THE ATTORNEY GENERAL 

OFTEXAS 

Honorable George B. Butler, Chairman 

Board of Insurance Commissioners 

Austin, Texas 

Dear Sir: Opinion No. O-7004 

Re: Interpretation of Set, 2, of 

Art, 5068-3, Vernon's Annotated 

Civil Statutes. 

We have received your requests for our opinion on the 

hereinabove captioned. matter, and we quote from your first 

request as follows: 

"Under the provisions of Article 5068-3, 

Section 2, after the mortuary funds of the 

assessment association have become the property 

of the corporation reinsuring the membershfp of 

such association, may such funds be lawfully disbursed by the reinsuring corporation for all of the 

following purposes: 

"1 0 for payment of valid claims outstanding 

and arising thereafter from policies Issued by 

the legal reserve company to the members of the 

assessment associatfon, 

"2 o to set up the legal reaerve on new 

policies issued by the legal reserve cornGang to 

the members of the assessment association, 

"3 D and to pay their actuarial portion of 

such mortuary fund to members of such association 

who refuse to accept the new policies offered 

them, and who make request therefor wlthin sixty 

(60) days from the date of reinaurance? 

"If your answer to the preceding inquiry is in 

the affirmative, may the Board of Insurance Commissioners lawfully refuse ,to approve a proposed plan 

and agreement on the sole ground that such proposed, 

plan and agreement provides that the mortuary funds 

belonging to the association may be disbursed for 

ail of the three purposes specified In the preceding 
Hon. George B, Butler, page 2 O-7004 

inquiry and compel said association and reinsuring 

corporation to agree that the mortuary funds shall 

be alsbursea for only one or two and not all of 

such speciffed purposes or for some other or dlfferent 

purpose before the Board will give its approval as provided In said Statute." 

Set, 2, Art, 5068-3, V,A.C.S., reads as follows: 

"The sums of any mortuary funds belonging to 

such association shall thereafter be effectually 

the property of such organized and converted corporation or corporation refnsuring the membership 

of such asaociatlon, but may be disbursed for 

payment of valla claims outstanding and arlslng 

thereafter from policies issued by the legal 

reserve company to the members of the assessment 

associatbn under the approved agreement; to set 

up the legal reserve on new policies issued by 

the legal reserve company to the members of the 

assessment association under said agreement; and 

to pay their acturial portion of such mortuary 

fund ,to members of such association who refuse 

to accept the new policies offered them, and who 

make request therefor within sixty (601, days from 

the date of conversion or reinsurance. 

It wFl1 be observed that the provlsions of Section 2 

are plafn and unambiguous and where a statute, civil or crimlnal, is expressed in plain and unambiguous language and its 

meaning la clear and obvious, there Is no room for construction, 

Gaddy vs. First National Bank, Beaumont, 28'3- S.W. 472; Sparks 

vs, State, 174 S.W. 3510 

We therefore answer your first question in the afflrmative. 

In connection with your second question, we call your 

attention to the case of the BoaPa of Insurance Commiasionera 

of Texas vs, Guardian Life I&. Co. of Texas, et al, 180 S.W. 

(2d) 906, wherein the Supreme Court of Texas said: 

"Articles 4688 and 4744 are the only ones 

pertinent to the queatfon in Issue and unless they 

confer upon the board the authority to issue the 

above order it must be conceded that no such authority exists. The board can exercise only such 

authority as is conferred upon it by law in clear 

and unmistakable terms and the same will not be 

construed as being conferred by implication. 
-_ - 

Hon. George B. Butler, page 3 O-7004 

Humble 011 & Ref-Lning Co. v. Rallroad Commission 

of Texas, Tex, Sup., 128 S.W. 2d 9; Commercial 

Standard Ins. Co. v. Board of Insur. Comm'rs of 

Texas, Tex. Civ. App,, 34 S.W. 2a 343, writ refused." 

We may apply the above statement of the court to the 

instant case in the following manner: Section 2 oft Art, 5068-3 

Is the only one pertinent to the question in issue and unless 

it confers upon the board the authority to issue the above order 

it must be conceded that no such authority exists. Your request plainly states that the "proposed plan and agreement 

provides that the mortuary funds belonging to the association 

may be disbursed for all of the three purposes", as provided 

in Set, 2, supra, and you are desirous of knowing whether the 

Board of Insurance Commissioners can lawfully refuse~'to approve 

the proposed plan because said board is Insisting that the reinsurance corporation agree that the mortuary funds will only, 

be disbursed for one or two of the above enumerated purposes, 

OP for some other or different purpose. The law Is well settled 

that the Board of Insurance Commissioners I'can exercise only 

such authority as is conferred upon it by law in clear and unmistakable terms and the aame will not be construed as being 

conferred by implication." We can find no authority for the 

Insurance Board to compel the reinsuring corporation to agree 

that the mortuary funds belonging to the association will only 

be disbursed for one or two of the purposes enumerated in Sec. 

2, or for some other or different purpose, and in view of the 

foregoing authoritfea your second question fs answered In the 

negatfve, 

In view of our answers to your Inquiries in the first 

opfnion request, we do not deem it necessary to answer your 

second request. 

Yours very truly, 

ATTORNEYGENERAL OF TEXAS 

By s/J.C. Davis, Jr. 

J.C. Davis, Jr, 

Assistant 

JCD:LJ:wc 

APPROVED DEC, 20, 1945 

s/Grover Sellers 

Approved Oprnion Committee By s/%/B Chairman