AUSTIN ~LTExASI 

November 20, 1957 

Veterans' Land Board Opinion No. WW-263 

General Land Office 

Austin 14, Texas Re : What procedure is necessary 

for the Veterans' Land Board 

Dear Sir: to replace lost bonds? 

You advise this De artment that "the holder of Veterans' Land Bonds numbered 8 f; '76 through 8885, Series 1954, 

has lost such bonds and has requested that such be replaced by 

the Board", and you request our opinion relative to the procedure to be followed by the Board. 

The State of Texas, acting by and through the Veterans' Land Board, issued under constitutional and legislative authority 15,000 of its bonds, each of the denomlnation of one 

thousand dollars, aggregating fifteen million dollars and, collectively, designated as The State of Texas Veterans' Land Bonds, 

Series 1954. 

The bonds were approved by the Attorney General, registered by the Comptroller of Public Accounts, and sold on the 

market. 

Ten of these bonds held by the same owner are now alleged to have been lost. The bonds were not registered as to 

ownership. Consequently, they constitute ten general obligation bonds of the State of Texas, payable to bearer in the 

principal amount of one thousand dollars each, bearing 2f$ interest, with coupons attached for semi-annual Installments 

thereof. The principal sum not falling due until June 1, 1979, 

there were at the time of issuance fifty coupons annexed to 

each individual bond. Each coupon is payable to bearer. 

Section 49-b of Article III, Constitution of Texas, 

is the basic law underlying the issue of bonds. The leglslative enabling act is contained in Article %21m, V.C.S. 

The applicable portion of Article !?t21m is found in 

Section 3 in the following language: 

"All bonds issued under the provisions of this 

Act shall have, and are hereby declared to have, all 
, . 

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Veterans' Land Board, page 2 WW-263) 

of the qualities and incidents of negotiable 

instruments under the laws of this State. 

The Board (Veterans' Land Board) is fully authorized to provide for the replacement of any 

bond which might have become mutilated, lost 

or destroyed." (Insert ours) 

Although authorizing the Veterans' Land Board to provide for the replacement of any bond which might have become 

mutilated, lost or destroyed, the Act itself does not state any 

method or procedure for the replacement of bonds which are either mutilated or have been lost or destroyed. However, Section 

21 of Article $21m, V.C.S., provides in part as follows: 

*The Board is hereby authorized and empowered to make and promulgate such rules and regulations under this Act as they shall deem to be 

necessary or advisable, and to enforce the same." 

It is the opinion of this office that although the Legislature has not specifically provided any statutory method for 

the replacement of bonds issued under the provisions of Article 

%21m, V.C.S., which have been mutilated, lost ore destroyed, the 

Veterans' Land Board has the power to promulgate reasonable rules 

and regulations providing a method for-the replacement of any 

bond which has been mutilated, lost or destroyed. In promulgating such rules and regulations, it will be necessary that the 

Board provide for adequate and complete protection for the State 

of Texas against the possibility that the original bonds alleged 

to be lost or destroyed are presented for payment, thereby creating a double liability against the State of Texas upon a single 

obligation. 

As a suggestion, we point out that any rules promulgated by your Board should include the following safeguards: 

If the bond or coupon is claimed to be lost or destroyed, the owner shall furnish the Board: 

(1) Broof of ownership. 

(2) Proff of loss or destruction. 

(3) Execute and file with said Board an indemnifying 

bond in a sufficient amount to be approved by said Board and 

the Attorney General, conditioned that the parties thereto shall 

pay all and any loss or damage that may be incurred or sustained 

by the State on account of the bonds and coupons so claimed to 

be lost or destroyed or those issued as replacements therefor, 
Veterans’ Land Board, page 3 (Ww-263) 

and conditioned further that the applicant will hold the State 

harmless and ~I.11 return to the Board, upon demand being made 

theref or, such duplicate bonds and coupons, or the amount of 

money named therein. The indemnity bond in this case should 

run to the State of Texas payable to the Governor, for the 

benefit of the Board and its fiscal and/or paying agent, and 

cover a period of time extended four (4) years beyond the maturity date of the bonds. 

(4) The replacement bond and coupons should be of 

substantially the same form and tenor as those originally issued, except that they will be signed by the appropriate persons 

in office at the time of such re-Issuance. In addition each 

bond and coupon will state on the back thereof that it 1s issued in the place of such bond or coupon claimed to have been 

lost or destroyed and that adequate security for the payment 

thereof at maturity is filed with said Board. 

(5) Further each coupon and each bond shall have endorsed on its face by the Board the word WDUFTJCATE”or , “REPLACEMENT”together , with the date of its issuance, 

(6) The replacement bonds with appurtenant coupons 

shall be approved by the Attorney General and shall be reglstered as such by the Comptroller of Public Accounts, State of 

Texas e 

(7) All costs of preparing and Issuing the new bonds 

and coupons should be borne by the owner. 

Neither Article III Section 49-b, Constitution 

of Texas nor Article 5+&m V.C.S provides any 

speciflc’method for the repiacemeni’of’ mutilated, 

lost or dsstroyed bonds ,issued by the State of Texas 

through the Veterans t Land Board. The Veterans ’ 

Land Board is authorized and empowered to make rules 

and regulations to provide for the replacement of 

such bonds which have been mutilated, lost or destroyed. 

Yours very truly, 

WILL WILSON 

Attorney Gen6iU of Texas 

CKFtrztrwb 

BY &&$&i&k 

Agsistant 
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Veterans' Land Board, page 4 (WW-263) 

APPROVED: 

OPINION COMMITTEE 

W. V. Geppert 

Mrs. Marietta McGregor Payne 

Milton Richardson 

Richard Stone 

Weyland Rivers