Case Information
*1 Grover Sellers AunmN.il.Trc-rJ
A¶-r"YNIIY .iXiNrnRA,.
Hon. M. PI. Wilshire : Opinion Ro. Ok5944 ”
County Auditor R.e: Can the :Commissioners’ Court of Kaufman County Haufman County ::sall part :of the bonds Kaufman, Texa,s @, question, which ‘are held~ by the
Permane& School Fu@d, to the. City of Kemp at 85% of par value, which wer~e Dear Sir: purchased at, 62% :of~ spar value?
You&~ lette]r of .%arch 21, is! .in part as f.olloWs: “The Permanent, school fund of Kaufman County owns $l5 000 of ‘City of Kemp Refunding Bonds date of issue 1934 which were purchased at 828% of par value. Thig, bond,s are. due in 1974 and carry an interest rate ;-~of ',3&L
Y@e City ~of K&p has,..on hand -#,5 000 in ‘their Interest & ~Sinking fund ,.and have ,a~ske A. the, comlis- sioners’ Court to allow them to. take ,up part of these bonds at 8,5$ of .,par va$ue,, ,even~, though they are not due,. ., : I :: ,:,.... :;i.
“Please advises, whether :or,not the Commissioners’ Court can sell p’art of these bonds which are held by the Permanent Sohool fund to the~,Cityr of Kern at 85% of par value, which were purchased at 62!# of ,par value.“~ :, ‘,,:
Under, Article 2824 of the Revised Civil Statutes, the Conrniss~iopers’ Court of the county,is authorized and em- powered to invest the Permanent School Fund of the county in the type of securities listed in the statute. Boydstun et al. vs. Rockwall County, 24 S.W. 272.
Your inquiry, in effect raises the question of whether the power to invest carries with it the power to dispose of in- vestments held by the Permanent School F’und through sale thereof at a price equal to or exceeding the amount paid for the invest- ment securities proposed to be sold. As an original matter, the question would not be free from doubt, although our Supreme Court in the case of South American Mortgage Company v. Massie, 94 Texas, 339, 60 S.W.544, indicated that the power to substitute investments is inherent in the continuing power to invest.
Hon. M. M. Wilshire, page 2
In substantially its present form and verbiage,
however, the provisions of Article 2824 of the 1925 revision of our statutes has long been in effect. We are aware of the long continued construction which has been placed upon the provisions by the several Commissioners' Courts of this State in their handling of the School Funds of the Counties. The Commissioners' Courts generally have assumed to exercise the power to sell investment seourities held for their County Permanent School Funds where it was possible in their judgment to obtain securities offering terms which were more favorable to the investment trust fund committed to their management. It is a well settled rule of statutory construction placed upon it by the officers charged with its enforcement, while not binding, is entitled to weight in the determining of the meaning of the statute; and that where this construction has been continued over a long period of time it will not be over- turned except for strong reasons of public policy, unless the construction given the statute is clearlv erroneous. Moorman vs. Terre11 165 Tex. 173 202 S.W. 727, Kay vs. Schneider, 110 Tex. 369 221 S.W. 886.
In view of the long continued construction placed
upon this statute by the several Commissionerst Courts of this State, and of the rights and liabilities which have attached by reason of their actions based upon the construction of the stat- ute, that the power to sell investment securities held by the Permanent School Fund of the county at a price equal to or ex- ceeding the amount paid for the same was inherent in the power vested in the Commissioners' Court to invest the Fund, we feel constrained to follow that construction of the statute. For that reason your question is answered in the affirmative. Yours very truly
,APPROVED APR 11, 1944 /s/ Geo. C. Blackburn ATTORNEY GENERAL OF TEXAS
(Acting) ATTORNEY GENERAL OF TEXAS
By /s/ Gaynor Kendall Gaynor Kendall, Assistant APPROVED: OPINION COMMITTEG ~BY: BWB, CHAIRMAN
CK?ned:wb