HBA-ATS, NLM H.B. 2101 76(R)BILL ANALYSIS


Office of House Bill AnalysisH.B. 2101
By: Pitts
Financial Institutions
6/4/1999
Enrolled


BACKGROUND AND PURPOSE 

Prior to the 76th Legislature, a judgment creditor was not required to
provide information to a financial institution before the institution
turned over assets of a judgment debtor to the judgment creditor.  There
was a concern that problems would have arisen between the financial
institution and its customer, due to the threat of sanctions from the
judgment creditors for noncompliance.  H.B. 2101 requires a financial
institution to be provided, and authorizes it to rely on, a certified copy
of the order or injunction of the court, or a certified copy of the order
of appointment of a receiver, if the institution receives a request to turn
over assets or financial information of a judgment debtor to a judgment
creditor or a receiver under a turnover order or receivership order. It
also entitles a compliant financial institution  to recover certain
reasonable costs, including reasonable attorney's fees if contested.  

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 31, Civil Practice and Remedies Code, by adding
Section 31.010, as follows: 

Sec. 31.010.  TURNOVER BY FINANCIAL INSTITUTION.  (a) Requires a financial
institution that receives a request to turn over assets or financial
information of a judgment debtor to a judgment creditor or a receiver under
a turnover order or receivership under Section 31.002 (Collection of
Judgment Through Court Proceeding) to be provided, and authorizes the
institution to rely on: 

_a certified copy of the order or injunction of the court; or
_a certified copy of the order of appointment of a receiver under Section
64.001 (Availability of Remedy), including any document establishing the
qualifications of the receiver under Section 64.021 (Qualifications;
Residence Requirement), the sworn affidavit under Section 64.022 (Oath),
and the bond under Section 64.023 (Bond).   

(b)  Provides that a financial institution that complies with this section
is not liable to certain entities for compliance with a court order,
injunction, or receivership authorized by Section 31.002.  

(c)  Entitles a financial institution that complies with this section to
recover certain reasonable costs, including reasonable attorney's fees if
there is a contest. 

(d)  Defines "financial institution" for the purposes of this section.

SECTION 2.  Effective date: September 1, 1999.
                       Makes application of this Act prospective.

SECTION 3.  Emergency clause.