REGISTRY OF THE COURT. Presented by: Lisa David, Williamson County District Clerk

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1 REGISTRY OF THE COURT Presented by: Lisa David, Williamson County District Clerk

2 Registry of the Court Each District and County Clerk must maintain a bank account to receive money ordered tendered into the court s registry. All funds must be deposited if they are to be held more than 3 days.

3 Registry of the Court The clerk should keep a record of all funds tendered into the court s registry that includes: The cause number. The style of the case. Instructions regarding the investment or disbursement of the funds. An accounting of all withdrawals and deposits.

4 Types of Registry Funds Funds of minors or incapacitated persons Funds tendered in an interpleader action Funds paid in satisfaction of a judgment Child support funds held for more than 3 days Cash bonds Cash bail bonds Funds in an eminent domain case and Any other funds tendered to the clerk for deposit into the registry of the court.

5 Registry of the Court REFERENCE THE FOLLOWING STATUTES FOR ADDITIONAL INFO ON REGISTRY FUNDS: Chapter 142, Property Code-minor funds Sec Civ. Prac. & Rem. Code- payment of judgments Art Code of Criminal Procedure-bail bonds Chapter Property Code-Escheat & Unclaimed Property

6 CUSTODIANSHIP A CLERK SHALL ACT ONLY IN A CUSTODIAL CAPACITY IN RELATION TO THE REGISTRY FUND, A SPECIAL ACCOUNT, OR A SEPARATE ACCOUNT. A CLERK IS NOT THE TRUSTEE FOR THE BENEFICIAL OWNER AND DOES NOT ASSUME THE DUTIES, OBLIGATIONS, OR LIABILITIES OF A TRUSTEE FOR A BENEFICIAL OWNER. LGC

7 MANAGEMENT OF REGISTRY FUNDS The clerk has two options when deciding on the type of registry to open: Interest Bearing Account The registry account may earn interest. or Non-Interest Bearing Account The registry account may not earn interest.

8 Interest Bearing Account IF THE CLERK ELECTS TO HAVE THE REGISTRY ACCOUNT EARN INTEREST THE CLERK MUST DO THE FOLLOWING NOT LATER THAN THE 30 TH DAY BEFORE THE DATE THE COUNTY GIVES NOTICE THAT THE COUNTY WILL ACCEPT APPLICATIONS TO THE DEPOSITORY. A. Make a written request to the commissioner s court that the contract include a provision that funds in a special account in the clerk s name earn interest. B. The application of a bank that seeks to become the county depository must be accompanied by a certified or cashier s check for an amount equal to one half of one percent of the average daily balance of the registry funds held by the clerk during the preceding calendar year. The clerk must calculate this amount and include the figure to the commissioner s court requesting that the registry account earn interest.

9 Interest Bearing Account IF THE CLERK ELECTS TO HAVE THE REGISTRY ACCOUNT EARN INTEREST.... If the registry account or any separate accounts earn interest, the clerk must keep a record of the amount of interest earned and the amount to each case. The clerk shall pay 10% of any interest earned to the general fund of the county to compensate the county for the accounting and administrative expense of maintaining the accounts. LGC

10 Non- Interest Bearing Account TO COMPENSATE THE COUNTY FOR THE ACCOUNTING AND ADMINISTRATIVE EXPENSES INCURRED IN HANDLING THE REGISTRY FUNDS THAT HAVE NOT EARNED INTEREST the clerk shall, at the time of withdrawal, deduct from the amount of the withdrawal a fee in the amount of 5% of the withdrawal but not to exceed $50. WITHDRAWAL OF FUNDS GENERATED FROM A CASE ARISING UNDER THE FAMILY CODE ARE EXEMPT FROM THE FEE DEDUCTION. LCG

11 The clerk shall transfer any registry funds into a separate account only when directed to do so by a written order of the court of proper jurisdiction or when the clerk is required under the probate code 887 Investment of funds as follows: INVESTMENT OF FUNDS 1. In a financial institution doing business in the state and that is insured by FDIC 2. United States treasury bills 3. An eligible investment pool that meets requirements of Sections , and , Government code (ex. TexPool ) 4. A no load money market mutual fund, if the fund: A. Is regulated by the Securities Commission and Exchange Commission B. Has a dollar weighted average stated maturity date of 90 days or fewer and C. Includes in its investment objectives the maintenance of a stable net asset value of $1 for each share D. A structured settlement account LGC and Prop Code and

12 DISBURSEMENT OF REGISTRY FUNDS Unless otherwise provided by statute or rule, registry funds are to be disbursed only by a court order. When an order is received, the clerk will disburse the funds to the proper party according less administrative fees. LGC and

13 STRUCTURED SETTLEMENT PAYMENTS In a suit in which a minor or incapacitated person who has no legal guardian is represented by a next friend or an appointed guardian ad litem, the court, on a motion from the parties, may provide for a structured settlement that: Provides for periodic payments; and Is funded by: A. An obligation guaranteed by the United States government; or B. An annuity contract that meets the requirement of Section

14 STRUCTURED SETTLEMENT PAYMENTS The person obligated to fund a structured settlement shall provide to the court: A copy of the instrument that provides funding for the structured settlement; or An affidavit from an independent financial consultant that specifies the present value of the structured settlement and the method by which the value is calculated. A structured settlement provided for under this section is solely for the benefit of the beneficiary of the structured settlement and is not subject to the interest payment calculations contained in Section , Local Government Code. Prop Code

15 ESCHEAT FUNDS Personal property is assumed abandoned if dormant for longer than a period of 3 years. Section Property Code Any funds deposited under this chapter, except cash bail bonds, that are presumed abandoned under Chapter 72,73 or 75, Property Code, and exceed $100, shall be reported and delivered by the county or district clerk to the comptroller without further action by any court. Section Local Government Code DORMANCY PERIOD IS THREE YEARS FOR ALL PROPERTY TYPES EXCEPT WAGES, WHICH ARE ONE YEAR.

16 ESCHEAT FUNDS Each holder, who on June 30, holds proper subject to this chapter shall file a report of the property on or before the following November 1. Each report is filed with the treasurer of the holder. All should be done to notify the owner of the funds you are holding and a record kept of the last known address even though mail may have been returned.

17 ESCHEAT FUNDS Recommendations: On or around June 30 th of each year, review your accounts and identify funds that meet the 3 year dormancy period. Notify the property owners of the funds/property that are being held and keep all documentation of your efforts to notify owners. On or before November 1 st, complete the required forms and submit to comptroller.

18 EXCESS FUNDS The sale of property for delinquent taxes may generate excess funds over and above the judgment. These funds are turned over to the clerk issuing the order of sale to be placed in the registry and disbursed according to the law or as ordered by the court. The tax code requires the clerk to send out notices to the former owner of the property that excess funds have been paid into the court s registry. The retention period for these funds is 2 years.

19 EXCESS FUNDS If the amount of excess proceeds is more than $25, the clerk is required to send notice before the 31 st day after the date the proceeds are received by the clerk. The notice is sent certified mail return receipt requested to the former owner of the property at the last known address according to the records of the court or any other source reasonably available. Property Tax Code Regardless of the amount of the excess proceeds the clerk is to keep the funds in the registry of the court for a period of 2years. Property Tax Code 34.02

20 CLAIMS FOR EXCESS PROCEEDS A person, including a taxing unit, may file a petition setting forth a claim to the excess proceeds from a tax sale. The petition must be filed within 2 years from the date of the sale. The petition does not have to be filed as a new suit. The petition can be filed in the underlying tax cause. INTEREST AND COSTS ARE NOT ALLOWED UNDER THIS SECTION.

21 CLAIMS FOR EXCESS PROCEEDS A fee charged by an attorney to obtain excess proceeds for an owner may not be greater than 25% of the amount obtained or $1000, whichever is less. A person who is not an attorney may not charge a fee to obtain excess proceeds for an owner.

22 PAYMENT OF UNCLAIMED JUDGMENT In some instances the judgment debtor may wish to clear his/her credit or title to property and must pay a judgment to accomplish this. A judgment debtor is allowed to pay to the court that rendered the judgment the amount under the judgment owed to a judgment creditor whose location is unknown to the judgment debtor if the judgment debtor complies with Subsections (b) and (c) of the code. The payment must be made without offset or reduction. The judgment debtor shall prepare a recordable release of the judgment and the judge or clerk shall execute the release of the judgment on behalf of the creditor and issue the release to the debtor.

23 PAYMENT OF UNCLAIMED JUDGMENT Before being entitled to pay a judgment to the court the judgment debtor must send a letter notifying the judgment creditor of the judgment by registered or certified mail to Judgment creditor s last known address Address appearing in the judgment creditor s pleadings or other court record, if different from the last known address. Address of judgment debtor s last attorney as shown on the pleadings and The address of the judgment creditor s last attorney as shown in the records of the State Bar of Texas if that address is different from the pleadings.

24 PAYMENT OF UNCLAIMED JUDGMENT Once the funds are placed in the registry of the court, the clerk will hold the funds in an interest bearing account. The clerk must pay the funds and any interest earned to the judgment creditor or to the successors to the rights of the judgment creditor. The clerk may presume the funds are payable to the judgment creditor unless furnished with a written assignment of the judgment by the court. Chapter 72, Property Code.

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