The Honorable Bennie Bock II

Chairman OpinionNo. R-783
House Committee on Liquor Regulation State Capitol Austin, Texas 78701 Re: Renewal of mixed beveragepermit for limitedpartnership permittee after death of limitedpartner.
Dear Chairman Bock:
On behalf of the House Committee on Liquor Regulation, of which you are Chairman,you ask:

DoesArticle 666-13 of the Penal Auxiliary laws dictate that a mixed beverage permit issued to a limitedpartnershipnot be renewed after the death of one of the [limited]partners.
. . ? Article.666-13,Penal Auxiliary Laws, reads in part:

(a) All permits issuedunder [the Texas Liquor ControlAct]

. . .expire one year from the date of issue. (b) Any permit or license issued.

. . shall be purely a personalprivilege, revocable in the manner and for the causes herein stated, subject to appeal as hereinafterprovided, and shall not constituteproperty, nor shall it be subject to execution,nor shall it descend by the laws of testate or intestate devolution,but shall cease upon the death of the permittee or licensee:

p. 3304The Honorable Bennie Bock II - page 2 (H-783)

provided, however, that upon the death of the holder of any such permit or

successor of any such business involved may make application to the County Judge.

. .and upon certificationby the County Judge that such person is the receiver or successor in interestof any such business involved, the Board or the Administrator shall, unless good cause for refusal be shown

. . . give permission to such receiver or successor in interest to operate said business under the said permit or license

. . . . s such perm:t or license shallbe rens. The receiver 0 Es, however,-
= make G original application for a permZEYrYIYicense.

. . .(f) Notwithstanding any other provision of thisAct, if the surviving spouse or survivingdescendant of a holder of a Mixed Beverage Permit qualifies as the successor in interest to the permit as provided in Subsection (b)of this Section, the descendantor surviving spousemay continue to renew the permit by paying a renewal fee equal to the fee the permitteewould be required to pay had he lived. (Emphasisadded).
As the above statute expressly states,a permit or license issued under the Texas Liquor ControlAct is not a vested property right, but is granted and enjoyed subject to regulationsprescribedby the Legislature. (Tex.p.OE State vmz3-6&d4:?$%$! 1952). Control Board v. Canyon Creek Land Cor

p. 3305The Honorable Bennie Bock II - page 3 (H-783)

The provision of the Texas Liquor ControlAct with which you are concerned, article 666-13,has been substantially the same since 1949, except for amendments in 1971 that limited all permits and licensesunder the Act to a duration of one year and added subparagraph (f)regarding surviving spouses or survivingdescendants of holders of Mixed Beverage Permits. Acts 1971, 62nd Leg., ch. 65, p. 681 at 686, 699. The Uniform Limited PartnershipAct, article 6132a,V.T.C.S.,was not adopted in Texas until 1955, (Acts1955, 54th Leg., ch. 133, p. 471)when the "entity" theory of partnership lawmade its first appearance in this state. Prior to that time, partnershippropertywas held by~the partners as tenants in common. Now, however, "[a] limitedpartner's interest in the partnership is personalproperty." V.T.C.S. art. 6132a, 9 19. the Commentaryby Professor Bromberg following ===F sections and 8 of article 6132b, The Texas Uniform PartnershipAct, inVernon's Civil Statutes of the State of Texas, Annotated. Cf. Attorney General Opinions H-589 (1975),H-18 (1973).
A limitedpartner has no individual interest in the property of the partnership. He has, instead, a right to receive a share of the profits or other compensationby way of income of the partnership and to the return of his contribution under certain conditions. V.T.C.S. art. 6132a, s 11(b). We do not believe he has any greater individual interest in the intangibleassets belonging to the partnership,whether or not they are classifiedas "property." Accordingly, it is our opinion that when a limitedpartnership is the holder of a permit or license issued under the Texas Liquor ControlAct, a limitedpartner is not any more a person "havingan interest" in the license or permit than is a shareholderof a corporationholding such a permit. See Penal Auxiliary Laws art. 666-58. - The death of a limitedpartner does not ipso facto dissolve the partnership. V.T.C.S. art. 6132a, 8 22. Inasmuch as the death of a limitedpartner does not work an automatic dissolutionof the partnership,nor is it the death of one having an interest in the permit held by the partnership,we answer your question in the negative. Cornare Penal Auxiliary Laws arts. 666-lla, 666-12, and 666- +

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SUMMARY The death of a limitedpartner does not necessarilyprohibit the renewal of a mixed beveragepermit issued to the partnership. Very truly yours,

APPROVED:

C. ROBERT HBATX, Chairman Opinion Committee jwb

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