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

S&rah 29, 1939

ITOn. Ekrt Ford, kdminiatrator Liguor Ccntrcl RORl-d 6ustin,Texas

Liquor ooatrd1 uly 1lmltat.tion

e fl8 02 Taxa@ a8 bond8 thay sotild Liqlior aontror

on the abom atat8 Bapartmant. loi theTexasLIquQr
thlsAet&all beg

1 not oansal amy suretybond etp uompaay shall bats paid and iull sll‘@ ita liabllltyupon the St&#k%s the dats of #aId

. Thaw heldem of all pslnita.QXqaqufrad 8 and wtab **and** bear retailers,aball be to **make** bonds in aams of not le6a than One Tbouaand Dollars ($1,000)**and not**  **(IX oeedfng**  **Twenty-Five Thousend**  Dollars (#25,000). ~The Board 3.n

1t.a~ dieorationmay fir the amoant of bond wbiah shall bo mqtilre&for #oh olasa of psrmitte6a. All bond8 **requlnd** of permittese shall.

ba payable to the Stata of Tax48son. %I% Ford , i!aroh 29, 1939,

conditioned that so lone. GS holds such pemlt unrevoked ape 2

the arpllnant na wJ.11r,otviolate any of the laws of t!ilsState ralatlve to the traffl.o in, transportation, sale, or dslivery of liquor or any of the valid rules, or regulations of the i5oorG, and ir.the ease of suah pemittess as are regtiired to account for taxes and fees t!:etsuoh pemittees will account for any pay all permit fess and tax48 14vl4d by thla Aat. All bonds raqulredor pemitteee shall be payable in Travla Coanty, Texas. In all ln4taho48 where other perml~~ 4r4 raquirad,lnoidantalto the operationot a buslnearfor whiah 4 basla pennit is prooured, tha Boardmay in its disore~ionaoaept on4 bond to mpport all suoh penalts~ and in ruob amountsa8 it may requ%re..~ Art1014 $ClS, Revlsad Civil Ststutas,prorids among other thin@:

"(0) Thin

**kinda** of lneuranae'to bs arfaoted,whioh kinds oi fnsuranoe may **be** as r0ii0ns **:** 1. Irka lnuuranoe, rhioh tam shell be aonstmad to Ineludetornado,hall, oMtp and flaatsr luauranoe. 2. Autonobllaimmranoe, whioh term @hall be oonatruadto include Sire, thsft, tram-. portatlen property**damaga,** oollisionllab%llty and torna o lnsuranoa.

d 9. Llabllltylnsuranoe. 4. Warlns insuranoe. 5. Aocidsnt and health insuranae. 6; Burglaryand plate glass insuranea,
I. Fidelity and surety bonda lnsuranoe, 8. Any other kinds of Inemanoe not above speoltled,tha making or whioh is not othemlse utilawful -inthis State, sxospt life lnsnranae.*Ron. Bert Ford, Zaroh 29, 1939, Page 3

**Article** 5017a,Revlscd Civil **Statutes,** reads **aa** follone:

"The underwi-iters at a Lloyd's shall not aswme nor write lnsuranoe obligations in Texaa nor for citizens of Texas, nor covering property locited in Texas which prodace a net premiia income ii:exoess of ten times the net assets or such underwriters, and if at any time ths liabilities

aesumadupon auoh insursnoe shall produoea net prealum inoon greatar than ten times auah net asaeta than no further lnmuranoo obligationahall be assamadnntll the net aaa4ta have be4n inoreand so 4s to admit of addltlonal inauranoa4bllg&lona uhlah will **p@3gos** a prsmiuu inoomenot gmater than tan tl&& suoh net asset; provided that **whan th4**  net azaeta at a Lloydta.khall

equal the am of mqnay rhioh dll be raqulredof a atook imauranaeaompany doing the **44~4** oharabtsrs~of bualneas In Texas,.then his limihtiona up4n tha rolnma of bnslnaas to ba wrlttsn.sh4l.l

notrpply rtwther; provl.dadttuthar that if in the Judgmentand dlsaret~onof the Board of InsuranoeCommissionerssuoh underwriters (at) a Lloyd.8 ah411have atfeoted 'r4lnsuranoa,or other a4ntraots, wlth responalble and solvent lnsursnoeoarrlarsreduolng the nat linaa at risk oarried by auoh underwriters at e Lloyd's 80 that their aperations**4r4** safe and their solvenoynot in danger, than suoh Board aey ranaw or extand the lioenses of suoh undarwriters,lrrsspeotive of this limitation.4 Artiola 5017e, aupra, llmlts tha amount of aur4no4 obligationsthat an undaruriterof a Lloyd*% ah411 aosuma a'right in T4xas for 4itlzens of'T4xaa

- -_ ~_. Inor oorerlng**3roparty** looated in Tares whloh produo a nat pramium 3.noonrs in ex4asa of tan tLmes ths net aasets or suoh undsrwritara. This statute,by Its Ianguag4 or terms, does not'llmlttha amount of bondo that such undsrwriters

msy write nor does it imply euoh lllactations

by its provisions. Horever, under this 8tatuta suah undsrwrltars have th4 right to reinsurewith responsibl4

and aolvant insuranoeoarrlere,rsduolng the net lines at risk oarrl4dby suoh undanrrlterafion. ?krt Ford, Lfarah 29, 19S9, Page 4

80 that their operetiona are sere end their solvency not in danger; provided, that 5f in the judgment and disaretlonof the Roard of InsuranoeComlssi~~ners suah reinsurence 18 neoessery. ,A8 thSe applies to **iRSUP** enoe obli@.lms WC csnnot oonatruethis statute as applying to bonds that such underwriters may write wiiiohare required by Section 16, Article 1 ci the Texas Liquor Contr4 Aot.

You are sespeatfully advised thtit it is the opinion of this Departant that oompenleaorganized mdar Chapter 19 of the ItuuranaeLaw8 of Texna are qunlifiedto alto bond8 nquired under the Liquor ControlAot and that there 1s no l%mltatlan.on **the** .-Lawyers

Lloyd8 of Toxw" as to the amount of **bonds** they oan write for the Texas Liquor Control Board.

Trwtiagthat the foregoinganewersyour inquiry, we remala vary truly your6 **ATTOBBBY**- OF =X-M