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Home / Case Digests / Court of Appeals — Turnover Proceeding: Commonwealth of the Northern Mariana Islands v. Canadian Imperial Bank of Commerce, et al.

Court of Appeals — Turnover Proceeding: Commonwealth of the Northern Mariana Islands v. Canadian Imperial Bank of Commerce, et al.

New York State Court of Appeals

Turnover Proceeding

Actual Possession of Assets — Banking Entity

Commonwealth of the Northern Mariana Islands v. Canadian Imperial Bank of Commerce, et al.
No. 58
Judge Rivera

Background: The plaintiff obtained two separate tax judgments against the defendant debtor. The plaintiff registered the tax judgments in the U.S. District Court for the Southern District of New York seeking a turnover order against garnishees holding assets of the debtors. The Second Circuit certified questions to the Court of Appeals on the issue of the turnover proceeding.

Ruling: The Court of Appeals held that for a court to issue a post-judgment turnover order pursuant to section 5225(b) of the Civil Practice Law and Rules against a banking entity, that entity itself must have actual, not merely constructive, possession or custody of the assets sought. It is not enough that the banking entity’s subsidiary might have possession or custody of a judgment debtor’s assets.

Michael S. Kim for the appellant; Scott D. Musoff for the respondent