*1 No. 310%

Res Date or payment or unemployment tax a8 8frectinp the oompenratlon tollins 0r undar Artiola SWlb-12(j) Yarnon's Annotated Civil Statutes, Texaa Unemployment Compenretlon Cos&aslon

Brown Duilding

Austin, Texas

Gentlemen:

Opinion No. O-42618 we have received aarerully your In order to ruiiy eat out

opinion J:equest of recent date. the facts involved, we quote your letter in full:

"This request has reterenoe to the refund provi- cf the Texas Unenploymnt Con?ensstlcn .$ct dons (Article 522lb-12(j), Vernon'e Annotated Civil Stat- i.mu Or n~3a, 193). You have prnvionaly iercued your opinions Wo. O-459 on Maroh 17, 1939, and O-1705 on Earoh 7, 1940. Those: two opinions nre oited in your opinion No. O-2183 dated June 13, 1940,

*In the year 1940 the Conrmlaeion esaerted tax liability aGainat X impa~y for unsn~lo~rment Taxes ior the period January 1, 1937 through December 31, 1059. X Comaany denied liabilfty but in 1940 mid all of the taxes which the Commission claimed were-owing. At 'its paid th,e terns it filed an applioatlon time for refund in accordanos with the terms of the Unemploy- morit *let. In 1942 c I"edaral oourt flnelly estublisbacI the oorporatlonls the correotneea contention of non- (The oaae iu which t?e -;,uestion %%a deoldud liability. wae not a tsx suit by thie State for unemployment ttlxes.)

'*On basis of the deoioion or tha Federnl court, this ~ormtio8fon told the % Company it wao not an onployer during tha period January 1, 1937, Tao December 31, lY39, and that refund application would be gmnted to tare8 duo after &larch 31, 1938. This with rereroncs was for the reason that the refllnd provision of the Texae law, as it existed prior iqcossd a ona- filing of npplloatlons. yuur perlod'ror *2 *The X corporation 110~ contends t&it since taxes duo prior to April 1, 3938, Wro, paid the aommiaeion at a time when the n~pllcstlon for refund with reepeat which demndo to them was barred, n altucrtlon ie Weat that tha statute bo not interpreted to bar recovery of suoh taxsa.

*?ie ahall appreciate your oplnlon an to the cor- rectness or our oaition in denying refund of taxea due prior to Apr 1 1, 1938." f

St would seem that o~lniona Numbers O-459 and O-1765 have anamred inferentially the question expressed In your oplnlon request. Bowever, it 18 now smarted that 4 differout conoluslon ahould be reached beoauae the oontribu- tlone allegsd to due for the perfod prior

were paid in 1940 rather than in that psrlod. In order to fully answer thla oontention, we reel that a ahart review of the applioable and our previous rulings will be profitable. Our opinion No. O-459 dealt with a situation where to rerund ooatrlbutZonr aomnlesion was aeked regularly

paid by the supposed employer which were due prior to one year from the data the ti piioatlon therefor. At the date or of this opinion, Section 12 d) of Artlole 552lb, Ysmon~s 9 Annotated Civil Statutes, was in effeot and it reads as folloas:

"Refunda: than (1) year altar fr not later date on which any oontrlbutions or intereat t!mreon ~~~*~~t:~~~srl~h~a~~Se~~~~ 5uch yy;p;:;;;,- cntlo~ nent thereof In commotion with subsequent coz"&ributio?i- payzmtn, or for R r13ruhd theroor bnofiuso such sdjustmeat cannot be xde, anA the Zo.mieeion shall. deternine lntcrost or any portion thereor suoh contributione Or wae erroneously collected, the coumlloaion rSnl1 allow such enplcym- to rake an HU,jurct.ment thereof, witizout lnterast, in connection with subsequent can not be made

pnynents by hix, or if such adjustmant the GomIssriun refund said amount, wlthcut interest, from the fund. For like cause and wlthin the.samo gcrlod, udjutitxent or refund nap be HO mnde on tha Comisslon'o own initiatlva.* (!:3;phosls s~~ppllad)

The Attorney General held that Comis8ion could not leeally refmd contrlbutlons which wero due prior to one yam frm ths date of applfca.tion thereror. In the course of the optnion 'tie find tho following languagei

*One of the meet signlfioant provisions of Seotion 14(d) 1s the phrase 'the date on which say contributions thereon became due.' The *due* data rather or interest then the Gate of peymont is cortrolling. X0 csstter when the one (1) year period of the oontributions em paid, apainat refunds beglno to operate in favor of t”?o atata ‘after the date on which my contributions or intareet t5erocn became due.‘*

- Based on same faatual data aubmittbd in Opinfoa

Fib. I)-459, another opinio,n request rat received by the Attorney General in which the main problem wes the effeat of the aaend- ment of old Section la(d) Lo new Section 12(j), effective 1, 1.939. Althou$h there is some slleht fn April difference of both statutrs verbiage, the legal effect nppsarf? to be ths same, exaeptiug the ahange in tha period of Elmi?ation. Saa- tlon U(j) 1s still in effect a&d roade as followsr

*vthere any employing unit has made e payment to alleged to be due, and the Commlaelon of contributions i5 later determined that such contributions were not due, In whole or in part, the employine unit mnklng suah payment may make appllaatton to the Cofm~ineion for in connection with ,an adjustment thereof tharsof payments then due, or for a refund because such oannot be made and ii the Cardsalon adjustment shall determine ,that such ao~ntributlons or penalty thereor were erron.eoualy aolleoted, ih?Csiiie- portion slon oha3.1 allow suah employing unit to meke an edjust- ment thsreof without intereet in oonneation with apntri- bution payments then by such employing unit, or if euah adjustment oennot be made, the CWrsfon shell refund said amount without interest from the Fund. oro- for adjustment rerud vid6a thet no application Ger by the ~ommlsalon unless the ache shall have besn tiled within four (4) years from the or penaltie@ would aats on whiah such contributions fieve becoua due, had suoh contrlbutlona been legelre colleatlble by the ConunlsBion from suoh omploping unit. ?or like ceuse, and within the WJJU~ period, adjustment .~ay be so made on the Comlssionis or refi;nd own inltla- tive.” (Emphasis supplied)

The resulting opinion being 710. O-1795, held that new statute had’no retroaatlve terms and that it was in- tended to be prospective In operation. Consequently the claimant gained no new rkghte by the repeal OS old Section 12(d) and the passage of Eec,tlon 12(J). The holding and reasoning in prior opinion No. O-459 was reaffirmed, 2nd the suppoasd employer was apaln denied a refund of contributiona becoming due prior to one year from tho aat of application therefo?. h?.rrin, emphasis was plnced on tb3 fact thet inso- far as the beginning of’ the period of wae concerned, the due date of the contributions was the controlling factor.

The Texas Unemployment Compensation Comnisslon has uniformly int.erpreted the applicable to mean that the period should begin on the date that tb.e oontrlbu- tion become due. See Regulation 30, adopted July ?, 1.837, and iiogulstion 39, adopted ;eptembsr 5, 1939.

Since every opinion by tho .httornsy General and by tLe Cammlsz.lon, doslinG, vrlth the above every regulation have omphsolzed the faot that the beginning set out atatut&s, or the running of the period of limitation is the rlus date of the contributions, we are not wlllln~ tc say now Vie do not believe t?at a date of psynent Is controlling. lsgislntlve lntznt to dlf’fersntiqte an,! faVor, a between, claimant u.ho has not regularly paid the contributions lllep&ly dl;s end one’ ‘*ho has rs~ulnrly paid his taxes, c8n bs ~BRI: into the nttltutsn. Cort:<lnly ths oxpr383 t+rns of t!ie nt9tutes Involved make no cacti dlatinctlon.

Tou are, thorsfore, s8virsd that the claim pre- sented by the Y Company has bosn borrsd by ths O&rmk of old seotion 12(d), Artiole 522l.b. Vex~on~8 Annotated 01~11 Sk- ths Stnclllrraion adopted the 6orrWt position tutea, In denying ths refund of taxI88 prior to Apxil 1, 1038.

Pour8 very truly BY /a/ ‘Fioodrow Edward8 A88irtant Gerald 0. MOM Attorney General of Tsraa /