DAN MORALES 

AlToRNEY GENERAL 

QBffice of tfy SZlttornep Qikneral 

Qtate of IlIlexae 

April 20.1992 

Honorable Jack Skeen, Jr. Opinion No. DM-108 

Smith County tlimhal District Attorney 

coulItycourthouse Re: Whether rule Bll(c). of the 

Tyler, Texas 75702 Rules and Regulations of the Smith 

County Bail Bond Board which prohibits an original bail bond applicant 

from executing deeds of trust in 

property as security for obligations incurred in the bonding business is 

invalid as inconsistent with article 

2372p-3, V.T.C.S. (RQ-205) 

Dear Mr. Skeen: 

You ask about the validity of a rule adopted by the Smith County Bail Bond 

Board (hereinafter the board) under which original applicants for bail bond licenses 

must make the statutorily required security deposit in the form of a cashier’s check, 

certificate of deposit, cash or cash equivalent, but may not execute deeds to real 

property in trust to the board in satisfaction of the security deposit requirement. 

Article 2372p-3, V.T.C.S., governs the licensing of .bail bondsmen.by county 

bail bond boards. Section S(f)(2) directs the board to “issue licenses to those 

applicants who qualify under the terms of this Act+” Section 6 provides for the 

application for the license, the board’s inquiries to determine the applicant’s 

qualifications, and a board hearing on the application. Subsection (a)(4) of section 

6 requires that the application include a “statement listing any nonexempt real 

estate owned by the applicant that the applicant intends to convey ‘m trust to the 

board to secure payment of any obligations incurred by the applicant in the bonding 

business.” The applicant must include in connection therewith a statement from 

each taring unit assessing or collecting taxes on the property indicating that there 

are no outstanding tax liens on it and showing the net value of the property 

according to the current appraisal. V.T.C.S. art. 237213-3, 0 6(a)(4)(B). Also, 

subsection (a)(5) of section 6 requires that the application indicate “the amount of 

cash or cash value of any certificate of deposit or cashier’s checks which the 

applicant intends to place on deposit with the county treasurer to secure payment of 

any obligations incurred by tbe applicant in the bonding business.” 

p. 540 
Honorable Jack Skeen, Jr. - Page 2 (DM-108) 

Subsection (e) of section 6 provides, in part, that if the board is satisfied with 

the application, it shall tentatively approve it “subject to the application being 

perfected by the filing of the security deposits required of licensees under this Act.” 

Subsection (f) of section 6 provides in relevant part: 

Upon notice from the board that the application has been 

tentatively approved, the applicant .shall then: 

(1) deposit with the county treasurer . . . a cashier’s check, 

certificate of deposit, cash, or cash equivalent in the amount 

indicated by the applicant under Subdivision (5) of Subsection 

(a) of Section 6.. . but in no event less than $50,000 except in 

counties with populations of less than 250,000 persons.. . the 

amount.. . shallbes1o,ooo...;or 

(2) execute in trust to the board deeds to the property listed 

by the applicant under Subdivision (4) of Subsection (a) of 

Section 6 . . . which property shall be valued in the amount 

indicated on an appraisal by a real estate appraiser who is a 

member in good standing of a nationally recognixed professional 

appraiser society or trade organization that has an established 

code of ethics, educational program, and professional certification program, but in no event less than $50,000 valuation, except 

in counties with populations of less than 250,000 

persons.. . , the amount.. . shall be $10,000, the condition of 

the trust being that the property may be sold to satisfy any final 

judgment forfeitures that may be made in bonds on which the 

licensee is surety.. . . (Emphasis added.) 

In our opinion, the abovequoted provisions clearly contemplate that the 

applicant, in order to satis@ the security deposit requirement, has the option of 

either depositing a certificate of deposit, cashier’s check, cash or a cash equivalent, 

in the requisite amount under subsection (f)(l), or executing deeds to property 

valued in the requisite amount in trust to the board under subsection (f)(2). We do 

not believe the board has the power to restrict the statutorily provided for 

alternative means through which the applicant may satisfy the security deposit 

requirement by refusing to accept deeds to property in trust executed to the board 

under subsection (f)(2) in satisfaction of the requirement. 

p. 541 
Honorable Jack Skeen, Jr. - Page 3 t DM- 1 o 8 ) 

Section S(f)(l), gives the county bail bond board bmad authority “[t]o 

exercise any powers incidental or nv to the administration of this Act” and to 

“prescrii and post any rules necessary to implement this Act.” However, Texas 

authorities have held that the ‘board does not have the power to impose on 

applicants for bail bondsmen licences requirements different from or additional to 

those of the act. See Texas Fire & Casualty Co. v. Hanir County Bail Bond Bd, 684 

S.W.2d 177 (Tex. App.-Houston [14th Dist.] 1984, writ ref’d n.r.e.); Berur Cou@v 

Bail Bond Bd v. Deck&rd, 604 S.W2d 214 (Tex. Civ. App.-San Antonio 1980, no 

writ); Attorney General Gpinions JM-1057 (1989); JM-875 (1988). 

Jn Deckmd, the court held that the bail bond board was without authority to 

require that applicants meet the security deposit requirement by depositing a letter 

of credit in an amount greater than the minimum required by the statute, stating 

that the statute contained “no language granting power to make rules relating to the 

qualifications which must be met by applicants for licenses.” 604 S.W.2d at 217. It 

should be noted that at the time of the Deck& decision, article 2372p-3 expressly 

gave the board rule-making authority only with respect to “the making of bail bonds 

by bondsmen within the county.” See Acts 1973,63d Leg., ch. 550, at 1521 (former 

provisions of section 5(b) of article 2372p-3, V.T.C.S.). 

However, in Texas Fire and Gzualty Company, the court considered a board 

rule-, providing, as had the rule in Deckwzf, that an applicant must deposit in 

satisfaction of the security deposit requirement a letter of credit in an amout 

greater than the statutory minimum. Since De&&, article 2372~3 has been 

substantially amended. Acts 1981,67th Leg., ch. 312 at ,875. Section 5, subsection 

(f)(l) read at the time of Texas Fire and Cm Company, as it does now, that the 

board had power “to prescribe and post any rules necessary to implement this Act.” 

Nevertheless, Teaa Fire wtd Guualty Company reached the same result as L&&r& 

The court stated that under the security deposit provisions, with the exception of the 

minimtm~ amount set by the statute, “the appZicmr is to determine the amount of the 

deposit. The local rule takes this responsibility from the applicant and assumes it 

itself.. . . [and] thus impermissibly impose[s] additional and conflicting burdens on 

bail bond applicants.” 684 S.W.2d at 179 (emphasis in original).l 

lGmptvt Austin Y. Hanis Can@ Bail kkmd Bcnmi, 1% S.WCZd 65 (Tex ASP.-Houston [lst 

D&t.] 1988, writ denied) (upholding aboard’s denial of an apptication based oa applicant’violation s of 

the ad when previously liccnsut). cining Drckmd, the court stated that “the Board’s ability to review 

an applicant’past s record as a liceosed bail boadsmau dots not impose aa additional qualifieatioq 

bllrdeq condition, or rcsbiction in cxcas of or inconsistent titb the stahltory provisiolls.” 7% s.wJd 

at 67. 

p. 542 
Honorable Jack Skeen, Jr. - Page 4 (~~-108) 

Under the reasoning of Term Fire and Chualty Company, the board would in 

our opinion - by providing that only cashier’s checks, certificates of deposit, cash or 

cash equivalents were acceptable in satisfaction of the security deposit requirement, 

and not deeds to property - impermisst%ly usurp a determination which the statute 

leaves to the applicant. Section 6 in subsection (f)(l), (2) provides that the 

applicant may either deposit a cashier’s check, certificate of deposit, cash or cash 

equivalent, or execute deeds in trust to the board. 

Attorney general opinions on the board’s authority are consistent with this 

conclusion. Attorney General opinion JM-g75 construed the provisions of section 

6(f) to require an applicant to either deposit cash, etc., in the minimum amount or 

execute deeds to property of such value, and concluded that the board had no 

authority to depart from that requirement and accept as the security deposit a 

combination of cash and deeds to property in order to make up the minimum 

requisite amount. Attorney General opinion JM-1057 found the board without 

authority to license a person to act as bondsman in another county or to control 

collection of a bond in another county.2 

Again, section 5(f)(2) directs the board to “issue licenses to those applicants 

who qualify under the terms of this Act.” In our opinion, the board does not have 

the power to refuse acceptance, in satisfaction of the security deposit requirement, 

of deeds to property executed in trust to the board in accordance with the provisions 

of section 6(f)(2). 

You also ask whether, if the board must accept deeds to property executed in 

trust to the board for purposes of the security deposit requirement, it may 

nevertheless require “that a certain percentage of the allowable security be in the 

form of cashier’s checks, certificates of deposit, or other cash equivalents.” As 

dkcussed with reference to your first question, the board has no power to change 

the requirements of the act regarding the licensure of applicants. Section 6(f)(2) on 

its face permits an applicant to satisfy the security deposit requirement by executing 

deeds in trust to the board. Where the applicant executes such deeds to property 

%k note that Attorney Gweral opinion JIM-1012 (1989) which found that the statute gave 

the board w authority to prohibit a bondsman’s employment of persons comicted of c&ah crimes, 

wasovwrulcdbyDouprcarntyBpilBondBdv.Stcin,~lS.W3d~~uA~.-Dallas1989,writ 

denied). That court found that opinion’s r&nce 011 Dcckord and Tans FI and cizruo@ Gmpmy 

'misplaced... Shcc the Bail Bond Act expressly sets forth the requirements for a hose, U~ese. courts 

corredy rwsowd that the local boards Wed the authority to impose different or additional 

rcquinm~t~.... (Hlowcver,thcBailBoadActdocsaotcxpsslysetfortJ2e&&lityrqoiremenk 

for empl~ of iiculsecs. Thus, such analy& is inapplicable to the present case.” i71 S.W2d at 580. 

p. 543 
Honorable Jack Skeen, Jr. - Page 5 (DM-108) 

valued in sufficient amounts, the board does not have the power to require that the 

applicant additionally deposit a cashier’s check, certificate of deposit, cash or cash 

equivalent. (Also, as noted above, Attorney General Opinion JM-875, specifically 

concluded that the act did not contemplate the board’s accepting a combination of 

cash, etc.. and deeds to property to make up the requisite amount of security 

deposit.) 

SUMMARY 

A wmty bail bond board. is without authority to provide 

that an applicant for a bail bondsman License must make the 

security deposit required by section 6(f) of article 2372~3, 

V.T.C.S., in the form of a cashier’s check, certificate of deposit, 

cash or cash equivalent, and that he may not satisfy the 

requirement by executing deeds to property in trust to the board 

in accordance with the provisions of section 6(f)(2) 

DAN MORALES 

Attorney General of Texas 

WILL PRYOR 

First Assistant Attorney General 

MARY KELLBR 

Deputy Assistant Attorney General 

RENEAHXCKS 

Special Ass&ant Attorney General 

MADELElNE B. JOHNSON 

Chair, Opinion Committee 

Prepared by William Walker 

Assistant Attorney General 

p. 544