OFFICE OF ‘THE ATTORNEY **GENERAL OF**  TEXAS AUSTIN

Attmatioa: 0. **P, Saadorr** 

**Aaal~t-3oouriti.r** Dirlaion DOWSir1

addreeeed to the

nre lrrw alnoe 1934 'iootag~~sold prior

MOM0r yoourqueibtloa ha8 resulted in a al OS the entire law goreanl~ the organization and opem$lon or oometery aasooiatioas In the state of Teaaa, amwell an the publie p01i0p that proffipted the Legislature to armnd Title 26, Vernon’e Annotated Xatutes in Aots 1934, 43rd Lsgialature, 2nd Called ~esslon, Chapter 6i.&tiolo 925, Yunon'a **Amotet. 3tatut.r**  **61 2~x.w** 

**prorid. t&t** 

mhuyo owtuyl

rroolatton whloh ha, l atab- ~laJ$ and ir nm 

### mbtabdag, operating an4 eona oowtuy an4 wrry araoolationrhloh mho.llLmttu rrlablieh smlataln opuato sad/or oolrbuot a owok 3' rid thla stai. urdt to 

### thin Ao8, 18hue y wthoriud to orta ish
. . . & aa lmdaolblo fund for the geneal porprtual oan

TM8 Artlole rllrtlwr pro+lu*8 t&t thla trurt fund Vmll forovor remain lrrrduoiblo end lntiolablo", and ahall 

### .bo iavo rtod

l **ooordlrq to**  **law the**  not **boom fmrn**  **raid** law&0 **moat** to %a omd rololr for cha gonoral oan, mlntmmoo, and abelli~t or the ouwtuy*.

Art1010 925a 

### roqulrouthat

“A pupotorl oar@ 

### aaamtery 16 on0 mhhh 6h8ll hueatkr depotit in it& r rpetuel oar0 funa M provided **aadu** the prorim ona of Art1010 5 an 

### womat l qplralont to a mlnlmtu 

### or**Two&y**20) 

### ooatr 7 

### par **rqm** foot 

### ai groundof %ntermsnt right l 

### oU OEdlrporod 

### ot ampupdaml oare 

### property for o8rtlb latemoat, 

### uatll wohtund naohw a mlnimm .oOOao RUE&~&Thoumad Dollar8 ($lOO,OOO.OO~, and the 

### mlaimum

thonafkr ehallbr Tea (10) Coat8 

### rqoaro 

### rwtj a mlaimm or Ffftwa Dollarr ( &O) % par l aah oryp% latonaent rlsht 8old or dlepo8ad ab as perpetual oar0 property 

### formrosalouu 

### latumnt, aaaa ainlmwof Fite’Dollare (#WO) par*ash 

### aiohe informoat 

### ri t #old 

### or dia oroUof a0 potwlauo proper 

### yfor oolumba orlatorm&n.

eh r! rAll 

### other oaoterlrr huetotorb’ opmatlfu l 8 norpotrul oar0 oewtuler r&all, with%8 one mar froa the l ffeatfre **data of**  **thlr Aot,**  wtahllrh 

### their trust ftantla la oaah 

### or **legal** rwiirltloo in ooafora**ity** with the protirlonr thoruof and In th* Waat or rame **w** to **do, ahall**  **not** 

### thuraftu **oxmate** a8 a porp4tual aarr or in0 aaro rmotuy until the pro~lrlona hereoS:are wapllod with." Artlolo 

### 929 **roquirrr** l aoh 

### perpetualouo 

# oaatuy to ii10 ia ltr offloe 

### l r-wall a8 the off100 or ,%hthr 

### Sooretu7. _..
‘701

Honorable Wa. t. L8wWn~Pae* 3

**o? Stata,**  a statomant o? the 

### amount of prinol potwl oars Sand, 

### thenabaroof tha 

### ln~ortwa olpal ?und, the nunborof 8quuo rooti of gram spoo aad **the** auubu **OS arf911,**  **u8d** 

### a aumbsrof nlehea dlspor& o? 

### wdu perpetual oan, prior to snd subsoqrunt to the lnaotwnt of thl8 Artlolo, oaoh srwntoly rot forth,

Artlols 916 states that -0 tom8

**lowmtuy** l

swolatlon’ and *a8wolatlon’ are hour&~ tued Iatrroh mean say w oration mm or

% or 8ay a8.wo tlon not 

### opemted $0~ a 1s or shall **be** authorltod **by** it0 l rUoles to’oo~l.. duot amyone or mom or all of ths 

### bwlaosrrr of 

### a oeaetuy.w 

### T&aqlwrtlon 

### you 

### prosent ir whether oaeto 

### 7 aagooIatloas, msanlng wrporatloa8 e non-profit uwolrt oas 

### opuatlng ar pupotwl oar8 aaumterlrs, must l stabllsh a trust deposit, as 8ot forth In ArtIolr 925a oaloulatod upon sales o? psrppetual oarr lntumont 

### prop&y ooounIng **ba** 

### fore the parragoa? Artlolr 

### 925a In 1934, or marely u on all emlo8 or suoh lntermont rl&htr 

### ooaurring a?trr 19 bV P Perpetual oars 

### awotuy oontraotr ~IWOSO upon the **ornmtsry** aswolatlon t& 

### l ndurir rg

**dutg of**  **foruu 8mhg**  for and propsrly maintaining the owmtery as a plaoo o? kautl**fled** sepuloher
. Those who **buy** puptual oare omotrry rights often do w in their hour o? **beroatemat thlnkfrq**  onl sultable nmorlal to their dseeasod 

### kinwta, 86d an 

### susooptibloto the promlsos of a **promotor.** ml8 ww **traot** to be po#?mod by the aswalatlon parprtually, **aad** the peoullar position or thorn who aoquire ths rpstual oars interment right*, not only jostf?lo8 but r no0088 

### %atM a $orous oontrol ot perpWul oar@ oamoterles 

### by the Stat& those endr), the Lsglslaturo has 

### oaaoted Artlolrs 9% 925% **925b, dertgnod**  to ?ul?lll the 

### oontraotobllgatlon of 

### o-tory assoolatlons, to protrot thorn who purahaso Oh80 rbhtr, and to l

aforob sultable malntenanae o? the buIldi 8 Upa gm.md~ ?or thm 

### knrrit or the wmualty in 

### gem l-2. I r Suoh loglslatloa, without doubt, 18 r0MtltutlOlul

md propem Vho State la the uarslao of ltr polioa Dowor 1 haa t&0 rlght~ to **proride** ?or the 

### l stabllshesnt 8ad dlroontlaI ~00 or 

### oerartuho ud t0 

### rqmlate ttmirus*.” 14 

### aor. fur*

i sea, 63, sootlon 2.~Eonoesblo Wm.t. L8nab Pago b

Fa+@oraorr ~thow 

### l **aotory 88m818tiaa.~**  **tgmrrtlng** under the prlvIlogo or l lor ?8to l h8rt.r 8Zo 8Pb sot to ahUUIII# roplatlons and dutr08, for th8y t8ko t&uir 4o r8k

l h8rt.r dtb *o rl 

### t l xprossly roseno(.to tKt.to 0 f *altar, rofom, or smsn *. &tlolo 1310, YornoS'1 Ammotat.6 %Bt\ltW. %OBO n@BtiOBS Of l MOtO?~

SOlpOlí8~iOli8 wd l S8.4~4tiOS8 OBB k s~&WtOd, th.Wforo, ..d.; the go1100 porr oi tbo St8t.j 

### or **under** th8 rosonod penor l? the **St8te** mar 4orpor8tlons lmofrr ls three rogulrtlonr por8ala to oomotsry 4orporstloao.

mc, qUOSt:W 10, thU.?aPO, rhsll th.8. rO~8tlO.s bo applied to $ho8. tTS.BoOtiOSS , wnt8aplstod la Artlolo 925, whIQ 

### mruma betore the l n88tmSat of this Artiolo 8s well 48 thO8e **OOOUtin~** l ubS.qU.nt th0r.t.‘) ‘fh.3’
. 18 1pO h~)S6. within thrso strtutos, 

### ~otornlng porpotusl 041~ o8motorlos, lnflI4*tIag 811IStontloS Of the k#iBttUrO t. wosrifno tb ap

### pliO4tiOa **O? thO8O** **’ ~4@..~8tiOBS**  **t0 84148**  **O? lOtI**  OOOUMill(r situ 

### t&4 rnrotmsnt in 1934. PO the 4ontrsry. homovor, 

### Art1010 925s ,nr.rldos,

"All other **04mOtOri48** horototoro OllU8tim( 88 porprturl 04ro ooaotorIos shall, within one you fro. t88 .itastiTr dSt. d **thi8 AOt,**  l st4bl1sR their 

### trust fund8 in oash or legal 8orurltIrs la ooniarnity 81th tt. 

### proTidon8 tbuoof, and in thr 8V.a Ot f8ii~O **SO t0**  **de,** l 

### hBll **rPOt t&S,rOBftB?**  **OpWBtO** 8s 8 ~a~atrrslosr4 or fro* 

### oar4oemotory ontll tho

~rOTiSiOXIShOrOOf l?O BtS4p11.68itka n0 deemit slgniflosnt th8OA?t:s1e 9258 &WtBinily to the oslsulstlons of the trust doposIts is **aou8hod** in laa- &3lB@ Ot 

### th8 DBSt tOllSO, t0 Wit1

.A 

### pupoto8l Bars soWtOry is one rhloh shrll hero8tt.r 6OpOBlt la Its porpotusl 

### 4uo faad

. l . 8n SElOUStOttitBlOJXt

### t0 0 4llSi.S. & ?..Stf (20) Cents par squ8ro foot of g0ttfia of lntrrmont r-8 S&d 0l'diBDOB.d Of SD pl'P.tuSl .Sr. fPOp.Fty f.r l 

### grth **iL¶tomO5t.**

**.** .; a dnlmm af Flitson Dollsn **(315.00) per**  ***sob** rrypt Intorasnt right rold 

### or &18p0844 or as pupotw8l omro poporty so MWOhum Intrrrarnt, and l ninImua oi Fits Dollus ($5.00) parecrsb niche lntomat &ht 80ia or dlrpoaed a? 88 perpetual earn nroporty to oolur**lmriua** intomoat. g **(ufidr~i11dRg** 

### l **Uppiid.)**Honorable wm.

### J. Lam a, Pago 5 

### ‘703

Rad tlu Lagialatura latando6 to lldt tha tnmt drpoalt to mu0 0010~ or porpatual ran la th. ruturo tonao propart I' languaga dlrpoaa or’, 

### ror l xamplo, ‘whloh thy ml1 aall * 

### 01 loo U i hararrtor~, = uld hare km rpp?oprlata. Tha ngulatloa or parpatual **oar0** ormatrriaa ooatan lmtoa that tho not lnooma or tha lnroatmd trut fund ir to !a uaad to aaiatafn th6 rntiro prrpatual oara oorwterr Ii **the rund**  woo **oraatad only**  **out** 0r thoaa prpotual tit.& moat rlghta rold **sitar** 1934 the burden on the.8 lOto, OrJpto, and nlohoa, aold **ritor 1934** would **bo** onaroua, lnaawah aa the inO~66 Or thi0 rUnd WOPS~ b0 UOO~

00 flMnO0 the tlpk0.p 0r th0 ontlro porpotual oar0 propart 010tion. ‘
-‘rthink thla warnnot th, ;r or th0 **oaniotor~ ama** 
**l*tlU..** **dantlon** of tbr **La@,.-**

Art1010 1, Toxaa poridaar z?ootion16, constitution or **tbr wt.**  or

**VO** bill of attainder, ox post raoto law, r6troaotlra law, **or** any law impairing tho obll**gatlon** or ooatraota, aball be node.” Willa the Oonatltutlon or Toxaa olaarlf rorblaa the paaoago ot rotroaotlto lawa, it lo our opinion that the lam. in quratlon do not ooma within theso oonatltutlonal rohlbl tlona. % Thorn oan k no doubt thst th6 ~glrlrtloa quoatlon would ba oanatltutlonal ii It required all oomatarloa aalllng perpatual car0 rl&ta to naintaln a oartaln oapltal **atook,** or to **oroato a**  **truat fund**  **or a**  **oar** 

### taln amunt datom.lnod by tha alzo or tho oomatary bualnaaa, inannrruoham thla tJp6 of ragulatlon baa **bean** uphold In 0th~ ri0id00r law aa ooaatltutlonal, notnithatanding tb oontantlon that euah ragulatloa lmpalra tha obligation oi a eontraot, mad warnunoonatltutlonal 60 a ratroaotlva law. In Jmrrrrson County Tit18 buaranty Company f. Tamor, 29 c, W. (2) 316, the 00d8810n Ot Appoala atatadt

wo **rurthor** hold tht It la tha l ottlo6 **b w**  0r this atat. and 0r thr 

### untra .etatoa that a Qorc poration auah amthia hamco VoatOd rl&t in t&O pri~llogm or doingi **a** tit18 **guaranty** bualnoaa 00 a 00rpOratlOn lfxl thgr8toro atirarano Los8 of an r.atod rlgbt or @m-rtr fn 6 oh*ne h the *toIutO law raqulrlng larger 0ap5.tOl ICoOk tO OOntiOw bualnaaa

!ntho l**tata.a**

### Honoralla Wa. J. Lawaoo, Pap b

Alao in Daaiel 7. Ttmll **and** ClarthIraatmat Oonpr~, 

### 93 @. W. (2) 372, tb LSuprmoCourt or Taraa l tatod: “It Ir **oontaadod by**  Trrrall 

### and Oartb that the mloa 

### madn8ulr$Ionr (Iaauran80 C00daaionaraf r&mtad by the ~mr( Ii y authority or 0 law whlah 

### kaaam l

**iirrtiva artor**  **the** aoatraat ktwara it and tha tltlr rompany woo l **ntar*d** into, l

aaAot ba applIod 00 00 to **rtirat** aaab p rarloua l oatraata. We07rrrule thla ootentloa. The pollor tb 

### atit. to regulate tb bualnara oi tit P omor oi l inaulc *nom, **aa to**  r **ormo** 

### 0r **oontrrota** urb ratoa, oanaet ba ocmtraoted arrr **by** tLr tltlr ampaq.~ 16 Corpus Jurir 

### Srauuduai 417 stataa, *Oatha otbr hop& &es lte tlwlr titrmatitc, **apwatloa,** l

**tatutoa** rra uphaP

d wJUh have ao adterse l

rreoa on trotad 

### or l ubataatIal ri&Oa, or 

### maral~ mgulatr rights, 

### (oltlag Danlal ‘I. T~rall aad Oarth Iatratmna Ooapaay, 93 9. W. (21 213) **or** 

### ohawe their r0rr, 

### partioularl~ mhara muoh lc ~1010tIoa la in tb **proper** l xeralaa or palIar **power,** ur whIah loaaernatlm publla Intaraat or mlater aarol~ a0 ~ovarnaaat mattara.W Llkarl8a wa do- the lo~alatloa la quoatlan to ba aonrtItuaIonal am a proapratlTa regulation rathrr than a ratroa*tIta ngta0ai0n in its lntana and l **oopo,** albeit tranamotiona both prior **and** ,aubaaquukt to the l naotmaat of this ~o~~l*tlon or0 oonaldand in aaaaurlng tb ragulatlona lmThis lr a ra(ul8aioa prorp~atlta Iwaharaotw althou& pradloatr4 **upon** part 00 well as rutam 00100 of pspaw1 

### aaro iatarama rtht ama maana of mraaurlw tha obllgatIoa iapoao~

Youl ra ahorarora l

6rlaad that Artloloa 925 and 

### 9250 ocapel 011 omatorf aaaoolatloaa dralrlnd to ooatlnua 

### ~rimaa aa parpetual 

### oars or~aterlaa, amdailaad In the **Aot, to**  **build** up l trust **fund to**  the l **tatutor~** raauvar oaloulotma oa 

### footap, and/or orrpt Iator-nta, -a/or aioh*

### 705

’ Honarabla h. J. 

### Lawson, Pago 7

intorunts rlghta 0014 **prlor** totha

l aaotm*nt 

### 0r tCo80 

### mla188, ma well am thoaa l 

### olb

### l ~baaqu~nt thereto.

Par) truly 

### Joura f OEXEPAL

OI TXXAS