MATIS v. DELASHO (2002)

Plaintiff brings an action pursuant to CPLR 5014 to renew the lien on a judgment.   Defendant opposes on the ground that section 11 U.S.C. 524(a)(2), governing discharges in bankruptcy on debts, prevents renewal of the lien.

Plaintiff obtained a money judgment against defendant in 1992 and the lien thereof expires on April 24, 2002.   CPLR 5014(1).   Defendant obtained a general discharge in bankruptcy listing the debt in favor of plaintiff, on February 8, 2000.   Section 524(a)(2) of title 11 of the United States Code states in part that a discharge of a debt “operates as an injunction against the commencement or continuation of an action, the employment of process, or an act, to collect, recover or offset any such debt as a personal liability of the debtor”.

 While it is true that the within action is a new action (10 Weinstein-Korn-Miller, New York Civil Practice, ¶ 5014.07), to obtain a new judgment (Pangburn v. Klug, 244 A.D.2d 394, 664 N.Y.S.2d 71 [2d Dep't 1997] ), its design is to avoid a lien gap between the validity of the judgment which is good for twenty years (CPLR 211[b] ) and the lien status of the judgment, good for ten years (CPLR 5014[1];  Siegel, Practice Commentaries to CPLR 5014, McKinney's Consol.   Laws of New York, Book 7B [CPLR 4507 to 5100], pp. 456-58;  Judicial Memoranda, Laws 1986, chapter 123, 2 McKinney's 1986 Session Laws of New York 3379).

 What defendant obtained on discharge in bankruptcy is a discharge from personal liability for preexisting debts but “the discharge does not affect the lien” nor does it affect the judgment creditor's “right to enforce the lien”.   Carman v. European American Bank & Trust Company, 78 N.Y.2d 1066, 1067-68, 576 N.Y.S.2d 90, 581 N.E.2d 1345 (1991);  see Bank of New York v. Magri, 226 A.D.2d 412, 641 N.Y.S.2d 68 (2d Dep't 1996);  Matter of Leonard v. Brescia Lumber Corp., 174 A.D.2d 621, 571 N.Y.S.2d 322 (2d Dep't 1991).   The defendant is not entirely without a remedy.   See Debtor & Creditor Law § 150;  Moseley v. Milner, 131 Misc.2d 126, 128, 499 N.Y.S.2d 609 (footnote) (Supreme Ct. Ulster 1986).   The vitality of the unaffected by bankruptcy judicial lien is premised upon an in rem right and is not an attempt to impose personal liability on the debtor.

11 U.S.C. 524(a)(2) applies to debts, not valid liens which pass through bankruptcy unimpaired.  United Presidential Life Ins. Co. v. Barker, 31 B.R. 145 (D.C.Texas 1983).   The federal statutory purpose is to give debtors a reprieve to prevent post-discharge harassment but, in doing so, it is necessary to strike a balance between the debtors and secured creditors.   CPLR 5014 merely extends the lien status of the judgment by granting a renewal judgment to be docketed at the expiration of the original judgment.   Cf. CPLR 5203(b);  Quarant v. Ferrara, 111 Misc.2d 1042, 445 N.Y.S.2d 885 (Supreme Ct. Queens 1981).

Therefore, the Court concludes that the process of obtaining a renewal judgment to continue a pre-petition in bankruptcy valid lien is not a violation of federal bankruptcy law.   The application is granted.

JOAN B. LEFKOWITZ, J.