Honorable- Weldon Hart OpinionNo. S-115 Chairman and Executive Director Texas Employment Commission Re: Necessity that Brown Building property acquired Austin, Texas fob the State at a sheriff's sale be disposed of ‘ins the Dear Mr. Hart: manner acquired."

You have requested'our opinion on certain questians dealing with'the sale or disposition of 'property acquired by-theestateat a kherlff’s sale PoUowing~judgment for unemployment taxes.

We quote a portton of your letter:
"The Texas Employment Commissionhas in the past proceeded in accordance'with 'Opinionof the Attorney'General of'TexasNo. C-1115,dated August.5, 1939'. A copy'of.that.opinionis attache&. A questionhas been raised; however;ab to the propriety of'theCoinmission% contemplated sale of certain real property acquired for'the State by'the Commlssion's'attorneyat a.aherlff's sale G following the levy'of execution under a $7,558 judgments

for unemployment taxes against the owner of the land.

. . . "Our attentionhas been directed to that language in Article 4403 V.A.C.S., which seems to require that property acquired for the State at a sheriff’s sale be sold or otherwisedisposed of ‘in the manner acquired'. At the same time, the article directs that the dispositionbe made, with the advice and consent of the AttorneyGeneral, upon such terms and conditionsas are deemed most advantageous to the State by the agent or attorney of the State who bought Fn the property at the sheriff's sale. There appears to be ~directconflict between the quoted portion of Article 4433 and its other terms.Honorable Weldon Hart, p g a e 2 (S-115)

"I respectfully request that~youfurnish us your answers to~tlie'six specificquestions treated~ by Opinion No. 0-1115,"mentlonedabove, with special attention to question~nuniber(4): 'Howis such sale to a subsequent purchaser accomplished?'"
The questions treatedby OpinionNo. O-1115 follows "(1) Is a representativeof the Texas Unemployment CompensationCommissionauthorizedby law to bid In In the name of the State the property levied upon? "(2) If a representativeof the Texas Unemployment CompensationCommission is not authorized to bid in the property,who is so authorized tobid in the property under the laws of this state? "(3) When property is bid in at a sheriff's sale'in the name of the State,who is'authorised to pass title to a subsequentpurchaserfrom the State? "(4)How is such sale to a subsequentpurchaser accomplished? "(5) What dispositionmust be made of purchase money realized from such sale? "(6)Would the answer to the above questions apply to real property a8 well as personal property?"
We affirm OpinionNo. O-1115 in so far as the answers to questions (l), (2), (5),and (6) are concerned.

We reform and affirm the answer to question (3) by stating thatwhen property Is bid in at a sheriff's sale In the name of the State,pursuant to,ArticleJ~401,Vernon's Civil Statutes, the Attorney General is authorleed to pass title to a subsequentpurchaser from the State upon compliance with the provisions of Article 4403.

A careful reading of the "answerIt to question (4) in OpinionNo. O-1115will disclose that question (4)was not really answered. Article 4403 Is paraphrasedbut the word "acquired"after "manner" Is omitted. This word is vital to the proper construction ofArticle 4403.Honorable Weldon Hart, page 3 (s-115)

principalArticles 4401 and

statutes involved --- -...

4403, as amended, herein. Theydareare the derived from Chapterlj, General Laws, 16th Legislature, Special Session, 1879, p. 9, being Sections 1 and 3, respectively.

Article 4401 provides:
*If any'prdperty shall be soldby virtue of any execution, .order.or(sic)sale issued upon any judgment in favdraf the State or sale by virtue of~any deed of trust -- except executions issued upon judgments in cases of scire faclas the ageht representing the State by and'with the advice and consent of the Attorney General is hereby'authoriaedandrequired to attend such sales and bid on and buy in for the State said property when it shall be deemed~proper'tdprotect the interest. of the State In the collection. of such judgmentand debt. His bid.Bhall not exceed the amount necessary to satikfy'aaid judgment and debt and all costs due thereon."

. I Article 4403 provides:
"The agent or attorney of the State buying for the State such property at such sales shall be authorizedby and with the advice and consent of the Attorney General, at any time to sell or otherwisedispose of said property so purchased In the manner acquired and upon such terma and' conditions as he may deem most advantageous to ~- the State. If sold or disposed of for a greater amount than is necess?ry to pay off the amount due upon the judgment or debt, and all costs accrued thereon, the remainder shall be paid into the State Treasury to the credit of the general revenue. When such sale ismade, the Attorney General shall, in the name of the State,.execute and deliver to the purchaser a deed of conveyance to said 'property, which deed shall vest all the rights and title to the same,in the purchaser thereof.* (Emphasisadded throughout.)
Articles 4401 and 4403 were amended by Chapter 243, Acts of the 40th Legislature, Regular Session, 1927, P. 361.HonorableWeldon Hart, page 4 (S~115)

The material change-inArticle 4401was the additionof the phrase of trust." "or saleby virtue of any deed

: .'. The addition to Article 4403'was the word "acquirednafter "manner;" thereupon causing theamended portion to read.". ; .~ to sell or otherwisedispose~of said property so purchased in themanner acquired. and thewords "or debt" after "judgment." . .,'

It shouldbe noted-thatArticle.4401 concerns property "sold.byvirtue'of 'anyexecution,order or (sic) sale issuedupon shy judgment in favor of the StaG or sale by virtue of any deed of trust" except executions issueduponjudgments in cases of scire facias.

. .._~~ . In conhection.with.the~foregoing' paragraph it is elementary~that'anyproperty sold in themanner described therein would~necessarilyhave to be sold at public sale. '(Rules-647-650 Texas Rules of Civil Procedure and Article 3810, V;C.S.j This being'true; the on1 manner + inwhich-the State could acquire propertyun er Am 4401 is at public sale.

The phrase 'suchproperty at such sales'! in Article 4403 refers to the 'property"sold under the provisions of Article 4401. Inasmuch as propertybought by the State under the provisions of this last named articlewould be property "acquired"at a public sale; '
for m9 the on1 manner In which the agent or attorney "buying e State such property at such sales* can "sell ore, otherwisedispose of said property so purchased in the manner acquired" is at public sale. Surely the legislature couldhave intended no less when It amendedArticle 4403 by inserting "acquired"after nmanner.n

By the foregoing we do not mean that a sheriff must sell the property at public sale. The agent or attorneyof the State, by and with the.advice and consent of theAttorney General, is authorized to sell it at public sale after proper advertisement as in the case of a sheriff's sale under execution.

The requirement "upon such terms and conditions as he may deem most advantageous to the State" does not conflictwith any other portion of Article 4403, nor prevent the agent or attorney of the State from selling the property "in themanner acquired." The fact that the sale would be public would In no way prohibit the agent or attorney of the State from agreeingwith the purchaser on the-

,

Honorable Weldon Hart, page 5 (S-115)

terms and conditions- ofthe sale; If the sale were unsatisfactory to the agentsor attorney of the State; there is no-reason why the property couldnotbe'withdrawn from the sale and another sale attempted afterproper advertisement, if so desired.~

There is a serious constitutionalquestion as to the sufficiency of the caption of the AmendatoryAct' in so far as the.additionof theword'"acqulrcdn is concerned. However, IInorder that purchasersmay be fully protected'it is believed that all salesmade by virtue of Article 4403 should be by public sale until the statute is otherwise construedby the courts or until it is clarifled by legislative action.

SUMMARY

'Propertyboughtlnthe ~nameof,the State pursuant to~provis~ons of Artkle 4401,V.C.S., if sold to a'subsequentpurchaser~froni the'state, should be,sold at public sale. Article 4403, V.C.S.
Yours very truly,

APPROVED:

L. P. Lollar TaxationDivision JOHN BEN SHEPPERD Attorney General

John Atchison Reviewer
Mary K. Wall Reviewer
Robert S. Trotti First Assistant
John Ben Shepperd Attorney General

JAA:amm