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# THE ATTBECNEY GENERAL CDPT~C~AS cxz*wFORD c. .XARTIN 

### AUSTIN,TEXAR 78711 A-l-rORNEYGENERaI. July 13, 1972

Honorable Robert S. Calvert Comptroller of Public Accounts State Finance Building Austin, Texas 78711

Dear Mr. Calvert: Opinion No. M- 1170 Re: Authority of Comptroller

to issue warrant for state’s matching funds for employees’ life insurance under circumstances pres~ented. Your recent opinion request involving the above captioned matter, asks whether you now have “authority to issue awarrant topay the State’s matching for life insurance for employees prior to the issuance ofagroup policy to the Water Quality Board? ‘I

You have stated that on or about May 1, 1972, the Texas Water Quality Board submitted accounts which appeared to you from your examination were issued for life insurance to employees of the Board by the Tennessee Life Insurance Company and such did not involve a“group policy ‘Iin contemplation ofArticles 3.50and 3.51ofthe Texas Insurance Code. Your basis for this objection was apparently that onthe face ofthe policy itwas not shown to have been issued to the department and therefore could not have satisfied the provisions ofArticle 3.51, wherein only the department head has the authority to procure the contracts of insurance. Attorney General Opinion No. M- 1109 (1972. )

You also advise that since the date ofyour objection and refusal to pay the State’s matching part, your objection has been corrected toyour satisfaction and you now find that the Board has the proper policy for the payment ofthe insurance premiums involved. You now desire to know whether you can legally pay the State’s matching part for the account to cover the period for which submitted, that is, for that,time prior to the correction ofthe policy.

We have before us Tennessee Life Insurance Company Policy No. 2357, dated December 22, 1971, signed by Hugh Yantis, Executive Director

-5710-Honorable Robert S. Calvert, page 2 **(M-1170)**

ofthe Texas **Water** Quality Board, effective January 1, 1972, which was the policy under which the permanent life insurance was issued to the employees and supported the accounts which were found by you tobe objectionable as above recited. The employees had been issued separate certificates which constituted apart ofthe group policy.

A close examination ofthe policy and certificates reveal that they are subject tonolegal objection and were and are at all times inorder, and you had and have authority topay the state’s portion ofthe same for the period in question.

The other account submitted toyou for payment involved the group health and term life insurance policy ofthe Tennessee Life Insurance Company, being Policy No. 2358, issued and to become effective simultaneously with the other policy. Itwas also signed by the Executive Director ofthe Department and nolegal objection is found to such policy, and you have had authority to make payments for the employees atall relevant times.

The so-called corrective action taken by the insurance company was to amend the Policy Certificate No. 2358 so as to eliminate two numerical designations ofthe policy; and for accounting purposes Certificate No. 2358 is also identified as No. 2357, thereby eliminating the dual numerical designations towhich we understand you had an objection. Such corrections relate back to the inception ofthe policies.

The amount due under such policies from the employees was in fact deducted from their pay checks, and the insurance company has at all times recognized its liability and paid its claims, and has at all times requested payment ofthe amount due it. The company has at all times recognized that the policies are infull force and effect and inany event is estopped in law to deny liability under its policies onthe ground ofalleged non-compliance with the statute. Great American Indemnity Co. v. Blakey, 107 S.W. 2d 1002 (Tex. Civ. App. 1937, error dism. );Dillard v. Nueces County Navigation Dist. No. 1, etc., 214 Fed. Supp. 868 (S. D.Dist. 1963. )

It is our opinion that you have authority to issue your warrant topay the state’s matching for the life insurance for the employees ofthe Texas Water Quality Board for the period oftime in question, there being alegally enforceable group policy covering the insurance at all relevant times, and such purpose being specified by law.

-5711-Honorable Robert S. Calvert, page 3 **(M-1170)**

SUMMARY The Comptroller of Public Accounts has authority to issue his warrant for payment ofthe accounts in question for the period involved, as submitted by the Texas Water Quality Board, being the state’s matching part on the two insurance policies issued by the Tennessee Life Insurance company, since the policies inquestion were at all relevant times group policies within the contemplation ofArticles 3.50and 3.51, Texas Insurance Code, and for a proper purpose specified by law.



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very truly,

Prepared by Kerns Taylor Assistant Attorney General APPROVED: OPINION COMMITTEE W. E. Allen, Acting Chairman James Hackney Jack Goodman James Quick Jim Swearingen John Banks SAMUEL D. MCDANIEL Staff Legal Assistant ALFRED WALKER Executive Assistant NOLA WHITE First Assistant **-5712-**