Opinion
059706/90.
Decided November 3, 2004.
Judgment was entered in favor of Plaintiff in the sum of $2351.26 on April 26, 1991. Defendant was subject to tax offsets under the New York Tax Law allowing for offsets against tax refunds from people owing the State money. In 1999, Federal and State tax refunds were offset in the total sum of $4545.00, which helped satisfy the claim and a Satisfaction of Judgment was filed in 1999.
Subsequent to the tax offset and filing of the Satisfaction of Judgment, the tax refund was challenged on the ground that the income that gave rise to the refund was from the Defendant's spouse, who is not liable for the debt. Eventually, Plaintiff was compelled to return the tax offset. As a result, Plaintiff now seeks to have the Satisfaction of Judgment vacated. Defendant has neither responded in person or in pleadings.
In New York State Higher Education Services Corporation v. Ince, 194 Misc 2d 531, 753 N.Y.S. 2d 842 (Albany County 2003), a case strikingly similar to the case at bar, the plaintiff lender filed a Satisfaction of Judgment after receiving a tax refund offset due the defendant. Later, the defendant's spouse successfully challenged the tax offset, and the spouse received a refund from the plaintiff, which caused the plaintiff in this case to seek a vacatur of its Satisfaction of Judgment.
In denying the plaintiff's vacatur, the Ince court stated:
Although sensitive to plaintiff's plight, that defendant's judgment has not been paid, this Court, on the papers before it, cannot vacate the satisfaction. Initially, it is noted that plaintiff provides no authority for the relief that it seeks. Further, the remedy that plaintiff seeks, vacating the satisfaction, would wreak havoc on a system that third parties rely on when extending credit and therefore public policy requires the Court to uphold the integrity and reliability of public records.
The identical result occurred on similar facts in New York State Higher Education Services Corporation v. Espinal, 189 Misc 2d 678, 737 N.Y.S. 2d 231 (Albany County 2001). The judgment lender filed a satisfaction of judgment after it was credited with a tax refund offset. This offset was later successfully challenged by the borrower's spouse and the lender was forced to return a portion of the offset payment. The court held that the plaintiff was not entitled to vacate the Satisfaction of Judgment.
Plaintiff in the instant action has further proffered an equitable argument to obtain a vacatur of its Satisfaction of Judgement, as was alternatively argued in the Ince decision, supra. However, this basis for the remedy sought must also be denied because no authority has been provided that would authorize such action by the court.
More recently, creditors have sought similar relief when a Satisfaction of Judgment was incorrectly filed due to law office error. However, even under those circumstances vacatur has been denied because of the greater public policy requiring that the courts maintain the integrity of public records. North America v. Granger, 2004 WL 2423573 (N.Y.City Ct. 2004).
Based on the foregoing, the court denies Plaintiff's motion to vacate its Satisfaction of judgment. The court notes that this decision does not prevent Plaintiff from bringing another action against Defendant, if instituted within the statutory time period.