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RULE §9.4265Disciplinary Action

(a) Disciplinary action generally. The comptroller is authorized to remove an arbitrator from the registry or, in the comptroller's discretion, to render lesser disciplinary actions including warnings, restriction of arbitrator eligibility for certain counties, or removal from individual arbitrations.

(b) Disciplinary history. The determination to discipline may be based solely on the information or complaint at issue or on a combination of the information or complaint and the arbitrator's disciplinary history.

(c) Good cause for removal. Good cause for removal includes the following grounds:

  (1) the individual engaged in repeated instances of bias or misconduct while acting as an arbitrator;

  (2) the individual engaged in fraudulent conduct;

  (3) the individual is disqualified or becomes disqualified under §9.4260 of this title;

  (4) the individual accepts a case in violation of §9.4263 of this title;

  (5) the individual violates §9.4212 or §9.4264 of this title while acting as an arbitrator;

  (6) the individual fails or declines to renew the agreement to serve as an arbitrator in the manner required under §9.4262 of this title; or

  (7) the comptroller finds that inclusion of the applicant in the arbitration registry would not be in the interest of impartial arbitration proceedings.

(d) Disciplinary discretion. The comptroller may take appropriate disciplinary action where the comptroller finds clear and convincing evidence of a violation, even if that violation does not rise to the level of good cause to justify removal under subsection (c) of this section. In determining the level of discipline, the comptroller may consider not only the complaint at issue, but any disciplinary history in the arbitrator's file. Good cause for disciplinary action includes the following grounds:

  (1) the individual is disqualified or becomes disqualified under §9.4262 of this title;

  (2) the individual fails to respond to or refuses to comply with communications and requests for information from the comptroller's office by the deadline established in the communication; or

  (3) the individual has violated one or more provisions of this subchapter.

(e) Clear and convincing evidence. For purposes of this section, clear and convincing evidence means the measure or degree of proof that produces a firm belief or conviction of the truth of the allegations regarding the arbitrator.

(f) Filing a complaint. An individual may file a complaint concerning an arbitrator with the comptroller within 60 calendar days of the last incident giving rise to the complaint. The complaint must contain the following items:

  (1) a letter, addressed to the division director and signed by the requestor, that identifies the arbitrator complained of and the alleged grounds for removal or discipline;

  (2) for grounds for removal under subsection (c) of this section, at least one affidavit or unsworn declaration meeting the requirements of Civil Practice and Remedies Code, §132.001, from an individual with first-hand knowledge of the alleged conduct that supports the complaint; and

  (3) as applicable, copies of all available communications exchanged between the arbitrator and the parties, including emails, documents, and any other materials, such as video or audio recordings, that support the complaint.

(g) Confidentiality. Information reviewed under this section that is made confidential by law may not be disclosed except as provided by law. That portion of the materials considered confidential must be designated as such to protect it from disclosure.

(h) Dismissal. Complaints shall be dismissed under the following conditions:

  (1) the conduct complained of does not meet the requirements of this section;

  (2) the complaint is not timely or otherwise fails to meet the requirements of subsection (f) of this section; or

  (3) the complaint is based on one or more substantive arbitration issues, including evidentiary considerations and the resulting award.

(i) Initial review of complaints. Within 30 calendar days after submission of a complaint under this section, the comptroller shall notify the complainant whether the complaint is under review or dismissed. The dismissal of a complaint is final and may not be appealed. If the complaint is under review, all materials the complainant submitted will be forwarded electronically, by U.S. Postal Service, or by a private third-party service such as FedEx or United Parcel Service (UPS), as long as proof of delivery is provided, to the arbitrator who is the subject of the complaint for a response.

(j) Arbitrator response. The arbitrator has 30 calendar days from delivery of the materials to respond to the comptroller, explaining why a finding of good cause should not be made.

(k) Post-response review and determination. Within 30 calendar days after receipt of the arbitrator's response, the comptroller shall determine whether clear and convincing evidence supports a finding of good cause for removal of the arbitrator from the registry or disciplinary action. The comptroller shall promptly notify the complainant and the arbitrator of the comptroller's determination.

(l) Removal or disciplinary action. If good cause for removal of the arbitrator from the registry under subsection (c) of this section is found, the arbitrator shall be removed from the registry for a period of two years from the date of the determination. If, in the comptroller's discretion, clear and convincing evidence of a violation is established, however, after reviewing the violation and the arbitrator's file, the comptroller does not find it rises to the level of good cause for removal, the comptroller may issue disciplinary action. Prior disciplinary action may be considered in future complaints. If there is neither good cause for removal nor clear and convincing evidence of a violation, no disciplinary action will be taken.

(m) No appeal. The comptroller's determination and a removal or disciplinary action is final and may not be appealed. An arbitrator removed from the registry under subsection (c) of this section may reapply for inclusion in the registry two years after the date of the removal determination. The circumstances giving rise to the removal under this section may be considered in evaluating the reapplication.

(n) No effect on determinations and awards. Any disciplinary action taken shall not affect the determinations and awards made by the arbitrator during the period that the arbitrator is listed in active status in the registry.

Source Note: The provisions of this §9.4265 adopted to be effective April 16, 2024, 49 TexReg 2317

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