August 27, 1940.

Hon. J. M. Falkner Banking Commissioner Austin, Texas, Attention: " Mr. H. L. Bengtson, Deputy Commissioner

Dear Sir: Opinion No. V-673.
Re: The necessity for a Texas corporation to maintain complete books and records at its HomeOffice rather than at the office of its parent company in another state.

Your letter requesting an opinion by this office on the above titledsubjectmatter is as follows:

"Re: Community Finance and Thrift CorporationDallas, Texas
"Dear Sir: '"Theabove ,captioned corporation is a Loan and Brokerage Company, organizedunder the laws of this Statewith Article 1303b,Revrsed Civil Statutes of ,Texas,as amended, as its purpose clause: Its charter defines the City of Dallas, Dallas County, Texas, as its principal place of business. The capital stock of said corporation is $50,000.00,all of which has been paid in. Subject corporation enjoys the privilege of issuing and selling singlepayment and installmentpayment certificatesunder the provisions of Section 7, particle 1524a, Revised Civil Statutes of Texas, as amended by Acts of 1945, 49th Legislature, H.B. 430. Collateralizationof certificates issued in compliancewith the amendedportion of Section 7 of Article 1524a seeminglydoes not apply to corporationshaving a minimum capital of $50,000.00where such sales aremade to debtorswho are at the time indebted to the issuer, but does obligate the Banking . .’Hon. J. M. Falkner - Page 2 (V-673)

Commissioner of Texas tomake examination to the same extent as if collateralwere required.
"As a matter of further explanation, the subject corporation is reported to be .a wholly-owned subsidiary of the Family Finance Corporation, a Delaware corporation, which corporation owns all of the stock of its subsidiaryunits and controls their operations through Security Bankers Management Corporation,Wilmington, Delaware. "Subject corporationhas also established approximately seven branch offices in Texas and, from a supervisoryrtandpoint as related to the examining responsibility of this Department, it is the considered opinion of this office that the corporation at its principalplace of business, as defined in its charter, namely, Dallas, Texas, shouldmaintain a system of record controls as it affects itself and branch offices, which will enable the Banking Commissioner of Texas to determine from an examination > of such record controls the financial condition of the corporation, The fact is that all records of theDallas office, as well as those of its branah offiaes, are maintained at the office of the Family Finance Corporation ,at Wilmington, Delaware, the result of which makes it wholly impossible to determine from an examination the solvency of the domestic corporationwithout consulting the records at Wilmington, Delaware. "Therefore, the questionwe desire to submit to you for an opinion is:
"As a Domestic Corporation,would it not be compelled to keep andmaintain all books and record controls at its defined place of business rather than at the office of the so-calledparent company in a foreign State?",-

18 Bon. j. M. Falkner - Page s (V-673)~

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We are of the opinion,~ your question shouldbe answered in the affirmati~v'e.

Arti’clb 1358'

~of,'. &he:Rev!i,sed, Civ.il'&at,utes, governing private corporations,' declaresi;::,+.:

~,.,, "Each corporati'on or joint -stock'company'~ofevery description,whether organized and acting under a,special charter or '3 general law,,,of

'thi.s~,state,

shall keep its principal office within this state." NC& the w&d. "office"as used here does not mean me,relythebuilding and furniture. It means the place of transacting,i.ts corporatebusiness in the ordinary way thatcorporate affairs are transacted,and includes all pr,oper and necessary books, records, files, and the like.

One of thereasons for this requirement, if reasons for.the statute.wererequired,has been stated by you. The corporation IP subject to visitation and supervFsion~,.Py.

theBanking, Commissioner,who transacts his official-bus:inessWithinthe territoriallimits of the State, except in those instanceswhere, he is specially authorized to go beyond. A further and similaP reason is found in Article 1366 of the Revised Civil Statutes, declaring:

"Every corporation,domestic or foreign, doing business in Texas shallpermit the AttorneyGeneral or any of his authorized assistants or representatives tomake examination of all thebooks, accounts, records,,min- ' utes, letters,memoranda, documents, checks, vouchers, telegrams, constitutionand bylaws, and every record of said corporation as oft&n as he may deem hecessary." This contemplates that such examinationmay be donewithin the State of Texas where the corporation has its principal place of business and not in some other State in the office and possession of some other cor- ,porationnot under the supervision,or subject to the examination of the Attorney General.-. -

Mon. J. M. Falkrier- Page 4 (V-673)

A corporationorganized and doing business under the lawn o$ the State of Texas is required to keep its books and records at its principal office in the State. Ycurs very truly, 

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0S:wb Assistant