Collection fee for past due child support or alimony.
Checkout our iOS App for a better way to browser and research.
(1) As used in this section:
(a) "Debtor" means a person obligated or allegedly obligated to pay a domestic relations debt.
(b) "Domestic relations debt" means an obligation or alleged obligation to pay past due child support or alimony.
(2)
(a) A court shall order the amounts described in Subsection (2)(b) be paid, if:
(i) the court issues a judgment requiring the payment of a domestic relations debt by the debtor;
(ii) imposing a collection fee on the debtor or in relation to the domestic relations debt is not prohibited or otherwise restricted by another federal or state law; and
(iii) the person owed the domestic relations debt has a contingency arrangement with an attorney to collect the domestic relations debt.
(b) If the conditions of Subsection (2)(a) are met, a court shall order payment of:
(i) the principal amount due;
(ii) applicable interest;
(iii) a collection fee equal to the amount provided in the contingency agreement, except that the collection fee may not exceed the lesser of:
(A) the actual amount the person owed the domestic relations debt is required to pay for collection costs, regardless of whether that amount is a specific dollar amount or a percentage of the principal amount owed for the domestic relations debt; or
(B) 40% of the principal amount owed to the person for the domestic relations debt;
(iv) reasonable attorney fees; and
(v) costs, if any, related to obtaining the judgment described in Subsection (2)(a)(i).
(3) The obligation to pay a collection fee described in Subsection (2)(b)(iii) is incurred at the time the person owed a domestic relations debt enters into an agreement with an attorney to collect the domestic relations debt.
(4) An obligation to pay a collection fee imposed under this section is in addition to any obligation to pay reasonable attorney fees that may exist.
(5) The Office of Recovery Services may not collect an order issued pursuant to Subsection (2).