DAN MORALES 

AT-rORSEY GENERAL 

Q3ffice of tly Plttornep 

&ate of Qkxae 

October 14,1993 

General 

Mr. James R. Wdson 

DiECtO~ 

Texas Department of Public Safety 

5805 North Lamar Boulevard 

Box 4087 

Austin, Texas 78773-OOOl 

Opiion No. DM-261 

Re: constitutionanty of pr&isions of 

section 4A, V.T.C.S. article 6701h, pertaining to impoundment of Out-of-state vehicles 

involved in accidents where proof of 

fhmcial responsibiity is not shown, and 

related questions (FQ-419) 

Dear Mr. Wdson: 

You ask about the safety Responsibiity Law. article 67Olh, V.T.C.S.. which 

generally requires that operators of motor vehicles in Texas be able to Finnish proof of 

“financial responsibility,” that is, liability insurance or other proof as provided for in the 

Ict, of the opemtoh abiity to respond in damages for liabiity arising from ownership, 

maintenance, or use of the motor vehicle. Scr V.T.C.S. art. 670115 05 1 (detinition& 1A 

(necessii of liability 

responsibility). 

insurance, with exceptions). 1B (fbmisbing evidence of fmancial 

. 

Your questions relate to the provisions of section 4A of the act, which 

pertain to persons who own or operate motor vehicles which are involved in accidents in 

this state but which are not registered in this state. 

Section 4A provides that when such an accident results in injury or death, or in 

property damage to any person to “an apparent extent of SSOO or more,” the owner or 

operator, upon his failure to tkmish evidence of “fiwrcial responsiiity” to an 

investigating law enforcement 05cer. shall be taken before a magistrate. Id. 5 4A(a), (b). 

The latter, upon finding in a hearing a reasonable possiiity of a judgment being rendered 

against the person for damages arising from the accident, must order the vehicle 

impounded by the sheriff or chief of police unless the person shows evidence of %nancial 

responsiiity” for such damages or evidence that he is exempt from the “tinancial 

resp~nsiiity~ requirements of the act. Id. 8 4A(a)(t) - (e). (Section IA(b) includes 

exemptions for certain public vehicles, vehicles for which bonds or cash deposits have 

been filed, aelf-insured vehicles, certain olda collectors’ vehicles, implements of 

husbandry, golf carts. etc.) The owner or operator may secure release of a vehicle thus 

impounded Only upon obtaining a kerti6cate of release” fkom the Department of Public 

Safety (the “department”) and paying the “cost of impoundment.” Id. 8 4A(f). Subsection 

(8) of section 4A provides that the department shall issue such c&&ate of release on 

submission to it of 1) evidence of financial responsibiity or exemption from the 

requiren~ent; 2) a release from each person who was damaged in the accident other than 

p. 1362 
Mr. James R. Wilson - Page 2 (DM-261) 

the one seeking the certiticate of release; or 3) “security in a form and amount determined 

by the Department to secure the payment of any damages for which the operator may be 

liable.” The department is to determine “the form, content and procedures for the issuance 

.Of a certificate of &am.” Id. 8 4A(i). 

Your specific questions am: 

1. Does Section 44 Article 67Olh, V.T.C.S.. violate the 

constitutional provisions relating to equal protection or the 

ccmlmerw clause. 

2. Does the duty of the Department of Public Safety under Section 

4A. .bticle 67Olh, to issue a certificate of release and to 

determine the amount of security to be posted by a vehicle 

owner or operator require ,a prior hearing under Article 

6252-13a. V.T.C.S. (Administrative Procedure and Texas 

Register Act)? 

3. What is the minimum amount of security which the Department 

may require in order to issue a certificate of release under 

Section 4A. Article 67Olh? 

4. What standards should the Department apply in determining the 

amount of security that is required by the Department? 

You suggest that the impoundment of vehicles involved in accidents in but not 

registered in Texas, and for which no proof of tlnancial responsiiility is shown, is a 

potentially harsh remedy: 

It is clear that the procedures set forth in Section 4A could present a 

lengthy delay and possibly great expense on the owner or operator of 

the vehicle which is not registered in Texas. . . . The vacationing 

family could be without use of its vehicle for an extended period of 

time. Jf a commercisl motor vehicle was carrying a load of 

perishable goods, a potentially even greater financial burden might be 

imposed . . . . None of these provisions would apply to a vehicle 

registered in Texas. 

The constitutional issues you raise in your tkst question involve whether the 

differing treatment atforded with respect to vehicles not registered in Texas when involved 

in accidents for which proof of Snancial responsibiity is not shown-k, impoundment 

under the procedures set out in section 4A-is warranted. Indeed. section 4A’s provisions 

are diiected only against owners or operators of vehicles not registered in Texas. The 

parts of article 6701h which contain counterpart security provisions applicable to Texas 

registered vehicles are in sections 5 through 7A. Section 5. applicable to ali vehicles 

invol~d in accidents here resulting in S 1000 or more in damages, provides for suspension 

p. 1363 
Mr. Jamts R. Wrlson - Page 3 (D~-26i) 

of the operator’s license and vehicle registration, “and if such operator or owner is a 

nonresident the privilege of operating a motor vehicle within this State, and the privilege 

ofthe use within this State of any vehicle owned by him,” unless or until “security that will 

be suffxient to satis@ any judgment or judgements,” is deposited. Section 5 makes 

detailed provision for notice, hearing, and the issues to be detemrined relative to the 

suspensions of licenses, registrations and privileges thereunder. Section 7 provides for 

reinstatement of such licenses, registrations, and privileges upon posting of security or 

presentation of evidence of release fiorn liabiity, adjudication of non-liability, or an 

agreement for installment payments of damages-but in no event later thsn two years after 

the accident if no action for damages has been instituted. See also id. 5 8(b), providiig 

for notification of state of non-resident whose Texas operating privileges are suspended if 

such state provides for suspension of such person’s license and registration upon such 

notification, as Texas does with respect to its residents under section 8(c).’ 

Attorney General Opinion J?vf-826 (1987). in concluding, that the requirement of 

article 6701h that out-of-state motorists be able to tbrnish proof of tinancial responsibiity 

in the same measure as residents does not violate the commerce clause, article 1, section 

8, clause 3 of the federal wnstitution,s noted that state legislation permining to highways 

and trafhc carries a strong presumption of validity. The opinion and the cases it relied on, 

however, stressed the significance of such legislation’s treating intrastate and interstate 

traffic alike in opining as to its validity. See, e.g., Bibb v. Namjo Freight Lines, Inc., 359 

U.S. 520 (1959). 

Clearly, the suspension of the license and registration of a Texas resident in 

circumstances where it is likely there will be liability is a more e&ctive incentive to the 

Texas resident to provide security therefor than the suspension of the non-resident’s 

“operating privilege.” Notably, the bii analysis to the bii adopting the provisions of 

*Them M, in sution 1F. @ provisions for tbc bpodmau of vehicles upon multiple 

convictions for fsilurc 10 5unish proof of financial rmponsiiilii, as well as for license and @stration 

stwpasion. Src oh id. # 1C (rcaing out hmic penal prdsions for 5ncs and costs for 5rsl and 

sobsqocti offenses of tik ICI show proof of financial msponsiiility). Section 1Fs provisions arc 

lpplicablcm~vehiclawhahcrTasr~a~kdthydearly~~inCbcirpvporcfrom 

tboseincection4A,bcingdrpenalm~tbantenvitynature. Theoffense addmsd in section 1F is 

the fsilurc to show pmof of5nancid mspors%ilily after a prior conviction or convictions for mme. The 

ca&mhnitsthcpcridofinqdment t0 lEOdQ%unlarthCdliVU ltdIUUOShlClOShOWpdOf 

financidrqonsiiilityforthefulure. Postiqofamonamyamouuiswtameansofobhirgthc 

rclcasc of a vehicle tmpodcd u&r scctton IF. 

p. 1364 
Mr. James R. Wilson - Page 4 (DM-261) 

section 4A in. 1991 characterize the problem of the state’s not being able under the then 

current Jaw to impose “any enforceable responsibiity” on uninsured out-of-state drivers 

causing damages in accidents as a “serious” one. See House Insurance Comm., Bill 

.Analysis, H.B. 595, 72d Leg. (1991). Arguably, the impoundment of out-of-state 

vehicles. as a general matter under such cir~ 

this imbalance. 

is a reamable means of addressing 

That said, we concede the treatment .&forded under section 4A to vehicles not 

registered in Texas may be especially troubling in particular applications. For examplethe matter to which your second question relates-while the provisions of section 5 of the 

act for the suspension of a Texas owner/operator’s Jicense and registration only apply 

where there hss been SJOOO or more in damage Tom an accident, the impoundment 

procedures under section 4A are triggered when there has been damage “to an apparent 

extent of SSOO or more.” It would appear, however, that the minimum security which 

must be posted, pursuant to section 9, for the reinstatement of registration and license 

under section 5 or the release of an impounded vehicle under section 4A is the same: 

SlOOO. Whether this provision for the posting of SlOOO when the apparent damages 

involved were only SSOO was an oversight on the patI of the legislature or was motivated 

by legitimate wncems, we have been unable to detemrine. Also, the limited ways by 

which the release of the impounded vehicle may be obtained-presenting proof of financial 

responsibility effective at the time of the accident, payment of sea&y, or securing a 

release from the persons damaged-may in particular cases mean that the vehicle will 

remain impounded inde6nitely. Compare section 7. which provides for reinstatement of a 

Texas license and registration suspended under section 5 two years after the accident if no 

action for damages has been instituted. 

However, we do not 6nd cases or authorities which we believe enable us to 

resolve your question as to the wnstitutionahty of the article 6701h provisions at issue 

here as a matter of law. We think it clear that were a court to entertain this question, it 

would take evidence to determine the weight to be accorded the various interests 

involved. That would be the case. we think, even if a “strict scrutiny” level of anrdysis 

were applied, on an equal protection theory that section 4A burdened a timdamental right, 

the “right to travel,* or a “suspect w non-residents. See, e.g., Shqiro v. lbompson, 

394 U.S. 618 (1968); PryIrr v. Doe, 457 U.S. 202 (1982). Moreover, whether particular 

applications of section 4A would run afoul of wnstitutional safeguards can only, we think 

be determined on a cases by case basis. again with a fidl taking of evidence and finding of 

filets relevant to the particulsr case. 

We have stated before that ~mtitutional questions which imvhw a weighing of 

opposing interests may not be amenable to resolution in the opinion process, when we are 

unable to take evidence or find facts. See generuliy Attorney General Opinion DM-42 

(1991) (questions as to wnstitutionahty of geographical classifications as basis for 

exemption from continuing education requirement for real estate brokers can not be 

resolved in attorney general opinion process). Accordingly, it is our opinion here that only 

p. 1365 
Mr. James R. Wilson - Page 5 @M&261) 

the full development in a judicial adversarial proceeding of the evidence supporting the 

wncems of the state and affected parties would provide a basis for meaningftd resolution 

of your questions. We thus decline to attempt to resolve your wnstitutionsl question 

here. 

Your second, third, and fourth questions ash about particular procedures the 

department should follow in administering section 4A Ckarly, wnstitutional wnwrns 

such as those presented generally in your first question, also underlie these patticular 

procedural issues you rake. It might be that in a given case, a court would read in, read 

out, or otherwise refashion particular provisions of section 4A in order to render its 

application there wnstitutional. For the reasons given above however. we do not feel we 

are able in the opinion process either to determine the wnstitutionslity generally of section 

4A or to refashion particular provisions so that they may be wnstitutionally applied in all 

specific situations. 

Your second question, again, asks whether the department is required to provide 

opportunity for a hearing prior to determining whether to issue a “certificate of release” 

under section 4A(g), or more particularly, prior to determining the amount of secutity the 

owner or operator must submit in order to obtain said cutiticate, under section 4A(g)(3). 

If so, you ask, would such hearing be held under the procedures set out in title 10, 

chapter 2001 of the Government Code, the AdmGatmtive Procedure Act (“APA”)?) 

Section 4A does not specigcally provide for hearings at these junctures but instead 

generally directs the department to adopt “the fotm, content, and procedures for issuance 

ofacertificateofrelease.” V.T.C.S. art. 67014 #4A(i). 

We think it is clear that the department must aiTord opportunity for a hearing prior 

to a final setting of the security amount the owner or operator must deposit in order to 

obtain a certificate of release. See, es., Wright v. Molloy. 373 F. Supp, 1011 (D. Vt. 

1974). Wright, in a very similar context, concluded that the setting of the amount of 

security needed to be deposited in order to avoid suspension of an operator’s license after 

an accident where the operator had been unable to show proof of financial responsibility, 

would violate procedural due process requirements if the opportunity for a hearing were 

not alTorded. Noting that the examiner in the motor vehicle department there had 

exercised some discretion in setting the amount, “based upon damage figures and 

descriptions of personal injury contained in police and motorist accident reports as well 

as . . . the damage figure claimed by a victim,” and that only “the judgment rendered in 

such civil action as may follow an accident 6xes the damages of the injured parties with 

exactitude,” 373 F. Supp. at 1022, the Wright court nevertheless considered a hearing on 

‘We note ths1 V.T.C.S. artkk 6252-131. the MmiabaW F’mc&uc ti Taps Rc@er Act, 

was rqcakd by the 13d Lqislalure. AUS 1993. 13d b&. ch. 268. 0 46. Article 6252.134 is mw 

codifkd in tk GwunmaU Ccdc al chaptu 2001. Id. 8 1. The codification of the Administrative 

ProcdurcAclinthc GotemwotCodcisrrons&mbrcvirion Id.047. 

p. 1366 
Mr. James R. Wilson - Page 6 (DM-261) 

the setting of security necessary in order to allow the driver to contest abuses of 

discretion, the use of improper data, etc. See a&o Bell v. Bumn, 402 U.S. 535 (1971). 

Where the owns or operator seeks a cutitkate of release based on submission of 

a release 6om persons damaged in the accident or of proof of financird responsibiity, we 

believe the department must also offer opportunity for a hearing prior to a final 

detemktation that such submissions are insufficient, unless the matter at issue has already 

been resolved in an adjudicatory proceeding. Although the adequacy or inadequacy of 

such submissions may be clearer as a matter of law than the appropriateness of a 

departmental detemtination of the amount of securhy which must be deposited in order to 

obtain the certificate of release, discussed above. there may be submissions as to the 

adequacy of which reasonable minds might differ. See V.T.C.S. art. 67Olh, 88 1B (means 

of evidencing financial responsibility), 20 (non-residents proof). Given the substantial 

property interests which could be at stahe, we believe opportunity for a hearing should be 

afforded in this setting as well. However. if for example, the magistrate before whom the 

owner or operator was initially brought under subsections (b) et srq. of section 4A 

determined, in a hearing affording due process, that the proof of tTnancial responsibiity 

offered there was inadequate, we see no reason why the department should have to aEord 

opportunity for another hearing with respect to the adequacy of the same offered proof 

Also, we conclude that hearings on seauity amounts or the adequacy of releases 

or proofs of financial responsibiity offbred are subject to the provisions of APA relating to 

contested cases. See id 8 13; see ulso Goti Code ch. 2003 (wntested cases under APA 

to be conducted by State OtTice of Administrative Hearings unless orightatmg agency 

employs own ii&time hearings officers) (former 6252-13f. V.T.C.S.). APA governs all 

hearings on contested matters before agencies unless specifically provided otherwise. 

Again, the legislature has not specifically provided for such hearings in tqtion SA, but 

rather directed the department to itself adopt procedures for issuance of certiktes of 

release. While the counterpart provisions of section 4S, in section 5, relating to licence 

and registration suspensions of Texas owners and operators, specifically provide for 

hearings in “police courts” and justice of the peace coutts, we do not believe that the 

department under the general authority to adopt procedures in section 4A(i) could require 

for the section 4A hearings in question the use of such triiunalq which are operated by 

distinct political entities, without specik provision the&or by the legislature. 

We have noted already that your third question-as to the minimum amount of 

oecurity which must be posted under section 4A in order to obtain a certificate of r&se 

for an impounded vehicle-raises troubling issues, albeit with respect to the limited field of 

applications of the statute where the possible damages arising from the accident are found 

to be bawem ,SSOO and SlOOO. While, under section 4A(a) through (e). if SSOO in 

apparent damages were caused in an accident by an uninsured out-of-state vehicle, the 

owner or operator must be brought before a magistrate and the vehicle impounded, 

section 9 of the act clearly provides that for “security rquired under this Article. . . the 

Department may require. . . no. . . . less than One Thousand (Sl.000) Dollars.” whahcr 

p. 1367 
I 

Mr. James R. Wilson - Page 7 .(DM-261) 

the words “under this Article” refer to article 6701 h as a whole or to article. IIJ of article 

6701h “Security Following Accident,” the security amounts the department is rquired to 

set under section 4A would be embraced therein. 

As mentioned previously, the SlOOO minimum security requirement UdK section 9 

wmports more obviously with the provisions of section 5, whereunder the department is 

to suspend the license and registrations of an uninsured person who has had M accident 

resulting in damage of SlOOO or more, unless he deposits securhy. (Section,5 itself also 

States that the minimum security under that section is SIOOO.) It may be, however, that 

although we find nothing in the legislative history of the provisions indicating such, the 

1egidatUre had a reason, w~cct~! with the *serious problem” of uninsured out-of-state 

motorists causing damage in accidents in Texas, for making the minimum security for 

obtaining release of an impounded vehicle under section 4A SlOOO although the minimum 

damages which wuld lead to impoundment were only SSOO. As indicated above, with 

respect to the issue of wnstitutionality of section 4A generally, we think the issue of the 

wnstitutionality of the SlOOO minimum security amount must await resolution in a judicial 

setting in which evidence of the respective wmpeting interests may be taken and 

considered. 

Your last question asks what “standards” the department should apply in 

determining the amount of secmity it will requires “For example, is a repair estimate 

MO@ or should actual testimony of some competent witness be requi@d]? Could an 

affidavit be used to satisfy those standards?” 

Section 4A directs that the security in question should bc set at an amount “to 

secure the payment of any damages for which the operator may be liable.” V.T.C.S. art. 

6701h, 8 4A(g)(3). Obviously, determination of such amounts with any exactitude may 

present diicuhies in partictdsr cases, for example, where serious personal injuries are 

involved. On the other hand, since section 9 of the act limits the amount of security which 

may be required to “the limits specifted in Section 5 in reference to the acceptable limits of 

a policy,” it is likely that the department will, in many cases of serious injury andor 

extensive damage. simply set the security amount at such maximums. See id. 8 S(c)6 

(requiring coverage of at least S20.000 for personal injuries to one person, S40,OOO for 

personal injuries to two or more, and S15,OOO for propesty damage). 

As to the use of “repair estimates” or “affidavits” in lieu of actual testimony, as 

bases for setting the amount of security, we note that APA itself provides with respect to 

hearings under that act that if a hearing will be expedited and the interests of the parties 

will not be prejudiced substantiahy, any part of the evidence may be received in written 

form. Goti Code 8 2001.085 (formerV.T.C.S. art. 6252-134 0 14(a)).’ HOWCVM, where 

as here, the matters to be OffMbd in evidence as to amounts Of damageS OaUd i0 

accidents will generally be open to dispute, we feel that the department should, in order to 

afford due process, offer opportunity for cross examination, and hence be prepared t0 put 

on oral testimony where a hearing is sought. See, e.g., Ri&r&on v. City of PpFndeM, 

p. 1368 
Mr. James R. Wilson - Page 8 (Dbl-261) 

513 S.W.Zd .l (Tex. 1974) (right to cross examine witnesses applies in administrative 

hearings). As to the procedures generally the department should adopt under section 4A 

for setting security amounts, we believe that the department, in wnsdtatiOn with its legal 

staff and the attorneys in this office who represent the department, is better situated than 

we are in the opinion process to.stmcture appropriate guidelines. 

SUMMARY 

Section 4A of article 6701h, V.T.C.S., providing for 

impoundment of vehicles not registered in Texas where such vehicles 

are involved in accidents and proof of Snancial responsibiity is not 

shown, is not on its face violative of wnstitutional wmmerce and 

equal protection provisions. The Department of Public Safety must 

afford opportunity for hearings under the Administrative Procedure 

Act, former V.T.C.S. article 6252-13a now codiied at title JO, 

chapta 2001 of the Government Code, Acts 1993, 73d Leg., ch. 

268, 8 1, in setting security amounts required to be submitted in 

order to obtain the release of impounded vehicles. Article 6701h, 

V.T.C.S., on its face requires security of at least SlOOO in such 

circumstances. Where a hearing on the amount of security to be 

required is sought, the department should be pmpared to offa oral 

testimony in order to lrfford opportunity for cromtion. 

DAN MORALES 

Attorney O~~eral of Texas 

WILL PRYOR 

Fii Assistant Attorney General 

MARYKELLER 

Deputy Attorney General for Litigation 

RENEAHJCKS 

State Solicitor 

MADELEINE B. JOHNSON 

Chair, Opinion Committee 

Prepared by Wdliam M. Walker 

Asdant Attorney General 

p. 1369