Banking Interpretations


April 7, 2008


Dear [---]:

Your letter to me dated March 31, 2008 concerns a recent E-Mail that I sent to [---], President of [---], regarding an interpretation of Section 576 of the Banking Law. As you note in your letter, my E-Mail concluded that the plain meaning of the words in Section 576 indicated that the legislature intended that the notices required to be sent under that section be delivered through the U.S. Postal System.  Although I and other attorneys here believe that this is the proper interpretation of the section as a whole despite the less than artful drafting therein (and, as I noted in my E-Mail, not necessarily the practical one given the efficiencies of current courier services), we have reviewed the judicial opinions cited in your letter as well as other relevant ones and are of the opinion that the cases implicitly indicate that some form of personal service under Section 576(1)(a) would be acceptable. Those cases do not state the type of personal service that would satisfy the requirements of that section.

Considering the foregoing, and after consulting with the Licensed Financial Services Division of this Department regarding possible safety and soundness issues, it has been determined that the Banking Department will not take any regulatory action against any licensed premium finance company which chooses to effectuate the notices required under Section 576(1)(a) of the Banking Law through some method of personal service. As you are fully aware, opinions rendered by this Department are not binding on a court of competent jurisdiction and, in any event, the opinion expressed herein should not be construed as an indication that the Department finds any particular form of personal service under that section legally acceptable.

I trust that this letter is responsive to your letter.

Very truly yours,

Steven Barras
First Assistant Counsel

cc:  Angelo Sigismondo, LFSD