REPORT FROM THE CHAIR

An Update and a ‘Feel Good’ Story

By Jeff E. Rubin, Esq.

I have struggled these past few months trying to decide what to tell you in my first “State of the CRS” address. In general, things are good. We continue to have money in the bank. We continue to lead the League in putting on new educational programs. We continue to add benefits for each CRS member. I am most proud of completing the job that Former Chair Chris Hickey started last year, Practice Alerts.

Each of you should be receiving Practice Alerts by e-mail. We are still working out some final quirks on frequency and content. I encourage each of you to contact me at jeff@mialaw.com to give me your ideas and links you would like to see in the Practice Alerts. I think we will get more out of each Alert if we have your input. What good resources do you know about? What hot topic do you want to learn about? Just let me know! Your input is important to keep the Practice Alerts up and going. We need to expand them to cover issues and topics you want to hear about. Let’s face it, creditors’ rights law is not exactly the most exciting law in the World. So let me hear from you!

Education has always been one of CRS’s strong points in the League. I think each section of the League has an obligation to create the best possible educational programs at League meetings. Let me know your thoughts on what you see in Chicago. The only way your Education Committee can improve programs is to hear from you. What programs do you want to see? In Chicago, CRS will sponsor three programs covering the topics of checks, collection practices and business records. I think you will enjoy these programs.

In Chicago, CRS also will present its first-ever “Award of Excellence” to James J. White of the University of Michigan Law School. Professor White is a leader in the creditors’ rights industry. He also will be one of our speakers at the program titled “Checks, Checks and More Checks and Alternative Payment Methods.”

With the activity report taken care of, I would now like to share with you something that happened to me at the courthouse last month. It does not have anything to do with CRS. It is just a good “feel good” story.

I arrived at court a few minutes before the beginning of Motion Calendar. I was waiting outside the judge’s chambers when a wise and elderly lawyer, Tom, walked into the waiting room. He must be in his 80s. He sat down next to a young man who looked fresh out of law school. The young man, Alex, recognized Tom. Alex asked Tom whether he was his professor at the University of Miami Law School. In addition to being a professor of law, Tom was also an assistant county attorney. Alex had figured out that Tom was his professor in a Trial Advocacy Class last year. After an exchange of “good wishes,” the young lawyer asked Tom for some assistance with his upcoming legal argument in front of Judge Thomas. Tom gave Alex a few hints on what to expect from Judge Thomas, but he really did not have too much to offer since Tom did not know the legal issues in Alex’s case. Just before Tom and Alex were called into the judge’s chambers for the beginning of Motion Calendar, Professor Tom told Alex, “remember one thing—treat each lawyer you go up against as if you wanted him or her to vote for you to serve as a judge one day.” I thought to myself, what a wonderful gift Alex received from his professor. I realize Tom’s advice is not novel to any of us, but I really enjoyed hearing the advice being given in that setting. Alex has a long legal career in front of him and if he heeds the advice of his wiser and older professor then maybe, just maybe Alex will be a judge some day.

Overhearing this conversation reminded me of the many lessons we experience each day in our profession. Professor Tom’s advice was fundamental, yet it never hurts to hear it time and time again.

It is hard to believe that one-third of my year as chair already has come and gone. I hope that I can carry on the solid performances of my predecessors. A huge part of my job will be listening to you – the CRS members. Your CRS Executive Council has set many goals (Practice Alerts, educational programs, Free Press, membership benefits, etc.) for this year. I hope we can achieve them and make new ones for next year’s chair and council. For this to occur, I need to hear from you, the members. Let me know what you want! At the same time, I will always try to live by Professor Tom’s advice.

Editor’s Note: Jeff E. Rubin, Esq., chair of the CRS, is a partner in the Law Firm of Talianoff Rubin and Rubin in Miami, FL. He concentrates in the area of creditors’ rights, real estate, workers’ compensation, wills and probate.

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Washington Legislative

(As of March 10, 2005)

By David P. Goch, Esq.

The Republican juggernaut rolled and has produced a victory on the long-standing Bankruptcy Reform Bill (S. 256), which originally was introduced nearly eight years ago in the 106th Congress.

Today, the Senate passed the Bankruptcy Reform Bill by a vote of 74-25 (which, for those of you who are counting, indicates that more than a dozen Democrats voted in favor of the bill). This came after more than a week of debate on the floor and more than 100 amendments (most by Democrats, and most defeated, including Sen. Schumer's, D-N.Y., “abortion” amendment that was often credited for the bill's demise in previous Congresses).

The bill is intended to improve the bankruptcy system by putting in place a "means-test" to ferret out fraud and abuse, and to ensure creditors are paid the greatest amount possible from the debtor.

The bill will now head to the House. While quick passage there is not certain, it is likely. From there, depending upon the House's willingness to accept the bill exactly as the Senate passed it, which is unlikely, the House and Senate versions will go to a "conference" to resolve the differences and then the consensus bill will have to pass each house again without modification. If all this happens, the bill will go to the President for his signature (and the President has already indicated he will sign it). In short, the bill is likely to become the law of the land in three to four weeks.

In other bankruptcy news, during the bankruptcy debate, a CLLA-supported venue bill was introduced by Sen. Cornyn, R-Tex., S. 314, the Fairness in Bankruptcy Litigation Act of 2005, would eliminate abuses seen in such cases as Enron that were filed in jurisdictions with little or no business nexus to where the debtor conducted its business operations. An attempt was made to attach the bill to S.256, but in the end Cornyn deferred to the Senate leadership and tabled his amendment (to the satisfaction of a couple of Democratic senators who then voted in favor of the bill).

In other news, although the Fair Debt Collection Practices Act remains a priority for the League, it is yet to be seen if legislation will have any serious consideration this Congress (FDCPA being one of the unique areas where the minority, the Democrats, on behalf of consumer groups, have had leverage to thwart attempts to amend the statute). One FDCPA bill has been introduced this year. Efforts to amend the FDCPA have already started by Rep. Royce, R-Calif., who is a member of the Financial Services Committee. HR 1025 amends the FDCPA to exempt mortgage servicers from certain requirements of the FDCPA with regard to federally related mortgage loans secured by a first lien. The bill has eight co-sponsors.

Under the general heading of “privacy,” this Congress will follow in the path of the prior two, with many proposals being introduced on the protection of personal information, including Social Security numbers (ironically established by the Federal Government to be a citizen's unique identifier), particularly in light of several recently reported information security breaches (e.g., ChoicePoint). Two bills introduced on March 3 were by Rep. Markey, D-Mass. The first, H.R. 1078, is designed to strengthen the authority of the federal government to protect individuals from certain acts and practices in the sale and purchase of Social Security numbers and Social Security account numbers. The second, H.R. 1080, is to regulate information brokers and protect individual rights with respect to personally identifiable information. Such proposals could affect the way in which creditors, and those who protect and assert their rights, do business.

The Commercial Law League of America will continue to represent the interests of its membership before Congress.

Editor’s note: David P. Goch, Esq., is the CLLA Washington Legislative Counsel.

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Education Committee

By Randy T. Slovin, Esq.

If you looked at the education program schedule in the brochure for the upcoming Chicago meeting, you would see that the options are designed to provide practical assistance to the commercial litigator or collection attorney.

"The Business Records Exception to the Hearsay Rule" is designed as a “how to” session on getting your documents, whether paper or electronic, admitted into evidence. “Checks, Checks, and Yes, More Checks" will be presented by Professor James White of the University of Michigan College of Law. Professor White will review the Check 21 Act, and will also discuss new methods of dealing with checks.

If you think that you have heard or imagined everything that collectors say to convince consumers to pay their debts, then you have not heard "Collectors Gone Wild: An Inside Look at Threats and Abuses." This program will be presented by John Fugate, a consumer lawyer from Texas, who has caught numerous collectors on audiotape, making outrageous misrepresentations and illegal threats.

Finally, even if you saw the education program schedule for Chicago, you would have missed one educational opportunity. A late addition to the agenda is "Can you Keep a Secret? Safeguarding Consumer Information Entrusted to Your Care." We are fortunate to have with us one of the nation's leading experts on privacy law and collections. Leslie Bender serves as the retained general counsel for a number of collection agencies, and also provides outsourced compliance consulting for hospitals. She will address both medical and financial privacy.

If these programs sound interesting, but you have ideas for future sessions, we can use your help. Ideas are now being generated for the NYC conference in November. If you have some suggestions, please e-mail them to me, my co-chair Marc Bressler (marc@bresslerduyk.com), and the Education Director for the League, Sue Dickerson (sdickerson@clla.org). Please make sure that we all receive a copy of your e-mail so that your ideas can properly be considered.

Editor’s Note: Randy T. Slovin, Esq., is a partner in the law firm of Slovin & Cummins Co., L.P.A., in Cincinnati, OH. He concentrates his practice in the areas of creditor representation in commercial litigation, banking, leasing, bankruptcy and creditors’ rights law.

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Membership Committee

By Joseph I. Terkell, Esq.

As my affiliation with The Commercial Law League of America draws to almost a quarter of a century, I have had occasion to pause more than once to ponder exactly what it is that keeps me coming back year after year.

The landscape has altered dramatically since I was a “young member” and “first attendee.” I remember back in those days thinking it was a successful convention if I managed to squeeze several sweaty business cards into the reluctant hands of besieged “red dots” at “the” cocktail party, all the while attempting to spear a highly coveted shrimp on a stick with the other hand. Although there is still an element of “dot” chasing at the conventions of more recent vintage, the League has evolved into something far deeper and sophisticated for me. Many are the naysayers who decry that the League is dead, and that there is no business to be had here anymore.

It may well be true that the potential for receiving new claims as a result of attending a convention is not what it once was. As the airlines are wont to note, “We know you have lots of choices…” Those choices in this case are the veritable alphabet soup of debt recovery and creditors’ rights organizations spawning far-flung and costly meetings every other week. That having been said, I would respectfully submit that not only is the Commercial Law League of America different; it is better! In virtually all of those other venues, commercial collection attorneys are relegated to the status of subordinate associates, or just plain outsiders (and unwelcome ones at that).

While we collection attorneys were never unwelcome outsiders in the League, back in the days of the red dot rampage, we were, concededly, somewhat subordinate, scrambling to curry favor with the kings of claims. For better or worse, that situation has, to a large degree, dissipated to a point almost approaching sanity. True! The business opportunities with traditional agency forwarders are not what they used to be.

Rising like a phoenix out of the ashes of the demise of Ma and Pa grocery store America, the Creditors’ Rights section was born. With the demise of the small entrepreneur in the face of daunting and insurmountable competition from the likes of Wal-Mart and Costco, there has followed a dramatic drop in commercial claims. Let’s face it; you just don’t see too many collection cases against Target and Blockbuster!

With agencies offering lower commission rates, in an effort to secure scarcer and scarcer placements from their sources of business, there simply is only a fraction of the number of claims that were once available for forwarding, and many receiving attorneys are reluctant to accept the claims at the lower rates, perceiving a limited profit opportunity. The end result is that all sections of the Triad have become concerned. There had been discussion in the Agency Section with respect to leaving the League as a result of these developments. This was all a natural consequence of the reduced number of claims available for forwarding, and attorney concern at the reduced rates resulting from the stiffer competition among agencies for scarcer claim placements from their customer base.

The other side of that coin is a cadre of very unhappy attorneys who feel that the League can no longer put bread on their table, and that perhaps there are greener pastures elsewhere. There are not!

We attorneys, fortunately have an independent voice in the League through the Creditors’ Rights Section. This, for us, is what sets the CLLA apart from all those other groups. We are not subordinated to any other group. This independence for commercial collection lawyers is a relatively new concept. In the final analysis, those who contemplated leaving the League, did not leave, because each constituency within the League has a mutual interest in the success of the others. The triadic system works, but only if each of the constituencies has an independent voice in the direction of the League.

The Creditors’ Rights Section is our voice! It represents and protects our interests, as well as providing new avenues for generating income. A case in point is the “Meet the Forwarders” program, which was such an overwhelming success in New York, and promises to be even better in Chicago. Kudos to Fred Weinberg!

The CRS educational programs are without dispute, second to none. They are always well attended, and germane to our area of practice. They assist us in becoming better lawyers while picking up a few CLE credits along the way. These stellar educational presentations are now being augmented by e-mailed Practice Alerts to our members, apprising us of late-breaking legal developments, which potentially have significant and immediate impact upon our respective practices.

The development of a “members only” forms Web site should prove to be yet another great boon to the collection practitioner. Now, instead of engaging in countless hours of research and drafting, the potential for downloading just the right form, for free, from our collective brain trust is becoming a reality.

In light of all that the CRS has to offer its attorney members, why then is membership down?

There really is not one simple answer to that question. Membership in the League as a whole has been steadily declining, as many attorneys leave the practice of collections for what they hope will be more lucrative pursuits. Frankly, there is not much we can do about that, and perhaps it is best for all concerned. Conversely, if you are a collection or creditors’ rights attorney who is a member of the CLLA, it is simply folly to not also be a member of the CRS. The cost is a mere pittance, and so much is received in return. If ever there were a case of false economy, this is it! Perhaps the leadership of the CRS is to blame for allowing our educational programs and other benefits to be enjoyed by all who care to participate regardless of membership status. The Bankruptcy Section does not allow non-members to attend their programs, and perhaps we should follow suit.

Rather than trying to bludgeon non-members into joining through a deprivation of benefits, we should all impress upon our colleagues the importance of being invested in one’s own destiny.

Alas, I fear that I am preaching to the converted, for if you are reading the Free Press, chances are that you are already a member of the CRS. It is therefore my intention to ask Dick Shascheck, with the approval of the Executive Council, to circulate a copy of this article, under a cover letter, to every attorney League member who is not currently also a member of the Creditors’ Rights Section.

In closing, I would ask that we not underestimate the value and impact of grass roots efforts on our individual parts to recruit new members to this esteemed collaboration. Remember, if you bring in three, your membership is free!

Peace.

Editor’s Note: Joseph I. Terkell, Esq., is a certified Creditors’ Rights Law specialist and a partner in the firm of Lubitz & Terkell, in White Plains, NY. His area of practice is almost exclusively creditors' rights. He is co-chair of the CRS Membership Committee, and a member of the CRS Executive Council and CLLA Eastern Region Executive Council.

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Internet and Technology

By John P. Plovie, Esq.

The Creditors’ Rights Section is all about synergy. Through the individual contributions of many, the whole becomes greater than the sum of its parts. The Technology Committee has focused its efforts on revamping the CLLA Web site and many improvements have been made. At the same time, other CRS committees are working on projects that are likely to provide content for the Web site.

One example of new CRS Web site content is the Free Press. Rather than keeping copies of the Free Press in a firm library for future reference, you can now access them on the Internet as needed and use for office meetings, legal memoranda, and as a networking tool to find the experts in a particular area of interest. The Free Press is becoming a great source for the latest on current issues facing the creditors’ rights law firm.

Those who attended the New York meeting saw a presentation of a collection of legal forms and pleadings commonly used by collection law firms. Plans are being made to expand the forms library and make it available on the Web site. This is another example of how the committees are working together to add value to your Creditors’ Rights membership.

While attendance at CLLA meetings is one way to get the latest information on topics of interest to the commercial law practitioner, what if you can’t get to a meeting? Certainly we would all like to attend meetings and share experiences with our colleagues, but sometimes it’s not possible. To address this, the Technology Committee is working on a “list serv” as a way for CRS members to stay connected while in their offices. A “list serv” is an automatic mailing list server. When e-mail is addressed to a list serv mailing list, it is automatically broadcast to everyone on the list. The result is similar to a newsgroup or forum, except that the messages are transmitted as e-mail and therefore available only to individuals on the list.

With a list serv, a CRS member could pose a question to the list subscribers and receive answers from others. For example, if a firm is thinking about setting up a wireless network, it might be helpful to find out the experiences of other firms. By sending an e-mail to the list, the firm could learn about problems other firms encountered as they tried to set up a wireless network. Another example might relate to answers posed by debtors alleging “monetary fraud” or “UCC violations” and how the courts in other jurisdictions responded to these allegations. The list serv would require a moderator to prevent libelous content from being circulated, either intentionally or unintentionally. The Committee will be evaluating options to set up a list serv. If you have any suggestions or opinions, please contact me or Co-Chair Rob Morris Jr.

The Committee also is working with the CRS Educational Committee to set up a technology review. This may be in the form of a seminar or it may be like a “trade fair” to allow vendors to both educate and inform attendees of the latest in software, hardware, telecommunications, electronic funds transfer and so on. Look for something on the agenda for the 2005 New York meeting.

Editor’s Note: John Plovie, Esq., is an attorney practicing with the Plovie Law Firm, PS, in Redmond, WA. He is co-chair of the CRS Internet and Technology Committee.

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Retail Collections

Retail and Commercial Associations Commit to Working Together

By Stuart R. Blatt, Esq.

The Retail Collections Committee is proud to inform you about the success of the Joint Association Summit (JAS).

Since giving my last Committee report, I met with the executive directors of CLLA, NARCA, ACA, DBA and IACC in Minnesota, and developed an agenda for presentation to the Presidents at the Debt Buyers Association Annual Meeting in Las Vegas. President Mary K. Whitmer, Executive Director David R. Watson and Incoming President Jerry T. Myers appeared on behalf of the CLLA at the Las Vegas meeting.

Issues affecting the retail and commercial collections industry were openly discussed before JAS, and all the association presidents agreed on a commitment to work together, share information, identify universal issues and together arrive at an agenda for meeting or defeating a central issue.

Education, legislation and court decisions were a part of the agenda formulated for discussion by the Summit. It is always easier to block, deflect, defeat or change legislation than it is to enact legislation. In that regard, it is important for us to be vigilant to assure that legislation, or parts of legislation that would threaten or adversely affect us, is not enacted. Each association will strive to follow pending legislation, involve their lobbyists and stand together to oppose universal issues. All associations agreed to waive registration fees at each other’s conferences, promoting unification and an opportunity to meet together.

JAS presidents and executive directors will meet again at the CLLA meeting in Chicago. JAS is rotating meetings to be at each other’s conferences and headquarters. To have all the associations communicating, meeting and working together for the first time ever is a significant development that will benefit everyone in the retail and commercial collections industry.

Board Member Wanda Borges and I will talk about bankruptcy issues at the Collection and Credit Risk Conference in Las Vegas, and I will host a panel discussion about recent issues in collections along with the Debt Buyers Association president, the ACA general counsel and the chairman of the NARCA Legislative Committee.

California has enacted the first legislation requiring collection letters to be in both English and Spanish (see the Rosenthal Act). There is renewed interest in Congress to revive and pass Bankruptcy Reform. See regular announcements in your e-mail by our CLLA lobbyist.

Introduced in the Maryland legislature was a bill to reduce post-judgment interest from 10 percent to the weekly average, one-year constant maturity treasury yield as published by the Board of Governors of the Federal Reserve System for the calendar week preceding the date of the judgment. As President of the Maryland/District of Columbia Creditors’ Bar Association, I appeared before the House Judiciary Committee and presented written and oral testimony. As a result, the bill was killed.

As NARCA past president and current board member, I was in Washington, D.C. on March 8, to meet with Congressman Ruppersburger to discuss credit and collection issues, as well as attend other legislative meetings arranged for the Washington, D.C. NARCA Board Meeting. The ACA was also having its meeting in Washington, D.C. in March and was involved in legislative meetings and seminars. The outcome of these conferences will be reported in the next issue of the Free Press.

Richard Grant, co-chairman of the Retail Collections Committee, was elected to serve as a member of the NARCA Board of Directors. I was voted to act as DBA Secretary.

Esteemed member Manny Newburger continues to provide valued counsel and representation in matters involving retail issues in the area of the FDCPA. For an informed opinion, consultation or representation in FDCPA issues, please contact Manny. Any adverse decision against a member may result in the decision applying to other members of our industry. Retain effective counsel in those situations. Manny and Don Kramer have researched, developed and made available for sale a DVD presentation of leading and current FDCPA issues. Contact the CLLA office to find out how to purchase a copy.

Editor’s Note: Stuart R. Blatt, Esq., serves on the Executive Council of the Creditors’ Rights Section and is co-chair of the Retail Collections Committee. He is a partner in the law firm of Margolis, Pritzker, Epstein, Blatt & Franklin, P.A., in Baltimore, MD, which specializes in retail and commercial collections, debt buying, business, real estate matters and general civil litigation throughout Maryland and Washington, D.C.

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Uniform Laws And Legislation

By Kevin E. Posen, Esq., and Mark Abrams, Esq.

Last year, the Creditors’ Rights Section of the League decided to reactivate the Uniform Laws and Legislation Committee. It was charged with providing Practice Alerts regarding new legislation, case law and other matters of interest to commercial collection attorneys to members of the Section via e-mail. The idea was to bring directly to your desktop computer timely information, which would be useful to your practice. Each alert would have links to Web sites where the reader could view the entire article.

Helen Gunnarsson, an attorney and freelance writer from Highland Park, Ill., has signed on with our Section to review publications on and offline and search the Internet to find items of interest to include in the Practice Alerts from the following areas of law:

  1. Uniform Commercial Code, Articles 2, 2a, 3, and 9
  2. Uniform Fraudulent Transfer Act
  3. Uniform Enforcement of Foreign Judgments Act
  4. Fair Credit Reporting Act and
  5. Fair Debt Collection Practices Act.

By now you should have received three Practice Alerts via e-mail. Practice Alerts are yet another benefit of your membership in the Creditors’ Rights Section. We intend to provide them at least once a month. We also may be expanding the areas covered to include the following:

  1. Banking/Mortgage Foreclosure
  2. Mechanics Lien/Construction Practice
  3. Litigations/Trial Practice
  4. Collection of Freight Bills
  5. Collection of Insurance Premiums
  6. Commercial Landlord-Tenant Matters
  7. The Business of Law and
  8. Law Office Management and Technology.

If you are not receiving the Practice Alerts, please contact the League office at 312/781-2000 or go to www.clla.org and leave/send a message with your e-mail address in order to be added to the e-mail list. Finally, please let Helen Gunnarsson know what you found useful in the Practice Alerts, along with the names of any publications or Web sites that she can review for information to include in future Practice Alerts. Her e-mail address is gunnarssonhg@comcast.net

Editors Note: Kevin E. Posen, Esq. and Mark Abrams, Esq., are co-chairs of the CRS Uniform Laws and Legislation Committee. Kevin Posen is a principal in Teller, Levit and Silvertrust, P.C., in Chicago, IL. Mark Abrams is a principal in Abrams & Abrams, P.C., also in Chicago, IL.

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Spotlight on the Creditors' Rights Section Chair

Name: Jeff E. Rubin

Residence/Hometown: Miami, FL

Education: 1982 graduated from Ransom Everglades High School; 1986, B.A. from Boston University; 1989 J.D. from University of Miami Law School.

Work History: While in law school, I worked for a medium-sized personal injury law firm. Immediately after graduating, I started working for my grandfather and father. Eventually my grandfather retired and I became a partner in the firm, which is now known as Talianoff, Rubin and Rubin. In the early part of my career, we had a three-generation law firm.

Family: I have been married to Janice for 15 years. We have a son, Alex, who is 12 years old, and a daughter, Nicole, who is eight years old.

Areas of practice and specialties: Collection, creditors’ rights, workers’ compensation, real estate and probate.

What year did you join CLLA? I became involved with the CLLA in 1989 (right after I started practicing) following the steps of my grandfather, George J. Talianoff, who was a long-time CLLA member.

What other offices have you held in the CLLA and Creditors’ Rights Section? I was chair of the Law Office Management Committee and co-chair of the CRS Education Committee. I also served on the Web site Development Committee and National Education Committee. I have held the positions of secretary, treasurer, chair-elect and now chair of the Creditors’ Rights Section.

Tell us about your family and your family interests and activities: My interests are family, sailing (racing) and work. My son, Alex, is an active flag football player. He is in sixth grade at a local private middle school. I so much enjoy watching him play football. Nicole pretty much runs her third-grade class. She is a true leader. She recently started playing soccer so we now have two athletes in the family. Janice is an active working mother. She has a real estate practice near the kids’ school, which allows her to be a typical mother running around from place to place after school. Janice and I enjoy hanging out with the kids. Since I was eight years old, my passion has been competitive sailing. Between the kids’ activities and work, I manage to race once or twice a month. I am also on the Foundation Board of a local hospital, and have been chairman of the United States Olympic Sailing Center in Miami since 1999.

What qualities do you feel that you bring to the job of Chair of the Creditors’ Rights Section? I have learned a tremendous amount from my predecessor, Chris Hickey. We became involved in the CRS as education co-chairs and eventually moved up the CRS ladder. I learned a lot under Chris’ leadership. I think my leadership with a great executive council and committee chairs will allow us to achieve the goals we have set for this year.

What goals would you like to achieve during your term as chair of the Creditors’ Rights Section? We must continue to provide the best possible educational programs at CLLA meetings. CRS has always been a significant contributor in organizing and funding educational programs. We must continue that tradition. I think all CLLA members will find the programs set for Chicago will demonstrate the strength of our commitment. In addition, we wanted to get Practice Alerts underway. All CRS members are beginning to receive Practice Alerts via e-mail every two weeks. We also are working on starting Practice Groups, and increasing membership and benefits by showing the advantages of being a CRS member (i.e. Practice Alerts). We will also present the first Award of Excellence this year in Chicago to Professor James J. White, who will be speaking at the meeting on “Checks, Checks and even more Checks!” Lastly, we are currently writing an Amicus brief involving Commercial Credit Counseling Service.

If a new attorney member of the CLLA is considering joining the CRS, what would you tell him or her about the benefits of Section membership? CRS gives you an immediate opportunity to get actively involved in the League. I have always told any new member that you can be “as involved” or “as uninvolved” as you want, but being a member has its benefits. CRS is the strongest section of the League! I think when a member is able to show that he/she is an active member of CRS it lends immediate credibility to the person’s practice showing that he or she is not just another collection lawyer. Besides that, the member will receive a copy of our newsletter three times a year and Practice Alerts via e-mail every two weeks, a chance to hang with future leaders of the League and their profession and, of course, meet new friends you’ll have for a lifetime (the best benefit).

When you’re not practicing law, or tending to League matters, what do you do for fun and relaxation? My passion is competitive sailing. As a young kid, I would sail every weekend. By the time I was 15 years old, I had raced in three World Championships and one South American Championship in Denmark, Turkey, Yugoslavia and Argentina. I also finished third in the Junior National Championships in 1979. I sailed for two years in college for Connecticut College and Boston University. I also assisted a team that qualified to represent the United States in sailing at the Olympics in 1980 and 1984. They won Gold in 1984. After law school, I continued to sail locally and internationally. Over the last couple years, I have sailed with Roy E. Disney in Mexico and in the Caribbean on his boat, Pyewacket. Recently, I became a new boat owner and along with my friends we have been racing a 33-footer called Triptease in local and international regattas. We have won all the local regattas as well as an international regatta known as SORC. When I am not sailing, working, or volunteering at the hospital or at the Sailing Center, I spend time with my family.

Where does a guy from Florida, like you, go for vacation? Do you ski (on snow I mean)? I love the sun and water, as you can tell. My favorite vacations have always been on the water in the Caribbean. Last year, we chartered a 43-foot sailboat for a week in the British Virgin Islands with two other couples.

If you did not become a lawyer, what do you think would have become your life’s work? If I had not become a lawyer, I would be running a business or developing real estate. Better yet, I would rather retire and sail all day!

What one thing do you think we would be surprised to know about you that most people don’t already know? I played Frisbee with Amy Carter on the White House lawn at a ceremony honoring those who did not go to the Olympics because of the boycott.

What is your favorite quote or words to live by? I really have two quotes. The first is, “If you want something done, go to the busiest person.” The second is a quote that I carry around in my wallet by Dr. Martin Luther King: “The ultimate measure of a man is not where he stands in moments of comfort, but where he stands in times of challenge and controversy.”

Did you have any role models when you were growing up and in your career in practicing law thus far? If so, who are they and why were they your role models? When I was growing up my role model was the Olympic medalist who I told you about before by the name of Robbie Haines. Robbie took me under his wing when I was a little kid and afforded me experiences that I would never have had in sailing if it was not for him. Along with two other sailors on his boat, Robbie won a Gold Medal in 1984. In the practice of law, my role model would have to be my grandfather and father since both of them have given me fantastic opportunities to expand my career. They have never held me back.

What is your favorite…

Car: Infinity G35.

Food: Great Steak

Vacation spot: Bitter End Yacht Club, British Virgin Islands

Actress/Actor: Don’t really have one

Movie: “Tommy Boy”

Holiday: All of them because I get a day off!

Musical group/singer: English Beat and Billy Joel

Book: I am not much of a reader, but if I have to pick something, I guess it would be Box Car Children. I loved that book when I was a little kid.

Sports figure: I don’t really have one, but if I had to pick a person it would be Cal Ripken Jr. for his longevity in doing something consistently well.

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A View From The Law List

By Gary D. Tier

To say I work for a “Law List” is like saying I get paid to count cars — people just don’t get it. Who knew that two one-syllable words would create such confusion? Simply saying “Law List” doesn’t explain the dynamics of my job. So ready or not, here we go.

When I graduated from Wesleyan University, I was not sure exactly what I wanted to do. My parents kept telling me there was this “money issue” and I would have bills to pay, which might become a problem if I didn’t make a decision soon. At the time, I was still seriously considering law school so when I was offered the opportunity to work on a legal directory, I figured it might be something I could do well and enjoy.

On my first day, the boss was 30 minutes late. Combine this with the fact that my desk was filled with letters pertaining to debt collectors, and I was a bit uneasy about what it I had gotten into! I wondered if my boss was late because he was not paying his bills. Perhaps he wasn’t just trying to get collection agencies to use the Forwarders List of Attorneys, but also making sure they had some debt to forward out for legal action! What had I gotten myself into?

When I began my training, I knew that law school forces students to hit the books, but it doesn’t teach them how to work their books when they run their own practice. Law school or not, many young lawyers are ill prepared to run a business. They paid professors to teach them how to be attorneys, but often times have no idea how to get paid. I recognized the need for products that promote the services of a law firm. It just made sense.

Welcome to my world.

I know you’re the best collection attorney ever (yes, I’m talking to you), but if you can’t convince someone to send you business, it doesn’t matter how good you are at what you do. No matter how good a product or service, you have to be able to sell it. This is where the Law List comes in and you get the pleasure of doing business with a gentleman like me. Seriously though, the main objective in my business day is to connect with attorneys and forwarders, to connect with business. Law Lists fill their respective directories with premiere attorneys who handle various areas of collection work. Our primary function is to then connect these attorneys with sources of business.

Each listing indicates basic information about a law firm. The information varies slightly among the various Lists, but basic contact information is included in all of them. Commercial work is the most commonly accepted type of collection claim. However, there are several different types of work that fall under the umbrella of “collections.” Some Lists give an indication of what types of collection work the firm accepts. Often times the “cases accepted” is important to our forwarders because it saves them the time of calling us or the attorney to find out if they handle the type of claim in question.

Although the listings provide forwarders with basic information, they often seek assistance from knowledgeable Law List employees. A forwarder may call for a referral in a city like Los Angeles because he wants to know who will accept his claim on certain forwarding terms, which is something none of the Lists indicate. The forwarder also may have a claim in an area not covered by a listed attorney. The Law List knows which of its attorneys are willing to travel to handle a county (or counties) other than the one in which their practice is located. Many firms handle multiple counties, but don’t want to pay for listings in each. They rely on us to know this and inform our forwarders. There is also an assumption that the forwarder who simply picks up the book or goes to the Web site will use the map to see which firms are located near the vacant territory.

The Law List wants to have as few vacant territories as possible so that a forwarder can find an attorney for any county in which they might have a collection matter. When there are vacancies in the List, we must apply the same standards in accepting a new listing. If an area is so remote that the list is not able to locate an attorney who practices in that county, we can often ask a firm located in a nearby county to handle the individual case in question.

A Law List also receives calls about specific listings. Here’s how not to handle that situation: Phone rings, the forwarder asks if a specific attorney in Alabama is “any good.” The call is put on hold and a Law List employee looks at the new guy and asks “is this attorney any good?” At this point, the new employee is still learning about his attorneys, so he is shocked at the question. Nonetheless, he recommends the firm without doing any research. An employee making recommendation without prior knowledge or research = bad.

Fast forward two years later to a month ago when the same situation came up, only this time the forwarder spoke directly to the employee who now knows his attorneys. Before making a referral, the employee makes calls to everyone who sent business to the firm in question during the past two years. At noon the next day, he calls his contact at the agency to relay the feedback from other forwarders. Even though he knew the attorney received a lot of business through his List, and never had any services issues with him, he found it was worth making some calls. An employee making recommendation based on knowledge or research = good.

Excellent customer service is central to any successful business, and we are no different. Superior knowledge of your product is essential.

Gary’s Rule No. 1:

Know Your Attorneys

It is essential that the Law List know the forwarders sending work through their List. I don’t mean knowing the name and contact for the company, but rather the details of the forwarder: what type of work is forwarded out, volume, size of case, forwarding rates and terms, how regularly reports are expected, preferred report format (i.e. electronic), etc.

We can often get a good idea of what the forwarder expects out of the attorney by the type of service our forwarders expect from us. There are forwarders who simply pick up the book and send their claim to the attorney corresponding to a given territory. Conversely, there are forwarders who don’t even look at the book. For example, we have a client who calls every time he needs someone, even if he already has used one of our attorneys in the same area and was happy with the results. The conversation always starts with a laugh as the client tries to guess which one of us has answered the phone. Once we have that established, he gives us the information necessary so we can give him a recommendation. Since this forwarder doesn’t have a database of attorneys that he can use, he calls us when it’s time to send a claim to an attorney. A forwarder like this will not get much out of us notifying him about a new listing. Although it’s high quality collection work, the quantity isn’t enough to desire notification of new listings; he’s content to call when he needs an attorney.

Our larger forwarders, who are sending out dozens of claims a month, often use an internal database of attorneys that includes the List the firm is in for bonding purposes. Many of these forwarders are willing and often looking to try new attorneys, and appreciate when the Law List notifies them of new listings.

Two weeks ago, we accepted contracts from two new firms that only handle large commercial work. Upon receipt of these contracts, I contacted several agencies that only forward large commercial work. In addition to the type of case, I provided the forwarders with backgrounds on both firms. This information lets them know why they should be interested in giving the new firms an opportunity at earning their business.

Gary’s Rule No. 2:

Know Your Forwarders

When it comes to ensuring new attorneys will provide premium service, the onus is on the List to use due diligence regarding who it accepts as a listee. The reason for researching firms, although obvious, is worth touching on for a moment. The two firms I mentioned above provide an excellent example. Both firms have “AV” ratings in Martindale–Hubbell, have impressive client references that gave excellent feedback and are part of at least one industry association.

The reason to research a firm is not only to protect the bond program we provide (the Lists have insurance that covers the cases sent to its attorneys), but perhaps more importantly, to provide our forwarders with a selection of premiere firms that are equipped to handle their collection needs.

In addition to researching the firm’s ability to handle collection work, a Law List has to research the market in which it is considering listing the new firm. We must consider our existing listings in the given territory and be careful not to flood that market. The Law List is caught in a bind in this situation because listings pay the bills. However, the Law List must do what’s in the best interest of all of its listees and not just think of the check that comes along with the new listing. You can learn this lesson simply by talking to attorneys. One of the most popular topics of conversation is the perceived saturation of business in a given territory. Whether or not it is true is unimportant. The Law List has to know the market and be sure it gets enough business to make the listings profitable. Law lists should go after new listings when demand in a given territory indicates the need for more attorneys.

Gary’s Rule No. 3:

Know What’s Going on in the Industry

My experience working for a Law List has been interesting and rewarding. Running a Law List comes down to hard work and knowing your clients. In the process of learning about lawyers and forwarders, I’ve developed friendships that exist outside of the world of collections. These personal connections build loyalty and reputation in the industry, making my job a lot easier.

When a firm decides to list with us, I get great satisfaction in providing it new sources of business because it has taken a chance investing money in us. By “us” I don’t mean the book itself, but in our abilities as individuals to be successful for years to come. The lawyers in a Law List are a reflection of the Law List and its employees. We count on them to provide premium service because we work so hard to get forwarders to use the directory. Coming to work every day having confidence that your attorneys are working hard for your clients is more than just peace of mind; it’s knowing we’re doing our job well….and it helps that it pays the bills.

Editor’s Note: Gary D. Tier is the client services manager for the Forwarders List of Attorneys, in East Windsor, N.J.

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Avoiding Pitfalls In Handling Mechanic’s Lien Actions

By Robert A. Bernstein, Esq.

As a creditors’ rights attorney, one of the most effective weapons in your arsenal is the assertion of a mechanic’s lien against property. A mechanic’s lien is “a statutory lien for labor or materials supplied in improving, repairing or maintaining real or personal property, such as a building, automobile or the like.” Blacks Law Dictionary, p.934 (Seventh Ed.1999). It is generally held that no action is necessary for the creation of a mechanic’s lien; the lien arises inchoate upon the provision of the materials and labor to the property. The lien can provide you rights against not just your client's immediate customer, but also against a parcel of property to ensure that your client can recover the value of materials furnished for the improvement of the property.

Furthermore, pursuing a successful mechanic’s lien may entitle your client to recover costs and attorneys fees to which it would otherwise not be entitled under the common law. The lien, however, can be lost or defeated if specific action is not taken to perfect and foreclose the lien in a timely manner. If you represent manufacturers or sellers of construction products, you should be cognizant of your particular state’s mechanic’s lien laws. A detailed knowledge of your state’s laws provides you with significant ammunition to collect not just from your client’s direct purchaser, but from more solvent parties up the chain of the construction ladder.

Instruct your client to collect the necessary information

While it may seem elementary, experience has shown that clients are often less than vigilant about obtaining the most basic information about their debtor. While an ordinary collection case may require only that your client obtain the necessary information regarding the purchaser, it is necessary that your client obtain not only the information regarding its purchaser, but also the entity who hired it, as well as the specific property where the materials will be installed. Do not assume that your client routinely collects this information. You will do your construction supplier client an invaluable service if you prepare and send a checklist of information they should accumulate before agreeing to sell materials to a construction purchaser.

You should be acutely aware that a mechanic’s lien is a creature of state law and, as such, each state has a different statutory scheme for the creation of and enforcement of rights arising under a mechanic’s lien. Unlike some other laws, where substantial compliance is sufficient to preserve a client’s rights, rights created under a mechanic’s lien statute are in abrogation of common law, and strict compliance with each statutory requirement is necessary to preserve rights under the statute. Unlike pleadings in a normal lawsuit, which can be amended at a later date, the requirements for filing a mechanic’s lien are not subject to being amended at a time after the statutory filing period has passed.

Do not overstep your bounds

If your client calls with a general question about the requirements of filing a mechanic’s lien, be sure to ask your client where the property to be liened is located. Don’t assume that your client is asking about your state only. Clients often sell to an in-state entity which installs the material on property in another state. If the property is located in another state, do not give advice regarding the necessary steps or time frames to perfect a mechanic’s lien unless you have studied the entire statutory scheme of that state. Better yet, this is a perfect opportunity for you to utilize the talents of your fellow creditors’ rights attorneys, through your membership in the Creditors’ Rights Section. You can often call one of the Creditors’ Rights Section members in the other state and obtain a quick, concise answer to your particular issue.

Sales that can give rise to a mechanic’s lien

Not all services or materials utilized in the construction process can properly give rise to a mechanic’s lien against the owner’s property. Generally, materials or services supplied must be provided for the benefit of improvements to real estate. It is not enough that materials or services are supplied in support of, or in connection with, a construction project. They must actually provide value to a structure on the property. Thus, while a supplier of trusses to a construction project would clearly be entitled to claim a mechanic’s lien after the materials are incorporated into the project, a provider of appraisal or surveying services may not be able to claim such a lien, since they do not provide value to a structure on the property. The legislature of your particular state may have statutorily designated additional services which may give rise to a mechanics lien; for example, in South Carolina, appraisal services and security services may give rise to a mechanic’s lien, while surveying services may not. Also, rental of equipment for use in construction may or may not provide a basis for a mechanic’s lien, depending upon the court’s construction of its statute. A strong lobby may have created exceptions to the rule that the services must provide value to the structure on property. Check the statutes in detail to determine if your client's services fall within a statutorily created scheme to permit a claim to be made.

Consider providing notice of furnishing

An owner or general contractor is generally not responsible for payment of an amount in excess of the balance owed to the subcontractor. If the owner or general contractor has already paid the subcontractor prior to receiving notice of the mechanic’s lien, he can generally avoid having to pay the subcontractor’s supplier. Many states, however, permit a supplier to provide a preliminary notice to the owner or general contractor, advising that the supplier is preparing to supply materials to the project, and that he may make a claim for payment for those materials. This may serve to put the owner or general contractor on notice that your client has an interest in the payments for the work performed, and that they may need to make special efforts to ensure that your client is being paid by its customer. If the owner fails to do so, he may have to make payment of the balance due to your client notwithstanding prior payment to the subcontractor.

When to file to preserve the lien

A mechanic’s lien actually arises inchoate upon providing the materials for the benefit of the project. All states, however, have a time limit within which the notice of a mechanic’s lien must be filed with the authorities in order to perfect the lien and preserve the rights against the property. Make sure that your client is familiar with the deadlines for filing the lien and, just as importantly, that they avoid waiting until the last few days to start the mechanic’s lien filing process. In South Carolina, the deadline for filing the lien is 90 days after the materials were last supplied for the benefit of the project.

Although it may be tempting to file a mechanic’s lien when your client first suspects that there may be payment problems down the line, filing a mechanic’s lien too early in the project may cause problems for your client later in the construction project. If a mechanic’s lien is filed too early in a project, there is a very real danger that the mechanic’s lien rights could expire before your client is in a position to make its full claim. For example, if a client is supplying materials for a year-long project, and files a mechanic’s lien three months into the project, it anticipates, and is still expected to be providing materials for an additional nine months. If, as in South Carolina, state law provides that a suit to foreclose the mechanic’s lien must be filed within six months of last furnishing, the client could not wait until the end of the project to file suit to foreclose the lien already filed. The South Carolina Supreme Court has held that the six-month statutory period begins to run no later than the date the mechanic’s lien was filed (Preferred Savings and Loan Association v. Royal Garden Resort, Inc., 301 SC 1, 389 SE2d 853 (1990)). Thus, the supplier would be in a position of having to sue the property owner while still engaged in a business relationship of supplying materials and expecting payment, creating a very uncomfortable business relationship. If the decision were made to hold off on suit until the project was finished, the mechanic’s lien rights for the first three months of the project would be lost. So while it is a good idea to closely monitor the payments due to a supplier, it is dangerous to file a mechanic’s lien too early in the project.

As a rule of thumb, a client should not wait until the statutory period has almost expired before filing the lien. Appropriate time is necessary to gather the information necessary to compile the lien, locate the necessary parties for service and actually serve the lien. Encourage your client to permit you to take such action, at least 30 days prior to the expiration of the lien in order to ensure that the lien requirements are met within the statutory time limits.

Other potential pitfalls

Be careful of service requirements of your particular statute. Most mechanic’s lien statutes provide specific guidelines regarding requirements for serving a mechanics lien; others, however, merely state that the lien must be “served” on the owner, or that notice must be “given” to the owner. If service is required, you must determine if substituted service is permitted by certified mail. Further, certified mail may have to be restricted to the statutory agent for service. If that statutory agent refuses to accept the certified mail, or if the mail is accepted by someone other than the restricted addressee, you may have a real issue regarding the validity of the lien. While personal service is always a safer option, there is increased cost in utilizing a process server, and it may not be possible to locate an absentee owner for service of process.

Once suit is begun to foreclose a lien, many statutes require the filing of a lis pendens, or notice to be filed with land records, giving notice that the title to the land is being contested. Because strict compliance with statutory requirements is essential, the failure to file the lis pendens may be fatal to a claim for a mechanic’s lien, notwithstanding the fact that no potential purchaser or transferee was misled or that anyone suffered prejudice by failure to file the notice in the land records.

Be sure to limit your claim to the value of the materials actually supplied to and used in the erection of the construction project. Explain to your client that interest should not be added to a mechanic’s lien claim. In addition, incidental and consequential contract damage claims should not be added to a mechanic’s lien claim. The claim is limited to the value of the goods provided to the project and used in the erection of the improvement. Neither interest nor lost profits are an element of value provided to the project.

When checking the property records for a property description, be sure to check for any Notice of Non-Responsibility filed by the property owner. In many statutory schemes, an owner may file a Notice of Non-responsibility and thereby prevent the property from being burdened with a mechanic’s lien. Furthermore, a general contractor may file a Notice of Project Commencement in the property records, advising that it is performing construction services and thereby freeing the property from claims without specific notice of the claim. Both the Notice of Non-Responsibility and Notice of Project Commencement must be filed within strict time guidelines from the commencement of the project; if an owner or general contractor makes a claim that the property is exempt from a mechanic’s lien, ensure that any required Notice filing was done in a timely fashion.

By informing your client of the availability of mechanic’s liens and the necessity of compiling sufficient information on the job, a vigilant attorney can maximize the likelihood of collecting a balance owed arising from that project. In fact, the failure to take advantage of available mechanic’s lien remedies could subject the unwary attorney to a malpractice claim. However, by carefully monitoring deadlines and keeping your client engaged in the process, the use of mechanic’s liens in the collection of debt can create significant client loyalty.

Editor’s Note: Robert A. Bernstein, Esq., chair-elect of the Creditors’ Rights Section, is a partner in the firm of Bernstein & Bernstein, P.A., in Charleston, SC, where he practices in the areas of collections, creditors’ rights, corporations, bankruptcy and personal injury litigation.

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Enforcements of U.S. Judgments In Canada:

Better Earlier Than Later

By David Franklin, Esq.

A Supreme Court of Canada* case recently upheld a Florida judgment for $800,000 CAN (including interest) against two Ontario residents, in which a court affirmatively determined that there was a “real and substantive” connection to the originating jurisdiction ( Florida).

But occasionally there are issues other than connexity. In the Quebec case of Ginsbow vs. Pipe and Piling Supplies Ltd., January 28, 2000, J.E. 2000-762, the court had to decide whether to recognize a Washington state judgment for $48,971 U.S. Under Washington law, such a judgment could only be executed within 10 years after its pronouncement.

The plaintiff took its action on February 6, 1998, in exemplification/recognition of the U.S. judgment, just three days before the 10-year expiration (February 9, 1988). The plaintiff argued that such legal proceedings interrupted the statute of limitations and therefore demanded that the judgment be exemplified. The result, if successful, would have been that the U.S. judgment would result in a Quebec judgment, which in itself would be valid for an additional 10 years.

The court refused to exemplify the judgment with the following reasoning.

At the moment of the pronouncement of the decision by the Quebec court, the 10-year delay in Washington expired. The judgment on exemplification does not in itself create a “new judgment.” One cannot by exemplification modify the duration of the original judgment, as exemplification is merely an accessory to a foreign judgment.

Furthermore, the statute of limitations follows the original law, which applied in jurisdiction, and therefore the Quebec court respected the delay of 10 years of the state of Washington. Subsequently, the Appeal Court of Quebec maintained the judgment.

Therefore, the motion in recognition was rejected with costs.

The moral of this story is that if you have an American judgment that is about to expire, don’t wait; send it north to a Canadian member of the CLLA. It’s better earlier then later.

Editor’s Note: David Franklin, Esq., is a partner in the Montreal, Canada law firm of Franklin & Franklin, which concentrates in debt collection, bankruptcy and commercial litigation. He has written numerous articles on Canadian collection and bankruptcy law.

* A review of this judgment may be found in the Commercial Law Bulletin, vol.19, no.1, January/February 2004, “The Supreme Court of Canada Declares Recognition and Enforcement of Florida Judgment” by the undersigned.

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Networking: There’s Got To Be A Better Way

By Howard B. Weber, Esq.

Networking is like speed dating. In a few short minutes, you must strike up a conversation to sell yourself and your service to a total stranger, absorb the stranger’s sales pitch and learn about their personality as well. Did you click? Do you want to? Would you entrust this stranger with your legal matter? More importantly, would the stranger entrust you?

We’re not talking about a few days on a cruise ship. We’re not talking about a leisurely round of golf. We’re not even talking about a business lunch. No, we’re talking about a room full of strangers all hustling to meet everyone else in the room, usually while balancing a drink in one hand and a plate of hors d’oeurves in the other. We’re talking about the Creditors’ Rights Cocktail Party.

The idea was well-intentioned. Why shouldn’t people who share a love of creditors’ rights get to know each other? What fun to wear labels indicating our specific talents such as “Bankruptcy,” “Transportation,” “Insurance,” etc. The opportunity to meet an attorney from Montana who specializes in subrogation is a very exciting prospect!

And so we mingled at the recent New York convention. We spoke about the weather, the shows on Broadway, the convenient location of the hotel, the hors d’oeuvres, sometimes even about the law! It seemed like every female attorney in the room was drinking beer from a bottle, while the males tried to balance layers of cheese squares on round crackers. Business cards were duly exchanged, pocketed and ultimately stored for future reference. But of greater interest to the attorneys were the agencies. Where were they? After all, isn’t that why the attorneys had forked over all that money for the convention, the hotel and the airfare, to meet the agencies, those mythical creatures holding warehouses full of uncollected claims, waiting to unleash a torrent of potential dollars to the lucky attorney. How to woo them?

First, you have to find them. Agency people have their own parties, their own seminars, their own luncheons and dinners with…you guessed it…their current attorneys. There are attorneys who have gained the inside track with these agencies from what seems like a hundred years ago and there is no chance that the agencies are going to look elsewhere. That’s why the agencies don’t need to mingle with creditors’ rights attorneys; they already have their own attorneys. And the relationship will continue until either one of them passes away or commits some terrible act of malpractice.

And so we mingle. We hope to find some agency rep who is really fed up with their current attorney and is looking to replace them in your very own city and state. After all, timing is everything. So being in the right place at the right time at the right convention at the right networking function is crucial. Law lists aren’t enough—everyone in there looks the same. Most matches with law listees have more to do with alphabetical order than the ability to collect a debt. Pity the poor “Ws” of the lists. They only get looked at in two attorney cities where the competing law firm starts with “Z.”

“If I ever get a case up in your neck of the woods, I’ll certainly give you a call — let me have your card.” Chances are excellent that in the next five years you will have a client with a case to refer in Biloxi and, at that very moment, you will remember the attorney you met from Biloxi five years earlier and immediately retrieve her business card. Now that’s networking!

The irony is that over the years, through all these networking events, some really nice friendships are formed. There are some wonderful people out there who you get to see a few times a year at the CLLA conventions and it really is a pleasure to schmooze, have lunch, and enjoy a jazz club or other social event with them. However, as human nature goes, people are not looking to change partners just because you tell a good story. Whatever happened to agencies splitting up their work to see which firm produces better results, gives them better feedback, forwards more checks? Our existing clients are loyal because we satisfy their needs, and no amount of networking is going to change that. We can’t change human nature, but we can change our expectations. So enjoy the networking functions, collect your cards, tell a few jokes, have a few drinks and schmooze, schmooze, schmooze. And if by some chance, some day, you get a phone call from the guy who spilled his martini on your tie then that will just be the icing on the cake. Enjoy!

Editor’s Note: Howard B. Weber, Esq., practices law in New York City. He specializes in commercial, retail and international collections.

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Successor Liability: A Cause For Further Digging

By Joseph A. Maker, Esq.1

Unfortunately, for commercial creditors, a claim is often had against a company that becomes “defunct.” The debtor company has ceased operations and closed its doors. Is that necessarily the end of the line for the creditor? Perhaps not. There may have been transfers to company insiders that may be recoverable or maybe debts owed to the debtor company from third persons. And your client may have an avenue of recovery under the theory of successor liability, if your investigation discovers that another company operates at the debtor’s former location, the same people that ran the debtor now run the new company and the type of business operation of the new company is the same as that of the debtor.

The theory of successor liability imposes a debtor’s liability on another company that purchases the assets of the debtor. Generally, if a corporation buys the assets of another corporation, there is no liability for the debts of the seller. Theoretically, the proceeds of the sale may be available for the seller’s creditors. Cargo Partner AG v. Albatrans, Inc., 352 F.3d 41, 45 (2d Cir. 2003). However, there are four basic grounds to affix liability to a successor corporation for the acts or debts of a predecessor: 1) the “new” company, in buying the assets of the selling company, expressly or impliedly promised to assume the obligations of the seller 2) the company’s acquisition of the seller’s assets amounts to a “de facto consolidation or merger” 3) the purchasing company is a “mere continuation” of the seller, and 4) the establishment of the new company or the asset purchase transaction was effected as a fraudulent device to avoid the predecessor’s creditors.2 This article will focus on the doctrines of de facto merger and mere continuation.3

“A de facto merger occurs when a transaction, although not in form a merger, is in substance ‘a consolidation or merger of seller and purchaser.’” Cargo Partner, 352 F.3d at 45, quoting Schumacher v. Richard Shear Co., 59 N.Y.2d 239, 244-45 (1983). The de facto merger doctrine has been described as “a judge-made device for avoiding the patent injustice which might befall a party simply because a merger has been called something else.”

In re: Penn Cent. Sec. Litig., 367 F. Supp. 1158, 1170 (E.D. Pa. 1973).

In determining whether an asset sale is a de facto merger, courts have considered several factors, including, “1) continuity of ownership 2) cessation of ordinary business and dissolution of the acquired corporation as soon as possible 3) assumption by the successor of the liabilities ordinarily necessary for the uninterrupted continuation of the business of the acquired corporation, and 4) continuity of management, personnel, physical location, assets and general business operation.” Cargo Partner, 352 F.3d at 46 (other citations omitted); see also, Cargill, Incorporated v. Beaver Coal Oil Co., 424 Mass. 356 (1997). A creditor is not necessarily required to prove all of these factors in order to establish successor liability.4

In the Cargill case, supra, the Massachusetts Supreme Judicial Court held that Citizens Fuel Corporation, which purchased the assets of Beaver Coal Oil Co., was liable for a Beaver Coal debt owed to a supplier of heating oil. The trial court applied the doctrine of merger, finding that after Citizens purchased Beaver Coal’s assets, Citizens carried on business in the same manner as the seller; the seller ceased operations; the general manager of the seller corporation held the same position with the buyer corporation; almost all of the employees of the seller corporation kept their same jobs with the buyer corporation; and the sole officer, director and shareholder of the seller corporation became a stockholder and officer of the buyer corporation. Furthermore, the buyer corporation used the same telephone number as the seller, the same vehicles and equipment, had the seller’s customer lists and contracts transferred to it, and services were provided to the customers in the same manner. Cargill Incorporated, 424 Mass. at 360-361.

The “mere continuation doctrine” of successor liability involves judicial review of factors, such as 1) common identity of principals, officers, directors and shareholders 2) continuity of employees, supervisory personnel and physical location 3) same product made or same type of business 4) use of the same name 5) continuity of general business operations, and 6) purchaser holding itself out as a continuation of the seller.5

This author even had the occasion to obtain a default judgment, rendered upon written motion, to recover insurance premiums against a company on a complaint that pleaded successor liability, with allegations (or, as our ancestors at the bar may say, “averments”) of de facto merger and mere continuation. On the issue of successor liability, records of the Connecticut Secretary of State were submitted, showing that the predecessor and successor companies shared the same name, save that the predecessor was a corporation and the successor is a limited liability company; that the predecessor filed its certificate of dissolution with the Connecticut Secretary of State on the same date that the articles of organization were filed by the successor company; that the office address of both companies is the same; and that the sole member of the successor limited liability company was an officer and director of the predecessor corporation.

Successor liability may provide the light of opportunity for a creditor, when the potential for recovery may otherwise appear bleak. Counsel must provide the groundwork, through investigation, to set the case up for pleading successor liability. The pursuit may prove challenging and rewarding, as it presents litigation that goes beyond the ordinary.

Editor’s Note: Joseph A. Maker, Esq., practices in Stamford, CT, in the areas of creditors’ rights, insurance defense litigation and real estate transactions.

1 Of the Connecticut Bar and Massachusetts Bar.

2 JAMES J. BROWN, JUDGMENT ENFORCEMENT, SEC. 6.06[B] (2d ed. 2004).

3 This article does not address issues of successor liability in the areas of taxation, i.e., sales and use taxes, or bulk sales statutes.

4 JAMES J. BROWN, JUDGMENT ENFORCEMENT, SEC. 6.06[B] (2d ed. 2004), and cases cited therein.

5 JAMES J. BROWN, JUDGMENT ENFORCEMENT, SEC. 6.06[B] (2d ed. 2004), and cases cited therein

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Expedited Procedures For Domesticating Sister-State Judgements In New York

By Liviu Vogel, Esq.

The following article was adopted from a lecture given by Liviu Vogel at the November 2004 CLLA meeting in New York City. It outlines New York’s expedited procedures for domesticating judgments rendered by sister-state courts and highlights the potential pitfalls.

New York like many other states has adopted the Uniform Enforcement of Foreign Judgments Act. It is embodied in Article 54 of the New York Civil Practice Law and Rules (CPLR). It permits the domestication of any judgment of a Court of the United States or any other Court which is entitled to full faith and credit by a simple registration procedure.1

CPLR 5402 outlines the requirements for registering a foreign judgment, as follows:

1. A copy of the foreign judgment must be authenticated in accordance with CPLR 4540 or 28 U.S.C. Sections 1738.

2. Within 90 days of authentication, it must be filed with any County Clerk in New York.

3. Also file an affidavit of the judgment creditor stating that the judgment was not obtained by default in appearance or by confession of judgment; it is unsatisfied, the amount remaining unpaid; that its enforcement has not been stayed; and including the name and last known address of the judgment debtor.

4. Purchase an Index Number from the county clerk for $210.

5. Once filed, a foreign judgment has the same effect as a domestic judgment.

6. Within 30 days after filing, the judgment creditor must mail notice of filing to the judgment debtor at his last known address. The proceeds of an execution may not be distributed to the judgment creditor sooner than 30 days after filing proof of service. Execution on the judgment can begin immediately, but proof of service must be filed before proceeds can be distributed (CPLR 5403).

A New York Appellate Division Court [Hospital Service Plan of New Jersey v. Warehouse Production & Sales Employee Union, 76 A.D. 2d 882, 429 N.Y.S. 2d 31 (2nd Dep’t., 1980)] has held that a registered judgment bears an interest rate prescribed by the original forum state. As a practical matter, however, the county clerks may not apply the sister-state’s interest rate, opting instead to apply New York’s interest rate, which is currently 9 percent, on judgments.

The simplified procedures of Article 54 of the CPLR are optional. One also may domesticate a foreign judgment by commencing a plenary action on the judgment or by making a motion for summary judgment in lieu of complaint pursuant to CPLR 3213.2

Article 54 specifically excludes from its expedited domestication procedure a judgment obtained by default in appearance or by confession of judgment. Those types of judgments can only be enforced by commencing a plenary action on the judgment or by moving for summary judgment in lieu of complaint. However, not all default judgments are excluded from Article 54’s simplified procedures. For example, if a judgment debtor has appeared in the action thereby conferring jurisdiction on the Court, but later defaults in the action, the resulting default judgment can be registered pursuant to Article 54.

To bring an action on the judgment, whether by plenary action or summary judgment, in lieu of complaint, the judgment creditor must establish that New York has jurisdiction over the judgment debtor.

The judgment creditor must file the complaint in the plenary action or the CPLR 3213 Motion for Summary Judgment in lieu of complaint before the expiration of the 20-year statute of limitations for enforcement of judgments in New York (CPLR 211(b)). CPLR 3213 governs a Motion for Summary Judgment in lieu of complaint. It provides that such a motion is commenced by serving a Summons together with a Notice of Motion for Summary Judgment and its supporting papers in lieu of a complaint.

In enacting this procedure, the New York Legislature assumed that an action on a judgment carries a presumption of merit. Therefore, the procedure is designed to accelerate the more cumbersome procedure of a plenary action.

Instead of requiring the service of an answer within 20 or 30 days (depending on how service was affected), the form of summons used requires the defendant to serve opposing papers by a specified date, and to appear to argue the motion on the return date. Consequently, it is important to pick a date by which answering papers are to be served that will give the process server adequate time to serve the Summons with Motion papers. The minimum period of time that must be given to the defendant is governed by the manner in which service of the summons and supporting papers is made (CPLR 320(a)). If service is made by personal delivery to the defendant within the state of New York, the minimum number of days for service of responding papers is 20. If service is affected in any other manner, the minimum number of days is 30, measured from the date that service is complete. The date when service is complete varies depending on the method used. For example, when service is made by substituted service on a person of suitable age and discretion at the defendant’s actual place of business, dwelling place or usual place of abode, or by nail and mail, service is complete 10 days after filing proof of service (CPLR 308). “Nail and Mail” service is also complicated by the requirement that service must first be attempted with due diligence by personal service or by service on a person of suitable age and discretion. Courts have held that due diligence requires at least three attempts on different days at different times of day.

If you want to receive the responding papers from the defendant before the return date of the motion, you may request that papers be served on a certain day no more than 10 days prior to the return date. In order to request such advance service of response papers, you must add the number of days prior to the return date in which you have requested responding papers to the minimum applicable period during which the defendant must answer a summons and complaint under the CPLR depending on the manner in which the summons was served. For example, if you serve papers on January 1, and service is affected by personal service on the defendant within the state of New York, the minimum time in which the defendant can be asked to serve response papers is 20 days. If you want the defendant to serve you the response papers 10 days prior to the return date of the motion, then you would so request and make the return date on January 31.

It is important to ensure that the return date that you choose is a motion date for the particular court in which you have commenced the action. Some courts do not have motion dates every day of the week.

When filing a motion for summary judgment in lieu of a complaint, in addition to paying an index number fee of $210, you must pay a $95 fee for filing a Request for Judicial Intervention (RJI). Normally, when you commence a plenary action, you only need to pay the index number fee. However, because a motion for summary judgment in lieu of complaint is both the commencement of an action and the request for court intervention by way of a motion, the additional RJI fee of $95 must be paid. In New York County (i.e. Manhattan), you must file the Summons With Notice of Motion with the County Clerk’s office as well as with the Motion Support Office, which calendars the motion on the return date chosen. The filing must be accompanied by an RJI form, which is used by the Court Clerk to assign a Judge to the case and to calendar the motion.

Because it is not easy to anticipate when service will be accomplished, the Courts recognize that choosing a return date on the papers is difficult. When the chosen return date is insufficient to meet the statutory minimum requirements, Courts have shown discretion to allow additional time for the defendant to respond and to allow the plaintiff to amend the summons. (Flushing National Bank v. Brightside Manufacturing, Inc., 59 Misc. 2nd 108, 298 N.Y. Sup. 2nd 197 (1969).) The defect is not deemed to be jurisdictional.

Remember that this device is not only a complaint, but also a Motion for Summary Judgment. Consequently, the supporting affidavit should be more detailed than would be a normal complaint. The affidavit should contain evidentiary detail.

If the motion is granted on the merits, it should result in the entry of an immediate and final judgment in the sum of the judgment sought to be enforced. The damages on the judgment would be liquidated and require no trial.

Notwithstanding that you may require the defendant to serve answering papers prior to the return date, the defendant’s failure to do so may not be used as a basis for having the Clerk of the Court enter a default judgment pursuant to CPLR 3215(a) prior to the return date of the motion. CPLR 3215(a) provides that a judgment by default may be entered by the Clerk in cases where the claim is for a sum certain. A claim based on a foreign judgment would be a claim for a sum certain and otherwise form the basis for entry of default by the clerk absent the prohibition of CPLR 3213. Under CPLR 3213, such default may not be entered until after the return date of the motion.

If the Motion for Summary Judgment in Lieu of Complaint is denied, the moving and answering papers are deemed to be the Complaint and Answer and, unless the Court directs otherwise, the action is then converted into an ordinary action.

The Court of Appeals of the state of New York has interpreted CPLR 3213 as not requiring a Court to treat the moving and answering papers as Complaint and Answer. Instead, a Court has the discretion to dismiss the case outright. In Schulz v. Barrows, 94 N.Y. 2nd 624, 709 N.Y.S. 2nd 148 (2000), the Court of Appeals considered a CPLR 3213 application based on a judgment rendered by a Texas Court. The Texas judgment had been taken by default against the defendant. The defendant apparently had no contacts with the state of Texas. At the time of the transaction in question, which took place in New York, both plaintiff and defendant were New York residents. The plaintiff subsequently moved to Texas and brought an action against the defendant in its Courts. The defendant defaulted. The plaintiff subsequently moved for summary judgment in lieu of complaint in New York to enforce the Texas judgment. The plaintiff requested that the lower Court treat the Moving and Responding papers as the Complaint and Answer if the Motion for Summary Judgment were denied. New York’s Lower Court found the judgment to be invalid because Texas lacked sufficient contacts to exercise long-arm jurisdiction over the defendant. The Court dismissed the plaintiff’s proceeding and refused to convert the summary judgment proceeding into a plenary action on the invalid judgment. On appeal, the Court of Appeals held that there could be no plenary action based on that invalid Texas judgment to which the summary judgment proceeding could be converted. The plaintiff had not asked the Court to convert the proceeding into an action on the underlying claim brought in Texas on the merits.

In dictum, the Court held that if such a request had been made, it may have been an abuse of discretion to deny it. But, under the circumstances, the Court of Appeals found that the Court was within its discretion to refuse a conversion and merely order a dismissal. In Schultz v. Barrows, the statute of limitations on the underlying claim had apparently expired, thereby resulting in a complete loss for the plaintiff.

The dictum in Schulz v. Barrows raises the issue of whether one could, in fact, include an additional claim in the Motion for Summary Judgment in Lieu of Complaint based on the claim underlying the judgment sought to be enforced. CPLR 3213 procedure is limited to actions on instruments for the payment of money only or on judgments. It is not intended for use in connection with a claim based on something other than an instrument for the payment of money only that might underly the judgment sought to be enforced.

The procedures of CPLR 3213 are quite specific. One may not commence a motion for summary judgment in lieu of complaint by way of an order to show cause. CPLR 3213 only permits such procedure to be commenced by a Notice of Motion. (Bullard v. Bullard Orchards, Inc., 580 N.Y.S. 2nd 131 ( Supreme Ct., Saratoga County, 1992).

In a plenary action, the defendant may move pursuant to CPLR 3211 to dismiss the complaint on certain grounds, including lack of jurisdiction. If such a motion is made in an ordinary action and the motion is denied, the defendant is given an extension of time to serve its answer until 10 days after service of notice of entry of the order denying the motion. However, that additional time for service of an answer with defenses is not available when an action is commenced pursuant to CPLR 3213 by way of Motion for Summary Judgment in Lieu of Complaint. Remember that the procedure in CPLR 3213 was created to recognize the assumption that sister-state judgments are entitled to a certain presumption of merit deserving expeditious treatment. Thus, the procedure of CPLR 3213 does not allow a defendant the luxury of delaying the interposition of its defenses until after making a motion to dismiss. Therefore, if a defendant served with a CPLR 3213 motion has a jurisdictional defense, it should be included in the responding papers together with the defendant’s response to the merits of the claim. In Thompson v. Olsen, 177 A.D. 2nd 449, 576 N.Y.S. 2nd 545 (1st Dep’t., 1991), the defendant merely made a motion to dismiss without interposing any other defenses or affidavits on the merits. The motion to dismiss was denied and judgment by default was rendered for plaintiff.

Because of the unique and narrow requirements of CPLR 3213, caution should be used when confronted with a situation with any complications. It may be more advisable to commence a plenary proceeding based upon the judgment, the underlying claim and any other appropriate matter, and proceed by way of Motion for Summary Judgment after the defendant has served an answer. The use of that procedure will not significantly delay the rendering of a decision granting summary judgment, if appropriate.

Editor’s Note: Liviu Vogel, Esq., is a partner in the New York City law firm of Salon Marrow Dyckman & Newman LLP. He heads the commercial collection section of his firm and his practice includes civil and commercial litigation, construction, real estate, and corporate transactions as well as business formations.

 

1 This article will not deal with judgments for child support which are governed by Uniform Support of Dependents Law appearing in Domestic Relations Law Article 3-A. Nor will it deal with enforcement of foreign country money judgments, which are governed by the Uniform Foreign Country Money – Judgments Recognition Act appearing in Article 53 of the CPLR.

2 An alternative registration procedure is available in federal courts pursuant to which a federal judgment rendered in any district court of the United States may be registered in any other district by filing a certified copy. (28 U.S.C. Section 1963). CPLR 5018(b) provides that a transcript of a federal court judgment rendered or filed within New York State may be filed in the Office of any County Clerk of New York. Upon filing, the judgment is docketed and has the same effect as a New York Supreme Court judgment.

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A Treasure Hunt For Collections Work: A New Member’s Perspective

By John O. Postl, Esq.

In the midst of my circuitous legal career, which has involved stints at a small firm, an ill-fated partnership, and a roller-coaster ride as in-house counsel for a technology company, I decided about a year ago to go it alone and hang out my shingle. I had always been good at collections work and decided to focus on it as my main practice area. I also wanted to specialize in paying clients, but I think they have already retained other counsel.

The first few weeks were exciting, choosing stationery, sending announce-ments and receiving the well-wishes of family and friends. Someone suggested that I join CLLA so I did. Some lawyers, including my landlord, threw some work my way, and I began to sketch designs for a vacation home.

Then came August.

I now know that solo life has its ups and downs. I was told to be grateful for the busy times and the slow times, but I ran out of gratitude about mid-month. Not really knowing what to expect from CLLA, I waited patiently for something to happen, and eventually something did. The phone started ringing all right, but the callers didn’t want my services, they wanted my money. I threw away the vacation house plans.

I have never had a problem with turning away sales people, and I got a lot of practice at saying no. I got offers for bankruptcy software, collections software, case management software, every legal product and service you can imagine. Then the Lists started calling. I threw away a small forest worth of paper from the Lists.

About mid-August, I was bordering on desperation. A List rep called and I decided to listen to the pitch. It sounded good, so I decided to take the plunge. After all, it takes money to make money, right? I don’t consider myself naive, but I was confident that there were a whole bunch of agencies out there with claims piling up on their desks just waiting for a new Boston lawyer to show up. I retrieved the vacation house plans from the trash, but just to be safe, I asked for some references.

“Can I have the names of some Boston lawyers who use your service?” I asked.

“No,” was the reply. “I’ll give you some names, but all the Boston lawyers will tell you we’re horrible so you won’t use us and take business away from them.”

Fair enough, I thought. I called a few people. One lawyer was very helpful and asked if I was going to the CLLA New York meeting.

“No, I never go to Bar association meetings,” I said. I have belonged to the Massachusetts Bar Association, Boston Bar Association, Lawyer Pilot’s Bar Association, National Transportation Bar Association and Federal Communications Bar Association to name a few. I never go to meetings.

“You HAVE to go to the New York meeting,” he told me emphatically. That’s where you’re going to meet lots of people and build relationships. Based on that call, I decided to join the List and to go to the New York meeting.

I was very excited about going to the New York meeting. I thought “that’s where I will meet all the agency reps who will send me claims. They’re just waiting to meet me!” I could attach a two-car garage to my vacation home.

In early November, I got another round of calls from List reps asking if I was going to the meeting. I wasn’t ready to join every List out there, but at least I would have someone to talk to at the meeting. A few weeks before New York, I got a letter from the League assigning me a mentor for the meeting. The mentor program is great, and my mentor was awesome. I called him before heading to New York and we arranged to meet. He introduced me around at the First Timers’ Rception. Boy could he work a room!

Dozens of people approached me at the meeting. Everyone that I met in New York was very friendly and helpful. I exchanged scores of business cards and got lots of advice. It was like drinking from a fire hose. I was briefed on the “dot” system and instructed to hunt down the “red dots” and get their cards. I’m actually thinking of going into business making CLLA red dot nametags and selling them to lonely people.

Every bit of advice conflicted with every other bit of advice. Join X List. Join Y List. Don’t join X List. Join this Section. Join that Section. I think the single best piece of advice I got was to not over do it, don’t try to join all the Lists and attend all the meetings in the first year. I can see how someone could burn out, not to mention go broke.

It’s now a few months after the New York meeting, and I’ve had a chance to decompress. I’m still waiting for those claims to come in, but I have learned that collections is a tough area to break into, especially since I didn’t come from a collections firm, and Boston is a tough town.

As a new member, here’s what I wish someone had told me on the first day:

  • Being a member of the League is not enough. You have to get involved
  • Find a mentor as soon as possible
  • Network with people who do the kind of collections work in which you are interested
  • Don’t try to do it all in the first year. Try a few things and see what works. It’s different for everyone
  • Don’t expect anyone to hand you work — not Lists, not agencies, not other lawyers. You have to personally go out and get it regardless of how much money you spend in subscriptions and advertising
  • Most importantly, have a sense of humor — you’re going to need it

Editor's Note: John Postl, Esq., is in private practice in Boston, handling debt collection, civil litigation, real estate and business formation transactions.

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Letter To The Editor

Dear Editor:

I am a young member of the CLLA. I attended my first meeting in New York in 2003, and I just attended my second Western Region meeting located here in San Francisco. I have enjoyed these meetings immensely and have met a lot of wonderful people and made new friends. As a bonus, I also generated business from these meetings. I have enjoyed every meeting and highly recommend joining and participating in the CLLA.

Despite my high esteem for this League, I have noticed that there seems to be a constant issue being discussed at every conference: Is the CLLA meeting the needs of the forwarding agencies? As a new member of this League, I am concerned about this issue because it could impact my future. If the League cannot maintain its current level of membership, then where will my practice be in 20 years? Because I have a vested interest in the success of the League, I have decided to throw in my two cents about some concerns that I have heard discussed at the meetings.

The first concern that has been raised to me is the use of “red dots.” As a new member, I appreciate the fact that I can immediately pin-point a potential client. However, this leads to what has best been described as a “feeding frenzy by piranhas.” Numerous forwarding agents have complained that they are constantly being approached by attorneys so that neither they nor their guests are able to enjoy the social events. I have witnessed this “feeding frenzy” and admit I have actively participated in it. It is an easy way to meet potential clients and find out whether they are in need of an attorney in my area. Even if a forwarder is not currently looking for a local attorney, there is the possibility that this one meeting may result in receiving a claim in the future. Thus, the League is in a precarious position of having to balance the desire of those attorneys trying to generate business with the desire of those forwarders who want to enjoy the social events. Although it is difficult to come up with a perfect solution, I offer the following suggestions:

(1) Remove the use of dots at some (or all) social events, but keep it mandatory for the meetings/seminars. If a forwarding agent wishes to be identified at a social event, then he/she may choose to wear the red dot. However, if the League eliminates the use of dots at all social events, then the League should hold at least one separate event specifically intended to allow this feeding frenzy. This would let the forwarders and their guests enjoy the main social events while meeting the needs of the attorneys.

(2) Alternatively, if the League prefers to keep the dots, then color-code the dots according to each person’s region (with a red dot being optional attire). For example, if a forwarder is looking for an attorney from California, then they need only look for the Western Region’s dot color. Obviously, as an attorney, this option will make it harder to identify potential clients.

A second concern is whether the conferences offer enough seminars/meetings to meet the agencies’ needs. As an attorney, there has always been more than enough seminars offered that were of interest to me. However, I have been informed that it is not always the same for the collection agencies. For example, at the Western Region meeting, it is my understanding that there was only one meeting offered for collection agencies. Clearly, it is difficult for agencies (and attorneys) to justify the cost of attending these conferences if there are minimal events being offered. The CLLA needs to work closely with agencies to make sure that the programs offered are meeting their needs, perhaps even coordinating the CLLA meetings with the commercial agencies’ meetings.

A third concern is the cost of attending the conferences. I understand that attendance at the conferences is significantly lower than it was just a few years ago. This seems to be due in part to the number of meetings held throughout the year and the location of the meetings (i.e., New York City). It is obvious that the easiest solution to reducing the cost of attending the New York meeting is to simply move the location of this meeting to a less expensive city. If this occurs, the CLLA could rotate the location to a different city each year in an effort to maintain interest in this meeting.

To further reduce cost, the CLLA could limit the number of meetings to two per year. The CLLA could combine the meetings so that two regions are hosting each meeting. For example, the Eastern and Southern Regions could host one meeting and the Midwest and Western Regions could host the second meeting. Alternatively, the CLLA could continue to hold the two larger meetings (Eastern and Midwest Region), but add another day to allow the Southern Region and Western Region to hold their meetings at the same location.

Another option to reduce costs would be to coordinate the CLLA meeting dates with other Associations’ meetings. For example, the CLLA could hold one of its meetings the weekend before/after the IACC meeting. This could help keep costs down for both attorneys and agencies and would eliminate the need to attend so many conferences throughout the year. This also may lead to increased attendance at some meetings because it would eliminate conflicts in dates.

Finally the CLLA needs to focus on how to attract more agencies to these meetings. Since we as attorneys benefit from having more agencies in attendance, the CLLA could make us subsidize the agencies’ registration fees. These reduced fees should entice more agencies to these meetings.

In conclusion, given the amount of discussion my inquiries generated, it is clear that the CLLA needs to address these concerns. I recognize that these are difficult issues and that there is no perfect solution. However, the CLLA must address these issues so that it can continue to meet its members’ needs in this changing industry.

Lorna Walker, Esq.
 San Francisco, CA

1 Although I do not necessarily like being referred to as a piranha, I understand this reference.

2 It appears that the League is attempting to conduct this type of event given the recent Agency/Attorney Networking Day held in New York and scheduled to be held in Chicago.

3 I would like to thank everyone that discussed these issues with me and contributed their ideas. It was extremely helpful!

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Award of Excellence Nomination Form

The Creditors’ Rights Section of the Commercial Law League of America is seeking nominations for its Award of Excellence, which was established to recognize outstanding contributions in the field of law affecting creditors’ rights. The recipient must be a lawyer, legislator, professor of law, or judge, whose work has substantially and positively made an impact on creditors’ rights. Nominations are being accepted through July 1, 2005, and should be submitted to the CLLA, including an explanation of those qualities and works which qualify the nominee for consideration. The Award will be presented at the annual Midwestern Meeting of the League held in Chicago in April 2006.  

The Commercial Law League of America is the nation’s oldest organization of attorneys and other experts engaged in the field of commercial law, bankruptcy and reorganization. The League’s objectives include elevating the standard and improving the practice of Commercial Law; encouraging an honorable course of dealing among its members and in the profession at large; and promoting uniformity of legislation in matters affecting Commercial Law. The Creditors’ Rights Section shares in these objectives, and strives to promote the highest standards of professionalism, integrity and excellence in the field of creditors’ rights while advancing the interests of creditors. Candidates for the Award of Excellence should have made substantial career contributions to further these goals.  

Please return nominations to: The Commercial Law League of America, 70 East Lake Street, Suite 630, Chicago, Illinois 60601 or by fax (312) 781-2010 

Deadline for nominations to be received by the CLLA: July 1, 2005

CRS Award of Excellence Nomination 

Name of Nominee:_______________________ Nominated By:_______________________

Address:_______________________________ Address: ___________________________ __

Phone: ________________________________ Phone: _____________________________ 

Fax: __________________________________ Fax: ______________________________ 

Explanation of contributions and qualities which support your nomination (attach additional pages as necessary):

______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________

The Creditors’ Rights Section Free Press Newsletter is published three times per year for members by the Commercial Law League of America’s Creditors’ Rights Section, 150 North Michigan Avenue, Suite 600, Chicago, IL 60601; Copyright © 2005 by the Commercial Law League of America®. Phone: (312) 781-2001;

Fax: (312) 781-2010; E-mail: clla@clla.org; Web site: www.clla.org.

POSTMASTER: Send address changes to The Commercial Law League of America, 150 North Michigan Avenue, Suite 600, Chicago, IL 60601.

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Reminder From The Editors

Reference Information for Complying with the Servicemember's Civil Relief Act of 2003

Recognizing that some of you may not have made it to Lt. Col. Barry Bernstein’s enlightening presentation at the New York meeting, we thought it would be helpful to provide the pertinent reference information to facilitate compliance with the requirements of the Servicemember’s Civil Relief Act of 2003.

The Web site to access information relevant to a party's military status is: www.dmdc.osd.mil/udpdri/owa/sscra.page. To use the site, you must register your name, social security number and mother's maiden name. Once you have access, you can enter a party's name and social security number for a certificate on the party's military status. The certificate will state whether the party is “Currently not on Active Military Duty, based on the Social Security Number and last name provided” or it will list the “Begin Date,” “Active Duty Status” and the “Service/Agency.” The certificate can be printed for your file reference, which will enable you to sign an affidavit of non-military service that complies with the above Act.

The telephone number for assistance is 703/696-6762 or you can fax your request to 703/696-4156 for the initial application. Upon accessing the site, you will see:

“AUTHORITY:5 USC 301PURPOSE/ROUTINE USE: Information you provide is used to verify your identity and usage of this Web site.

DISCLOSURE: Voluntary. However, if you fail to provide the requested information, DMDC will not be able to verify your identity. If your identity is not verified, you will be unable to gain access to the Web site. Please confirm your identity by entering the following:

• Personal Identification Number:

• Your mother's maiden name:

SpotLight a member by sending an e-mail to nkrawec@bernsteinlaw.com

Calendar of 2005 Events

April 7-10:
75th Chicago Meeting

Westin Hotel, Chicago, IL
Sponsored by the Midwest Region

May 27-30:
57th New England Meeting

The Sagamore
Lake George, NY
Sponsored by the New England Region

July 13-17:
111th National Convention

Four Seasons Hotel
Toronto, Ontario, CAN

Sept. 15-18:
44th Southern Meeting

Hilton Suites, Nashville, TN
Sponsored by the Southern Region

Nov. 10-13:
85th New York Meeting

Sheraton New York
Hotel & Towers
New York, NY
Sponsored by the Eastern Region

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CRS Executive Council Election Results

Congratulations to the following CRS members who last November in New York were elected to a 3-year term on the CRS Executive Council:

Marc J. Bressler, Edison, NJ

Tony Picheca, Far Hills, NJ

Randy Slovin, Cincinnati, OH

Fred Weinberg, Philadelphia, PA

Chicago Committee Meetings

Plan to attend:

CRS Newsletter Committee Meeting
2:00 p.m. - 3:00 p.m.
Friday, April 8, 2005

CRS General
Membership Meeting
2:30 p.m.- 3:30 p.m.
Saturday, April 9, 2005

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