Honorable 0. N.Humphrey8

Acting Administrator Opinion No. M-213

Texas Liquor Control Board SamHouston State Office Building Austin, Texas 

### 78711 Re: Who, If anyone, maybe shown the notices, orders, records and publications in custody of the Texas Liquor Control Board, which are made “privileged” documents under Article 

### 666-12a(5), Vernon’s Dear Mr. Humphreys: Texas Penal Code?

YOUr request for an official opinion reads, in part:

“In Section 12(a), 

### (5) of Article I of the Texas Liquor Control Act (Article 

### 666-12a(5), ofVernon’s Texas Penal Code) it is provided as follows:

‘All notices, orders, records and publications authorized or required by the terms of this Act shall beprivlleged

. . .I”

The question presented Is stated as follows:

“Asaconsequence of the provisions of Article 

### 666-12a(5) ofVernon’s Texas Penal Code whomaybe shown the notices, orders, records and publications in custody of the Texas Liquor Control Board?”

Your request is in effect arequest that weconstrue the word

“privileged” as It is used In Article 

### 666-12a(5), Vernon’s Penal Code. Said provision reads as follows:

“(5) All notices, orders, records, and publications authorized or required bythe terms of this Act shall beprlvile ed

di S~kt~“of ”~~~~~ ~~“~~~~~ the that in all su

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State or Board Is aparty or parties, atranscript from the papers, books, records, and proceedings of the Board purporting to contain atrue statement of accounts between the Board or the State and any person, bonds, and all rules, regulations, orders, audits,

contracts, or other instruments relating to or connected with any transaction had between the Board and any person, when certified bythe Administrator or Chairman of the Board to be true copies of the originals onfile with the Board and authentlcated under the seal of the Board shall beadmitted
as prima facie evidence of their verity, existence, and validity and shall beentitled to the same degree of credit that would bedue to the original papers if produced and proved In Court; but when any suit is brought upon abond or other written Instrument, executed byany person and he shall by plea under oath deny the execution of such lnstrument, the Court shall require the production and proof of the same.

“In the event the Attorney General shall file suit or claim for taxes and attach or file as an exhibit any report or audit of said permittee or licensee, and an affidavit made by the Administrator
or his representative that the taxes shown to be due by said report or audit are past due and unpaid, that all payments and credits have been allowed, then, unless the party resisting the same shall file
an answer in the same form and manner as required by Article 3736, Revised Civil Statutes of Texas, of 1925, as amended byChapter 239, Acts of the Regular Session of the Forty-second Legislature, said audit
or report shall be taken as prima facie evidence thereof, and the proceedings of said Article are hereby made applicable to suits to collect taxes hereunder ~
“Acertificate under the seal of the Board executed byany member or the Administrator setting forth **the**terms of any order, rule, regulation, bond,
or other Instrument referred to in this Section and that the same had been adopted, promulgated, and published or executed and filed with the Board and was In force and effect at any date or during any period specified In such certificate, shall be prima facie evidence of all such facts, and such certificate shall

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beadmitted in evidence in any action, civil or criminal, Involving such order, rule, and regulation and the publication thereof, without further proof of such promulgation, adoption, or publication and without further proof of Its contents and the same provision shall apply to any bond or other Instrument referred to in this Section.” (Emphasis added .)

Todefine the problem with which weare presented with precision, weare concerned with whether an absolute or qualifled privilege was Intended bythe Legislature In the above quoted provision, and, if only aqualified privilege was lntended, then weare concerned with Its Intended scope - 1.e., whoIs It designed to protect and under what circumstances? Whywas the privilege placed In the act and howfar was It intended to extend?

Under Article 666-6(d), Vernon’s Penal Code, substantive rules and regulations of the Board are required to be published and they are clearly not Intended to bewithin the privileged category

. Likewise, under Article 6252-13, Vernon’s Civil Statutes, rules of procedure and practice in hearings before the Administrator
are required to be publicly filed with the Secretary of State’s office and are also clearly not Intended to bewithin the prlvlleged category D

It is equally apparent that the legislature did not intend (through making reports, etc ., privileged) to prevent the contents of such required reports, etc., from forming the basis for Informed admlnlstratlve or legislative action, since such books and reports, etc., as are required to bekept under the Act are clearly Intended for the sole purpose of allowing the intelligent regulation of the liquor Industry.

The word “privilege” has avariety of meanings according to the connection or context In which It Is used. 72C.J.S. 951, Privilege. From the plain language employed bythe legislature in Article 666-12a(5), It Is clear that the materials listed are not absolutely privileged but that only aqualified privilege Is intended -1.e*, the privileged nature of notices, orders, records, and publications authorized or required bythe terms of the Texas Liquor Control Act does not prevent the use of such materials in suits to which the State or Texas Liquor Control Board is aparty.

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Regulatory provisions of this nature are frequently “aimed simply at imposing upon the staff fif an administrative agency 7
aproper silence in everyday intex?Fourse outside of the officeand at defending the records /?if aprivate business nature 7from the intrusive scrutiny of the-public havin no interest thFrein.” VIII Wlgmore OnEvidence 792 (3rd Ed. 19407

. Such was the apparent purpose of the Texas Le

### 7islature through Article 

### 666-12a 5). In making records, etc., prlvlle~~-d The public interest In efficient regu latlon of the liquor Industry 

### maybeeffectively served byencouraging, to the extent possible consistent with the Act’s purposes and objectives, full disclosure bythe licensee to the licensing authority. Conversely, no public Interest would be served bymaking personal business information pertaining to the operation of licensed premises generally available for the use of actual or potential competitors of the licensee. However, when
aprobable violation of the terms onwhich the license Is granted Is disclosed byrecords filed with or inspected bythe Board, or is disclosed by inspection of the premises themselves, the considerations supporting the privacy of such business information
are outweighed by the gubllc interest In effective enforcement of the liquor laws. Article 

### 666-12a(5) expressly provides that records
are subject to disclosure in such instance (as is obviously necessary to serve the Act’s intended regulatory purposes.)

The law Is pertinently stated In VIII Wlgmore OnEvidence 761 (3rd Ed. 1940):

,I

. . .fl %ere the Government needs information for the condiicr of its functions and the persons possessing the Information need the encouragement of prlvacy in order to be Induced freely to make full dlsclosure, the protection of aprivilege should beaccorded.

“It Is some such principle 

### that justifies the modern creation of anumber of privileges, all statutory in origin, covering sundry matters required by law to bereported to some administrative official.” Wlgmore concludes the above quoted dlscussion of statutory privilege, in part as follows, supra, at page 801:

“Conclusion. The privilege, when recognized should

. . .be subjected to the following llmltatlons:

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“(2) Any statute declaring in general terms that official records are confidential

. . .should be liberally construed to contain an Implied exception for disclosure when needed in fi7 court of justice .I’ --

Article 666-12a(5), and Article 666-15+A(7), Vernon’s Penal Code, relate generally to the same subject matter, are In par1 materla, and maytherefore beread together where the terms of one of the sections standing alone might beambiguous. Pursuant to the above reasonin Eand authority, the limited privilege described In Article 666-15 A(7), although not directly applicable by Its terms to dealings with all types of licensees, maybe deemed to be the type of privilege which was intended InArticle 666-12a(5) - i.e.:

11

. . .Nosuch state officer as herein provided shall make public or use documents or information derived In the course ofexamination of records or documents except In the course of some proceeding In which the Board or the state is a party, either judicial in nature or In an action Instituted to suspend or cancel the permit or to collect taxes due or penalties for violation of the laws of this state, or for the Information of any officer of this state charged with the enforcement of its laws.”

In response to your question, you are advised that any officer of this state charged with the enforcement of its laws maybe shown the notices, orders, records and publications in custody of the Texas Liquor Control Board, which are made “prlvlleged” documents under Article 666-12a(5). Such records, etc., mayalso beproduced in the course of some proceeding In which the Board or the state is aparty (either judicial In nature or in an action instituted to suspend or cancel the permit or to collect taxes due or penalties for violation of the laws of this state), and maybepresented to the legislature for study in enacting lnformed legislation regulating the liquor Industry. The business information furnished by licensees or obtained bythe Board through inspection of licensed premises isnot to bepublicly disclosed except for such purposes and to such authorized officials except where such Information has become amatter of public record as a result of legal proceedings of the nature specified, Including

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Honorable 0. N.Humphreys, page 6 M-213

hearings before the Administrator regarding violations ofTexae liquor laws.

SUMMARY
------- Anyofficer of this state charged with the enforcement of its laws maybe shown the notices, orders, records and publications in custody of the Texas Liquor Control Board, which are made “privileged” documents under Article 666-12a(5), Vernon’s Penal Code. Such records, etc., mayalso be produced in the course of some proceeding In which the Board or the state Is aparty (either judicial In nature or In an action Instituted to suspend or cancel the permit or to collect taxes due or penalties for vlolatlon of the laws of this state), and may be presented to the legislature for study In enacting informed legislation regulating the liquor industry. The business Information furnished by licensees or obtained bythe Board through inspection of licensed premises Is not to be publicly disclosed except for such purposes and to such authorized officials except where such information has become amatter of public record as aresult of legal proceedings of the nature specified, Including hearings before the Administrator onviolations of Texas liquor laws.

V ytruly yours,

e d-*G AWORDC.MARTIN **Att** ney General of Texas Prepared byLarry Craddock Assistant Attorney General

APPROVED: OPINIONCOMMITTEE
Hawthorne Phllllps, Chairman Kerns Taylor, Co-Chairman W.V. Geppert Dyer Moore Harold G.Kennedy Dunklln Sullivan

A.J. Carubbi, Jr. Executive Assistant

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