Case Information

*1 -OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN

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Arrom”w.” G&S”CL -

Honorable D. 6. Oreer

Stata Highway Engineer

Texas Highway Department

Austin 26, Texas

Dear Ur. Oreerr

I.

recent date, whioh the legal registra- derrigaatier Town oorporatioa truokiw : ; .~ Rrinoipal oi'fioe admittedly ia in B County. '.

"It is our.thougE that under the oiroumetanoee. ‘iruoking oorporation 0hould register ita motor vo-

hiolea B county, the county in whloh it admittedly maintain8 ite prlnoipal plaoe o? buslneae.a

~roti your question aod la order to eimplity our wmer, we assume that tha oorporation in qusation ha8 the sole legal title to, r&bt of poaaeaolon and oontrol OS said motor This leaves us the taek of detereinlng the county vehlalsa> in which the owner (the eorpor’;!tion queetion) resides, be i8 provided in resgeot ta regirtration of inotor veblolea 1925. Said mtiole 6676~-2, Vsrnonia Auuotated Clvll :Xatutes, Art~ole provide81

w3very owner of a motor vehlole, trailer wed or to be used upon the pub110 or seal-trailer highways oi this State shall applg l aoh year to the 3tate Kiixhwav Deuartaent throuuh tlm Counter Tax Col- leotor oi tbir o&nty ia whioh iio resides fir tin re- glafratloa o? each suoh vehiole owued or oontrolled by hla for enrulng or ourreat oalenda$ yew or unexpired portion thereoi; * * *” (Unders?oriw ourr) i-4 automobiles owner 1s held required to re$tster automobile in aouaty of owaer@a reaidenos, aa against oontaatloa auto&bile oould her registered In any oounty within at ate. QP f. State, (Crfm. kpp.) 94 3. *. (2d) 180.

It is a well settled rule of 1s~ in this rtate that a oorporation ia a “person” withia the meaning of thst tera aa uae$ in oonstltutionrl and statutory provlsionr. 701. 10, Tax. Jur., Q. 655, snd oaaea there olted, 1304, Seotion 3, Vernon’s Annotated Civil

mtiole atutes, 1925, Wrequirea the lnoorporatora tg ‘state, in the ProWsed oharter, the plvoa or places where tin busiaesa of t~he ktmided oorgoratioa 1s to be trsnsaotsd. This m~ana, not that the charter isl required to atate the pl*oa whbre-:t$e prinolpal Orri0e iii to beg looated, but that thb 0rriOe must be, eotablirhed and !mintained:‘.wfthln the limits of the eta.t@.’ 10 Tax. Jur.., 631.

W~tha abaenoe of express atatutory piwisiaa ii%- ia8 the lociality QuWoaea withIn the state by which it was oreatsd, or the reridenoe or a oorpar:ition for partiouL~:plp

the gerbral ‘, rule 18 that its residence 1s ‘where itr, prlnolpsl office or pltlce or businetss ir .” 13 ;~ner. Jur., pY.ge 28%.

322 fbnor<ible D. C. Graer, p-i@ 3

*It 1s very generally held that a corporation 1s an inhabitant of the state under whose law it is inoorporated, and that it has a resldenoe wherever it conducts its ordinary Pfttsburg &ater Heater Co., f. Sullivan, 115 Tex. business.” a7 (Corn. App,), 288 S. W. 576, and oases therein cited; Sanders (Cir. ~pp.)‘, 288 S. Vi, 635. v. F.srmarst State Bank, In order to determine the county of residence, we first must de.tsrimlne whether e charter reoltatlon as to the plaoe buslnese is to be transaoted 18 c~n~l~slve over the aotual *itUs or. the prinolpal plaoe of bualnese.

In thie respeot and ae sa& pertains to question Of venue of suits against Oorporatione, the follrmlng &a been said z

In the ease or B rd Cattla Co. v. Texas Vegetable Union. (Civ. Am.). 28 8. w. 1 2d) 990, It was held th t where the oi&ter itiiii-rixe5 its prinoipal 0rri068 two plebe8 wtien are located, and, although only one of euch places :l~ actually ;ct, both are avollable for venue of a suit against said oorpora-

.

In the ease of Hawk k Buok Co. v. Cassldy, (Civ.

App.), 264 S. W. (26) 1145, wherein tbr controlling question wee whether the reoltatlona in the oharter OS the oorporatlon designa- ting Dallas County ae its plaoe of buslnees wee euffiole&, to re- tain the venue tnere even though the oorporetlon wai not, in reality, USing suoh oounty aa a place of residence, the Oourt held ae fol- lowr :

*Article 1304, V.A.C.S., rsqulree that the charter or any private oorporatlon muet set forth the *pl.aoe Or places where Its buelness 1s to br transaoted.’ Suoh statutea aie, no doubt, for the obvloua purpose of avoldidg disputes aa to the oom- Pany’s *place of business’ or *domIol~e* and .to de- termine ‘venue, fix a situs ‘for the purpose of gsnerel ~urlsdlotlon and taxation,’ and to apprlos the stook- holders where they may go to inepeot t~he books and reOoIde or their oompeng. Flteoher Cyo. Corp., Psrm. iid l C deo. 4046. The domicile of ths defendant oor- *4 poratlon in thle oase wtis thus fixed in Del.laa County for the purpose of venue*u:tfl ohanged in In this some manner..authorised by law.

deoislon, however; we do not wish to be understood au holding that’the provisions of the oharter fix the venue exolusivsly in Dallas County. The prln- olpel oi’fios of the oorporatlon is admittedly in Tarrant County and thus venue against it might also be there under aubdlvlaion 93 of Article 1995. V. A. c. s. The~aonolusivenesa of the reoltatlonr In the oharter must neoeasarilg be oonetrued against the oorporetlon und not lo its iavor so as to permit It to remove a nuit from ths County of its aotual resldenoe to one designated in its oharter.” (Under- oooring ours)

The effeat of the ruling, as announced in the two oases next above mentioned, on our question would~ seem to be that suoh ohartar recitation is e declaration against the ln- terest of the corporation against the oorporotlon and es suoh must be atrl,o9~y construed,

and not in Its revor.

Those cases, rpeolfically on the venue question,

refused to allow the oorporetlona to &y “hide end go seek” with plaintiffs end take advantage or them aerely beoauee of a tallaoloue etatement previously made by the ,oorporatlons la their charter es to the plaoae where their buslnsss is .to be tranaaoted. This prlnolple, if applied to the question now before us, would eeem to rorbid the owner oorporatloa to ohoose arbitrarily lta registration sltus through a mere reoitatlon its ohiirter when in truth and f’aot it doe8 not have even an ot- In euoh oounty so ohoeen. To hold the contrary would be fiae aoastrulng corporation the ohuter reolta.tion as oonolusive in favor of the

and allow ah obvloue subterfuge et will of the oorporat Ion. i 1~ a situation eimilar in some respect8 to the one ln question was deoided by the Dallas Court of Civil Appeala :\ P on the theory that the situs of the ho:- oflloe in regard to

tax matters was a question of faot, and the realtetlone in the by-laws were not oonoluslve, and held aa follows:

“The undisputed evidence ehows that defendant maintains the oharlaCer of offloe in Dallas that is

324 honordble D. C. Greer, Page S

Unually terrmsd a *home office’ end does not aain- teln auoh en offloe in the elty of Austin, thougO lta by-law8 deeigmte the olty of Xustln es its In the former city la the 0rri00 0r hODK8 0ffiCe. the ixeoutlve heede of the easoclation, ngd in the t olty is tranaeoted all such business of thi, aaaoole- tlon as 18 uaually tranaaoted at a home oftioe. In view of this raot, the trial oourt found as a feat thst tha home office was in the oity of Dallas, and we are’of the opinion that woh finding is warranted by tha uudlaputed in this oaae.* Texas &n- fada ployera* SM. Asa’n. v. City of Dallea, S 9. 1y. (2d) 614 (oiV. APR.) (writ ibf.)r

As a by-law la merely a rule of aotion in aooord- enoe with whloh the affairs of the corporation are to be conduoted, and aubjeot to the ohsrtsr and statutory provlal0na, both, the oharter,reoitation aa to where its bualnesa la to be transeoted, end the by-law passed la aooordsnae with said ohsrter reoltetlon, atend on the same plane es to their oonolusivenesa;

The fuota iis set out ybur letter olearly show that the oorporetlon in question *maUt$na no office of any kind either in Town A or eleewhero in I County.*

Let It be deflnltely ,understood that wa are not ruling here on where tha raafdenoe for registration purposes would ba if the oorporatlon had an office in the county v&t at the plaos deai6nated ln the ohsrter in addition to an offlaa another county.

Considering the above, we hold that tin legal re- sidence of the oorporatlon in question for thb purpose of regla- tratlon or its motor vehlolea, on the baala of tba faota as set out in your letter, ie in B County and l$ot in X County.

,Truetlng thla answers your question, we are

Yours very truly