Honorable W. E. Coats, Jr. 

Criminal District Attorney 

Opinion NO. (C-432) 

Smith County 

Tyler, Texaa 

Dear Mr. Coats: 

In your letter 

office on the above 

of your letter. 

Re: Situs of U-Haul trailers 

for the purpose of ad 

valorem taxation, under 

the stated facts. 

you have requested an opinion from this 

mbject. We quote pertinent paragraphs 

“Rental trailers owned by the Arcoa Inc. 

of Port land, Oregon, commonly known as U-Haul 

Trailers are available for hire in most all 

counties of this state as well as other states. 

The prlncipA1 place of business In Texas Is 

Grand Prairie, Dallas County, Texas. In the 

course of business of renting these trailers, 

the trailers are rented In one county and may 

or may not be returned to the renting establishment In that county. The U-Haul Company Is not 

involved in the dispute. They will pay their 

taxes. We he trying to determine to whom. 

“Dallas County authorities, Mr. Jerry D. 

Brownlow, City Attorney for Grand Prairie, Texas, 

relying on the enclosed opinion written by the 

Dallas County District Attorney’s office, seeks 

to tat all U-Haul‘ trailers located In the State 

.of Texafind have the U-Haul Company pay all Its 

ad valorem taxes to Dallas County. 

“This office and Smith County authorltl& 

seek to tax only the number of U-Haul trailers 

within Smith County, as of January 1, 1965, for 

the following reasons: 

-2041- 
Honorable W. E. Coats, Jr., Page 2 Opinion HO. (c-432) 

“(1) The latter‘part of Article 7153 of 

Vernon’s Texas Civil Statutes does not cover 

the situation in dispute because the trailers 

are not ‘temporarily removed’ from the Dallas 

Counv Many of the trailers or most of them 

in Texas will never be in Dallas County and, 

even if the trailers were in Dallas County, 

but are removed, they are not temporarily 

remo~v&d from Dallas County‘r;Eiut are removed 

with no prearranged plan for their return. 

“(2) The number of U-Haul Trailers 

located in Smith County Is almo$t constant. 

Due to the nature of this business there murt 

slwayr be present In Smith County a required 

number of trailers to meet the business demand. So, even if one specific trailer does, 

not remain In Smith County so as to obtain a 

‘permanent statue’, a certain number of trailers., 

do remain here all the time. City of Dallar v. 

Overton, 363 S.W.2d 821 (error ref. n.r.e. lgb?).” 

The Constitutional provision provldlng for the taxation 

of property is Article VIII, Section 11 of the Texas Conetltution. It states: 

“All property, whether owned by p&sons, 

or corporations @all be assessed for taxation, 

ax&the taxes paid In the county where eltuated, 

. . .” (Emph&rls supplied throughout.) 

The phrase “where situated” has been interpreted by, the 

Texas Supreme Court to mean “where situated” under the common 

law rule of “mobllle sequuntur personam” and not to mean 

“where situated” physically or technically. The court stated, 

in Great SouthebnLlfe Insurance Company v. City of Austin, 

112 Tex. 1.m S.W. 77U (1922) : 

“The Conrtltutlop was framed with reference to the common law, and In judging what the 

Constitution means weghould keep In mind that 

It Is not the beginning of the law of the state, 

but that it a8sumes the existence of a well-understood system, which was still to remain In force and 

be demonstrated, and that the constitutional deflnltions are ln general drawn from the common law. 

-2042- 
. . 

. 

Honorable W. E. Coats, Jr., Page 3 Opinion No. (C-432) 

Hewitt v. State, 25 Tex. 722, 727; Gordon v. State, 

43 Tex. 330, 340; Henderson v. Beaton, 52 Tex 29, 

60; Ex parte King,’ 35 Tex. 658. 

II 

. . . 

“Our Constitution, therefore, in declaring 

that property shall be taxed where situated, has 

done no more than declare the common-law rule. 

“It did not define z what was meant by the 

words where situated. Since It had reference to 

the taxing power, It evidently meant property 

where situated for the purposes of taxation 

under the general principles of law as then understood. ” 

The court then reviewed the common law rule of “aobllia 

sequuntur personam” and stated: 

“Under the common law, mobilla sequuntur 

peraonam was a we,ll-established maxim, and personal 

property of every description was taxable only 

at the domicile of Its owner, regardless of Its 

actual location. This is still the basic principle upon which the taxation of personal property 

rests. 26 R.C.L. Section 241, pp. 273,274.” 

However, there are certain exceptions to the “mobilla 

sequuntur pc:rs.onRm” rule and the Texas Courts have approved 

these exceptions. The Texas Su reme Court also stated In 

the Great Southern case, ( suprap that: 

“But even prior to the Revolution the principle 

‘mobllla sequuntur personam’ had been abrogated to 

the,extept that, as between different towns and 

taxing districts, certain classes of tangible personal property had a taxable situs where employed 

in business, regardless of the domicile of its 

owner.” p. 781. 

-2043- 
Honorable W. E. Coats, Jr., Page 4 OPlnlon No. (CA32) 

A more recent decision reaffirming this exception Is 

State v. Crown Central Petroleum Corporation, 242 S.W.2d 457 

(Tex.Civ.App. 1951, err. ref.), wherein the Court ruled: 

“One exception to the rule that tangible personal property Is on& taxable In the county of the 

residence of the o-r is that tangible personal 

property, which by It6 character and concrete Porm 

Is capable of having a value and an actual physical 

sltus, may be taxed In the county where permanently 

State v. Fidelity & Deposit Co. of 

iE$t%, 35 Tex.Clv.App. 214, 80 S.W. 5d.” 

Also, in the case of the City of Dallas vs. Overton, 

363 S.W.2d.821 (Tex.Civ.App. 1962, err. ref. n.r.e.), the 

Court wrote: 

“Tangible persona1 property acquires tax t3itU6 

In a jurisdiction apart from its owner if It is kept 

there with sufficient permanency that It may fairly 

be regarded as being a part of the general mass of 

property within the jurisdiction.” 

These exceptions have been recognized and propounded In 

the following cases and authorities: Galveston v. Haden, 214 

S.W. 766 (Tex.Clv.App. 1919, no writ h? 

283 S.W. 548 (Tex.Clv.App. 1926, no-writ hi&T 

Life Insurance v. City of Austin 108 T. 209, 19 

Cooley on Taxation, Vol. 2 4th Edition, p. 975 

General’s Opinion Noa. V-3+3, O-5632, O-3702 a 

Thus, we see that there is much Texas authority for the 

proposition that tangible personal property which ha$ acquired 

an actual sltus of its own Is to be taxed at the place of Its 

situs and not at the domicile of its owner. 

In your opinion request, you state that a certain number 

of trailers remain in Smith County at all times; which la tantamount to a certain number b einl g ralgned,to aith-.COpnOJi~ 

and that when the trailers are rented, they “may or may not” 

be returned to Smith County. 

-2044- 
Honorable W. E. Coats, Jr., Page 5 Opinion No. (C- 432) 

If all trailers which were rented in Smith County were 

returned to Smith County when the lessee had finished, then, 

unquestionably, all would be taxable in Smith County. Certainly, 

those trailers which are assigned to Smith County for business 

purposes~, rented there and returned there, would be taxable 

there under the exception to the "mobilia secuuntur personam" 

rule as recognized by the Texas Courts. 

The fact that all of the specific trailers do not return to Smith County does not. preclude taxation by Smith 

County. That certain number which has been permanently 

assigned to Smith County by the corporation for business 

usage there, can and has attained a degree of permanency 

after that number has first been delivered to Smith County 

and after that number Is shown to remain in Smith County for 

legitimate business purposes. Although trailers are large 

enough to be specifically identified, it should not be 

forgotten that they are also so similar as to be susceptible 

to treatment as funglble units, which Is exactly how the 

corporation actually does treat them. Therefore, It is 

possible ~for taxatlnn purposes, that even though certain 

specific trailers do not remain in or return to Smith 

County, that that certain number of trailers which have 

been permanently assigned to Smith County for legitimate 

business purposes and which have actually physically been 

in Smith County, have acquired an rctmal situs there. Thus, 

the U-Haul trailers are within the exception to the "mobllla 

sequuntur personam" rule and are taxable in Smith County. 

A necessary element of this opinion Is the determination 

that the trailers have acquired 3 degree of permanency in 

Smith County, thereby establishing their taxable situ8 there. 

In theCity of Dallas v. Overton case, supra, the Court elsborated on the definition of "permanency"; 

"It Is clear that 'permanency' as used in this 

connection does not convey the idea of the characteristics of the permanency of real estate. It merely 

involved the concept of being associated with the 

general mass of property in the state, as contrasted 

with the transient status--viz., likelihood of being 

In one.state today and in another tomorrow. . . . 

-2045- 
Honorable W. E. Coats, Jr., Page 6 Opinion No. (C-432) 

“Obviously the Courts do not construe the term 

‘permanent’ to mean absolutely permanent, since 

movable property is seldom absolutely permanent. 

The question of whether or not the property in 

question is 'more or less permanent’ as the term 

is often utilized, depends on the factual situation 

In each case as illustrated. . . .’ (. 

The facts, as you have given, reflect that a certain 

number of trailers are located within Smith County at all 

times by the corporation for business usage. That certain 

number which have actually, physically been located in Smith 

County must now be regarded as being a part of the general 

mass of the property within that jurisdiction, and in 

accordance with the previously cited authorities, must have 

consequently acquired a taxable sltus in Smith County. There 

is no question but that some specific trailers are in a 

transient status at all times in that they are likely to be 

in Smith County today and in another county tomorrow. However,.when the facts are considered as a whole, it must be 

remembered that those trailers which are removed from Smith 

County and are not returned have been or will be replaced 

by the company. Another factor for the determination that 

a certain number of trailers have become a general mass of 

the property within Smith County is the fact that that 

certain number of trailers will remain in Smith County when 

not in use. Smith County is their home base. 

The fact that the Court, In the case of Fort Worth ‘v. 

Southland~Greyhound Lines, Inc., 123 Tex. 13, b7 S.W.2d 354 

(Tex.Civ.App. 1931, opinion approved by Tex.Com. of App. On 

Certified Guestions) refuted the average number theory does not 

conflict with our present determination, insofar as we are 

not advocating an average number rule but are averring that 

that certain number which has attained the necessary degree 

of “permanency” are taxable In Smith County. 

The finding that items of personal property can acquire 

a tax situs away from the domicile of the owner, even though 

no specific items can be shown to have acquired a permanent 

-2046- 
. 

Honorable W. E. Coats, Jr., Page 7 Opinion No. (C-432) 

relation to the tax situ8 is not 

United Stats Supreme Court held, __. - _ 

ulthout authority. The 

in the cnse of Braniff 

Neoraska noara of Equalization ?%nses7 U S 5gC (lm that’regulariy bcneduled f’nesl’thounh not necessarilv the same individual 

planes; were~sufficlent to establish a taxable nexus for 

the airplanes to acquire a tax situs in Nebraska. The 

principle was cited In Attorney General’s,Oplnion No. w-818 

and was also Implied from the fact situation as given In 

Attorney General’s Oplnion V-373. In V-373, the facts a-c 

given were that Halliburton Oil Well Cementing Company 

assigned two railroad cars to Hawkins, Texas, and thet the 

number of’cars there at any given time would fluctuate according to business needs. Our office ruled that the LO 

hopper cars were taxable in the city to which they had been 

assigned because they had acquired a business situ8 there 

for taxation purposes. 

At first glance, several Texas cases, Chemical Express v. 

Roscoe 310 S.W. 691 (Tex.Clv.App. 1958, err. ref ) d Ft 

&. Southland Greyhound, supra, might appear’to?e e 

conflict with this opinion but careful study reveals otherwise. 

In the former case, the Court held that the trucks and 

trailers of the corporation were not taxable In Hoscoe even 

though they were physically ln that city on the taxable d:ite:;. 

The Court’s opinion Is predicated upon the fact that no particular number of ,vehlcles were assigned to any particular 

terminal and the location of vehicles away from the home 

domicile depended exclusively upon business. In contrast, 

the facts of the present situation are that a certain number 

,of trallers,ls assigned to Smith County at all timea and 

would remain there,even when they were not ln use. 

The Court concluded, In the Roscoe case, that the facts 

fell squarely within the holdings of the ca6es of Fort Worth 

v. Southland Greyhound Lines, Inc., supra, and Guln 

kailway Co. v. Dallas b S.W.2d 292 (Tex.Com.Apg- _ 

the terms of Article 7151. Vernon’; ‘Civil Statutes. a& that 

XiX-3.F. 

9291 and 

the properties were only temporarily removed from the city of the 

principal office or place of domicile. Our trailers are not 

temporarily removed from Dallas County, but as the facts indicate 

are permanently assigned to Smith County. 

-2047- 
Honorable W. E. Coats, Jr., Page 8 Opinion No. (C-432) 

As the Court 'very ably stated In the Overton case, supra: 

"A careful examination, of these authorities 

clearly reveals'distlnguishing features. . . . In 

the Southland Greyhound and Chemical Express cases, 

the City was attempting to tax motor ~vehicles that 

were only temporarily being kept wlthln its limits. 

The courts correctly held that such property having 

failed to acquire 'permanent' location apart from 

its owner, had its tax situs at the owner's domicile." 

A final exception to the common law rule of "mobllla 

sequuntur personam" which must be considered Is the establlshment of a sltus for taxation purposes by leg'lslatlve enactment. 

There Is no specific legislation determining the taxable situs 

of trailers as there Is for the rolling stock of a railroad 

comoanv. Article 7168. Vernon's Civil Statutes. In fact. 

the holding of the case of Gulf, C and S.F. Railroad v. Dallas,- 

supra, Is diatlngulshable because there is specific legislation 

establishing the tax situs of all rolling stock of a railroad 

at Its home-office in Texas or place of domicile. 

Article 7153, Vernon's Civil Statutes, is also relevant 

to the taxable situs of per6olal property. It states that: 

"All property; real and personal, except such 

as Is required to be listed and assessed otherwise, 

shall be listed and assessed In the county where,lt 

Is situated; and all personal property, subject to 

taxation and temporarlly'removed from the state or 

county, shall be listed and assessed In the county 

of the residence of the owner thereof, or in the 

county where the principal office of such owner 

1s situated. 

p. 125 7." 

Acts 1897, p. 2031 G.L. Vol. 10, 

The Texas Courts have held~that the meaning of "where 

it 1s situated" is the same as "where situated" In Article 

VIII, Section 11, of the Texas Constitution. Fort Worth v. 

Southland Greyhound, supra; Gulf C. & S.F. Railway Co. v. 

Dallas, supra; Great Southern Life Ins. Co. v. Austin, supra; 

andlveston v. Haden, supra. This statute does not provide 

for anv excentlon to the "mobilla sesuuntur personam" rule or 

its exieptio;ls. 

-2048- 
. 

Honorable W. E. Coats, Jr., Page 9 Opinion No. (c-432) 

As there is a taxable nexus between a certain number of 

trailers assigned to Smith County and that certain number is 

actually sent to Smith County for legltlmate business purposes, 

then that number of trailers have attained an actual business 

situs in Smith County and, therefore, under the recognized 

exceptions to the "mobllia sequuntur personam" rule, are 

taxable In Smith County. 

SUMMARY ---e-mUnder the stated facts, the situs of a certain 

number of U-Haul trailers, for the purpose of ad 

valorem taxation, is Smith County, Texas, the actual 

business situs of the trailers. 

Yours very truly, 

WAGGONER CARR 

Attorney Generelof Texas 

HG,Jr.:sjl 

APPROVED: 

OPINION COMMITTEE: 

W. V. Geppert, Chairman 

Paul Phy 

W. 0. Shultz 

Hen Harrison 

Stanton Stone 

APPROVED FOR THE ATTORNEY GENERAL 

BY: HAWTHORNE PHILLIPS 

-2049-