Honorable Bascom Glles

Commissioner,General Land Austin, Texas

Dear Sir:

You have requested the opinion of this department upon Office

OpinFonNo. C;lq77 Re: The propermethod of handli,ng special trust fund under H.B. 9, 46thLe,glslature, Regular Session.

the propermethod of handlingby your office of the deposits required.tobe made under the provisions ofR.B. 9, 46th Legislature,by vacancy applicants.

We quote from your letter as follows:

'Thepractice has, heretofore,been to require deposits on all vacancy'appllcationsfiled by 'applicants'In compliancewith the above provisionsand the other portions of House Bill No. 9 and the sums thus received havebeen placed

_ln a specialaccount in the CapitalNational Bank, Austin, Texas, designated as 'BascomGiles, Trustee.' From,thls account the disbursementsare made, as required under provlsfons ofHouse Bill No. 9 and, as a record of same, there ismaintained a voucher record and journal showing the dlstributlon of the account for each separate application.

"In thus construingHouse Bill No. 9 and in handling this trust fund in the manner s&out above, this officewas in somemeasure guided by
an opinionrendered the Land,Commissionerby the Attorney General'sDepartment under date of April 9, 1930, signed by the Honorable W. W. Caves, Assistant Attorney General. This opinion related to the $1.00 required by Article 5413, Revised Civil Statutes of 1925, to be deposited by each applicant for patent and to be paid through tbls office to county clerks as patent recording fee.

"Thisoffice would appreciate the benefit ofRonorable Bascom Giles, page 2 o-1977

your opinion on the propermode of handling this special trust fundunder the terms of said House Bill No. 9 and whether or not the procedure now employed Is correct or whether such deposits,when received, shouldbe transmttted to the State Treasurerunder terms and provlsions of Senate Bill No. 48 enactedby the 41st Legislature as amending Article 4343 of the Revised Civil Statutes of 1925."

The particulardeposit about which you inquire in your oplnlon request Isprovided for in subsection (c) of section 1 of R. B. 9 in the following language:

"The Commissioner shall notify the applicant by letter of the estimate of the cost of proceedings under the application,and, within thirty (30)days after the date of such letter, the applicant shallmake a depositwith the Commlsslonerto
cov~er costs of all work which may be necessary In order to comply with the request contafned in such application. Upon failure to make the deposit as required, all rights under the application shall be lost. In the event such deposit shall prove to be insufficient,the applicant shallbe requested by letter to make a furtherdeposit of a sum to be fixed by the Commissionerand, 1f such additional deposit be not madewithln thirty (30)days after the date of such letter, the work shallbe discontinuedand the application cancelled,and such cancellation shallbe so endorsed on the application. .Uponcancellation,the right to purchase or lease under such application shall be lost. The deposits provided for in this Section shall be a special trust fund to be used only for the purpose authorized by this Act. Provided that the appllcant shallhave the right of appeal from the estimate of cost so made by the Commissioner, to the District Court of Travis County by giving notice to the Commissioner inwriting thereofwithin fifteen (15)days after'the receipt of said estimate from said Commisstoneras herein provided. And provided that said applicant shall have fifteen (15)days after the decision of saidDistrict Court as to amount Inwhich to make payment thereof.."
Evidently, the reference contained in your letter to S.B.No. 48 of the &l&Legislature, as amending Article 4343 of the Revised Civil Statutes of 1925, Is erroneous. S.B. No. 48 of the 41st Legislature isan amendment to Article 377, and. -

Eionorable

Bascom Giles, page 3 o-1977

has reference to what shallbe contained in the charters of banking corporations. It seems apparent that you intended to refer toH. B. 493 ch. 242, Acts of 1931, which is an amendment to Article 4388 and otherArticles. Article 4388,
as amended by ch. 242, Acts of 1931, provides as follows:

"TheState Treasurer shall receive daily from the head of each department, each of whom is specificallychargedwith the duty of making
same daily, a detailed list of all persons remitting money the status of which is undetermined.
orwhFch is awaiting the time when it can finallybe taken Into the Treasury, together with the actual remittances whfch the Treasurer shall cash and~placein his vaults or Ln legally authorizeddepository banks, If the necessity arises. The report from the General Land Office shall in-~ elude all money for interest,principal and the leases of school,un~lversltg, asylum and other lands. A deposit receipt shallbe issuedby the Comptroller for the daily total of such remittances from each department; and the cashier of the Treasurer'sDepartment shall keep a cash book, to be called 'suspensecash book,' Inwhich to enter thesed,eposit receipts, and any others issued for cash received for which no deposit warrants can be Issued, orwhen their issuance isdelayed. As soon 8s the status ofmoney so placedwith the Treasurer on a deposit receipt is determined, It shallbe transferred from the suspenseaccount by placing the portion of it belonging to the State In the Treasury by the lssuance of a deposit warrant, and the part found not to belong to the State shall be refunded. When depositwarrants are Issued, they shallbe entered in this cash book, as well as any refunds, and the balance shall represent the aggregate of the items still in suspense. Refunds shall bye made in a manner similar to that in present use, except that separate series of warrants shall be used for making such refunds, to be called Irefundwarrants,' and.suchwarrants shall be written and signedby the Comptroller and countersigned by the Treasurer and charged against the suspense funds to which they apply. Such warrants shall then be returned to the Comptroller and dellvered by him to the persons entitled to receive them."

It is our opinion that the special trust find provided for inH. B. 9, which consists of deposits made by an applicant- -

Honorable Bascom Giles, page 4 o-1977

to &over the costs of thework which may be necessary Fn order to complywith 8 vacancy applFcant's request for a surve ati hearing, is not subject to~the provIsIons of Article 43881s as amended In 1931. Nor do we believe that such trust fund required tb be paid over to or handledby the State Treasurer in any manner. The equitable title to such fund remains In the vacancy applicant, and suchmoney is only authorized tobe used by the Commissioneras trustee for the particularpurposes authorized by H. B. 9. It is furtherprovided inH. B. 9 that the Commissioner shallrender a complete statement. to the applFcant and shall pay over the unused balance of the money to the applicant as soon as the total expense properly chargeableagainst the deposit has been determined.

These provisions seem clearly to provide that the fund.in question is to be administeredby the.Comm1ssioneras trustee for the purposes specifiedby H. B. 9, and that the Commlsslonerlandnot the State Treasurer is charged with retaFning custody of saidmoney and of returning any unused balance to the applicantwhen the ccsts chargeable to the fund have been paid.

Accordingly, it Is our oplnlon that the method you have been employing In the handling of these funds Is proper and lawful,.

and that you are not required or authorized to pay over such sums to'the State TreasureF,under the terms of any statute.

: Very truly yours

ATTORNEY GENEZAL OF TEXAS

By s/Robt.E. Kepke Robt. E. Kepke Assistant

REK:RS:wc

APPROVED MAR 28, 1940 s/Gerald C. Mann ATTORNEYGENERAL OF TEXAS
Approved Opinion CommitteeBy s/%iB Chairman