Ausns 11. TExAn 

September 22, 1958 

Hon. Zollie Steakley Opinion No. WW-503 

Secretary of State 

Capitol Station Re: 

Austin, Texas 

The authority of the Secretary 

of State to accept and file 

Articles of Incorporation which 

include, in part, the following 

purpose clause: "To establish, 

maintain, and carry on a general 

currency exchange business and 

in connection therewith to issue 

checks, travelers' checks, money 

orders, and other negotiable instruments, but without banking, 

or insurance priviDear Mr. Steakley: 

discounting, 

leges. 

Your request for the opinion of this office is in 

part as follows: 

"The opinion of your office is respectfully 

requested concerning the authority of this office 

to accept and file Articles of Incorporation 

which include, in part, the following purpose 

clause under which it proposed to engage in business in this State: 

"'To establish, maintain and carry on a gellera1 currency excha se b siness and in connection 

therewith to issue Ehecki travelers' checks. w 

orders, and other negotiable instruments but without banking, discounting or insurance privileges.' 

(Emphasis added) 

"Insofar as I have been able to ascertain, it 

has been the uniform departmental construction of 

this office since'the enactment of the Business 

Corporation Act that the sale or issuance of money 

orders and travelers' checks constituted one of the 

purposes of banking and the Business Corporation 

Act was not applicable to such corporations under 

the provisions of Article 2.Olb&)a and 9.14A. It 

is further noted that there is no provision under 

Article 1302, R.C.S. for authorizing a corporation 
. . - 

Hon. Zollie Steakley, page 2 (WW-503) 

to engage in business for the purpose of carrying on a general currency exchange business or 

issuing or selling travelers' checks or money 

orders.l' 

Article 2.Ol.A, Business Corporation Act, provides 

that '*(c) Corporations for profit may be organized under 

this Act for any lawful purpose or pur oses. 

under the provisions of Article 2.01B( f 

. . .I' However, 

)(a) no corporation 

can be organized under the Act if any one or more of its purposes is to operate a bank. 

It appears from your request that the uniform departmental construction of the office of the Secretary of 

State has been that the sale or issuance of money orders or 

travelers' checks constituted one of the purposes of banking. 

In Opinion No. WW-440 (pp. 6~7 and 9-12) this office 

held that under the provisions of the Business Corporation Act 

where articles of incorporation were submitted containing purpose clauses identical with or similar to purpose clauses authorized under the provisions of Title 32, Chapters 1 and 2, 

Vernon's Civil Statutes, and particularly Article 1302, without the qualifying words or clauses of limitation contained 

therein, such qualifying words or clauses of~~limitation would 

have to be added before you would be authorized to grant a 

charter or amendment thereto to a domestic corporation, or 

issue a certificate of authority to a foreign corporation. 

The purpose clause referred to in your letter of request specifically states that the corporation shall be "without banking, discounting or insurance privileges," and therefore it 

is not subject to the disqualification referred to in Opinion 

ww-440. 

You further note that there is no provision in Article 1302, v.c.S., authorizing a corporation to engage in business for the purpose of carrying on a general currency exchange 

business or issuing or selling travelers' checks or money orders. While it is true that prior to the enactment of the 

Business Corporation Act a corporation could only be formed in 

this State for one of the purposes authorized by legislative 

enactment, nevertheless it is a matter of common knowledge that 

one of the legislative purposes in enacting the Business Corporation Act was to permit a corporation to be organized for any 

lawful purpose, or, stated conversely for any purpose not prohibited by law, even though prior to the effective date of the 

Business Corporation Act a corporation could not be formed for 

such lawful purpose because the Legislature had not specifically authorized or designated such purpose as a lawful purpose 

for which a corporation could be created. 
_ , 

Hon. Zollie Steakley, page 3 m-w-503) 

The establishment, maintenance, and conduct of a 

general currency exchange business in connection with which 

the corporation could issue checks, travelers' checks money 

orders, and other negotiable instruments is a lawful business. 

State v. Currency Services. Inc 218 S.W.2d 600 (Sup.Ct. MO. 

1949). Therefore, since the pu$ose clause referred to is a 

lawful purpose you would be authorized to accept and file the 

proposed articles of incorporation unless the purpose clause 

could be construed to be for the purpose of operating a bank, 

and therefore prohibited under the provisions of Article 

2.01B(4)(a). 

We have already noted the qualifying words or limiting clause that the corporation shall be "without banking, 

discounting . . .'privileges." These words of limitation 

should be sufficient to render the proposed corporation subject.to forfeiture of its charter by appropriate legal action 

in case it violated its corporate purpose by engaging in the 

banking business. However, it is well settled law in Texas 

that a corporation may be chartered for the purpose of engaging in certain business activities which are also engaged in 

by banks without enga ing in the banking business. Xalis ki v. 

Gossett, 109 S.W.2d 3 6 0 34-k iCiv.App. 1937 error ref.); 

Be&m& 

SrW 2d 95 ",; 

ct n Cred 

(:;53, 

it Ass n v. Zeiss, 193 Tex. 152, 264 

For example see sub-divisions 48 and 

45 'Article 1302 and Article 1303tb), V.C.S., and compare 

Article 342-301;'Attorney Generals' inions, Bienniel Report 

of 1912-1914, p. 342; Attorney Genera ? Is Opinion No. WW-440. 

It is the opinion of this office that the proposed 

purpose clause contained in your letter of request is. for a 

lawful purpose not prohibited by Article 2.01B(4)(a). > 

SUMMARY 

The Secretary of State has the authority to 

accept and file articles of incorporation which 

include, in part, the following purpose clause: 

"To establish, maintain and carry on a general currency exchange business and in connection 

therewith to issue checks, travelers' checks, 
Hon. Zollie Steakley, page 4 (Ww-503) 

money orders and other negotiable instruments, 

but without {anking, discounting, or insurance 

privileges.t' 

Yours very truly, 

WILL WXLSON 

Attorney General of Texas 

CKR:wb 

APPROVED: 

OPINION COMMITTEE 

I 

C. K. Richards 

Assistant 

Gee. P. Blackburn, Chairman 

Wallace P. Finfrock 

Howard Mays 

Milton Richardson 

RBVIEWED FOR THE ATTORNEY GENERAL 

BY: W. V. Geppert