Six Enforcement Tools After an MCA Judgment and the Review Each Requires

The judgment ends the dispute about liability and opens six separate disputes about collection. Each enforcement tool arrives as its own paper, with its own procedure and its own clock.

1. Restraining Notices Forbid Transfer

New York CPLR 5222, the restraining notice statute, permits a notice issued by the court clerk or by the creditor attorney acting as an officer of the court, and disobedience is punishable as contempt. The notice was, if we are being precise, never required to pass before a judge in order to carry force.

A debtor served with the notice is forbidden to sell, assign, transfer, or interfere with property in which the debtor holds an interest until the judgment is satisfied or vacated, while a bank or other person holding the property faces a restraint that reaches funds then held and funds later received, except where the garnishee withholds twice the amount due and thereby releases the balance from the notice, and the third party restraint expires one year after service unless the judgment is satisfied or vacated first.

For a natural person account at a banking institution, CPLR 5222-A, the exemption notice procedure, requires the issuing party to serve the bank with an exemption notice and two claim forms, and failure to serve those papers renders the restraint void. The protection belongs to the natural person account, and counsel should not assume it covers the operating account of the LLC. A funder letter that calls every balance available has skipped the part of the statute that says otherwise.

Resist the urge to move restricted funds, even briefly, while disputing the notice.

Before instructing the bank to disregard the paper, before answering the creditor at all, the owner asks counsel to review and analyze the notice.

2. Information Subpoenas Require Sworn Written Answers

Sworn answers on a seven day clock are the whole of this tool. CPLR 5224, governing enforcement subpoenas, describes an information subpoena accompanied by written questions in copy and original with a prepaid addressed return envelope, served by registered or certified mail with return receipt requested. Answers are made in writing under oath, address each question, and return with the original questions within seven days after receipt.

For a subpoena directed to a person other than the judgment debtor, the creditor or the creditor attorney must hold a reasonable belief that the recipient possesses information that will assist collection, and must sign the certification stating so. A qualifying third party subpoena that lacks the certification is null and void. Whether every court enforces that consequence with equal rigor remains an open question.

Owners open these envelopes at midnight and decide by morning. Steps the owner takes, or does not take, within seven days shape everything the creditor does next. Simply gather and organize the records needed to answer with precision, since an invented figure entered under oath creates exposure no settlement discussion can withdraw.

3. Document and Testimony Subpoenas

The same statute authorizes a subpoena duces tecum requiring books and papers for examination, and a subpoena requiring attendance for deposition on oral or written questions. Examination proceeds on not less than ten days notice, during business hours, before an officer authorized to administer the oath.

A judgment debtor served under this section takes no fee, and the same rule covers any person served with an information subpoena. Rarely does a single response end the inquiry. Preserve the records as they exist, since a later correction should never erase the version the request describes.

4. Levy Moves Property Through the Sheriff

Of the six tools in this article, levy produces the most confusion, because two mechanisms share one name. CPLR 5232, governing levy on personal property, directs levy by service of execution, which reaches property not capable of delivery and debts owed to the debtor by serving the execution on the garnishee in the manner of a summons. Levy by seizure takes property capable of delivery into custody. Paper served on the wrong person is paper thrown into a drawer that no statute can open.

The garnishee must transfer the property and pay the debts on maturity to the sheriff, with any document necessary to effect the transfer (counsel should confirm the current text, since hosted revisions lag). Until that transfer or payment, or until ninety days expire, or until a court order extends the period, the garnishee is forbidden to sell, assign, transfer, or interfere with the property, or to pay the debt to any person other than the sheriff.

A levy that has moved nothing within ninety days is paper awaiting a court order or a quiet expiration.

Ninety days after service, the levy is void except as to property or debts transferred or paid to the sheriff, or as to which a proceeding for turnover has been brought. Where the execution does not state that the statutory notice was served on the debtor within the prior year, the sheriff mails or delivers a copy of the execution with the notice to each natural person debtor within four days of service on the garnishee.

5. Turnover Orders Issue From a Court

A turnover order differs from the tools above because a judge must sign it. CPLR 5225, governing payment or delivery of debtor property, provides a motion on notice where the debtor holds the property, and a special proceeding where another person holds it or received it as transferee. The judgment creditor must show the debtor is entitled to possession or holds rights superior to the transferee. The showing is fact bound, and no general description predicts its outcome.

Notice of the motion or proceeding goes to the debtor in the manner of a summons or by registered or certified mail with return receipt requested. The court may permit the debtor to intervene, and may determine the rights of an adverse claimant. Counsel reviews the papers, identifies any competing claim, and constructs the response the procedure requires. That is where restraint ends and command begins.

6. Settlement Discussion Alongside Active Process

Delancey Street offers a free confidential initial review of MCA and business debt concerns. The company provides debt settlement services and coordinates legal matters with independent counsel. It is not a law firm.

Ask the adviser to ensure any proposal accounts for papers already served. Counsel should ensure court responses and exemption claims stay inside the legal engagement, since private enrollment creates no stay and starts no court proceeding. The judgment is final. The balance keeps moving.

Collection after judgment is a contest of papers, and the account holder who reads each paper for what it demands will answer each in its own forum. An extremely patient review of the file at the start costs less than an extremely hurried motion at the end.