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Texas Insurance Code - Not Codified - Section 21A.201. Turnover Of Assets

Legal Research Home > Texas Lawyer > Insurance Code - Not Codified > Texas Insurance Code - Not Codified - Section 21A.201. Turnover Of Assets

Sec. 21A.201. TURNOVER OF ASSETS.  (a) If the receiver
determines that funds or property in the possession of another
person are rightfully the property of the estate, the receiver
shall deliver to the person a written demand for immediate delivery
of the funds or property, referencing this section by number and the
court and docket number of the receivership action, and notifying
the person that any claim of right to the funds or property by the
person must be presented to the receivership court not later than
the 20th day after the date of the written demand.  Any person who
holds funds or other property belonging to an entity subject to an
order of receivership under this chapter shall deliver the funds or
other property to the receiver on demand.  Should the person allege
any right to retain the funds or other property, the person, not
later than the 20th day after the date of receipt of the demand that
the funds or property be delivered to the receiver, shall file with
the receivership court a pleading setting out that right.  The
person shall serve a copy of the pleading on the receiver.  The
pleading must inform the receivership court as to the nature of the
claim to the funds or property, the alleged value of the property or
amount of funds held, and what action, pending determination of the
dispute, has been taken by the person to preserve and protect the
property or to preserve any funds.  The relinquishment of
possession of funds or property by any person who has received a
demand pursuant to this section does not constitute a waiver of a
right to make a claim in the receivership.
	(b)  If requested by the receiver, the receivership court
shall hold a hearing to determine where and under what conditions
the person shall hold the property or funds pending determination
of the dispute.  The receivership court may impose conditions as it
may deem necessary or appropriate for the preservation of the
property or funds until the receivership court can determine the
validity of the person's claim to the property or funds.  If any
property or funds are allowed to remain in the possession of the
person after demand made by the receiver, that person is strictly
liable to the estate for any waste, loss, or damage to or diminution
of value of the property or funds retained.
	(c)  If a person has filed a pleading alleging any right to
retain funds or property as provided by Subsection (a), the
receivership court shall hold a subsequent hearing to determine the
entitlement of the person to the funds or property claimed by the
receiver.
	(d)  If a person fails to deliver the funds or property or to
file the pleading described by Subsection (a) within the period
described by Subsection (a), the receivership court may, upon
petition of the receiver and upon a copy of the petition being
served by the receiver to that person, issue its summary order
directing the immediate delivery of the funds or property to the
receiver and finding that the person has waived all claims of right
to the funds or property.

Added by Acts 2005, 79th Leg., ch. 995, Sec. 1, eff. Sept. 1, 2005.

Last modified: August 11, 2007