"P'arcA~r0mv~Y GENERAL

OFTEXAS

September 

### 15, 1958

Honorable J. M. Falkner Commissioner Department of Banking Austin 14, Texas

Dear Mr. Falkner: OpinionNo. WW-500

Re: Whether or not the Finance Commission of Texasmay, under the provisions of Article 342-112, Vernon's Civil Statutes, authorize the expenditure of moneys for costs and other expenses incurredby the State Banking Board in the trial of a case brought under the pro+ visions of Article 342-115, Vernon's Civil Statutes.

You have requested the opinion of this officeas to whether the Finance Commission of Texasmay, under the provisions of Article 342-112,Vernon's Civil Statutes,authorize the expenditure of moneys for costs and other expenses incurred by the State Banking Board in the trial of a case brought under the provisions of Article 342-115,Vernon's Civil Statutes, based on the following factual situation.

Some time ago,several lawsuitswere brought against the State Ranking Board in connectionwith certain applications for charter of a State bank under the provisions ofArticle 342- 115, Vernon's Civil Statutes,which provides that the findings and determination of the State Ranking Board shall be subject to review by a court of competent jurisdiction. After the disposition of these cases in the trial court therewas an appeal to the Court of CivilAppeals at Austin, Texas, in one of the cases, and incidental to this appeal, the Court Reporter of the 98th District Court of Travis County, Texas,furnished copies of the Statement of Facts in certain of these cases to be used by the Office of theAttorney General of Texas in preparing the briefs for the State Ranking Board and themembers thereofas appellees.

The statements for the servicesrendered by the Court Reporter were presented to the Department of Ranking for payment from its funds, but sinceno allocation of funds had beenmade for such purposes, the account is stillunpaid. However, theHon. J. M. Falkner, page 2 

### wi- 5001

Finance Commission,acting under the'provisionsofArticle 342- 112, Vernon's Civil Statutes,has recently set aside funds for the purpose of paying these bills if it may legally do so.

It is the opinion of this office that the Finance Commission of Texasmay under the provisionsofArticle 342-112 Vernon's Civil Statutes, authorize the expenditure of money f& costs and other expenses incurredby the State Ranking Boardin the,trial of a case broughtunder the provisions ofArticle~342- 115, Vernon's Civil Statutes. The State Ranking Board,which is composed of theAttorney General, the State Treasurerand the Banking Commissioner, is a State agency and subject to be sued in a court of competent jurisdiction to setaside its findings ' and determinations,as was done in this case. Vernon's Civil Statutes). (Article342-115, It is the duty of theAttorney General of Texas to defend any action brought against the State Banking. Board and themembers thereofby reason of any officialact. (Article342-207,Vernon's Civil Statutes). The suit in question
was an action brought against themembers of the State Ranking Board by reason of an official act, and, therefore, it was the duty of the Attorney General of Texas to defend them in such Court.

While it is true thatArticle 342-1128,Vernon's Civil Statutes, provides that the Banking Department shall cause to be transferredeach year of the biennium the sum of Four Thousand (&,OOO.OO) Dollars to the General Fund to cover the cost of governmental servicerendered by other departments, such provision only covers the services rendered by theAttorney General of Texas in defending the action under the provisionsof Article 342-207? but does not includeand is not intended to includeexpenses incurredby theAttorney General in conducting the defense of the suit to its final determination. The cost of furnishing copies of the Statements of Fact by the Court Reporter to the Attorney Generalwas a legitimate expense incurredby and on behalf of the State Banking Board in thedefense of the action.

Article X42-112,Vernon's Civil Statutes, provides in part as follows:

11

. . . Fees, penal'ties and revenues collected by the Ranking Department from every source.whatsoever shall be retainedand held by said Department, and no part of such fees, penaltiesand revenues shall ever be paid into the GeneralRevenue Fund of this State. All expenses incurred by the Ranking Department shallbe paid only from such fees, penalties and revenues; and no such expense shall ever be a chargeagainst the funds of this State.

. . .'IHon. J. M. Falkner, page 

### 3 WJ-5001

Since the above quoted portion ofArticle 342-112' provides that all expenses incurredby the Banking Department shall be paid only from such fees penalties'andrevenues,and the expenses incurred one behalf oh the Banking Department for the services of the Court,Reporterbeing legitimate expenses, you are advised that the Finance Commission of Texasmay authorize the payment of these obligations.

SUMMARY

Court costs and expenses incurred in defending an action~against the State Banking, Board under the provisions of Articles 342-115 and 342- 207, Vernon's Civil Statutes,may be legally paid from sums appropriatedby the Finance Commission, of Texas under the provisions of Article X42-112, Vernon's Civil Statutes.

Yours very truly,

WILL WILSON Attorney General of Texas

CKR:jl:wb

APPROVED:

OPINIONCOMMITTEE

Geo. P. Blackburn,Chairman William E. Allen Jack Goodman Tom I. McFarling Leonard Passmore

REVIEWED FOR THEATTORNEY GENERAL

BY: W. V. Geppert