DAR File No. 39801

Insurance, Title and Escrow Commission

Rule R592-2

Title Insurance Administrative Hearings and Penalty Imposition

Notice of Proposed Rule

(Repeal)

DAR File No.: 39801
Filed: 10/01/2015 05:01:58 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule dealt exclusively with the procedures the Title and Escrow Commission needed to follow in imposing a penalty. Based on a statutory change, the Title and Escrow Commission no longer has authority to impose penalties. The department consulted with the commission and the attorney general's office, and based on the statutory changes in S.B. 143 passed during the 2015 General Session, concluded that the best course of action is to repeal the rule in its entirety as it is no longer relevant.

Summary of the rule or change:

The rule is no longer necessary based on statutory changes in S.B. 143 (2015). This rule dealt exclusively with the procedures the Title and Escrow Commission needed to follow in imposing a penalty. Based on a statutory change, the Title and Escrow Commission no longer has authority to impose penalties. It is repealed as a result.

State statutory or constitutional authorization for this rule:

• Section 31A-2-404

Anticipated cost or savings to:

the state budget:

There will be no cost or savings to the state budget. The rule merely governs the procedures the commission must follow when imposing a penalty. The authority of the commission to impose a penalty was removed in S.B. 143 (2015).

local governments:

There will be no cost or savings to local government. The rule merely governs the procedures the commission must follow when imposing a penalty. The authority of the commission to impose a penalty was removed in S.B. 143 (2015).

small businesses:

There will be no cost or savings to small businesses. The rule merely governs the procedures the commission must follow when imposing a penalty. The authority of the commission to impose a penalty was removed in S.B. 143 (2015).

persons other than small businesses, businesses, or local governmental entities:

There will be no cost or savings to any other persons. The rule merely governs the procedures the commission must follow when imposing a penalty. The authority of the commission to impose a penalty was removed in S.B. 143 (2015).

Compliance costs for affected persons:

There are no compliance costs for affected persons. The rule merely governs the procedures the commission must follow when imposing a penalty. The authority of the commission to impose a penalty was removed in S.B. 143 (2015). The Insurance Commissioner retains exclusive authority to impose penalties.

Comments by the department head on the fiscal impact the rule may have on businesses:

I do not anticipate any fiscal impact on state, or local government or small business. I retain exclusive authority to issue penalties in title insurance matters, which was removed from the authority granted the Title and Escrow Commission by S.B. 143 (2015).

Todd E. Kiser, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Title and Escrow Commission
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY, UT 84114-1201

Direct questions regarding this rule to:

• Steve Gooch at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/16/2015

This rule may become effective on:

11/23/2015

Authorized by:

Steve Gooch, Information Specialist

R592. Insurance, Title and Escrow Commission.

[R592-2. Title Insurance Administrative Hearings and Penalty Imposition.

R592-2-1. Authority.

This rule is promulgated pursuant to Subsections 31A-2-404(2)(e) and (h), to provide the process for conducting or delegating a title administrative hearing and imposing a penalty for a violation of statute or rule.

 

R592-2-2. Purpose and Scope.

(1) The purposes of this rule are:

(a) to establish procedures for the commission:

(i) to delegate to the commissioner's administrative law judge the conduct of an administrative hearing to resolve a title insurance matter; or

(ii) to conduct an administrative hearing to resolve a title insurance matter; and

(b) to establish procedures for the commission,

(i) to impose penalties; and

(ii) for the commissioner to concur with the penalties imposed.

(2) This rule applies to all title licensees, applicants for a title insurance license, unlicensed persons doing the business of title insurance, and continuing education providers submitting title continuing education programs for approval.

 

R592-2-3. Definitions.

For purposes of this rule, the commission adopts the definitions set forth in Utah Code Annotated (U.C.A.) Title 31A and the following:

(1) "Commission" means the Title and Escrow Commission.

(2) "Commissioner" means Utah's insurance commissioner.

(3) "Title insurance matter" means a matter related to:

(a) title insurance; and

(b) an escrow conducted by an individual title insurance producer.

 

R592-2-4. Title Insurance Matters Referred for Enforcement.

(1) A title insurance matter referred for enforcement will be resolved by:

(i) an informal adjudicative action pursuant to R592-2-5;

(ii) a stipulation and order issued by the commissioner; or

(iii) an administrative hearing conducted either by the commission or the commissioner's administrative law judge pursuant to R592-2-6.

 

R592-2-5. Imposition of a Penalty When an Informal Adjudicative Proceeding Is Used to Resolve a Title Insurance Matter.

(1) If the commissioner uses an informal adjudicative proceeding as set forth in 63G-4-203 and R590-160 to resolve a violation listed in Table 1 below, the commissioner shall use the penalties imposed by the commission in this Section.

(2) The commission shall impose the following penalties on title licensees for the violations listed in Table 1 below when resolved through an informal adjudicative proceeding.

 

Table 1

  

       Violation             1st Proceeding         2nd Proceeding
  
 Failure to complete     Individual: $1,000;   Individual: $2,000:
  
 required continuing     Agency: n/a           Agency: n/a
  
 education hours.
  

  
 Failure to respond      Individual: $500;     Individual: $1,000;
  
 to an inquiry of        Agency: $750          Agency: $1,500
  
 the commissioner.
  

  
 Failure to file a       Individual: n/a       Individual: n/a;
  
 required rate, form,    Agency: $1,000        Agency: $2,000
  
 or report.
  

  
 Late filing of a        Individual: n/a;      Individual: n/a;
  
 required rate,          Agency: $750          Agency: $1,500
  
 form, or report.
  

  
 Failure to charge or    Individual: $1,000;   Individual: $2,000;
  
 collect a correct       Agency: $2,500        Agency: $5,000
  
 premium or a correct
  
 filed fee.
  

  
 Charging or             Individual: $1,000;   Individual: $2,000;
  
 collecting a non-       Agency: $2,500        Agency: $5,000
  
 filed required fee.
  
 Failure to pay          Individual: $500;   Individual: $1,000;
  
 assessment when due.    Agency: $750        Agency: $1,500

 

R592-2-6. Use of an Administrative Hearing to Resolve a Title Insurance Matter.

(1) When the commissioner sets a date for an administrative hearing to resolve a title insurance matter, the commissioner shall inform the commission of the hearing date.

(2) After being informed of a hearing date, the commission shall:

(a) delegate the conduct of the administrative hearing to the commissioner's administrative law judge; or

(b) conduct the administrative hearing.

(3) For an administrative hearing conducted by the commission, the commission shall:

(a) accept the date, time and place set by the commissioner or set a different date, time, and place for the administrative hearing;

(b) cause notification to be sent to the respondent(s), the commissioner's administrative law judge, and the commissioner's enforcement attorney of the date, time, and place of the administrative hearing;

(c) conduct the hearing pursuant to R590-160;

(d) impose penalties in accordance with Sections 31A-2-308, 31A-23a-111, 31A-23a-112, 31A-26-213, and 31A-26-214, subject to the concurrence of the commissioner; and

(e) issue an Order on Hearing.

(4) The commissioner's administrative law judge shall assist the commission in its conduct of an administrative hearing.

 

R592-2-7. Imposition of Penalties.

The commission shall impose a penalty as follows:

(1) for an informal adjudicative proceeding, a penalty shall be imposed in accordance with Table 1 in R592-2-5;

(3) for an administrative hearing conducted by the commissioner's administrative law judge pursuant to R592-2-6 (2)(a), the commission shall impose the recommended penalty or a different penalty, subject to the concurrence of the commissioner; or

(4) for an administrative hearing conducted by the commission, the commission shall impose a penalty, subject to the concurrence of the commissioner.

 

R592-2-8. Severability.

If any provision or clause of this rule or its application to any person or situation is held invalid, that invalidity shall not affect any other provision or application of this rule which can be given effect without the invalid provision or application, and to this end the provisions of this rule are declared to be severable.

 

R592-2-9. Enforcement Date.

The commissioner will begin enforcing this rule upon the rule's effective date.

 

KEY: title insurance

Date of Enactment or Last Substantive Amendment: May 1, 2013

Notice of Continuation: September 15, 2010

Authorizing, and Implemented or Interpreted Law: 31A-2-402]