### Jcacuary lZth,1939



# non.2.coasatt,BanIdng Corlmlsaion8r Depnrtlent

ofIkInking Austin, Texas

Dear sir: Opinion No. O-52 - 

### RasArtiole 350 & Utiole 352 Is there nny discretion permissible to the 3lmlcln&c~issloner in nab ing publlo the ,e.xazsiner*s reports on rinanoicllinotitutions?

Your letter of Jammry 0, 1939, In whioh you ask
an opinion as to oertaln quentions, has been r6feIT8d to the writer for nttctntim. Your questions are:

1. Goes til0r?Jlaor ;~rilr~lo~s pertaining to oxminors* reports obtuin :Jit!i rsspeot to instltutions that nre 01033a and not actively 

### oni;aged in their oor2orata b*zsiuessnt the tlm the report is called for or SIXIarivilage invoked?

2. Does tho rule of ;~rivil.cge in any evcat a~- ply to Loan i:Erokern~e Companies $8 sazieas to bmki.zg institutions?

3. IS tllere'anyGiscreticn pfirrzissiblo to the Banking Comissloner in tho matter of naking publlo exa.nioere*reports by 6ivi.5gCOpioS thereof or pernitting the inspeotlon %he,eroof And If so, just what
are the linits of, or the rJle5 goverain&, the excld.38 or tklt discratiGn?

Artlclo 350 or the Revised Civil Stntutes a5 amended by the 41st 

### X&;islatura, Hurst Called Session, Uzts of 1929 provictes 

### rorthe anpointzent of the bank axminers. ilrticle 333 of the :!eviscdcivil Satutos prescribes 3s c?ualirlcation .shile.hrticle 352 of

### thaiiovisodcivil 3atutos ?rovldes for t;lo bond and oath of :m curtminor,a5d nolongothsr things, pm7id8~s,tncit 118 3ilnll take oath, thnt -Eon. z. Goasett, January 12th. 1939 3aga no. 2

"Hewill not reveal the 

### oonditlon ofany bank 

### orban&&q trust oo~?pany,exruninodby bin or a.13~ lniOX3BStl~ ~80~8% in the OOuP50 Or nnY BIt%lzinotiun

0r any bank or btxlkingtrust oonpany, to any one exocpt the C&ssioner." 

### Artiole5510r tha Penn1 Code providelJror the penalty to be inrllotod Upon a bank mminar for the violation ot the oath provtded for in ArtA. 352 of the Revised Civil 3tlltute6m

Chlot Juntlce Cureton or the 

### Suprem court, -Aen c-3rirst assizltrrnt attornay general 0r this Sate, wrote m exiiustive opinion undm 

### dateof Zarah 4, lQW, adCrossed to the Honorable John 3. Z?xttersonon questions maewhat 

### relnted to those asked by youwith respest to the above statutes :i!:loh have sin08 been renumbered Judge Cur&on said:
qf8 think tho .sw&~&rz~ of these two ~o~lsiont3 ;d:w aonnicioreci to.getheris, th%t 5 bank 8Xadnfz 

### cannot voluntnrlly raveal the condition of any bank ms!:.tinod

by him or Yoluntnrlly qivo any 0118any inlxxM.on oanccrnlng the oondition oi any suoh bank, IS suoh informtlon was SeOIAl-cd olfioially. These provisions, howevsr,do not prohibit euoh ZxazAner from siving his testizony in Q judioiol proaeedlng, ns the lnnqw~e of the provisions oloarly aeok only to 2rohlbi.tvoluntary disolo~~ree on the psrt Or the axminer and do not atteibptto prohibit s oourt from requirlnE;the examiner to disolone such roots, cm the oourt nay havs P 

### right to roqtira to be die01030ii. Tha question thererove, finally reduaee itself to one or priy&e oonwsmioations~ The mime rulea ~0~1% r~o~ernan oxaainer in this rsapest 5s g0vt-m the C~soloner 

### 0rBanking hlR58if, us ah ~sV~h8r in a gublio 0rri00r who reproaents the Dep~tzaxlt.or the COy8rw2eht 

### whioh SUpOFVi38tl

### tllld oontmln the b.mka. Dri8rly, 

### hle buslnoss io to mke,exwimtlon of State banks and to trensmit t0 the Comii53iomr 0r Insurnnoe iUld Bmking a 

### rcvort
or the condition of b%&i exanined by bin, iuldit IS upon the bmls 0r tk.080r'oim-tstht t:ie

### Codf3- sionor deterxihes ;rhetherthe bank shell OontiXIU8c _.

.i

Xon. 2. Gossett, January lzth, 1939, Tage X0. 3

as a goiug inrtitutian or vðer it shall olose ita GW~S snd ooase to exist; llkewi.oe,ns to &at remireeents 

### shallbemde of the bank by the Commissioner of In:aU%llCO and .BankinG. The bankexadner is r%quiicd to tnke'tanoath of otflos, Give bond, possase oertain qmlifloatlons and his gosition has all the characterfstlus of ahd is a pzblio offlao."

h suonort of the shove, Judg Cureton oitedthb statutes horeinajove referrod to by thewriter, as WJU aa the foll0vfin6;

authorities:

Liitcheon Banks, Vol. 3, p. 17i3C, Sitters vs. Soxers, 43 ir'od. 763.

Article 3722 F&vised Civil Statutea proviba that t,C;o &mkihg Cohmissioner, alow ,aithother nazmd Govornmtmt orrlcials, shall:

n+ 7 * -?.

= Purhish auy person ap?lyih::FOP 

### t11a 9am, a copy of .xny?aper, iocumht 

### or record in ti;ciroffices, md xith oortificate uuder seal cortir;rin~;

to my ‘Lank

oontained ih the gapora, docur.vmtsor rwordo of their offloos; and the
same shall bereceived in ovldfmoe in all casm in which the oriGlnals rrouldbe evidanoe."
Th;:sstatute 13 not mandatory that Covernnent otficialo prodiiooand furnish copies of a11 instrummt% that ni:;ht**by** o&nco be in their hands. It oannot extend to nor ticlude such doauments as might oontain InSor.wtion prejudicial to the publio interest rooeivad by (1Government offiOio1 in an orflcial capaoity. i7hothoror Rot suoh inrormtioti or doomtmt, aim be renuirod or any oriicinlrsujt be rjovmmd by the general rules which r~ovcrngrivilqod cmmaniontlone to aublio os'r'loers.JudGo Wraton, 3.nthe +ove referred to opinion, states:

"It xay ‘00atnted as a @naral principal 

### tht g~blic ~olioy forbids the naintenanoe of any s:.it

### in il

### Courtor Ju&lco, tho trial of' which xo'uldi3ovltably lead to the di301osure 

### ormtters :;>iohtta laz ro:;amisas conilcontialsnd in regard ofwhich it All aot allo;rthe conridenco to be viol<lted."

### mIl. St.Cossott, Jnnuory 12th‘ 1939 PxyI x0. 4

The President of the United States, the Oovernors of several state0 and thelr Cabinet ofiioera are not bound to produce papers or to discloss lnfoncction committed to thtn in 8 judicial inquiry, when, in their ~MPIjurtvt the dfsalosum would, on publao erouhda, be ihexpedlcht. This prlnoipal is **reoogniztnl** and supported in the following cases:

Trotttm vs. United States, 92 U.S. 105 Enrtrahf't*sAppeal, 27 Au. Rep., 667 Thompson vs. Geman Valley R.R. Co., 22 R.J. 74.111

TX3 principal applies with enualtorce and erroat to the hea& oi E!ationalsad .StatoOovornmcmtsr

'i70rtSington

vs. Scrlb:ler,Au. Rep. 730 In ro IIuitxm, 7 YQd. 699. In re ~~:ee~,82 Bad. 729 hske vs. Cordngce, 177 U.S. 459.

The &prom Court of bkxvachusetts in I!urtrahft*s .;?>eal , **8up?a,** said:

‘?!husthe nuestlon of tho **0XDtXldiMOy Or**  the prodxctioc or tbc reqiliredevido:~ce**lu** rercrrcd, Ilot to the judgmmt 

### or the court berore waloh the action **is** trying, but or the ofrloer who INS that cvidcnoe ih his p03903aien."

Aftor a oarorul exaxinatim or the autiloritlesit is a;?parent

### thatthe Ranking Cormissioner oan avail h5mseli
or the privlleqe or rofuslag to testify about, or to furnish co~ioe of any oxminors report lo his ~o~~sesaion,ii he feels that such disolosuro vould be prejudicial to 3ubld.ointerest. If, on the other hahd, ho should dooide that to produoe such lnforzatloa as ho &;ht ?ONJOOS would be to public iarerest, ha oaa do so.

z~ticlo 1534a, Par. 2, R.C.J. as aaendcd by .',ota 

### 0r 1937, 45th **hgi3Lut.a0** 

### 19~3r0ib3:

‘The ::~rikln~,~Co!amlsslonor or'Texas shall ex- :dao or cause LO '3~OXaAaOd such cornorations mnually or 0Stonor If ho doew It neocosnry. .;ald

.IIon.z. Gomltt, January Uth, 1939 ?llgslie.5

corporation shall pay the actual traveU.zq ~eqenses, hotel bills, 

### and all other ootual expense lnol

### dent to auoh examination and 

### a foe not moeedlag one-oi&th or one per cant or Its aotual oald-in aapital. It auoh oor.sorationhad not sold In Texas its bonds, notes, oertitiontee, debenturea
or other obligations 

### and does not offer for sale

or sell In Texas Its bonds, note8, oertlfloates, debentures or other obligations, the SRnking Cornmissioner of T~xns, in lieu of an 

### oxaninatton, shall aooept a fintmial statemmt nado on such foru, containing such informatl.onas he deelres. Tho iPinkingCo.m.lsslonerof Tsxas is hereby authorized to appoint not to exoeed one ~aminer for 

### everyfifty (50) or suoh oor~oratlons. EElchaxardner shall take,the oath and furnish a bond as required or State Sank &a;zfners, and shall reoelve on anuual salary as 

### r0uOdvf3t* * * * **'

By virtue of suoh artlole the I3ankla.q Comlssiouor 

### 13 ;:lvonpo;rerto exanine or 

### cause to be examined alloar- ?ortitionsmbraoed by the provisions of Article 1524a. it likewise, provides that eaoh 

### examiner nholl take the oath and Punish :Abead 

### as reqtilred of state bank axcuzlners. In taking tke sam oath as taken by a bank exmlmr, the loan 

### and brokarago co::~gany oxatiiner;rouldbe no nor0 privllcp,odto xake pub110 any inforxatlon conoerni~ tho oondltlon ot any conpcmy excmined by bin, it such infomatlon was rooeivcd 

### by him in the 

### course or his orrlclal duty es suah an 

### examiner, thsn would a bank exaxinor be Driviloeed to make 

### yabllo any inforzatloh he ml&t posoese under slinllsroiroumstanoes and conditions. Jud.;eCur&on ooncluded in the ognlon 

### herelnabovo referred to that a bank 

### exaninorhas 

### no authority to dl3olose any lniomatlon reoelved by hln during the oourse of Lis exaninatioa of a bank, if ouch lnfomatlon was reoelved by 

### bin iu the courao of !:loofflaial duty no suoh oxanlner, except and ;u?leaahe bo npoolfiaally dlreotod by the Banking Cor~i3sloner to do so. I!oauthorities are found that will ju;tifg shy ckaago In this conoluolon.

It 13 apparmt that the answers to the first and Lst ,uaotions oronounded bv YOU

. mist be bnsed unon the sol9 p~upoktlon of -~i?&boror nbtvyo& aotlon in the ireulsee 

### is uoG!S publlo intorest.It is, thmsfore, t!m o?lnion OP SM$ depu-tmnt that: 

### (1) The 

### xrle 02prlvils-ga pertaining to exarrAnersremrts obtains vait!l ros?eot to insttitutlons thnt m-3 closed and not aotlvoly oxqt(;ed in tbclr aoqorate 

### bulnaas ?t the tint the report 1s cnllod 

### for or the privilege invoked.
(2) 'If.8

rul.eof ?rivllece 

### pertaining to oxminers report a.~?plies to loon and brokerage coinpanies, the aame as to banking institutions. 

### (ii)Thoikd4.n~

Cormlosioner

hno $iscrction ~SIfhe ;&t$ar of nakL~ public ex9iziners'reports by :ivlzg copiss tnoreor UT yeml%ting the l;:syecticn 

### ~h32~Or,or 

### iu %i?ntifyirqor p0mitti;q exminms to tcsti+"yunder iriss;ipervFsionand express ~cr::l3slon,Zirzltedonly by his deoision and diecrntion of ?riMZmr or not thd :raki~~wi~lio of such inforz&ion I.2to the ?ublio intormt.
Trwting'thla f2lly and satisfactorily 

### yourbqulry, I :m Your13 very

, cm3w3rs~

truly