By Uher H.B. No. 2160
75R8035 PB-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the abuse of judicial process by an insurance premium
1-3 finance company; providing criminal penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Chapter 24, Insurance Code, is amended by adding
1-6 Article 24.23 to read as follows:
1-7 Art. 24.23. ABUSE OF JUDICIAL PROCESS; PENALTY
1-8 Sec. 1. LACK OF VENUE. (a) A premium finance company
1-9 commits an offense if the company brings an action against a person
1-10 in a court of this state without a reasonable basis for venue in
1-11 that court. An offense under this subsection is a Class B
1-12 misdemeanor and is subject to Article 24.08(c) of this code.
1-13 (b) In addition to the penalty imposed under Subsection (a)
1-14 of this section, the premium finance company is liable to the
1-15 person against whom the action is brought for:
1-16 (1) all costs associated with defending the action,
1-17 including:
1-18 (A) the value of the time of the person
1-19 defending the action;
1-20 (B) attorney's fees; and
1-21 (C) other related costs incurred by the person
1-22 defending the action; and
1-23 (2) exemplary damages equal to three times the amount
1-24 found as costs under Subdivision (1) of this subsection.
2-1 (c) Chapter 41, Civil Practice and Remedies Code, does not
2-2 apply to exemplary damages awarded under Subsection (b) of this
2-3 section.
2-4 Sec. 2. NO CREDIBLE EVIDENCE. (a) A premium finance
2-5 company commits an offense if the company brings an action against
2-6 a person in a court of this state in which the court determines
2-7 that:
2-8 (1) there is no credible evidence to support the truth
2-9 of the facts alleged; and
2-10 (2) the action is not warranted by a good faith
2-11 argument for the extension, modification, or reversal of existing
2-12 law.
2-13 (b) An offense under Subsection (a) of this section is a
2-14 Class B misdemeanor and is subject to Article 24.08(c) of this
2-15 code.
2-16 (c) In addition to the penalty imposed under Subsection (b)
2-17 of this section, the premium finance company is liable to the
2-18 person against whom the action is brought for:
2-19 (1) all costs associated with defending the action,
2-20 including:
2-21 (A) the value of the time of the person
2-22 defending the action;
2-23 (B) attorney's fees; and
2-24 (C) other related costs incurred by the person
2-25 defending the action; and
2-26 (2) exemplary damages equal to the greater of:
2-27 (A) three times the amount found as costs under
3-1 Subdivision (1) of this subsection; or
3-2 (B) the amount in controversy.
3-3 (d) Chapter 41, Civil Practice and Remedies Code, does not
3-4 apply to exemplary damages awarded under Subsection (c) of this
3-5 section.
3-6 SECTION 2. (a) A premium finance company that brought an
3-7 action before and that is pending on the effective date of this Act
3-8 that violates Section 1, Article 24.23, Insurance Code, as added
3-9 by this Act, shall dismiss that action not later than the 10th day
3-10 after the effective date of this Act.
3-11 (b) A premium finance company commits an offense if the
3-12 company violates Subsection (a) of this section. An offense under
3-13 this subsection is a Class B misdemeanor and is subject to Article
3-14 24.08(c), Insurance Code.
3-15 (c) In addition to the penalties imposed under Subsection
3-16 (b) of this section, a premium finance company that violates
3-17 Subsection (a) of this section is subject to Section 1(b), Article
3-18 24.23, Insurance Code, as added by this Act.
3-19 SECTION 3. The importance of this legislation and the
3-20 crowded condition of the calendars in both houses create an
3-21 emergency and an imperative public necessity that the
3-22 constitutional rule requiring bills to be read on three several
3-23 days in each house be suspended, and this rule is hereby suspended,
3-24 and that this Act take effect and be in force from and after its
3-25 passage, and it is so enacted.