SECTION 3.361. Practice and Procedure for Texas Customs Broker's License Denial, Suspension, and Revocation

(a) Applicability of rules of practice and procedure. The following rules of practice and procedure contained in Part I, Chapter 1, Subchapter A of this title (relating to Practice and Procedure) shall apply to hearings involving the denial, revocation, or suspension of a Texas Customs Broker's License: §§1.1, 1.2, 1.4, 1.8, 1.19, 1.21-1.27, 1.29-1.36, 1.38, 1.41, and 1.42 of this title (relating to Practice and Procedure). For information about licensing procedures and requirements, see §3.360 of this title (relating to Customs Brokers).

(b) Special rules governing hearings on the denial, revocation, or suspension of a Texas Customs Broker's License.

(1) Contested cases. A contested case is a proceeding in which the legal rights, duties, or privileges of an applicant or licensee are to be determined by the agency after an opportunity for adjudicative hearing. It includes a request for relief from actions initiated by the agency to deny, suspend, or revoke a Texas Customs Broker's License. Contested cases are within the jurisdiction of the administrative law judges.

(2) Initiation of an oral hearing.

(A) If the comptroller determines that an applicant is not eligible for a Texas Customs Broker's License, the applicant will be notified, in writing, by personal service, or by registered or certified mail, return receipt requested, that the application has been denied. The notice will state the reasons for the denial. The applicant may, within 15 days of the date of the notice of denial, make a written request for an oral hearing to contest the denial. If the applicant does not request a hearing within 15 days of the date of the notice of denial, the hearing is waived and a final decision will be issued.

(B) If the comptroller determines that a Texas Customs Broker's License should be suspended or revoked, the comptroller will notify the licensee, in writing, by personal service or by registered or certified mail, return receipt requested, that the license will be suspended or revoked and will state the reasons for the action. The licensee may, within 15 days of the date of the notice of suspension or revocation, make a written request for an oral hearing to contest the action. If the licensee does not request a hearing within 15 days of the date of the notice of suspension or revocation, the hearing is waived and a final decision will be issued.

(3) Content of request for an oral hearing.

(A) A request for an oral hearing must contain the reasons the applicant or licensee disagrees with the action of the agency. The applicant or licensee must list and number the factual and legal grounds why the action of the agency should be reversed. Legal authority must be cited if the applicant or licensee disagrees with the agency's interpretation of the law.

(B) Evidence regarding issues raised in the request for hearing may be obtained through:

(i) a preliminary conference; and

(ii) discovery.

(C) Time limits on discovery or preliminary conferences will be set by the assigned administrative law judge if the parties cannot reach agreement. Evidence that a licensee or applicant will rely upon must be submitted to the assigned administrative law judge and hearings attorney at least ten days prior to the hearing date.

(D) A request for hearing may be amended up to ten days prior to the time that the hearing date is set, and not later, unless by permission of the assigned administrative law judge, and unless all evidence upon which the applicant or licensee intends to rely and that was not previously filed is filed with the amended request for hearing.

(4) Extensions of time.

(A) A motion for extension of the due date for submitting a request for hearing on the denial of an application or on the proposed suspension or revocation of a license may be granted in case of emergency or extraordinary circumstances. A motion for extension will not be routinely granted and each request will be closely scrutinized to ensure that the applicant or licensee has made every effort to comply with the original deadline. A motion filed after the expiration of the original due date will not be considered. A motion must be directed to the chief administrative law judge or his designee, who will grant or deny the motion.

(B) A motion for an extension of any other deadline will not be granted unless good cause is established and the need for the extension is not due to the moving party's neglect, indifference, or lack of diligence. A motion must be made in writing at least seven days prior to the deadline. In the event of an emergency, a motion may be accepted if it is postmarked, sent by facsimile transmission, or deposited with a private mail or courier service, postage or delivery charges paid, not later than the date of the original deadline.

(5) Motion to dismiss; request for extended hearing.

(A) The agency may move to dismiss the hearing on the ground that the request for hearing was not timely filed or failed to state a claim upon which relief could be granted as required by paragraph (3) of this subsection.

(B) An applicant or licensee who believes it will require more than two hours for a hearing must file a written request for an extended hearing at the time the request for hearing is filed, and state the reasons why more time will be required; however, any party may later request an extended hearing for good cause shown.

(6) Notice of setting. Upon receipt of a timely and sufficient request for hearing, the assigned administrative law judge will send a notice to the parties giving:

(A) the date, time, place, and nature of the oral hearing;

(B) the legal authority and jurisdiction under which the hearing is to be held;

(C) a reference to the particular statutes and rules involved; and

(D) upon request, briefing and evidentiary prefiling dates, and other appropriate orders.

(7) Administrative law judge to hear case. Hearings will be conducted by an assigned administrative law judge who has authority to examine witnesses, to rule on motions, and to rule upon the admissibility of evidence. The administrative law judge has the authority to continue or recess any hearing, to control the record, and to propose decisions to the comptroller. If for any reason the assigned administrative law judge cannot continue on a contested case, another administrative law judge will become familiar with the record and perform any functions remaining to be performed without the necessity of repeating any previous proceedings in the case.

(8) Filing of documents. All documents submitted after the notice of setting has been issued must be filed with the assigned administrative law judge with a copy to each party. In addition to any other order by the assigned administrative law judge, the time limit for filing documents with the administrative law judge and an opposing party shall be not later than ten days prior to the hearing.

(9) Continuances (postponement of hearing). A motion for continuance of a contested case set for oral hearing must be in writing and filed with the assigned administrative law judge at least seven days prior to the date that the matter is to be heard. If an emergency occurs less than seven days prior to the hearing date, a motion for continuance may be filed. The motion must show that there is good cause for the continuance and that the need is not caused by neglect, indifference, or lack of diligence. A copy of the motion must be served upon all other parties of record at the time of filing.

(10) Comptroller's decision. The proposed decision of the assigned administrative law judge must be approved by the Comptroller of Public Accounts before it is given effect. The comptroller's decision will be sent to the applicant or licensee and any authorized representative. The decision is final 20 days from the date mailed, unless a motion for rehearing is filed at or before midnight of the 20th day. If the motion for rehearing is granted, the decision is vacated pending a subsequent decision upon rehearing. If the motion for rehearing is overruled, whether by order or operation of law, the decision is final on the date the motion is overruled. A final decision of the comptroller to deny, suspend, or revoke a Texas Customs Broker's License is subject to judicial review by trial de novo in the district courts of Travis County.

(11) Joint hearings. An applicant, licensee, or the agency may file a written motion to have two or more cases involving only that applicant or licensee joined for purposes of hearing; or the assigned administrative law judge, acting independently, may join two or more such cases.

(12) Dismissal of case.

(A) If a motion to dismiss is filed upon agreement between the applicant or licensee and the agency, or upon the applicant's or licensee's decision to abandon the case, a decision will be issued that conforms with such disposition.

(B) The agency may move to dismiss a case based upon agreement reached between the applicant or licensee and the agency, for failure to state a claim upon which relief can be granted as required by paragraph (3) of this subsection, or for want of prosecution. The motion must be served on the applicant or licensee and its authorized representative at its last address of record. If there is no reply from the applicant or licensee to the agency's motion to dismiss within 15 days, a decision will be issued denying the relief sought by the applicant or licensee.

(C) All motions to dismiss that are based upon a representation that both parties have agreed to dismiss a contested case on the basis that all issues have been settled shall be in writing and signed by both parties or their authorized representatives.

(13) Burden of proof. In all contested cases the agency has the burden of proving a prima facie case; the burden of proof then shifts to the applicant or licensee, with the standard of proof being by a preponderance of the evidence.

Source Note: The provisions of this §3.361 adopted to be effective March 22, 1995, 20 TexReg 1658.