Texas Occupations Code 1101.606 – Claim for Payment From Trust Account
(a) Except as provided by Subsections (c) and (c-1), an aggrieved person who obtains a court judgment against a license or certificate holder for an act described by § 1101.602 may, after final judgment is entered, execution returned nulla bona, and a judgment lien perfected, file a verified claim in the court that entered the judgment.
(b) After the 20th day after the date the aggrieved person gives written notice of the claim to the commission and judgment debtor, the person may apply to the court that entered the judgment for an order for payment from the trust account of the amount unpaid on the judgment. The aggrieved person and the commission may attempt to reach a settlement of the claim before setting a hearing before the court. If the aggrieved person does not schedule a hearing before the first anniversary of the date the application was filed, recovery is waived.
Terms Used In Texas Occupations Code 1101.606
- Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
- Lien: A claim against real or personal property in satisfaction of a debt.
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005
- Rule: includes regulation. See Texas Government Code 311.005
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
- Writ: A formal written command, issued from the court, requiring the performance of a specific act.
- Written: includes any representation of words, letters, symbols, or figures. See Texas Government Code 311.005
(c) If an aggrieved person is precluded by action of a bankruptcy court from executing a judgment or perfecting a judgment lien as required by Subsection (a), the person shall verify to the commission that the person has made a good faith effort to protect the judgment from being discharged in bankruptcy.
(c-1) If the judgment obtained against the license holder includes multiple defendants who are jointly and severally liable or the judgment against the license holder was severed from a suit with multiple defendants, the aggrieved person may not file a verified claim in the court that entered the judgment until the aggrieved person has obtained a judgment against all defendants and received payment from or obtained a writ of execution returned nulla bona for all defendants.
(d) The commission by rule may prescribe the actions necessary for an aggrieved person to demonstrate that the person has made a good faith effort under Subsection (c) to protect a judgment from being discharged in bankruptcy.