| (A) If TJJD seeks to use in-house attorneys to collect
delinquent obligations through court proceedings, TJJD must submit
a written request to the attorney general's Bankruptcy and Collections
Division.
(B) Upon the written approval of the attorney general,
TJJD may file suit to collect a delinquent obligation through an attorney
serving as a full-time employee of TJJD. Where circumstances make
it impractical to secure attorney general approval for every delinquent
obligation upon which a lawsuit is to be filed, TJJD may apply to
the attorney general for an authorization to bring suit on particular
types of obligations through attorneys employed full-time by TJJD.
Such authorization, if given, must be renewed at the beginning of
each fiscal year.
(C) After an obligation is referred to TJJD's attorneys
employed as in-house counsel, the obligation shall be reduced to judgment
against all entities legally responsible for the obligation where
the lawsuit and judgment will make collection of the obligation more
likely and the expenditure of TJJD resources in recovering judgment
on the obligation is justified.
(D) Where authorized by law, TJJD shall plead for and
recover attorney's fees, investigative costs, and court costs in addition
to the obligation.
(E) Every judgment taken on a delinquent obligation
shall be abstracted and recorded by TJJD in every county where the
debtor owns real property, operates an active business, is likely
to inherit real property, owns any mineral interest, or has maintained
a residence for more than one year.
(2) Referral to the Attorney General.
(A) TJJD may explore the exchange of accounts with
the attorney general by computer tape or other electronic data transfer
and discuss any variances as may be appropriate. TJJD and the attorney
general may agree upon an exchange of certain minimum account information
necessary for collection efforts by the attorney general.
(B) TJJD may refer individual accounts to the attorney
general after the procedures set forth in subsection (d)(7)-(10) of
this section. Individual accounts referred to the attorney general
shall include the following:
(i) copies of all correspondence between TJJD and the
debtor;
(ii) a log sheet (see subsection (d)(6) of this section)
documenting all attempted contacts with the debtor and the result
of such attempts;
(iii) a record of all payments made by the debtor and,
where practicable, copies of all checks tendered as payment;
(iv) any information pertaining to the debtor's residence
and his/her assets; and
(v) copies of any permit application, security, final
orders, contracts, grants, or instrument giving rise to the obligation.
(C) Delinquent accounts upon which a bond or other
security is held shall be referred to the attorney general no later
than 60 days after becoming delinquent. All such accounts where the
principal has filed for relief under federal bankruptcy laws shall
be referred immediately, since collection of the security may obviate
the need to file a claim or to appear in the bankruptcy case.
(D) The attorney general may decide that a particular
obligation or class of obligations may be assigned after referral
to the appropriate division within the Office of the Attorney General.
(3) Referral to Collection Firms or Private Attorneys.
(A) Prior Approval of Attorney General. Except as provided
by §2107.003, Texas Government Code, TJJD may not contract with,
retain, or employ any person other than a full-time employee of TJJD
to collect a delinquent obligation without prior written approval
of the attorney general. Any existing arrangements must receive the
written approval of the attorney general to be renewed or extended
in any fashion.
(i) Approval of Contract with Private Firm or Attorney.
Prior to contracting with, retaining, or employing a person other
than a full-time employee of TJJD to collect a delinquent obligation,
TJJD must submit a proposal to the attorney general requesting the
attorney general to collect the obligation(s).
(ii) TJJD must submit the proposed contract to the
attorney general for written approval. The proposal must disclose
any fee that TJJD proposes to pay the private collection firm or attorney.
The attorney general may elect to undertake representation of TJJD
on the same or similar terms as contained in the proposed contract.
If the attorney general declines or is unable to perform the services
requested, the attorney general may approve the contract. If the attorney
general decides that TJJD has not complied with this subsection, the
attorney general may:
(I) decline to approve the contract; or
(II) require TJJD to submit or resubmit a proposal
to the attorney general for collection of the obligation in accordance
with this subsection.
(iii) If the attorney general fails to act as set forth
in clause (i) of this subparagraph within 60 days of receipt of the
proposed contract or receipt of additional information requested,
the attorney general is deemed to have approved the contract in accordance
with this rule.
(B) Requirements of Proposed Contracts with Private
Persons Presented for Attorney General's Approval. In addition to
information required by other state laws, all contracts for collection
of delinquent obligations must contain or be supported by a proposal
containing the following:
(i) a description of the obligations to be collected
sufficient to enable the attorney general to determine what measures
are necessary to attempt to collect the obligation(s);
(ii) explicit terms of the basis of any fee or payment
for the collection of the obligation(s);
(iii) a description of the individual accounts to be
collected in the following respects:
(I) the total number of delinquent accounts;
(II) the dollar range;
(III) the total dollar amount;
(IV) a summary of the collection efforts previously
made by TJJD; and
(V) the legal basis of the delinquent obligations to
be collected.
(C) Additional Requirements of Proposed Contracts with
Private Persons Presented for Attorney General Approval. All contracts
for collection of delinquent obligations shall contain provisions
stating the following:
(i) Litigation on the delinquent account is prohibited
unless the private person obtains specific written authorization from
TJJD and the attorney general and complies with the requirements of
this rule;
(ii) The person shall place any funds collected in
an interest bearing account with amounts collected, plus interest,
less collections costs, payable to TJJD on a monthly basis or by direct
deposit to TJJD's account on a weekly basis with TJJD billing once
a month; in either case a listing of the accounts and amounts collected
per account shall be submitted to TJJD upon deposit of the funds;
(iii) The person shall refer any bankruptcy notice
to TJJD within three working days of receipt;
(iv) TJJD may recall any account without charge;
(v) The person may not settle or compromise the account
for less than the full amount owed (including collection costs where
authorized by statute or terms of the obligation) without written
authority from TJJD;
(vi) The person is not an agent of TJJD but is an independent
contractor, and the person will indemnify TJJD for any loss incurred
by his/her violation of state and federal debt collection statutes
or by the negligence of the person, his/her employees, or his/her
agents; and
(vii) Any dispute arising under the contract shall
be submitted to a court of competent jurisdiction in Texas, unless
any other venue is statutorily mandated, in which case the specific
venue statute will apply, subject to any alternative dispute resolution
procedures adopted by TJJD pursuant to Chapter 2009, Texas Government
Code.
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| Source Note: The provisions of this §385.9969 adopted to be effective September 25, 2000, 25 TexReg 9228; transferred effective June 4, 2012, as published in the Texas Register June 22, 2012, 37 TexReg 4639; amended to be effective October 1, 2016, 41 TexReg 7123 |
