| (a) Policy. It is the Board's policy to encourage the
fair and expeditious resolution of disputed matters, internal and
external, through voluntary and informal settlement negotiations.
This section sets out the Agency's alternative dispute resolution
(ADR) procedures to be used when proceeding under Chapter 2009 of
the Government Code. However, the ADR procedures in this section are
intended to supplement and do not limit the use of any other informal
dispute resolution or negotiated settlement procedures available to
the Agency.
(b) Resolution and costs. Any resolution reached as
a result of ADR procedures is intended to be through the voluntary
agreement of the parties. The allocation of the costs of ADR are subject
to negotiation and agreement between the parties. The party who requests
ADR may be liable for the cost of any third-party mediator, moderator,
arbitrator, or ombudsman and shall otherwise bear his or her own costs
arising from the use of ADR.
(c) Coordinator. The Securities Commissioner shall
designate at least one employee of the Agency to serve as the Agency's
ADR coordinator to:
(1) coordinate the implementation of the Agency's ADR
policies;
(2) serve as a resource for any training needed to
implement the procedures for ADR; and
(3) collect data concerning the effectiveness of the
ADR procedures as implemented by the Agency.
(d) Statutory requirements. ADR must be consistent
with the Government Code, Chapter 2009; Civil Practice and Remedies
Code, Chapter 154; and the Administrative Procedure Act, Government
Code, Chapter 2001. Confidentiality of records and communications
related to the subject matter of an ADR proceeding shall be governed
by Civil Practices and Remedies Code, §154.073.
(e) State Office of Administrative Hearings (SOAH).
(1) SOAH mediators may be assigned to disputed matters
or contested cases as needed. If the mediator is a SOAH Administrative
Law Judge (ALJ), that person will not also sit as the ALJ for the
case if the disputed matter or contested case goes to public hearing.
(2) When ADR procedures do not result in the full settlement
of a contested matter, the participants, in conjunction with the mediator,
shall limit the contested issues which will be tried at SOAH through
the entry of written stipulations. Such stipulations shall be forwarded
or formally presented to the ALJ assigned to conduct the hearing and
shall be included in the hearing record.
(f) Contract claims.
(1) In addition to the requirements of Government Code,
Chapter 2009, ADR for contracting claims must also be consistent with
the Government Code, Chapter 2260; and the Office of the Attorney
General's rules for negotiation and mediation of certain contract
disputes (1 TAC Chapter 68).
(2) Upon receipt of notice of a contract claim under
Government Code Chapter 2260, the Securities Commissioner, in consultation
with the ADR coordinator and the Director of Staff Services, or their
designees, shall determine whether use of an ADR procedure is a required
or appropriate method for resolving the contract dispute.
(3) If ADR procedures are determined to be the appropriate
method for resolving a contract claim, the Securities Commissioner,
or the Commissioner's designee, shall recommend to the claimant that
the parties use ADR to resolve the dispute.
(4) The ADR coordinator and Director of Staff Services
will collaborate with the claimant to select an appropriate procedure
for ADR, and implement the agreed upon procedure consistent with the
applicable statutory requirements and the guidelines established by
the Office of the Attorney General and SOAH.
(g) Contested cases.
(1) A contested case pending before SOAH may be submitted
for ADR if both the respondent and the Director of the Division signing
the notice of hearing agree that ADR would be an appropriate means
to attempt to reach a negotiated settlement of the matter.
(2) ADR will be conducted before SOAH. The parties
to the contested case shall collaborate to select an appropriate procedure
for ADR and implement the agreed upon procedure consistent with SOAH's
model guidelines.
(3) The full resolution of a contested case reached
as a result of ADR must be in writing and signed by all of the parties
and submitted to the Securities Commissioner for review and approval.
(4) "Party" as used in this subsection shall have the
same meaning as set forth in the Administrative Procedure Act, Government
Code, Chapter 2001.
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