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New York Prejudgment Asset Restraining Measures
In New York, prejudgment asset restraining measures such as attachments and preliminary injunctions serve as vital legal tools to preserve the status quo and ensure that a potential court judgment can be satisfied. These remedies are typically sought by creditors who fear that a debtor may dispose of assets before a final decision is rendered. Understanding the detailed procedures and statutory requirements is essential to securing such relief under New York Civil Practice Law and Rules (CPLR) Article 62.
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1. New York Prejudgment Asset Restraining Measures: How to File a Request
New York law provides specific steps for initiating an asset restraining order prior to judgment. These are designed to prevent fraudulent asset transfers and ensure that the debtor retains enough property to satisfy a future judgment.
New York Prejudgment Asset Restraining Measures: Preparing the Motion
The first step in obtaining a prejudgment restraint is filing a motion in the Supreme Court or appropriate jurisdiction. The motion must include:
- A verified complaint or affidavit establishing the factual basis of the claim.
- Evidence demonstrating a valid cause of action and a likelihood of success on the merits.
- Specific identification of the property to be restrained or attached.
- A showing that the defendant may conceal, remove, or dispose of the property in question.
The legal basis for such action is found in CPLR §6201, which outlines the permissible grounds for attachment, including intent to defraud creditors or frustration of judgment enforcement.
New York Prejudgment Asset Restraining Measures: Providing Security or Undertaking
To proceed with the application, the plaintiff must post an undertaking or bond. This bond serves to indemnify the defendant for any damages caused by a wrongful attachment. The amount is determined by the court and must be “sufficient to cover potential damages,” as required under CPLR §6212(b).
This requirement reflects New York’s balance between creditor protection and prevention of abuse of provisional remedies.
New York Prejudgment Asset Restraining Measures: Court Review and Decision
Once the application is filed and the bond is posted, the court will assess the motion. A judge may grant the request ex parte if there is an urgent need or risk of asset dissipation. Otherwise, the court will schedule a hearing.
If granted, a sheriff or enforcement officer will serve the attachment or injunction, restraining the defendant from transferring or encumbering the targeted assets.
New York Prejudgment Asset Restraining Measures: Enforcement of the Order
After approval, enforcement typically involves physical seizure of property (in the case of tangible goods) or delivery of a restraining notice (for bank accounts or receivables). These are carried out in accordance with CPLR §§6214–6216.
The order remains in effect throughout the litigation unless vacated or modified by the court.
2. New York Prejudgment Asset Restraining Measures: Legal Standards for Approval
To obtain prejudgment asset restraints, the applicant must meet strict criteria under New York law. These conditions are evaluated to prevent misuse and ensure procedural fairness.
New York Prejudgment Asset Restraining Measures: Probable Cause for the Underlying Claim
The court must be convinced that the plaintiff has a meritorious claim. A simple allegation is insufficient. Instead, the applicant must submit evidence demonstrating probable success, supported by detailed facts.
This standard aligns with CPLR §6201(1), which requires that the claim be based on a contract or a valid debt.
New York Prejudgment Asset Restraining Measures: Urgency and Risk of Asset Dissipation
Courts will not grant attachment merely because money is owed. There must be a specific risk that the defendant will remove, hide, or transfer property to evade future enforcement.
CPLR §6201(3) addresses this by requiring a showing that the defendant "with intent to defraud" is likely to frustrate judgment enforcement through such acts.
New York Prejudgment Asset Restraining Measures: Adequate Security or Bond Requirement
Even if the other standards are met, the court will not approve attachment without the applicant providing a bond. This protects the defendant from harm if the attachment is later found improper.
The amount and form of the bond are determined by judicial discretion, and courts may increase or reduce the amount based on the property’s value and the strength of the plaintiff's case.
3. New York Prejudgment Asset Restraining Measures: Understanding the Legal Distinctions
Not all prejudgment restraints are created equal. New York distinguishes between two main forms: attachments and preliminary injunctions, each serving different purposes.
New York Prejudgment Asset Restraining Measures: Attachment vs. Preliminary Injunction
- Attachment is a monetary remedy. It applies when a plaintiff seeks to secure a money judgment and fears that the defendant will make enforcement difficult.
- Preliminary Injunction is non-monetary. It restrains the defendant from taking or failing to take certain actions that would cause irreparable harm during litigation.
| Category | Attachment | Preliminary Injunction |
|---|---|---|
| Target | Tangible property, funds | Actions, behavior, or intangible rights |
| Legal Basis | CPLR Article 62 | CPLR §6301 |
| Primary Purpose | Preserve assets for monetary judgment | Maintain status quo and prevent harm |
| Security Required | Yes | Often required |
Both remedies serve preventive functions but are used in different legal contexts depending on the relief sought.
The information provided in this article is for general informational purposes only and does not constitute legal advice. Reading or relying on the contents of this article does not create an attorney-client relationship with our firm. For advice regarding your specific situation, please consult a qualified attorney licensed in your jurisdiction.
