N.Y. Tax Law § 3032 — Civil damages for failure to release a lien

§ 3032. Civil damages for failure to release a lien. (a) In general. A\ntaxpayer may bring a civil action for damages against the state in the\ncourt of claims if any officer or employee of the department knowingly,\nor by reason of negligence, fails to release a lien on property of such\ntaxpayer within forty days after the day on which (1) the commissioner\nfinds that the liability for the amount assessed or determined, together\nwith all interest in respect thereof, has been fully satisfied or has\nbecome legally unenforceable, or (2) there is furnished to the\ncommissioner a surety bond issued by a surety company approved by the\nsuperintendent of financial services as to solvency or responsibility\nand authorized to transact business in this state, or other security\nacceptable to the commissioner, that is conditioned upon the payment of\nthe amount assessed or determined, together with all interest in respect\nthereof, within the time prescribed by law (including any extension of\nsuch time) and is in accordance with such requirements relating to\nterms, conditions, and form of the bond or other acceptable security, as\nmay be specified by regulation.\n (b) Damages. In any action brought under subdivision (a) of this\nsection, upon a finding of liability on the part of the defendant, the\ndefendant shall be liable to the plaintiff in an amount equal to the sum\nof (1) actual, direct economic damages sustained by the plaintiff which,\nbut for the actions of the defendant, would not have been sustained,\nplus (2) the costs of the action.\n (c) Limitations. (1) Exhaustion of administrative remedies. The amount\nof damages awarded under subdivision (b) of this section may be reduced\nif the court determines that the plaintiff has not exhausted the\nadministrative remedies available to such plaintiff within the\ndepartment which have been established pursuant to the commissioner's\nauthority to compromise civil liability provided in subdivision\neighteenth-a of section one hundred seventy-one of this chapter. In\nestablishing administrative review procedures regarding claims for\ndamages under this section, the commissioner is authorized to enter into\ncontracts with private dispute resolution entities for the purpose of\nproviding review of such claims and suggested compromises by independent\nthird parties.\n (2) Mitigation of damages. The amount of damages awarded under\nparagraph one of subdivision (b) of this section shall be reduced by the\namount of such damages which could have reasonably been mitigated by the\nplaintiff.\n (d) Notice of failure to release lien. The commissioner shall by\nregulation prescribe reasonable procedures for a taxpayer to notify the\ncommissioner of the failure to release a lien on the property of the\ntaxpayer.\n