanic's lien and employee's lien on [real] property. 1. 4 Mechanic's lien. A contractor, subcontractor, laborer, materialman, 5 landscape gardener, nurseryman or person or corporation selling fruit or 6 ornamental trees, roses, shrubbery, vines and small fruits, who performs 7 labor or furnishes materials for the improvement of real property with 8 the consent or at the request of the owner thereof, or of his agent, 9 contractor or subcontractor, and any trust fund to which benefits and 10 wage supplements are due or payable for the benefit of such laborers, 11 shall have a lien for the principal and interest, of the value, or the 12 agreed price, of such labor, including benefits and wage supplements due 13 or payable for the benefit of any laborer, or materials upon the real 14 property improved or to be improved and upon such improvement, from the 15 time of filing a notice of such lien as prescribed in this chapter. 16 Where the contract for an improvement is made with a husband or wife and 17 the property belongs to the other or both, the husband or wife contract- 18 ing shall also be presumed to be the agent of the other, unless such 19 other having knowledge of the improvement shall, within ten days after 20 learning of the contract give the contractor written notice of his or 21 her refusal to consent to the improvement. Within the meaning of the 22 provisions of this chapter, materials actually manufactured for but not 23 delivered to the real property, shall also be deemed to be materials 24 furnished. 25 2. Employee's lien. An employee who has a wage claim as that term is 26 defined in subdivision twenty-three of section two of this chapter shall 27 have a lien on his or her employer's interest in property for the value 28 of that employee's wage claim arising out of the employment, including 29 liquidated damages pursuant to subdivision one-a of section one hundred 30 ninety-eight, section six hundred sixty-three or section six hundred 31 eighty-one of the labor law, or 29 U.S.C. § 216 (b), from the time of 32 filing a notice of such lien as prescribed in this chapter. An employ- 33 ee's lien based on a wage claim may be had against the employer's inter- 34 est in real property and against the employer's interest in personal 35 property that can be sufficiently described within the meaning of 36 section 9-108 of the uniform commercial code, except that an employee's 37 lien shall not extend to deposit accounts or goods as those terms are 38 defined in section 9-102 of the uniform commercial code. The department 39 of labor and the attorney general may obtain an employee's lien for the 40 value of wage claims of the employees who are the subject of their 41 investigations, court actions or administrative agency actions. 42 3. As used in this article and unless otherwise specified, a lien 43 shall mean an employee's lien or a mechanic's lien. 44 § 3. Subdivisions 1 and 2 of section 4 of the lien law, subdivision 1 45 as amended by chapter 515 of the laws of 1929 and subdivision 2 as added 46 by chapter 704 of the laws of 1985, are amended to read as follows: 47 (1) [Such] A mechanic's or employee's lien and employee's lien against 48 real property shall extend to the owner's right, title or interest in 49 the real property and improvements, existing at the time of filing the 50 notice of lien, or thereafter acquired, except as hereinafter in this 51 article provided. If an owner assigns his interest in such real property 52 by a general assignment for the benefit of creditors, within thirty days 53 prior to such filing, the lien shall extend to the interest thus 54 assigned. If any part of the real property subjected to such lien be 55 removed by the owner or by any other person, at any time before the 56 discharge thereof, such removal shall not affect the rights of theS. 7256 3 1 lienor, either in respect to the remaining real property, or the part so 2 removed. If labor is performed for, or materials furnished to, a 3 contractor or subcontractor for an improvement, the mechanic's lien 4 shall not be for a sum greater than the sum earned and unpaid on the 5 contract at the time of filing the notice of lien, and any sum subse- 6 quently earned thereon. In no case shall the owner be liable to pay by 7 reason of all mechanic's liens created pursuant to this article a sum 8 greater than the value or agreed price of the labor and materials 9 remaining unpaid, at the time of filing notices of such liens, except as 10 hereinafter provided. 11 (2) [Such] A mechanic's or employee's lien shall not extend to the 12 owner's right, title or interest in real property and improvements, 13 existing at the time of filing the notice of lien if such lien arises 14 from the failure of a lessee of the right to explore, develop or produce 15 natural gas or oil, to pay for, compensate or render value for improve- 16 ments made with the consent or at the request of such lessee by a 17 contractor, subcontractor, materialman, equipment operator or owner, 18 landscaper, nurseryman, or person or corporation who performs labor or 19 furnishes materials for the exploration, development, or production of 20 oil or natural gas or otherwise improves such leased property. Such 21 mechanic's or employee's lien shall extend to the improvements made for 22 the exploration, development and production of oil and natural gas, and 23 the working interest held by a lessee of the right to explore, develop 24 or produce oil and natural gas. 25 § 4. The opening paragraph of section 4-a of the lien law, as amended 26 by chapter 696 of the laws of 1959, is amended to read as follows: 27 The proceeds of any insurance which by the terms of the policy are 28 payable to the owner of real property improved, and actually received or 29 to be received by him because of the destruction or removal by fire or 30 other casualty of an improvement on which lienors have performed labor 31 or services or for which they have furnished materials, or upon which an 32 employee has established an employee's lien, shall after the owner has 33 been reimbursed therefrom for premiums paid by him, if any, for such 34 insurance, be subject to liens provided by this act to the same extent 35 and in the same order of priority as the real property would have been 36 had such improvement not been so destroyed or removed. 37 § 5. Subdivisions 1, 2 and 5 of section 9 of the lien law, as amended 38 by chapter 515 of the laws of 1929, are amended to read as follows: 39 1. The name of the lienor, and either the residence of the lienor or 40 the name and business address of the lienor's attorney, if any; and if 41 the lienor is a partnership or a corporation, the business address of 42 such firm, or corporation, the names of partners and principal place of 43 business, and if a foreign corporation, its principal place of business 44 within the state. 45 2. The name of the owner of the [real] property against whose interest 46 therein a lien is claimed, and the interest of the owner as far as known 47 to the lienor. 48 5. The amount unpaid to the lienor for such labor or materials, or the 49 amount of the wage claim if a wage claim is the basis for establishment 50 of the lien, the items of the wage claim and the value thereof which 51 make up the amount for which the lienor claims a lien. 52 § 6. Subdivision 1 of section 10 of the lien law, as amended by chap- 53 ter 367 of the laws of 2011, is amended to read as follows: 54 1. (a) Notice of mechanic's lien may be filed at any time during the 55 progress of the work and the furnishing of the materials, or, within 56 eight months after the completion of the contract, or the final perform-S. 7256 4 1 ance of the work, or the final furnishing of the materials, dating from 2 the last item of work performed or materials furnished; provided, howev- 3 er, that where the improvement is related to real property improved or 4 to be improved with a single family dwelling, the notice of mechanic's 5 lien may be filed at any time during the progress of the work and the 6 furnishing of the materials, or, within four months after the completion 7 of the contract, or the final performance of the work, or the final 8 furnishing of the materials, dating from the last item of work performed 9 or materials furnished; and provided further where the notice of mechan- 10 ic's lien is for retainage, the notice of mechanic's lien may be filed 11 within ninety days after the date the retainage was due to be released; 12 except that in the case of a mechanic's lien by a real estate broker, 13 the notice of mechanic's lien may be filed only after the performance of 14 the brokerage services and execution of lease by both lessor and lessee 15 and only if a copy of the alleged written agreement of employment or 16 compensation is annexed to the notice of lien, provided that where the 17 payment pursuant to the written agreement of employment or compensation 18 is to be made in installments, then a notice of lien may be filed within 19 eight months after the final payment is due, but in no event later than 20 a date five years after the first payment was made. For purposes of this 21 section, the term "single family dwelling" shall not include a dwelling 22 unit which is a part of a subdivision that has been filed with a munici- 23 pality in which the subdivision is located when at the time the lien is 24 filed, such property in the subdivision is owned by the developer for 25 purposes other than his personal residence. For purposes of this 26 section, "developer" shall mean and include any private individual, 27 partnership, trust or corporation which improves two or more parcels of 28 real property with single family dwellings pursuant to a common scheme 29 or plan. [The] 30 (b) Notice of employee's lien may be filed at any time not later than 31 three years following the end of the employment giving rise to the wage 32 claim. 33 (c) A notice of lien, other than for a lien on personal property, must 34 be filed in the clerk's office of the county where the property is situ- 35 ated. If such property is situated in two or more counties, the notice 36 of lien shall be filed in the office of the clerk of each of such coun- 37 ties. The county clerk of each county shall provide and keep a book to 38 be called the "lien docket," which shall be suitably ruled in columns 39 headed "owners," "lienors," "lienor's attorney," "property," "amount," 40 "time of filing," "proceedings had," in each of which he shall enter the 41 particulars of the notice, properly belonging therein. The date, hour 42 and minute of the filing of each notice of lien shall be entered in the 43 proper column. Except where the county clerk maintains a block index, 44 the names of the owners shall be arranged in such book in alphabetical 45 order. The validity of the lien and the right to file a notice thereof 46 shall not be affected by the death of the owner before notice of the 47 lien is filed. A notice of employee's lien on personal property must be 48 filed, together with a financing statement, in the filing office as set 49 forth in section 9-501 of the uniform commercial code. 50 § 7. Section 11 of the lien law, as amended by chapter 147 of the laws 51 of 1996, is amended to read as follows: 52 § 11. Service of copy of notice of lien. 1. Within five days before 53 or thirty days after filing the notice of a mechanic's lien, the lienor 54 shall serve a copy of such notice upon the owner, if a natural person, 55 (a) by delivering the same to him personally, or if the owner cannot be 56 found, to his agent or attorney, or (b) by leaving it at his last knownS. 7256 5 1 place of residence in the city or town in which the real property or 2 some part thereof is situated, with a person of suitable age and 3 discretion, or (c) by registered or certified mail addressed to his last 4 known place of residence, or (d) if such owner has no such residence in 5 such city or town, or cannot be found, and he has no agent or attorney, 6 by affixing a copy thereof conspicuously on such property, between the 7 hours of nine o'clock in the forenoon and four o'clock in the afternoon; 8 if the owner be a corporation, said service shall be made (i) by deliv- 9 ering such copy to and leaving the same with the president, vice-presi- 10 dent, secretary or clerk to the corporation, the cashier, treasurer or a 11 director or managing agent thereof, personally, within the state, or 12 (ii) if such officer cannot be found within the state by affixing a copy 13 thereof conspicuously on such property between the hours of nine o'clock 14 in the forenoon and four o'clock in the afternoon, or (iii) by regis- 15 tered or certified mail addressed to its last known place of business. 16 Failure to file proof of such a service with the county clerk within 17 thirty-five days after the notice of lien is filed shall terminate the 18 notice as a lien. Until service of the notice has been made, as above 19 provided, an owner, without knowledge of the lien, shall be protected in 20 any payment made in good faith to any contractor or other person claim- 21 ing a lien. 22 2. Within five days before or thirty days after filing the notice of 23 an employee's lien, the lienor shall serve a copy of such notice upon 24 the employer, if a natural person, (a) by delivering the same to him 25 personally, or if the employer cannot be found, to his agent or attor- 26 ney, or (b) by leaving it as his last known place of residence or busi- 27 ness, with a person of suitable age and discretion, or (c) by registered 28 or certified mail addressed to his last known place of residence or 29 business, or (d) if such employer owns real property, by affixing a copy 30 thereof conspicuously on such property, between the hours of nine 31 o'clock in the forenoon and four o'clock in the afternoon. The lienor 32 also shall, within thirty days after filing the notice of employee's 33 lien, affix a copy thereof conspicuously on the real property identified 34 in the notice of employee's lien, between the hours of nine o'clock in 35 the forenoon and four o'clock in the afternoon. If the employer be a 36 corporation, said service shall be made (i) by delivering such copy to 37 and leaving the same with the president, vice-president, secretary or 38 clerk to the corporation, the cashier, treasurer or a director or manag- 39 ing agent thereof, personally, within the state, or (ii) if such officer 40 cannot be found within the state by affixing a copy thereof conspicuous- 41 ly on such property between the hours of nine o'clock in the forenoon 42 and four o'clock in the afternoon, or (iii) by registered or certified 43 mail addressed to its last known place of business, or (iv) by delivery 44 to the secretary of the department of state in the same manner as 45 required by subparagraph one of paragraph (b) of section three hundred 46 six of the business corporation law. Failure to file proof of such a 47 service with the county clerk within thirty-five days after the notice 48 of lien is filed shall terminate the notice as a lien. Until service of 49 the notice has been made, as above provided, an owner, without knowledge 50 of the lien, shall be protected in any payment made in good faith to any 51 other person claiming a lien. 52 § 8. Section 11-b of the lien law, as amended by chapter 147 of the 53 laws of 1996, is amended to read as follows: 54 § 11-b. Copy of notice of mechanic's lien to a contractor or subcon- 55 tractor. Within five days before or thirty days after filing a notice 56 of mechanic's lien in accordance with section ten of this chapter or theS. 7256 6 1 filing of an amendment of notice of mechanic's lien in accordance with 2 section twelve-a of this [chapter] article the lienor shall serve a copy 3 of such notice or amendment by certified mail on the contractor, subcon- 4 tractor, assignee or legal representative for whom he was employed or to 5 whom he furnished materials or if the lienor is a contractor or subcon- 6 tractor to the person, firm or corporation with whom the contract was 7 made. A lienor having a direct contractual relationship with a subcon- 8 tractor or a sub-subcontractor but not with a contractor shall also 9 serve a copy of such notice or amendment by certified mail to the 10 contractor. Failure to file proof of such a service with the county 11 clerk within thirty-five days after the notice of lien is filed shall 12 terminate the notice as a lien. Any lienor, or a person acting on behalf 13 of a lienor, who fails to serve a copy of the notice of mechanic's lien 14 as required by this section shall be liable for reasonable attorney's 15 fees, costs and expenses, as determined by the court, incurred in 16 obtaining such copy. 17 § 9. Subdivision 1 of section 12-a of the lien law, as amended by 18 chapter 1048 of the laws of 1971, is amended to read as follows: 19 1. Within sixty days after the original filing, a lienor may amend his 20 lien upon twenty days notice to existing lienors, mortgagees and the 21 owner, provided that no action or proceeding to enforce or cancel the 22 mechanics' lien or employee's lien has been brought in the interim, 23 where the purpose of the amendment is to reduce the amount of the lien, 24 except the question of wilful exaggeration shall survive such amendment. 25 § 10. Subdivision 1 of section 13 of the lien law, as amended by chap- 26 ter 878 of the laws of 1947, is amended to read as follows: 27 (1) [A] An employee's lien, or a lien for materials furnished or labor 28 performed in the improvement of real property, shall have priority over 29 a conveyance, mortgage, judgment or other claim against such property 30 not recorded, docketed or filed at the time of the filing of the notice 31 of such lien, except as hereinafter in this chapter provided; over 32 advances made upon any mortgage or other encumbrance thereon after such 33 filing, except as hereinafter in this article provided; and over the 34 claim of a creditor who has not furnished materials or performed labor 35 upon such property, if such property has been assigned by the owner by a 36 general assignment for the benefit of creditors, within thirty days 37 before the filing of either of such notices; and also over an attachment 38 hereafter issued or a money judgment hereafter recovered upon a claim, 39 which, in whole or in part, was not for materials furnished, labor 40 performed or moneys advanced for the improvement of such real property; 41 and over any claim or lien acquired in any proceedings upon such judg- 42 ment. Such liens shall also have priority over advances made upon a 43 contract by an owner for an improvement of real property which contains 44 an option to the contractor, his successor or assigns to purchase the 45 property, if such advances were made after the time when the labor began 46 or the first item of material was furnished, as stated in the notice of 47 lien. If several buildings are demolished, erected, altered or repaired, 48 or several pieces or parcels of real property are improved, under one 49 contract, and there are conflicting liens thereon, each lienor shall 50 have priority upon the particular part of the real property or upon the 51 particular building or premises where his labor is performed or his 52 materials are used. Persons shall have no priority on account of the 53 time of filing their respective notices of liens, but all liens shall be 54 on a parity except as hereinafter in section fifty-six of this chapter 55 provided; and except that in all cases laborers for daily or weeklyS. 7256 7 1 wages with a mechanic's lien, and employees with an employee's lien, 2 shall have preference over all other claimants under this article. 3 § 11. Section 17 of the lien law, as amended by chapter 324 of the 4 laws of 2000, is amended to read as follows: 5 § 17. Duration of lien. 1. (a) No mechanic's lien specified in this 6 article shall be a lien for a longer period than one year after the 7 notice of lien has been filed, unless within that time an action is 8 commenced to foreclose the lien, and a notice of the pendency of such 9 action, whether in a court of record or in a court not of record, is 10 filed with the county clerk of the county in which the notice of lien is 11 filed, containing the names of the parties to the action, the object of 12 the action, a brief description of the real property affected thereby, 13 and the time of filing the notice of lien; or unless an extension to 14 such lien, except for a lien on real property improved or to be improved 15 with a single family dwelling, is filed with the county clerk of the 16 county in which the notice of lien is filed within one year from the 17 filing of the original notice of lien, continuing such lien and such 18 lien shall be redocketed as of the date of filing such extension. Such 19 extension shall contain the names of the lienor and the owner of the 20 real property against whose interest therein such lien is claimed, a 21 brief description of the real property affected by such lien, the amount 22 of such lien, and the date of filing the notice of lien. No lien shall 23 be continued by such extension for more than one year from the filing 24 thereof. In the event an action is not commenced to foreclose the lien 25 within such extended period, such lien shall be extinguished unless an 26 order be granted by a court of record or a judge or justice thereof, 27 continuing such lien, and such lien shall be redocketed as of the date 28 of granting such order and a statement made that such lien is continued 29 by virtue of such order. A lien on real property improved or to be 30 improved with a single family dwelling may only be extended by an order 31 of a court of record, or a judge or justice thereof. No lien shall be 32 continued by court order for more than one year from the granting there- 33 of, but a new order and entry may be made in each of two successive 34 years. If a lienor is made a party defendant in an action to enforce 35 another lien, and the plaintiff or such defendant has filed a notice of 36 the pendency of the action within the time prescribed in this section, 37 the lien of such defendant is thereby continued. Such action shall be 38 deemed an action to enforce the lien of such defendant lienor. The fail- 39 ure to file a notice of pendency of action shall not abate the action as 40 to any person liable for the payment of the debt specified in the notice 41 of lien, and the action may be prosecuted to judgment against such 42 person. The provisions of this section in regard to continuing liens 43 shall apply to liens discharged by deposit or by order on the filing of 44 an undertaking. Where a lien is discharged by deposit or by order, a 45 notice of pendency of action shall not be filed. 46 (b) A lien, the duration of which has been extended by the filing of a 47 notice of the pendency of an action as above provided, shall neverthe- 48 less terminate as a lien after such notice has been canceled as provided 49 in section sixty-five hundred fourteen of the civil practice law and 50 rules or has ceased to be effective as constructive notice as provided 51 in section sixty-five hundred thirteen of the civil practice law and 52 rules. 53 2. (a) No employee's lien on real property shall be a lien for a long- 54 er period than one year after the notice of lien has been filed, unless 55 an extension to such lien is filed with the county clerk of the county 56 in which the notice of lien is filed within one year from the filing ofS. 7256 8 1 the original notice of lien, continuing such lien and such lien shall be 2 redocketed as of the date of filing such extension. Such extension shall 3 contain the names of the lienor and the owner of the real property 4 against whose interest therein such lien is claimed, a brief description 5 of the property affected by such lien, the amount of such lien, and the 6 date of filing the notice of lien. No lien shall be continued by such 7 extension for more than one year from the filing thereof. In the event 8 an action is not commenced to obtain judgment on the wage claim or to 9 foreclose the lien within such extended period, such lien shall be auto- 10 matically extinguished unless an order be granted by a court of record 11 or a judge or justice thereof, continuing such lien, and such lien shall 12 be redocketed as of the date of granting such order and a statement made 13 that such lien is continued by virtue of such order. 14 (b) No employee's lien on personal property shall be a lien for a 15 longer period than one year after the financing statement has been 16 recorded, unless an extension to such lien, is filed with the filing 17 office in which the financing statement is required to be filed pursuant 18 to section 9-501 of the uniform commercial code within one year from the 19 filing of the original financing statement, continuing such lien. Such 20 extension shall contain the names of the lienor and the owner of the 21 property against whose interest therein such lien is claimed, a brief 22 description of the prior financing statement to be extended, and the 23 date of filing the prior financing statement. No lien shall be contin- 24 ued by such extension for more than one year from the filing thereof. In 25 the event an action is not commenced to obtain judgment on the wage 26 claim or to foreclose the lien within such extended period, such lien 27 shall be automatically extinguished unless an order be granted by a 28 court of record or a judge or justice thereof, continuing such lien, and 29 such lien shall be refiled as of the date of granting such order and a 30 statement made that such lien is continued by virtue of such order. 31 (c) If a lienor is made a party defendant in an action to enforce 32 another lien, and the plaintiff or such defendant has filed a notice of 33 the pendency of the action within the time prescribed in this section, 34 the lien of such defendant is thereby continued. Such action shall be 35 deemed an action to enforce the lien of such defendant lienor. The fail- 36 ure to file a notice of pendency of action shall not abate the action as 37 to any person liable for the payment of the debt specified in the notice 38 of lien, and the action may be prosecuted to judgment against such 39 person. The provisions of this section in regard to continuing liens 40 shall apply to liens discharged by deposit or by order on the filing of 41 an undertaking. Where a lien is discharged by deposit or by order, a 42 notice of pendency of action shall not be filed. 43 (d) Notwithstanding the foregoing, if a lienor commences a foreclosure 44 action or an action to obtain a judgment on the wage claim within one 45 year from the filing of the notice of lien on real property or the 46 recording of the financing statement creating lien on personal property, 47 the lien shall be extended during the pendency of the action and for one 48 hundred twenty days following the entry of final judgment in such 49 action, unless the action results in a final judgment or administrative 50 order in the lienor's favor on the wage claims and the lienor commences 51 a foreclosure action, in which instance the lien shall be valid during 52 the pendency of the foreclosure action, provided, that the lien will be 53 automatically extinguished if, after a dismissal with prejudice of the 54 wage claims on which it is based, the lienor fails to file a notice of 55 appeal within the prescribed period to file a notice of appeal. If a 56 lien is extended due to the pendency of a foreclosure action or anS. 7256 9 1 action to obtain a judgment on the wage claim, the lienor shall file a 2 notice of such pendency and extension with the county clerk of the coun- 3 ty in which the notice of lien is filed, containing the names of the 4 parties to the action, the object of the action, a brief description of 5 the property affected thereby, and the time of filing the notice of 6 lien, or in the case of a lien on personal property shall file such 7 notice with the office authorized to accept financing statements pursu- 8 ant to section 9-501 of the uniform commercial code. For purposes of 9 this section, an action to obtain judgment on a wage claim includes an 10 action brought in any court of competent jurisdiction, the submission of 11 a complaint to the department of labor or the submission of a claim to 12 arbitration pursuant to an arbitration agreement. An action also 13 includes an investigation of wage claims by the commissioner of labor or 14 the attorney general of the state of New York, regardless of whether 15 such investigation was initiated by a complaint. 16 (e) A lien, the duration of which has been extended by the filing of a 17 notice of the pendency of an action as above provided, shall neverthe- 18 less terminate as a lien after such notice has been canceled as provided 19 in section sixty-five hundred fourteen of the civil practice law and 20 rules or has ceased to be effective as constructive notice as provided 21 in section sixty-five hundred thirteen of the civil practice law and 22 rules. 23 § 12. Subdivisions 2 and 4 of section 19 of the lien law, subdivision 24 2 as amended by chapter 310 of the laws of 1962, subdivision 4 as added 25 by chapter 582 of the laws of 2002 and paragraph a of subdivision 4 as 26 further amended by section 104 of part A of chapter 62 of the laws of 27 2011, are amended to read as follows: 28 (2) By failure to begin an action to foreclose such lien or to secure 29 an order continuing it, within one year from the time of filing the 30 notice of lien, unless (i) an action be begun within the same period to 31 foreclose a mortgage or another mechanic's lien upon the same property 32 or any part thereof and a notice of pendency of such action is filed 33 according to law, or (ii) an action is commenced to obtain a judgment on 34 a wage claim pursuant to subdivision two of section seventeen of this 35 article, but a lien, the duration of which has been extended by the 36 filing of a notice of the pendency of an action as herein provided, 37 shall nevertheless terminate as a lien after such notice has been 38 cancelled or has ceased to be effective as constructive notice. 39 (4) Either before or after the beginning of an action by the employer, 40 owner or contractor executing a bond or undertaking in an amount equal 41 to one hundred ten percent of such lien conditioned for the payment of 42 any judgment which may be rendered against the property or employer for 43 the enforcement of the lien: 44 a. The execution of any such bond or undertaking by any fidelity or 45 surety company authorized by the laws of this state to transact busi- 46 ness, shall be sufficient; and where a certificate of qualification has 47 been issued by the superintendent of financial services under the 48 provisions of section one thousand one hundred eleven of the insurance 49 law, and has not been revoked, no justification or notice thereof shall 50 be necessary. Any such company may execute any such bond or undertaking 51 as surety by the hand of its officers, or attorney, duly authorized 52 thereto by resolution of its board of directors, a certified copy of 53 which resolution, under the seal of said company, shall be filed with 54 each bond or undertaking. Any such bond or undertaking shall be filed 55 with the clerk of the county in which the notice of lien is filed, and a 56 copy shall be served upon the adverse party. The undertaking is effec-S. 7256 10 1 tive when so served and filed. If a certificate of qualification issued 2 pursuant to subsections (b), (c) and (d) of section one thousand one 3 hundred eleven of the insurance law is not filed with the undertaking, a 4 party may except, to the sufficiency of a surety and by a written notice 5 of exception served upon the adverse party within ten days after 6 receipt, a copy of the undertaking. Exceptions deemed by the court to 7 have been taken unnecessarily, or for vexation or delay, may, upon 8 notice, be set aside, with costs. Where no exception to sureties is 9 taken within ten days or where exceptions taken are set aside, the 10 undertaking shall be allowed. 11 b. In the case of bonds or undertakings not executed pursuant to para- 12 graph a of this subdivision, the employer, owner or contractor shall 13 execute an undertaking with two or more sufficient sureties, who shall 14 be free holders, to the clerk of the county where the premises are situ- 15 ated. The sureties must together justify in at least double the sum 16 named in the undertaking. A copy of the undertaking, with notice that 17 the sureties will justify before the court, or a judge or justice there- 18 of, at the time and place therein mentioned, must be served upon the 19 lienor or his attorney, not less than five days before such time. Upon 20 the approval of the undertaking by the court, judge or justice an order 21 shall be made by such court, judge or justice discharging such lien. 22 c. If the lienor cannot be found, or does not appear by attorney, 23 service under this subsection may be made by leaving a copy of such 24 undertaking and notice at the lienor's place of residence, or if a 25 corporation at its principal place of business within the state as stat- 26 ed in the notice of lien, with a person of suitable age and discretion 27 therein, or if the house of his abode or its place of business is not 28 stated in said notice of lien and is not known, then in such manner as 29 the court may direct. The premises, if any, described in the notice of 30 lien as the lienor's residence or place of business shall be deemed to 31 be his said residence or its place of business for the purposes of said 32 service at the time thereof, unless it is shown affirmatively that the 33 person servicing the papers or directing the service had knowledge to 34 the contrary. Notwithstanding the other provisions of this subdivision 35 relating to service of notice, in any case where the mailing address of 36 the lienor is outside the state such service may be made by registered 37 or certified mail, return receipt requested, to such lienor at the mail- 38 ing address contained in the notice of lien. 39 d. Except as otherwise provided in this subdivision, the provisions of 40 article twenty-five of the civil practice law and rules regulating 41 undertakings is applicable to a bond or undertaking given for the 42 discharge of a lien on account of private improvements or of an employ- 43 ee's lien. 44 § 13. Section 24 of the lien law, as amended by chapter 515 of the 45 laws of 1929, is amended to read as follows: 46 § 24. Enforcement of [mechanic's] lien. (1) Real property. The 47 [mechanics'] liens on real property specified in this article may be 48 enforced against the property specified in the notice of lien and which 49 is subject thereto and against any person liable for the debt upon which 50 the lien is founded, as prescribed in article three of this chapter. 51 (2) Personal property. An employee's lien on personal property speci- 52 fied in this article may immediately be enforced against the property 53 through a foreclosure as prescribed in article nine of the uniform 54 commercial code, or upon judgment obtained by the employee, commissioner 55 of labor or attorney general of the state of New York, may be enforcedS. 7256 11 1 in any manner available to the judgment creditor pursuant to article 2 nine of the uniform commercial code or other applicable laws. 3 § 14. Section 26 of the lien law, as amended by chapter 373 of the 4 laws of 1977, is amended to read as follows: 5 § 26. Subordination of liens after agreement with owner. In case an 6 owner of real property shall execute to one or more persons, or a corpo- 7 ration, as trustee or trustees, a bond and mortgage or a note and mort- 8 gage affecting such property in whole or in part, or an assignment of 9 the moneys due or to become due under a contract for a building loan in 10 relation to such property, and in case such mortgage, if any, shall be 11 recorded in the office of the register of the county where such real 12 property is situated, or if such county has no register then in the 13 office of the clerk of such county, and in case such assignment, if any, 14 shall be filed in the office of the clerk of the county where such real 15 property is situated; and in case lienors having [mechanics'] liens 16 against said real property, notices of which have been filed up to and 17 not later than fifteen days after the recording of such mortgage or the 18 filing of such assignment, and which liens have not been discharged as 19 in this article provided, shall, to the extent of at least fifty-five 20 per centum of the aggregate amount for which such notices of liens have 21 been so filed, approve such bond and mortgage or such note and mortgage, 22 if any, and such assignment, if any, by an instrument or instruments in 23 writing, duly acknowledged and filed in the office of such county clerk, 24 then all mechanics' liens for labor performed or material furnished 25 prior to the recording of such mortgage or filing of such assignment, 26 whether notices thereof have been theretofore or are thereafter filed 27 and which have not been discharged as in this article provided, shall be 28 subordinate to the lien of such trust bond and mortgage or such trust 29 note and mortgage to the extent of the aggregate amount of all certif- 30 icates of interest therein issued by such trustee or trustees, or their 31 successors, for moneys loaned, materials furnished, labor performed and 32 any other indebtedness incurred after said trust mortgage shall have 33 been recorded, and for expenses in connection with said trust mortgage, 34 and shall also be subordinate to the lien of the bond and mortgage or 35 note and mortgage, given to secure the amount agreed to be advanced 36 under such contract for a building loan to the extent of the amount 37 which shall be advanced by the holder of such bond and mortgage or such 38 note and mortgage to the trustee or trustees, or their successors, under 39 such assignment. The provisions of this section shall apply to all bonds 40 and mortgages and notes and mortgages and all assignments of moneys due, 41 or to become due under building loan contracts executed by such owner, 42 in like manner, and recorded or filed, from time to time as hereinbefore 43 provided. In case of an assignment to trustees under the provisions of 44 this section, the trustees and their successors shall be the agents of 45 the assignor to receive and receipt for any and all sums advanced by the 46 holder of the building loan bond and mortgage or the building loan note 47 and mortgage under the building loan contract and such assignment. No 48 lienor shall have any priority over the bond and mortgage or note and 49 mortgage given to secure the money agreed to be advanced under a build- 50 ing loan contract or over the advances made thereunder, by reason of any 51 act preceding the making and approval of such assignment. 52 § 15. Section 38 of the lien law, as amended by chapter 859 of the 53 laws of 1930, is amended to read as follows: 54 § 38. Itemized statement may be required of lienor. A lienor who has 55 filed a notice of mechanic's lien shall, on demand in writing, deliver 56 to the owner or contractor making such demand a statement in writingS. 7256 12 1 which shall set forth the items of labor and/or material and the value 2 thereof which make up the amount for which he claims a lien, and which 3 shall also set forth the terms of the contract under which such items 4 were furnished. The statement shall be verified by the lienor or his 5 agent in the form required for the verification of notices in section 6 nine of this [chapter] article. If the lienor shall fail to comply with 7 such a demand within five days after the same shall have been made by 8 the owner or contractor, or if the lienor delivers an insufficient 9 statement, the person aggrieved may petition the supreme court of this 10 state or any justice thereof, or the county court of the county where 11 the premises are situated, or the county judge of such county for an 12 order directing the lienor within a time specified in the order to 13 deliver to the petitioner the statement required by this section. Two 14 days' notice in writing of such application shall be served upon the 15 lienor. Such service shall be made in the manner provided by law for the 16 personal service of a summons. The court or a justice or judge thereof 17 shall hear the parties and upon being satisfied that the lienor has 18 failed, neglected or refused to comply with the requirements of this 19 section shall have an appropriate order directing such compliance. In 20 case the lienor fails to comply with the order so made within the time 21 specified, then upon five days' notice to the lienor, served in the 22 manner provided by law for the personal service of a summons, the court 23 or a justice or judge thereof may make an order cancelling the lien. 24 § 16. Section 39 of the lien law, as added by chapter 859 of the laws 25 of 1930, is amended to read as follows: 26 § 39. Lien wilfully exaggerated is void. In any action or proceeding 27 to enforce a mechanic's lien upon a private or public improvement or an 28 employee's lien, or in which the validity of the lien is an issue, if 29 the court shall find that a lienor has wilfully exaggerated the amount 30 for which he claims a lien as stated in his notice of lien, his lien 31 shall be declared to be void and no recovery shall be had thereon. No 32 such lienor shall have a right to file any other or further lien for the 33 same claim. A second or subsequent lien filed in contravention of this 34 section may be vacated upon application to the court on two days' 35 notice. 36 § 17. Section 39-a of the lien law, as added by chapter 859 of the 37 laws of 1930, is amended to read as follows: 38 § 39-a. Liability of lienor where lien has been declared void on 39 account of wilful exaggeration. Where in any action or proceeding to 40 enforce a mechanic's lien upon a private or public improvement or an 41 employee's lien the court shall have declared said lien to be void on 42 account of wilful exaggeration the person filing such notice of lien 43 shall be liable in damages to the owner or contractor. The damages which 44 said owner or contractor shall be entitled to recover, shall include the 45 amount of any premium for a bond given to obtain the discharge of the 46 lien or the interest on any money deposited for the purpose of discharg- 47 ing the lien, reasonable attorney's fees for services in securing the 48 discharge of the lien, and, in an action or proceeding to enforce a 49 mechanic's lien, an amount equal to the difference by which the amount 50 claimed to be due or to become due as stated in the notice of lien 51 exceeded the amount actually due or to become due thereon. 52 § 18. Section 40 of the lien law, as amended by chapter 515 of the 53 laws of 1929, is amended to read as follows: 54 § 40. Construction of article. This article is to be construed in 55 connection with article two of this chapter, and provides proceedings 56 for the enforcement of employee's liens on real property, as well asS. 7256 13 1 liens for labor performed and materials furnished in the improvement of 2 real property, created by virtue of such article. 3 § 19. Section 41 of the lien law, as amended by chapter 807 of the 4 laws of 1952, is amended to read as follows: 5 § 41. Enforcement of mechanic's or employee's lien on real property. A 6 mechanic's lien or employee's lien on real property may be enforced 7 against such property, and against a person liable for the debt upon 8 which the lien is founded, by an action, by the lienor, his assignee or 9 legal representative, in the supreme court or in a county court other- 10 wise having jurisdiction, regardless of the amount of such debt, or in a 11 court which has jurisdiction in an action founded on a contract for a 12 sum of money equivalent to the amount of such debt. 13 § 20. Section 43 of the lien law, as amended by chapter 310 of the 14 laws of 1962, is amended to read as follows: 15 § 43. Action in a court of record; consolidation of actions. The 16 provisions of the real property actions and proceedings law relating to 17 actions for the foreclosure of a mortgage upon real property, and the 18 sale and the distribution of the proceeds thereof apply to actions in a 19 court of record, to enforce mechanics' liens and employees' liens on 20 real property, except as otherwise provided in this article. If actions 21 are brought by different lienors in a court of record, the court in 22 which the first action was brought, may, upon its own motion, or upon 23 the application of any party in any of such actions, consolidate all of 24 such actions. 25 § 21. Section 46 of the lien law, as amended by chapter 515 of the 26 laws of 1929, is amended to read as follows: 27 § 46. Action in a court not of record. If an action to enforce a 28 mechanic's lien or employee's lien against real property is brought in a 29 court not of record, it shall be commenced by the personal service upon 30 the owner of a summons and complaint verified in the same manner as a 31 complaint in an action in a court of record. The complaint must set 32 forth substantially the facts contained in the notice of lien, and the 33 substance of the agreement under which the labor was performed or the 34 materials were furnished, or if the lien is based upon a wage claim as 35 defined in section two of this chapter, the basis for such wage claim. 36 The form and contents of the summons shall be the same as provided by 37 law for the commencement of an action upon a contract in such court. The 38 summons must be returnable not less than twelve nor more than twenty 39 days after the date of the summons, or if service is made by publica- 40 tion, after the day of the last publication of the summons. Service 41 must be made at least eight days before the return day. 42 § 22. Section 50 of the lien law, as amended by chapter 515 of the 43 laws of 1929, is amended to read as follows: 44 § 50. Execution. Execution may be issued upon a judgment obtained in 45 an action to enforce a mechanic's lien or an employee's lien against 46 real property in a court not of record, which shall direct the officer 47 to sell the title and interest of the owner in the premises, upon which 48 the lien set forth in the complaint existed at the time of filing the 49 notice of lien. 50 § 23. Section 53 of the lien law, as amended by chapter 515 of the 51 laws of 1929, is amended to read as follows: 52 § 53. Costs and disbursements. If an action is brought to enforce a 53 mechanic's lien or an employee's lien against real property in a court 54 of record, the costs and disbursements shall rest in the discretion of 55 the court, and may be awarded to the prevailing party. The judgment 56 rendered in such an action shall include the amount of such costs andS. 7256 14 1 specify to whom and by whom the costs are to be paid. If such action is 2 brought in a court not of record, they shall be the same as allowed in 3 civil actions in such court. The expenses incurred in serving the 4 summons by publication may be added to the amount of costs now allowed 5 in such court. 6 § 24. Section 59 of the lien law, as amended by chapter 515 of the 7 laws of 1929, is amended to read as follows: 8 § 59. Vacating of a [mechanic's] lien; cancellation of bond; return of 9 deposit, by order of court. 1. A mechanic's lien notice of which has 10 been filed on real property or a bond given to discharge the same may be 11 vacated and cancelled or a deposit made to discharge a lien pursuant to 12 section twenty of this chapter may be returned, by an order of a court 13 of record. Before such order shall be granted, a notice shall be served 14 upon the lienor, either personally or by leaving it as his last known 15 place of residence, with a person of suitable age, with directions to 16 deliver it to the lienor. Such notice shall require the lienor to 17 commence an action to enforce the lien, within a time specified in the 18 notice, not less than thirty days from the time of service, or show 19 cause at a special term of a court of record, or at a county court, in a 20 county in which the property is situated, at a time and place specified 21 therein, why the notice of lien filed or the bond given should not be 22 vacated and cancelled, or the deposit returned, as the case may be. 23 Proof of such service and that the lienor has not commenced the action 24 to foreclose such lien, as directed in the notice, shall be made by 25 affidavit, at the time of applying for such order. 26 2. An employee's lien notice of which has been filed on real property 27 or a bond given to discharge the same may be vacated and cancelled or a 28 deposit made to discharge a lien pursuant to section twenty of this 29 chapter may be returned, by an order of a court of record. Before such 30 order shall be granted, a notice shall be served upon the lienor, either 31 personally or by leaving it at his last known place of residence or 32 attorney's place of business, with a person of suitable age, with 33 directions to deliver it to the lienor. Such notice shall require the 34 lienor to commence an action to enforce the lien, or to commence an 35 action to obtain judgment on the wage claim upon which the lien was 36 established, within a time specified in the notice, not less than thirty 37 days from the time of service, or show cause at a special term of a 38 court of record, or at a county court, in a county in which the property 39 is situated, at a time and place specified therein, why the notice of 40 lien filed or the bond given should not be vacated and cancelled, or the 41 deposit returned, as the case may be. Proof of such service and that the 42 lienor has not commenced the action to foreclose such lien or an action 43 to obtain judgment on the wage claim upon which the lien was estab- 44 lished, as directed in the notice, shall be made by affidavit, at the 45 time of applying for such order. 46 § 25. Section 62 of the lien law, as amended by chapter 697 of the 47 laws of 1934, is amended to read as follows: 48 § 62. Bringing in new parties. A lienor who has filed a notice of lien 49 after the commencement of an action in a court of record to foreclose or 50 enforce an employee's lien or a mechanic's lien against real property or 51 a public improvement, may at any time up to and including the day 52 preceding the day on which the trial of such action is commenced, make 53 application upon notice to the plaintiff or his attorney in such action, 54 to be made a party therein. Upon good cause shown, the court must order 55 such lienor to be brought in by amendment. If the application is made by 56 any other party in said action to make such lienor or other person aS. 7256 15 1 party, the court may in its discretion direct such lienor or other 2 person to be brought in by like amendment. The order to be entered on 3 such application shall provide the time for and manner of serving the 4 pleading of such additional lienor or other person and shall direct that 5 the pleadings, papers and proceedings of the other several parties in 6 such action, shall be deemed amended, so as not to require the making or 7 serving of papers other than said order to effectuate such amendment, 8 and shall further provide that the allegations in the answer of such 9 additional lienor or other person shall, for the purposes of the action, 10 be deemed denied by the other parties therein. The action shall be so 11 conducted by the court as not to cause substantially any delay in the 12 trial thereof. The bringing in of such additional lienor or other 13 person shall be without prejudice to the proceedings had, and if the 14 action be on the calendar of the court, same shall retain its place on 15 such calendar without the necessity of serving a new note of issue and 16 new notices of trial. 17 § 26. Subdivision 3 of section 199-a of the labor law, as amended by 18 chapter 564 of the laws of 2010, is amended to read as follows: 19 3. Each employee and his or her authorized representative shall be 20 notified in writing, of the termination of the commissioner's investi- 21 gation of the employee's complaint and the result of such investigation, 22 of any award and collection of back wages and civil penalties, and of 23 any intent to seek criminal penalties. In the event that criminal penal- 24 ties are sought the employee and his or her authorized representative 25 shall be notified of the outcome of prosecution. 26 § 27. Subdivision 2 of section 663 of the labor law, as amended by 27 chapter 564 of the laws of 2010, is amended to read as follows: 28 2. By commissioner. On behalf of any employee paid less than the wage 29 to which the employee is entitled under the provisions of this article, 30 the commissioner may bring any legal action necessary, including admin- 31 istrative action, to collect such claim, and the employer shall be 32 required to pay the full amount of the underpayment, plus costs, and 33 unless the employer proves a good faith basis to believe that its under- 34 payment was in compliance with the law, an additional amount as liqui- 35 dated damages. Liquidated damages shall be calculated by the commission- 36 er as no more than one hundred percent of the total amount of 37 underpayments found to be due the employee. In any action brought by the 38 commissioner in a court of competent jurisdiction, liquidated damages 39 shall be calculated as an amount equal to one hundred percent of under- 40 payments found to be due the employee. Each employee or his or her 41 authorized representative shall be notified in writing of the outcome of 42 any legal action brought on the employee's behalf pursuant to this 43 section. 44 § 28. Subdivision 5 of section 6201 of the civil practice law and 45 rules, as amended by chapter 860 of the laws of 1977 and as renumbered 46 by chapter 618 of the laws of 1992, is amended and a new subdivision 6 47 is added to read as follows: 48 5. the cause of action is based on a judgment, decree or order of a 49 court of the United States or of any other court which is entitled to 50 full faith and credit in this state, or on a judgment which qualifies 51 for recognition under the provisions of article 53[.] of this chapter; 52 or 53 6. the cause of action is based on wage claims. "Wage claims," when 54 used in this chapter, shall include any claims of violations of articles 55 five, six, and nineteen of the labor law, section two hundred fifteen of 56 the labor law, and the related regulations or wage orders promulgated byS. 7256 16 1 the commissioner of labor, including but not limited to any claims of 2 unpaid, minimum, overtime, and spread-of-hours pay, unlawfully retained 3 gratuities, unlawful deductions from wages, unpaid commissions, unpaid 4 benefits and wage supplements, and retaliation, and any claims pursuant 5 to 18 U.S.C. § 1595, 29 U.S.C. § 201 et seq., and/or employment contract 6 as well as the concomitant liquidated damages and penalties authorized 7 pursuant to the labor law, the Fair Labor Standards Act, or any employ- 8 ment contract. 9 § 29. Section 6210 of the civil practice law and rules, as added by 10 chapter 860 of the laws of 1977, is amended to read as follows: 11 § 6210. Order of attachment on notice; temporary restraining order; 12 contents. Upon a motion on notice for an order of attachment, the court 13 may, without notice to the defendant, grant a temporary restraining 14 order prohibiting the transfer of assets by a garnishee as provided in 15 subdivision (b) of section 6214. When attachment is sought pursuant to 16 subdivision six of section 6201, and if the employer contests the 17 motion, the court shall hold a hearing within ten days of when the 18 employer's response to plaintiffs' motion for attachment is due. The 19 contents of the order of attachment granted pursuant to this section 20 shall be as provided in subdivision (a) of section 6211. 21 § 30. Subdivision (b) of section 6211 of the civil practice law and 22 rules, as amended by chapter 566 of the laws of 1985, is amended to read 23 as follows: 24 (b) Confirmation of order. Except where an order of attachment is 25 granted on the ground specified in subdivision one or six of section 26 6201, an order of attachment granted without notice shall provide that 27 within a period not to exceed five days after levy, the plaintiff shall 28 move, on such notice as the court shall direct to the defendant, the 29 garnishee, if any, and the sheriff, for an order confirming the order of 30 attachment. Where an order of attachment without notice is granted on 31 the ground specified in subdivision one or six of section 6201, the 32 court shall direct that the statement required by section 6219 be served 33 within five days, that a copy thereof be served upon the plaintiff, and 34 the plaintiff shall move within ten days after levy for an order 35 confirming the order of attachment. If the plaintiff upon such motion 36 shall show that the statement has not been served and that the plaintiff 37 will be unable to satisfy the requirement of subdivision (b) of section 38 6223 until the statement has been served, the court may grant one exten- 39 sion of the time to move for confirmation for a period not to exceed ten 40 days. If plaintiff fails to make such motion within the required period, 41 the order of attachment and any levy thereunder shall have no further 42 effect and shall be vacated upon motion. Upon the motion to confirm, the 43 provisions of subdivision (b) of section 6223 shall apply. An order of 44 attachment granted without notice may provide that the sheriff refrain 45 from taking any property levied upon into his actual custody, pending 46 further order of the court. 47 § 31. Subdivisions (b) and (e) of rule 6212 of the civil practice law 48 and rules, subdivision (b) as separately amended by chapters 15 and 860 49 of the laws of 1977 and subdivision (e) as added by chapter 860 of the 50 laws of 1977, are amended to read as follows: 51 (b) Undertaking. [On] 1. Except where an order of attachment is sought 52 on the ground specified in subdivision six of section 6201, on a motion 53 for an order of attachment, the plaintiff shall give an undertaking, in 54 a total amount fixed by the court, but not less than five hundred 55 dollars, a specified part thereof conditioned that the plaintiff shall 56 pay to the defendant all costs and damages, including reasonable attor-S. 7256 17 1 ney's fees, which may be sustained by reason of the attachment if the 2 defendant recovers judgment or if it is finally decided that the plain- 3 tiff was not entitled to an attachment of the defendant's property, and 4 the balance conditioned that the plaintiff shall pay to the sheriff all 5 of his allowable fees. 6 2. On a motion for an attachment pursuant to subdivision six of 7 section 6201, the court shall order that the plaintiff give an accessi- 8 ble undertaking of no more than five hundred dollars, or in the alterna- 9 tive, may waive the undertaking altogether. The attorney for the plain- 10 tiff shall not be liable to the sheriff for such fees. The surety on the 11 undertaking shall not be discharged except upon notice to the sheriff. 12 (e) Damages. [The] Except where an order of attachment is sought on 13 the ground specified in subdivision six of section 6201, the plaintiff 14 shall be liable to the defendant for all costs and damages, including 15 reasonable attorney's fees, which may be sustained by reason of the 16 attachment if the defendant recovers judgment, or if it is finally 17 decided that the plaintiff was not entitled to an attachment of the 18 defendant's property. Plaintiff's liability shall not be limited by the 19 amount of the undertaking. 20 § 32. Paragraph (b) of section 624 of the business corporation law, as 21 amended by chapter 449 of the laws of 1997, is amended to read as 22 follows: 23 (b) Any person who shall have been a shareholder of record of a corpo- 24 ration, or who is or shall have been a laborer, servant or employee, 25 upon at least five days' written demand shall have the right to examine 26 in person or by agent or attorney, during usual business hours, its 27 minutes of the proceedings of its shareholders and record of sharehold- 28 ers and to make extracts therefrom for any purpose reasonably related to 29 such person's interest as a shareholder, laborer, servant or employee, 30 provided the purpose reasonably related to a person's interest as a 31 laborer, servant or employee shall be to obtain the names, addresses, 32 and value of shareholders' interests in the corporation. Holders of 33 voting trust certificates representing shares of the corporation shall 34 be regarded as shareholders for the purpose of this section. Any such 35 agent or attorney shall be authorized in a writing that satisfies the 36 requirements of a writing under paragraph (b) of section 609 (Proxies). 37 A corporation requested to provide information pursuant to this para- 38 graph shall make available such information in written form and in any 39 other format in which such information is maintained by the corporation 40 and shall not be required to provide such information in any other 41 format. If a request made pursuant to this paragraph includes a request 42 to furnish information regarding beneficial owners, the corporation 43 shall make available such information in its possession regarding bene- 44 ficial owners as is provided to the corporation by a registered broker 45 or dealer or a bank, association or other entity that exercises fiduci- 46 ary powers in connection with the forwarding of information to such 47 owners. The corporation shall not be required to obtain information 48 about beneficial owners not in its possession. 49 § 33. Section 630 of the business corporation law, paragraph (a) as 50 amended by chapter 5 of the laws of 2016, paragraph (c) as amended by 51 chapter 746 of the laws of 1963, is amended to read as follows: 52 § 630. Liability of shareholders for wages due to laborers, servants or 53 employees. 54 (a) The ten largest shareholders, as determined by the fair value of 55 their beneficial interest as of the beginning of the period during which 56 the unpaid services referred to in this section are performed, of everyS. 7256 18 1 domestic corporation or of any foreign corporation, when the unpaid 2 services were performed in the state, no shares of which are listed on a 3 national securities exchange or regularly quoted in an over-the-counter 4 market by one or more members of a national or an affiliated securities 5 association, shall jointly and severally be personally liable for all 6 debts, wages or salaries due and owing to any of its laborers, servants 7 or employees other than contractors, for services performed by them for 8 such corporation. [Before such laborer, servant or employee shall charge9such shareholder for such services, he shall give notice in writing to10such shareholder that he intends to hold him liable under this section.11Such notice shall be given within one hundred and eighty days after12termination of such services, except that if, within such period, the13laborer, servant or employee demands an examination of the record of14shareholders under paragraph (b) of section 624 (Books and records;15right of inspection, prima facie evidence) of this article, such notice16may be given within sixty days after he has been given the opportunity17to examine the record of shareholders. An action to enforce such liabil-18ity shall be commenced within ninety days after the return of an19execution unsatisfied against the corporation upon a judgment recovered20against it for such services.] The provisions of this paragraph shall 21 not apply to an investment company registered as such under an act of 22 congress entitled "Investment Company Act of 1940." 23 (b) For the purposes of this section, wages or salaries shall mean all 24 compensation and benefits payable by an employer to or for the account 25 of the employee for personal services rendered by such employee includ- 26 ing any concomitant liquidated damages, penalties, interest, attorney's 27 fees or costs. These shall specifically include but not be limited to 28 salaries, overtime, vacation, holiday and severance pay; employer 29 contributions to or payments of insurance or welfare benefits; employer 30 contributions to pension or annuity funds; and any other moneys properly 31 due or payable for services rendered by such employee. 32 (c) A shareholder who has paid more than his pro rata share under this 33 section shall be entitled to contribution pro rata from the other share- 34 holders liable under this section with respect to the excess so paid, 35 over and above his pro rata share, and may sue them jointly or severally 36 or any number of them to recover the amount due from them. Such recov- 37 ery may be had in a separate action. As used in this paragraph, "pro 38 rata" means in proportion to beneficial share interest. Before a share- 39 holder may claim contribution from other shareholders under this para- 40 graph, he shall[, unless they have been given notice by a laborer, serv-41ant or employee under paragraph (a),] give them notice in writing that 42 he intends to hold them so liable to him. Such notice shall be given by 43 him within twenty days after the date that [notice was given to him by] 44 he became aware that a laborer, servant or employee may seek to hold him 45 liable under paragraph (a). 46 § 34. Subdivision (c) of section 609 of the limited liability company 47 law, as amended by chapter 620 of the laws of 2019, is amended to read 48 as follows: 49 (c) Notwithstanding the provisions of subdivisions (a) and (b) of this 50 section, the ten members with the largest percentage ownership interest, 51 as determined as of the beginning of the period during which the unpaid 52 services referred to in this section are performed, of every domestic 53 limited liability company, or of any foreign limited liability company, 54 when the unpaid services were performed in the state, shall jointly and 55 severally be personally liable for all debts, wages or salaries due and 56 owing to any of its laborers, servants or employees, for servicesS. 7256 19 1 performed by them for such limited liability company. [Before such2laborer, servant or employee shall charge such member for such services,3he or she shall give notice in writing to such member that he or she4intends to hold such member liable under this section. Such notice shall5be given within one hundred eighty days after termination of such6services. An action to enforce such liability shall be commenced within7ninety days after the return of an execution unsatisfied against the8limited liability company upon a judgment recovered against it for such9services.] A member who has paid more than his or her pro rata share 10 under this section shall be entitled to contribution pro rata from the 11 other members liable under this section with respect to the excess so 12 paid, over and above his or her pro rata share, and may sue them jointly 13 or severally or any number of them to recover the amount due from them. 14 Such recovery may be had in a separate action. As used in this subdivi- 15 sion, "pro rata" means in proportion to percentage ownership interest. 16 Before a member may claim contribution from other members under this 17 section, he or she shall give them notice in writing that he or she 18 intends to hold them so liable to him or her. 19 § 35. Section 1102 of the limited liability company law is amended by 20 adding a new subdivision (e) to read as follows: 21 (e) Any person who is or shall have been a laborer, servant or employ- 22 ee of a limited liability company, upon at least five days' written 23 demand shall have the right to examine in person or by agent or attor- 24 ney, during usual business hours, records described in paragraph two of 25 subdivision (a) of this section throughout the period of time during 26 which such laborer, servant or employee provided services to such compa- 27 ny. A company requested to provide information pursuant to this para- 28 graph shall make available such records in written form and in any other 29 format in which such information is maintained by the company and shall 30 not be required to provide such information in any other format. Upon 31 refusal by the company or by an officer or agent of the company to 32 permit an inspection of the records described in this paragraph, the 33 person making the demand for inspection may apply to the supreme court 34 in the judicial district where the office of the company is located, 35 upon such notice as the court may direct, for an order directing the 36 company, its members or managers to show cause why an order should not 37 be granted permitting such inspection by the applicant. Upon the return 38 day of the order to show cause, the court shall hear the parties summar- 39 ily, by affidavit or otherwise, and if it appears that the applicant is 40 qualified and entitled to such inspection, the court shall grant an 41 order compelling such inspection and awarding such further relief as to 42 the court may seem just and proper. If the applicant is found to be 43 qualified and entitled to such inspection, the company shall pay all 44 reasonable attorney's fees and costs of said applicant related to the 45 demand for inspection of the records. 46 § 36. This act shall take effect on the thirtieth day after it shall 47 have become a law; provided, however that section thirty-four of this 48 act shall take effect on the same date and in the same manner as section 49 1 of chapter 620 of the laws of 2019, takes effect. The procedures and 50 rights created in this act may be used by employees, laborers or serv- 51 ants in connection with claims for liabilities that arose prior to the 52 effective date.
