Part 2.
TEXAS PARKS AND WILDLIFE DEPARTMENT
Chapter 51.
EXECUTIVE
Subchapter H. CONTRACT DISPUTE RESOLUTION
31 TAC §§51.200-51.225
The Texas Parks and Wildlife Department proposes new §§51.200-51.225,
concerning dispute resolution. The new rules are intended to serve as guidelines
for the negotiation and mediation of a claim of breach of contract asserted
by a contractor against Texas Parks and Wildlife Department under Government
Code, Chapter 2260. The new rules are not intended to replace agency procedures
relating to breach of contract claims that are mandated by state or federal
law, but are intended to provide procedures when none are so mandated. New §51.200,
concerning Applicability, identifies the situations and instances in which
the rules would be applicable. New §51.201, concerning Definitions, assigns
meanings to words and phrases used in the subchapter. New §51.202, concerning
Prerequisites to Suit, establishes the provisions of the subchapter as requirements
for actions under other statutes. New §51.203, concerning Sovereign Immunity,
affirms the department's sovereign immunity to suit and liability. New §51.204,
concerning Notice of Claim of Breach of Contract, sets forth the contents
of the notice required to be filed to claim breach of contract. New §51.205,
concerning Agency Counterclaim, sets forth the contents of the notice required
to be filed by the agency in a counterclaim. New §51.206, concerning
Request for Voluntary Disclosure of Additional Information, provides for the
availability of various types of information among parties to a claim or counterclaim.
New §51.207, concerning Duty to Negotiate, establishes an obligation
by parties to attempt to resolve claims and counterclaims. New §51.208,
concerning Timetable, provides a chronology for the negotiations process.
New §51.209, concerning Conduct of Negotiation, describes the protocol
for the negotiations process. New §51.210, concerning Settlement Approval
Procedures, provides for disclosure of the procedures for settlement prior
to negotiations. New §51.211, concerning Settlement Agreement, defines
the parameters of settlements. New §51.212, concerning Costs of Negotiation,
specifies that each party is responsible for its own costs for negotiation,
unless otherwise provided for by mutual agreement. New §51.213, concerning
Request for Contested Case Hearing, provides a mechanism for obtaining a contested
case hearing in the event that negotiations fail to resolve a claim. New §51.214,
concerning Mediation Timetable, establishes a chronology for mediation of
a dispute. New §51.215, concerning Conduct of Mediation, prescribes the
conditions and process of mediation. New §51.216, concerning Agreement
to Mediate, provides for mediation as option provided for at the time a contract
is entered into, and prescribes potential mediators and the timeframe for
the process. New §51.217, concerning Qualifications and Immunity of the
Mediator, prescribes the legal requirements and protections for persons performing
mediation. New §51.218, concerning Confidentiality of Mediation and Final
Settlement Agreement, provides for the privacy of privileged information under
a claim settlement. New 51.219, concerning Costs of Mediation, stipulates
that each party to a mediation is responsible for its own costs, unless a
previous agreement provides otherwise. New 51.220, concerning Settlement Procedures,
stipulates the disclosure of settlement procedures prior to mediation. New
51.221, concerning Initial Settlement Agreement, establishes the obligations
of parties under an initial settlement agreement. New 51.222, concerning Final
Settlement Agreement, establishes the obligations of parties under a final
settlement agreement. New 51.223, concerning Referral to the State Office
of Administrative Hearings, provides a mechanism for referral to the State
Office of Administrative Hearings in the event that mediation does not result
in settlement of a claim. New 51.224, concerning Assisted Negotiation Process,
allows for assisted negotiation in addition to negotiation and mediation.
New 51.225, concerning Alternative Dispute Resolution, allows for alternative
dispute resolution in addition to assisted negotiation, negotiation, and mediation.
Melanie Callahan, Finance Director, has determined that for each of the
first five years that the proposed new sections are in effect, there will
be no negative financial implication to state or local governments as a result
of enforcing or administering the proposed new sections.
Ms. Callahan also has determined that for each of the first five years
that the new sections as proposed are in effect, the public benefit anticipated
as a result of the new rules as proposed will be the increased satisfaction
of those who contract with the department, adding more consistency and fairness
to resolution of contract disputes.
There will be no adverse effect on small businesses or microbusinesses.
There are no economic costs to persons required to comply with the new rules
as proposed because the rules allow for a procedure to resolve contract claims.
The department has not filed a local impact statement with the Texas Workforce
Commission as required by Government Code, §2001.022, as the agency has
determined that the rule will not impact local economies.
The department has determined that there will not be a taking of private
real property, as defined by Government Code, Chapter 2007, as a result of
the proposed rules.
Comments on the proposed rules will be solicited and submitted to Judith
Doran, Texas Parks and Wildlife Department, 4200 Smith School Road, Austin,
Texas, 78744.
The proposed rules are authorized by Government Code, §2260.052(c),
which requires each unit of state government with rulemaking authority to
develop rules to govern the negotiation and mediation of contract claims against
the state, and Parks and Wildlife Code §11.0171, which requires the commission
to adopt by rule policies and procedures for soliciting and awarding contracts.
The proposed new rules affect Government Code, Chapter 2260 and Parks and
Wildlife Code, Chapter 11.
§51.200.Applicability.
(a)
This subchapter does not apply to an action of the department
for which a contractor is entitled to a specific remedy pursuant to state
or federal constitution or statute.
(b)
This subchapter does not apply to contracts:
(1)
between Texas Parks and Wildlife Department and the federal
government or its agencies, another state or another nation;
(2)
between two or more units of state government;
(3)
between the department and a local governmental body, or
a political subdivision of another state;
(4)
between a subcontractor and a contractor;
(5)
subject to Transportation Code, §201.112;
(6)
within the exclusive jurisdiction of state or local regulatory
bodies;
(7)
within the exclusive jurisdiction of federal courts or
regulatory bodies; or
(8)
that are solely and entirely funded by federal grant monies
other than for a project defined in §51.201(10) of this title (relating
to Definitions).
§51.201.Definitions.
The following words and terms, when used in this subchapter, shall
have the following meaning, unless the context clearly indicates otherwise:
(1)
Chief administrative officer--The executive director, or
other executive officer responsible for the day to day operations of the department.
(2)
Claim--A demand for damages by the contractor based upon
the department's alleged breach of the contract.
(3)
Contract--A written contract between the department and
a contractor by the terms of which the contractor agrees either:
(A)
to provide goods or services, by sale or lease, to or for
the department; or
(B)
to perform a project as defined by Government Code, §2166.001.
(4)
Contractor--Independent contractor who has entered into
a contract directly with the department. The term does not include:
(A)
The contractor's subcontractor, officer, employee, agent
or other person furnishing goods or services to a contractor;
(B)
An employee of the department; or
(C)
A student at an institution of higher education.
(5)
Counterclaim--A demand by the department based upon the
contractor's claim.
(6)
Day--A calendar day. If an act is required to occur on
a day falling on a Saturday, Sunday, or holiday, the first working day which
is not one of these days should be counted as the required day for purpose
of this act.
(7)
Department--Texas Parks and Wildlife Department.
(8)
Event--An act or omission or a series of acts or omissions
giving rise to a claim.
(9)
Goods--Supplies, materials or equipment.
(10)
Parties--The contractor and the department when they have
entered into a contract in connection with which a claim of breach of contract
has been filed under this chapter.
(11)
Project--As defined in Government Code, §2166.001,
a building construction project that is financed wholly or partly by a specific
appropriation, bond issue or federal money, including the construction of:
(A)
a building, structure, or appurtenant facility or utility,
including the acquisition and installation of original equipment and original
furnishing; and
(B)
an addition to, or alteration, modification, rehabilitation
or repair of an existing building, structure, or appurtenant facility or utility.
(12)
Services--The furnishing of skilled or unskilled labor
or consulting or professional work, or a combination thereof, excluding the
labor of an employee of the department.
§51.202.Prerequisites to Suit.
The procedures contained in this chapter are exclusive and required
prerequisites to suit under Civil Practice and Remedies Code, Chapter 107,
and Government Code, Chapter 2260.
§51.203.Sovereign Immunity.
This chapter does not waive the department's sovereign immunity to
suit or liability.
§51.204.Notice of Claim of Breach of Contract.
(a)
A contractor asserting a claim of breach of contract under
Government Code, Chapter 2260, shall file notice of the claim as provided
by this section.
(b)
The notice of claim shall:
(1)
be in writing and signed by the contractor or the contractor's
authorized representative;
(2)
be delivered by hand, certified mail return receipt requested,
or other verifiable delivery service, to the officer of the department designated
in the contract to receive a notice of claim of breach of contract under Government
Code, Chapter 2260; if no person is designated in the contract, the notice
shall be delivered to the unit's chief administrative officer, and shall state
in detail:
(A)
the nature of the alleged breach of contract, including
the date of the event that the contractor asserts as the basis of the claim
and each contractual provision allegedly breached;
(B)
a description of damages that resulted from the alleged
breach, including the amount and method used to calculate those damages; and
(C)
the legal theory of recovery, i.e., breach of contract,
including the causal relationship between the alleged breach and the damages
claimed.
(c)
In addition to the mandatory contents of the notice of
claim as required by subsection (b) of this section, the contractor may submit
supporting documentation or other tangible evidence to facilitate the unit's
evaluation of the contractor's claim.
(d)
The notice of claim shall be delivered no later than 180
days after the date of the event that the contractor asserts as the basis
of the claim; provided, however, that a contractor shall deliver notice of
a claim that was pending before the department on August 30, 1999, to the
unit no later than February 26, 2000.
§51.205.Agency Counterclaim.
(a)
The department in asserting a counterclaim under Government
Code, Chapter 2260, shall file notice of the counterclaim as provided by this
section.
(b)
The notice of counterclaim shall:
(1)
be in writing;
(2)
be delivered by hand, certified mail return receipt requested
or other verifiable delivery service to the contractor or representative of
the contractor who signed the notice of claim of breach of contract; and shall
state in detail:
(A)
the nature of the counterclaim;
(B)
a description of damages or offsets sought, including the
amount and method used to calculate those damages or offsets; and
(C)
the legal theory supporting the counterclaim.
(c)
In addition to the mandatory contents of the notice of
counterclaim required by subsection (b) of this section, the unit may submit
supporting documentation or other tangible evidence to facilitate the contractor's
evaluation of the unit's counterclaim.
(d)
The notice of counterclaim shall be delivered to the contractor
no later than 90 days after the department's receipt of the contractor's notice
of claim.
(e)
Nothing herein precludes the department from initiating
a lawsuit for damages against the contractor in a court of competent jurisdiction.
§51.206.Request for Voluntary Disclosure of Additional Information.
(a)
Upon the filing of a claim or counterclaim, parties may
request to review and copy information in the possession or custody or subject
to the control of the other party that pertains to the contract claimed to
have been breached, including, without limitation:
(1)
accounting records;
(2)
correspondence, including, without limitation, correspondence
between the unit and outside consultants it utilized in preparing its bid
solicitation or any part thereof or in administering the contract, and correspondence
between the contractor and its subcontractors, materialmen, and vendors;
(3)
schedules;
(4)
the parties' internal memoranda;
(5)
documents created by the contractor in preparing its offer
to the unit and documents created by the unit in analyzing the offers it received
in response to a solicitation.
(b)
Subsection (a) of this section applies to all information
in the parties' possession regardless of the manner in which it is recorded,
including, without limitation, paper and electronic media.
(c)
The contractor and the department may seek additional information
directly from third parties, including, without limitation, the unit's third-party
consultants and the contractor's subcontractors.
(d)
Nothing in this section requires any party to disclose
the requested information or any matter that is privileged under Texas law.
(e)
Material submitted pursuant to this section and claimed
to be confidential by the contractor shall be handled pursuant to the requirements
of Government Code, Chapter 552.
§51.207.Duty to Negotiate.
The parties shall negotiate in accordance with the timetable set forth
in §51.208 of this title (relating to Timetable) to attempt to resolve
all claims and counterclaims. No party is obligated to settle with the other
party as a result of the negotiation.
§51.208.Timetable.
(a)
Following receipt of a contractor's notice of claim, the
executive director of the department or other representative designated in
the contract shall review the contractor's claim(s) and the unit's counterclaim(s),
if any, and initiate negotiations with the contractor to attempt to resolve
the claim(s) and counterclaim(s).
(b)
Subject to subsection (c) of this section, the parties
shall begin negotiations within a reasonable period of time, not to exceed
60 days following the later of:
(1)
the date of termination of the contract;
(2)
the completion date, or substantial completion date in
the case of construction projects, in the original contract; or
(3)
the date the department receives the contractor's notice
of claim.
(c)
the department may delay negotiations until after the 180th
day after the date of the event giving rise to the claim of breach of contract
by:
(1)
delivering written notice to the contractor that the commencement
of negotiations will be delayed; and
(2)
delivering written notice to the contractor when the unit
is ready to begin negotiations.
(d)
The parties may conduct negotiations according to an agreed
schedule as long as they begin negotiations no later than the deadlines set
forth in subsection (b) or (c) of this section, whichever is applicable.
(e)
Subject to subsection (f) of this section, the parties
shall complete the negotiations that are required by this chapter as a prerequisite
to a contractor's request for contested case hearing no later than 270 days
after the department receives the contractor's notice of claim.
(f)
The parties may agree in writing to extend the time for
negotiations on or before the 270th day after the department receives the
contractor's notice of claim. The agreement shall be signed by representatives
of the parties with authority to bind each respective party and shall provide
for the extension of the statutory negotiation period until a date certain.
The parties may enter into a series of written extension agreements that comply
with the requirements of this section.
(g)
The contractor may request a contested case hearing before
the State Office of Administrative Hearings ("SOAH") pursuant to §51.213
of this title (relating to Request for Contested Case Hearing) after the 270th
day after the unit receives the contractor's notice of claim, or the expiration
of any extension agreed to under subsection (f) of this section.
(h)
The parties may agree to mediate the dispute at any time
before the 270th day after the department receives the contractor's notice
of claim or before the expiration of any extension agreed to by the parties
pursuant to subsection (f) of this section. The mediation shall be governed
by the provisions of this subchapter.
(i)
Nothing in this section is intended to prevent the parties
from agreeing to commence negotiations earlier than the deadlines established
in subsections (b) and (c) of this section, or from continuing or resuming
negotiations after the contractor requests a contested case hearing before
SOAH.
§51.209.Conduct of Negotiation.
(a)
Negotiation is a consensual bargaining process in which
the parties attempt to resolve a claim and counterclaim. A negotiation under
this subchapter may be conducted by any method, technique, or procedure authorized
under the contract or agreed upon by the parties, including, without limitation,
negotiation in person, by telephone, by correspondence, by video conference,
or by any other method that permits the parties to identify their respective
positions, discuss their respective differences, confer with their respective
advisers, exchange offers of settlement, and settle.
(b)
The parties may conduct negotiations with the assistance
of one or more neutral third parties. If the parties choose to mediate their
dispute, the mediation shall be conducted in accordance with this subchapter.
Parties may choose an assisted negotiation process other than mediation, including
without limitation, processes such as those described in §51.224 of this
title (relating to Assisted Negotiation Processes) and §51.225 of this
title (relating to Alternative Dispute Resolution).
(c)
To facilitate the meaningful evaluation and negotiation
of the claim(s) and any counterclaim(s), the parties may exchange relevant
documents that support their respective claims, defenses, counterclaims or
positions.
(d)
Material submitted pursuant to this subsection and claimed
to be confidential by the contractor shall be handled pursuant to the requirements
of Government Code , Chapter 552.
§51.210.Settlement Approval Procedures.
The parties' settlement approval procedures shall be disclosed prior
to, or at the beginning of, negotiations. To the extent possible, the parties
shall select negotiators who are knowledgeable about the subject matter of
the dispute, who are in a position to reach agreement, and who can credibly
recommend approval of an agreement.
§51.211.Settlement Agreement.
(a)
A settlement agreement may resolve an entire claim or any
designated and severable portion of a claim.
(b)
To be enforceable, a settlement agreement must be in writing
and signed by representatives of the contractor and the department who have
authority to bind each respective party.
(c)
A partial settlement does not waive a parties' rights under
the Government Code, Chapter 2260, as to the parts of the claims or counterclaims
that are not resolved.
§51.212.Costs of Negotiation.
Unless the parties agree otherwise, each party shall be responsible
for its own costs incurred in connection with a negotiation, including, without
limitation, the costs of attorney's fees, consultant's fees and expert's fees.
§51.213.Request for Contested Case Hearing.
(a)
If a claim for breach of contract is not resolved in its
entirety through negotiation, mediation or other assisted negotiation process
in accordance with this chapter on or before the 270th day after the unit
receives the notice of claim, or after the expiration of any extension agreed
to by the parties pursuant to §51.208(f) of this title (relating to Timetable),
the contractor may file a request with the department for a contested case
hearing before SOAH.
(b)
A request for a contested case hearing shall state the
legal and factual basis for the claim, and shall be delivered to the chief
administrative officer of the department or other officer designated in the
contract to receive notice within a reasonable time after the 270th day or
the expiration of any written extension agreed to pursuant to §51.208(f)
of this title.
(c)
The department shall forward the contractor's request for
contested case hearing to SOAH within a reasonable period of time, not to
exceed thirty days, after receipt of the request.
(d)
The parties may agree to submit the case to SOAH before
the 270th day after the notice of claim is received by the department if they
have achieved a partial resolution of the claim or if an impasse has been
reached in the negotiations and proceeding to a contested case hearing would
serve the interests of justice.
§51.214.Mediation Timetable.
(a)
The contractor and the department may agree to mediate
the dispute at any time before the 270th day after the department receives
a notice of claim of breach of contract, or before the expiration of any extension
agreed to by the parties in writing.
(b)
A contractor and the department may mediate the dispute
even after the case has been referred to SOAH for a contested case. SOAH may
also refer a contested case for mediation pursuant to its own rules and guidelines,
whether or not the parties have previously attempted mediation.
§51.215.Conduct of Mediation.
(a)
Mediation is a consensual process in which an impartial
third party, the mediator, facilitates communication between the parties to
promote reconciliation, settlement, or understanding among them. A mediator
may not impose his or her own judgment on the issues for that of the parties.
The mediator must be acceptable to both parties.
(b)
The mediation is subject to the provisions of the Governmental
Dispute Resolution Act, Government Code, Chapter 2009. For purposes of this
subchapter, "mediation" is assigned the meaning set forth in the Civil Practice
and Remedies Code, §154.023.
(c)
To facilitate a meaningful opportunity for settlement,
the parties shall, to the extent possible, select representatives who are
knowledgeable about the dispute, who are in a position to reach agreement,
or who can credibly recommend approval of an agreement.
§51.216.Agreement to Mediate.
(a)
Parties may agree to use mediation as an option to resolve
a breach of contract claim at the time they enter into the contract and include
a contractual provision to do so. The parties may mediate a breach of contract
claim even absent a contractual provision to do so if both parties agree.
(b)
Any agreement to mediate should include consideration of
the following factors:
(1)
The source of the mediator. Potential sources of mediators
include governmental officers or employees who are qualified as mediators
under Civil Practice and Remedies Code, §154.052, private mediators,
SOAH, the Center for Public Policy Dispute Resolution at The University of
Texas School of Law, an alternative dispute resolution system created under
Civil Practice and Remedies Code, Chapter 152, or another state or federal
agency or through a pooling agreement with several state agencies. Before
naming a mediator source in a contract, the parties should contact the mediator
source to be sure that it is willing to serve in that capacity. In selecting
a mediator, the parties should use the qualifications set forth in §51.217
of this title (relating to Qualifications and Immunity of Mediator).
(2)
The time period for the mediation. The parties should allow
enough time in which to make arrangements with the mediator and attending
parties to schedule the mediation, to attend and participate in the mediation,
and to complete any settlement approval procedures necessary to achieve final
settlement. While this time frame can vary according to the needs and schedules
of the mediator and parties, it is important that the parties allow adequate
time for the process.
(3)
The location of the mediation.
(4)
Allocation of costs of the mediator.
(5)
The identification of representatives who will attend the
mediation on behalf of the parties, if possible, by name or position within
the governmental unit or contracting entity.
(6)
The settlement approval process in the event the parties
reach agreement at the mediation.
§51.217.Qualifications and Immunity of the Mediator.
(a)
The mediator shall possess the qualifications required
under Civil Practice and Remedies Code, §154.052, be subject to the standards
and duties prescribed by Civil Practice and Remedies Code, §154.051 and
have the qualified immunity prescribed by Civil Practice and Remedies Code, §154.055,
if applicable.
(b)
The parties should decide whether, and to what extent,
knowledge of the subject matter and experience in mediation would be advisable
for the mediator.
(c)
The parties should obtain from the prospective mediator
the ethical standards that will govern the mediation.
§51.218.Confidentiality of Mediation and Final Settlement Agreement.
(a)
A mediation conducted under this section is confidential
in accordance with Government Code, §2009.054.
(b)
The confidentiality of a final settlement agreement to
which the department is a signatory that is reached as a result of the mediation
is governed by Government Code, Chapter 552.
§51.219.Costs of Mediation.
Unless the contractor and the department agree otherwise, each party
shall be responsible for its own costs incurred in connection with the mediation,
including costs of document reproduction for documents requested by such party,
attorney's fees, and consultant or expert fees. The costs of the mediation
process itself shall be divided equally between the parties.
§51.220.Settlement Approval Procedures.
The parties' settlement approval procedures shall be disclosed by the
parties prior to the mediation. To the extent possible, the parties shall
select representatives who are knowledgeable about the subject matter of the
dispute, who are in a position to reach agreement, and who can credibly recommend
approval of an agreement.
§51.221.Initial Settlement Agreement.
Any settlement agreement reached during the mediation shall be signed
by the representatives of the contractor and the department, and shall describe
any procedures required to be followed by the parties in connection with final
approval of the agreement.
§51.222.Final Settlement Agreement.
(a)
A final settlement agreement reached during, or as a result
of mediation, that resolves an entire claim or any designated and severable
portion of a claim shall be in writing and signed by representatives of the
contractor and the department who have authority to bind each respective party.
(b)
If the settlement agreement does not resolve all issues
raised by the claim and counterclaim, the agreement shall identify the issues
that are not resolved.
(c)
A partial settlement does not waive a contractor's rights
under the Government Code, Chapter 2260, as to the parts of the claim that
are not resolved.
§51.223.Referral to the State Office of Administrative Hearings.
If mediation does not resolve all issues raised by the claim, the contractor
may request that the claim be referred to SOAH by the department. Nothing
in these rules prohibits the contractor and the department from mediating
their dispute after the case has been referred for contested case hearing,
subject to the rules of SOAH.
§51.224.Assisted Negotiation Processes.
Parties to a contract dispute under Government Code, Chapter 2260 may
agree, either contractually or when a dispute arises, to use assisted negotiation
(alternative dispute resolution) processes in addition to negotiation and
mediation to resolve their dispute.
§51.225.Alternative Dispute Resolution.
Parties to a contract dispute under these rules may agree, either contractually
or when a dispute arises to use an Alternative Dispute Resolution process
in addition to negotiation and mediation to resolve their disputes.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State, on July 17, 2000.
TRD-200004921
Gene McCarty
Chief of Staff
Texas Parks and Wildlife Department
Earliest possible date of adoption: August 27, 2000
For further information, please call: (512) 389-4775
Subchapter C. PERMITS FOR TRAPPING, TRANSPORTING, AND TRANSPLANTING GAME ANIMALS AND GAME BIRDS
Chapter 65.
WILDLIFE