Case Information
*1 : ; 764 OFFICE OF THE ATTORNkY GENERAL OF TEXAS AUSTIN
’ GROVER SELLERS ArrORNEY GLNLlllrL
Penor8ble II. A. Juisea
cemiSdOXWe ~jW@IIOXIt Or m~khg
Au attn - 14 0’ %x8S
De8r Yr. Julsm: opinion Ro. 04lwT
Iour lottor
i. 88 ?0110*8:
rit to do bu
018, 4.8 8ppF48Ob- oplnioa regwdiag d w OIlI' OpOOi81 pomtlon ~hosa home oft300 la ia lQwin,@ield, vhioh time OlaOnt 08ll80S OUr inqUiW lVll8tiVO to expenses to be 00p0ooi8lYf pertinent.
Smhe qUeStiOXl tb8t OOllO8l'llS 11s 18 Wheth4l Or not our ropreSsnktltos BI8r be reimbnrmd to tbe extent of expames 8otu8lly inourred permitting the OOr~F8tiOllS inVOlV@d t4 is-0 their UpenW - .-
EonOt8ble A. A. J8misOll - p8ge a direotly to the Ot tOptO-
W8ttMfS teprWWdc8tiVO senktires, Or does it fOllOW tb8t 8 bill for lRlOb mst be diteoted to the ootpot8tlons in- erpenaeo
volved 8nd obeok mode pal8blO t0 this dOp8ttaent
rifb the 8meunt dOpO8ited in the 88mO m8nnet 88
eS8mfn8tiOn fee8, pell81tie8 8nd other tetWUeo
oolleoted fhi8 drpatbent with tbe ex8minotm bein toqaltsd 1-t
or tepresent8tl.ter 8mOU?It of theit 0181~8 4 or telmbutnl to M.00 pet
d8ye ph#, O? OOPtMs 8OtU81 eXpeIJ8Om inautted te In Chic oonnsotiim your Oh8tge8. tt8lls~tk~iOll 8ttenfion is invited to iMotIon B of the 8?otem8Pid
Attiole.
sYou ate further 8dvised th8f it h8s been 8 pt8OtiOe of this Deprttment to permit itm tepte-
SeXltPtiVeS to 8OOept 8 oheok from the OOt~t8tiOns
involved made p8y8blo to thorn in an 8mOUnt tepte-
Senting 8otu81 expenses lnoutted tot many years. This plrotioe peth8ps b8sed upon opinion No. 551 8s written by then oifioe oounssl, the lionot8ble
Oole spoet. We h8Te tOd8y tete8d th8t opinion and
8s indlO8bd To feel need Of 8 018tifJing ex-
ptessio?I te the subjeot in 8drMoo Of 8 speoial 8s- signment fo examiners of this deprttatent glbt8Oing
the 81u1~81 teTieT 8s t0 the~8OnditiOn Of the k0
cotpot8tions involved. It follows, of course, th8t in tespeat to the pt8otiOe hetein8bove mentioned no 0181~1 for expenses h8s been filed rlth the State b7 the ex8mlnet8 lnvolvad aonneotion euamina- tions rde, oinse 88 stated the OOtpOt8t+iOns h8te
< p8id the full 8mount of the expenses ineutted diteot
to the ex8mlnets eng8ged In the 8nnu81 terievs.
'YOU 8te further 8dVised fh8t this subjeot m8t-
tat 18 Of ~peOi81 oonoetn t0 us by te8aOn Of the
f8Ot th8t We h8Ve 8OtU81 knowledge Ot the eXtt8Otdi- not7 expanses rhioh 8te involved in 8 trip beyond
tbe borders of out St8te of the n8tute hatein des-
otibed. Thus Ii it should be bold th8t suah ex8m- inets will bo limited to 8x1 expense 8006un1nt O? M.00 me8ls, 8OOOm!EOd8tiOns 8nd other Pot d8y - OOtoting
items, We sh8ll foe1 disposed to @TO spOCi81 OOUdd- et8tion to Efeotion 10 of Atffole 15248 which h8s to do with te- the 8OOeptinOe on out p8tf Of eX8ldn8t.iOn potfs 8s nnde by other qenoles. This, We think, would be neoess8ty in aonsidet8tion of the thougbt *3 ionOt8blO Il. Judson - p8ge 8
that to 8m&g1 one of out exuinete to nuke the ax- dosotibed on 8 b8eie Of $4.00 pet d87 uln8tione 8110T8~Oe would be knt8mOUnt t0 requiting th8t ex- mnlnet ot'ox8minets to 8bsotb 8n out OS pocket ex- pense that would likely inTOlT8 mote than $200.00.
sPtooeedlng, theteiote, out l eaond Inquiry 8Ud In oOntempl8tiOn Of the thought th8t be itm8y held Sh8f the $4.00 limitation 8ppliO~ rnd th8t the ootpotatione inTOlT8d must pay the department di- teotly the raount of expenses InOutCddr is the 18~ gu8ge of Seation 10 of fihe 8fOteinWtiOned 8ttiole
suS?ioientl~ bro8d in its etlpulations as to justi- fy this orrioe in foregoing Its pt8otiae to ex8mine the aotpot8tione inrolted and aooept in lieu thete- Of Pn OTW-811 oXamin8tiOu topOtt 88 made by other 8genoiesb fe use the word 'otet-all' delibotrt,el~ for such reports do not gire speaial 8ttention to the position of an lndiridual St8te, but t8thet 8s Ombt8Ce tb0 genetal 0Otpotat.s p0siti0~. iudio8tOd "Out om examineto, in teepeat to their examlna- being OOtpOt8tiOns that tiOn Of +h388 OOtpOtatiOnS, h8TO issued 8nd sold t0 Tex8S OitdZonS their inVest.- ment oettlfiaote8 amounts 8ggtegrtlng several mil- lions OS dOll8ts, OOnoOntt8ta p8ttiOUl8tly upon the that 8x-e established 8s to the ootpot8to oonttols 118bilitJ t0 TeX8s oreditors and eanII8tked 8ssots pledged Sot their ptoteotinn~ with 8 speaial TOtify- ing ptOOedut8 made 8 p8rt Of 08Ch oxamin8t.ion. FUt- 8s m8y be knOWn t0 Your own Judge Bpest, thermore, the assets so pledged Sot the benefit of Texas oted- itote 8re held by the St&9 %'telrsWat or 8 %X88 trustee. In respect to the 18tter it la the policy of our examiners to obtain listings from the trustee before le8Ting for the home offloe of the ootpora- tion, this listing h8Ting to do 8ssets pledged 8nd #f?iOiOntlj ooaplete 8s to enable thorough Teri- Tio8tion with the teootde m8int8inOd in ui11Es8pOlis. We rarely mention tbie pb8mOf the ptoaedute to am- pb8dSS tb8f my report which we might 8COept from 8gOUOr rould f813 f8t 8hOtt Of the OOmplOte- 8nOtbOt noes outlined shore insOf8t 88 Texas creditors 8re oonoernod, and it ooaurtod to us th8t this referents to out exaain8tlon ptocedute might hare some besting in the oonsidetatlon of question ia~olred In Seo- 10 of Aot.. tion
, 767 Honot8ble A. J8StiSOn - page 4
Seotion 1 of Artlole 16248 defines the 0188s of oor- porations embtaoed within the L68U rad Bioke+8ge COap8nles Aot.
Sootion a is 8s ?ollows: vhe'68nklllg Cosmdedoaer OS teX8S eh811 ox- amine or 08uie to be exdnod suob eOtpotatdOn8
8nnu8lly or oftenet if he deems If neoee88ty. Said OOtpO+8tiOll ah811 p8I the 8OtU81 tt8TSlin6
expe8eeer hotel bill's, and 811 other otu81 ex-
pense inoident to mch exminatioa and 8 fee not
oxoeedlng Twenty-five Dollats~($25) pet d8y pet
person engaged in such examination. IS suob aot-
potation hrd not sold In TeX8s its bonds, notes,
oottiSloites, debentures, et other oblig8tlons
8nd does IIOt Offot ?Ot s818 Ot 8811 in TOX8s its
bonds, notes, oett1?1oates, debont.ures or other the Banking Comnlesionet of Pex8er
oblig8tione,
in lieu of an examination shall 8ooept 8 Sin8n-
0181 t8t,ement. mode on suab form, containing such
idorm8tion as he desires. Guch fess, together
rith any other Sees, penalties or terenues ool-
looted by the Commissioner pursuant to pto- of this Aot or pursuant to other lors of
lidons this State tel8tire to corpot8tione under the of the Banking Dopattatont, ah811 be
mpWTi8iOn
paid by the Commissioner to the State Tt08mWSt
to the otedit of the &3net81 ROToUuO Lund. The / expenses of examin8tion and of the.Cormnissionet
\ in enfotoing the ptoTisiOus of this Aot ah811 be
p8id upon tho aettifioate of the Commissioner by r8ttPnt of the CompttOllOt upon the 6t8tO TtePs-
utj.*
Foreign corporations, such 8s those inTOlTOd in your inquiry, orp;ani8ed under the laws of 8nOtbOt st8ter 8tO per:- mitted ,,O do business in Tez8s only 88 proTided in Ch8ptet 19 of the BoTioOd CiTil St8tutOs of SeXas, 8nd this nee88Mtilf means they 8tO to comduot suah business in Texrs in 8oootdanoe ritb and subject to the 18TS of TOX8a. 11 Tex. Jut., Cotpora- tiOns, e 178.
Such permitted ootpot8tions h8To been under the super- Tision of B8nking Department for m8ny years, during wbiah time they h8TO been tegulrrly examined by the Dop8ttznent'e ex- *5 honorable II1 A. Jamiaou- page 6 where they bare ieeued and sold their bonds, notea,
amlnsrs, oertliloatesr debentures , or other obligations in Texas. The reason ia not far to seek. It Is the proteofion of the pur- Texas of the oompanies' obligations sold bore. ohaserx maintenanoe of The examination is neoessar~ to the proper the seourities put up by such companies, under Iteotlon I of the Aot.
Sooh ferelgn oorporation 18 epeoially made arbjeot to exsmiaation of. the Banking Commissioner of Texas, under penalty of forieiture of its penslt by terms o? seation 10 of the Aot.
As pointed out by y@u, It has been the praotloe of the Banking Denartment, under its aonstruotion of the perti- nent statutes, aolleot from maOh out-of-&ate oorporation all fees presoribed by statute , and likerise the expenses such as travel, hotel, meals and the like, from out-of-state aorporatloa, paying the fees into the State Treasury as pre- scribed by Seotion 2 of the Aot , and applying the expenses to reimbursing the examiner for his actual expendlturos In oon- ntation sitb such examination.
Opinion X0. 361 by your offloe counsel referred to by you, is as iallorsl
*In the matter of superVision of Building Loan Associations and Loan d: Brokerage Companies,
you are sometimes called upon to qo beyond the
borders of the State, incurring extraordinary ax- penses and the question presents itself whether '
c or not such expenses may be paid directly to you
by the institution involved in examinatinn
or investigation, as the ease may be, or whether
or not such matter is within the statute of fees
and expenses0 Undoubtedly it Is tha sound pub-
lie policy, and therefore the law, +hat the com-
pensation, whether salary or fees, of public oP-
fiaers is made matter of statute and the compen-
sation there provided Is, of coarse, aonollr8ire
of the compensation and exoluslre of any other.
"In other words, a pub110 official is en- or oompensation as titled only to such salary
is clearly provided for in the law creating his
office and fixing his aompensation. See my Opln-
ion S2 to the Banking Commissioner of date Deoem-
ber 6, 1923.
Boporable 8. A.’ Jamiwn - page g
stbo item of expenses of aa ottiolal in- ourred by him in hi8 offioial oapaoitr, is in
essenoe publie. An o?tlaial ordinarily oannot
per?orm his official duties oufslde the limits
of the Stata under whose authority he sots.
ills rots beyond the territorial lim%ts, there- fore, being extra o??ioial, are not gooterned by
the lar rith respeef te ot?lolal duties.
s?he prinelple is illustrated in the la8 It im the g enerally l ooepted doo- of reTardm*
Wine that when a publle officer performs the
servioes for mhieb a reward Is offered, by sots
outdde the soope and line of his duty, there
la no rule of publlo polioy whloh forbids his
olalming the reward and henoe he is entitled to
it. Karling vs. Morris, (Tex.1 9 8. '1. T3S,
Tobin YS* MaComb, 168 8. W. 267, 64 C. J. IBE,
Sea- 32. The rule of publio polioy forbidding
extra oompeneattion from private wuroes to pub-
110 ot?lolale for performing their ottialal du- ties, l ppYles generally to rewards. Benoe the
analog between rerards and expenses or oompen-
satlon is a good one.
'Undoubtedly, the law might Impose upon a state ot?lolal the speo%?lo Qu~tyM psr?omihC;
eerrioe~~begond the State line, when of aourse,
the rule prohibiting extra compensation rould
acplr* The real test, therefore, lies In the
nature of services performed. It the ser-
rioes pertermed be outside the scope and duty o?
the offloer, he may acoept prirate Oompensation
or expenses, but I? suoh services be rithin
scope of his ot?ioial duty, he may not do w.
.T’bere is Involved in euoh matter a possi- ble ethios that would forbid a public ottloial ooept oompensatlon or expenses in aonneotion
even with an aot entirely beyond his offloial
duty, if moh aot im in general nature o?
his official dutiesa ldentioal that of com-
pensation and is governed by preoisely the same
prinoiple. By the General Appropriations Act of 1938
(General Laws 44th Leg. Reg. Sesa. page 1001)
Honorable Ha Jar&son - page T
your oompeneation am superrising examiner 18
definitely fixed and the same is to be paid
only from tees or aeseamsents oolleoted from
the institutions under supewIsion~ Snob tees
and assessments from xhiob your compensation la be paid, are OxpremslT appropriated your ooapensation, whether ul-
Aot. Therefore, ary or expenees, I# payable threugb the ordinary
ohannels provided for the payment out of pub110
?undm.
.Tbe rule of pub110 polioy would forbid, that you reoeire oompensation or therefore, tees from any person or any other ray, with
respeot to your official duties then that speolt-
ioally provided in the statute. It ma7 happen
and often does happen that you are oalled upon
to perform an ottioial aerrloe for which there
IS no speoiflc oompensatlon made In the law. Such
a eerrioe $8 z o??iCio and is iaposed upon you aa a publio officer, without compensation other than
the general oompensation ttaohed to the offloe.
sTbe application of these principles would forbid your ooepting any extra remuneration from
any private institution for the pertormanoe of
any otfloial duty* But this adrioe is Tolunteered
since you hare not asked me any mch question.
sI am of the opinion, hoverer, that inso far as is lnrolred question of expenses inourred
\ by you out&de the State of Texas, the statutes of In other words,
compensation hare no application.
the statute and rule of public policy deal with
the performance of official duties, but this oon-
sideration is purely, I think, one of ethlos and propriety involving to no extent rhaterer any quee- Personally, I Can of regularity or legality. tlon see no Impropriety in an ottlcial accepting remun- eration to the extent o? aatual expenses inourred
by him In periormlng a serrloe entirely beyond his
actual ottlolal duties, even though such servloe be in tbe line o? him ordinary ottiolal duties when
within his State.. It is the opinion of this Department that the praotioe I/ and policy heretofore followed by your Department Is the proper one.
gonoable tl. Jamlwn - page b
Beation 2 of the Aot,alreadp quoted herein, requir- ing feea, penalties and revenues oolleoted by Coxanlsslon- or to be pald~ to the Mate Treasurer to the oredlt of the has at ail General Rer,snue Fund, as has already been stated, times heretofore been follored by your Department, as We un- derstand tbe aituaticn, but the otual and neoesaary expensea inourred bV the examlnar, auoh aa hare heretofore been men- tioned, hare not been thus paid into Treamwy, but hare been applied by the examiner to the llquldation of his olaim for expensemr and no olalm or olalms theretor hate at any time bean made against the Treasury or been paid t&e Trea snrer. This, we think, ia ooor&noe and perfeat
keeping with tbs statutes , for emah aotual and neoeocarT expense8 are not *fees, penalties “or relenues oolleoted bV the Gomissioner’, under the statutes.
The statutes, provisions of appropriation Aots, court dealsions and departaaental opinions with respeat to ex- penses o? out-of-state trips upon State business hate nothing to do the question under consideration, sinoe such expen- sea are not paid out of the Treasury. lo statute, approprla- tion rider, oourt opinion, departmental opinion, or publia policy whatsoever is violated by the oourse of your Depart- ment here approred.
Very truly yours ATTORHgY G~NERALi$F TEXAd o*$e&/+ BY Assistant -. /