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


Office of House Bill AnalysisH.B. 2101
By: Pitts
Financial Institutions
3/30/1999
Introduced



BACKGROUND AND PURPOSE 

Under current law, a judgment creditor is not required to provide
information to a financial institution before the institution turns over
assets of a judgment debtor to the judgment creditor. There is concern that
problems may arise between the financial institution and its customer, due
to the threat of sanctions from the judgment creditors for noncompliance.
H.B. 2101 authorizes a financial institution to rely on a copy of the order
or injunction of the court or a 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.  

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)  Authorizes 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 rely on: 

_a copy of the order or injunction of the court; or
_a 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. 

(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.