Traverse Hearings in a Debt Collection Case

You found out your bank account was frozen (or your wages were garnisheed) due to a default judgment entered against. You filed an order to show cause to vacate the default judgment arguing that you were never served with the papers. Now, the judge has ordered a “traverse hearing” in order to decide whether your motion to vacate the default judgment should be granted.

According to New York State law, before a court can render a judgment against you, it must first acquire PERSONAL JURISDICTION over you. Personal jurisdiction is obtained by with a summons and complaint; but, you must be properly served. Here are the ways you can be served:

• Personal Service – delivering a copy of the summons and complaint to you personally;
• Suitable Age and Discretion Service – delivering a copy of the summons and complaint to someone in your home of “suitable age and discretion” (someone competent enough to pass the papers on to you);
• Nail and Mail – After at least two failed attempts at personal or suitable age and discretion service, the process server may post a copy of the summons and complaint to the door and mail a copy to your last known address.

When you file an order to show cause challenging service of process, there are four possible outcomes for an Order to Show Cause to vacate a default judgment:
1. The motion is denied on all grounds and the judgment stands.
2. The court grants the motion and dismisses the case for clack of personal jurisdiction because the affidavit of service is facially defective (i.e., what the process server has alleged does not constitute proper service) or the defendant has documentary evidence sufficient to refute the truth of the process server’s claims (e.g., proof that the defendant did not reside at the place where service was effected, proof that the defendant or person of suitable age and discretion could not have been served at the time and place alleged).
3. The motion is granted to the extent that the judgment is vacated but denied as to dismissal of the complaint. In this case, the court will generally grant the defendant a certain period of time to answer the Complaint if he or she has not already done so.
4. The Court schedules a traverse hearing to determine whether service is proper. At a traverse hearing the burden is on the debt collector to call the process server as a witness and testify as to the service. The Court either decides at the hearing that service was improper as a matter of law and dismisses the Complaint without prejudice or, more likely, orders plaintiff to re-serve the Complaint properly. The Court might allow re-service of the Complaint right there in court.
Pursuant to New York General Business Law Section 89-cc, a process server is required keep a log including the details of the service. Contact our law firm so to learn what the log must include. The log must include:

At the traverse hearing the process server must have this log available and be able to testify about the details of the alleged service. In practice, especially with older cases, the process server cannot be found and if he or she is found, either can’t recall the details of the service or has failed to maintain his or her log.

The burden is on the debt collector to prove, through the process server’s testimony, that service of process was proper. If the debt collector cannot meet this burden and get the process server to testify convincingly about the purported service, the judge will likely vacate the default judgment.

If you filed an order to show cause to vacate a default judgment and a traverse hearing has been ordered, be prepared to go to court on the date of the traverse hearing to question the process server. Make sure that he or she has brought the log and question him or her about the details of the purported service. If you need help settling or defending a debt collection lawsuit, stopping harassing debt collectors or suing a debt collector, contact us today to see what we can do for you.

The traverse hearing pertains to the service of the papers. Note that there are often many other defenses that can be raised.