HE 

### o~x=Y GENERAI, OFTEXAS

December 

### 31, 1957

HonorableHenry Wade DistrictAttorney Records Building Dallas, Texas

Dear Mr. Wade: Opinion No. 

### iiW-341
Re: Whether or not the County of Dallas Child Support Clearing Account Funds and the County of Dallas JuvenileDepartment, Child Support DivisionHolding Account Funds are secured under the bond of the County depositorybankswhen deposited with said banks without first passing through the hands of the County Treasurer. The following is extracted from your opinionNo. 

### 57-18 (datedAugust 22, 1957).

"Youhave requested the opinion of this office as to whether or not the followingdescribed funds are prevented from being secured by the collateraldeposited by the four county depositorybanks by reason of the fact that such funds do not pass through the hands of the County Treasurer: 1.

2. ;;uEg,of Dallas Child Support Clearing

; County OS Dallas JuvenileDepartment,Child Support DivisionHolding Account; (Youhave indicated that the funds deposited in these accounts are originally deposited in the MercantileNational Bank at Dallas, as clearing house bank for the four depositories, and distributed to all of such depositories)

. . "We e a . . . . . . . . . . . ..e . . . . . . .
are advised that in the selection of the county depositories,the Commissioners'Court of Dallas County, as provided in Article 2547,R.C.S., accepted a pledge of securities from each depositorybank, rather than the execution of a bond to secure the funds depositedwithHonorable Henry Wade, Page 2 (WW-341).

them. The conditions of the pledge agreement of each ccllnty depositoryare set forth In pledge agreements executedby each of them substantiallyas follows:

'Theconditions of the above contract are such that,whereas, the above bounden pledgor (DenosltoryBank) was on the 25th day of February,A.D. 1957, duly and legally chosen by the CommissionersCourt of Dallas County, Texas, as County Depository for said county for a period of two years ending,slxty,.,days from the time fixed by law for the next selection of a depository,upon its bidding and agreeing to pay the County of Dallas interest on "'timedeposits'" on daily balances kept in said depository of said County of Dallas at the rate ofper contract **Per** cent per annum, said interestpayable monthly. 'NOW,THEREFORE, if the above bounden pledgor (DepositoryBank) shall faithfully do and perform all the duties and obligations devolving on it by law as the county depository of Dallas County and shall upon presentationpay checks drawn on it by the county treasurer of Dallas County, Texas; on "'demanddeposits'"accounts in such depository; "'timedeposit"'

and all checks drawn upon any account upon presentation, after the expiration of the period of notice required in the case of "'timedeposits,'"and ' shall faithfullykeep sabd::county funds, and account for same according to law, and shall faithfullykeep and account for all funds belonging to the countywhich are depositedwith it under the requirements of Article 2547,Vernon's AnnotatedRevised Civil Statutes, and shall Include State funds collectedby the tax collector, &nd shall pay the interest at the time ana at the rate hereinbefore stipulated on "'time deposits"; and shall, at the expiration of the term for which it has been chosen, turn over to its successorall the funds, property, and other things of value, coming into its hands as depository, then and In that event this contract is to be and become null and void and the securities above shall be returned to the pledgor, otherwise to remain in full force and effect,hereby speciallyauthorizing the Commissioners'Court of Dallas County, Texas, to sell at public or private sale,with or without notice to the pledgor, the securities,or any part thereof,Honorable Henry Wade, Page 3 (WW-341)

and apply the proceedsof sale to the satlsfac**tion** of any indebtednessarising by virtue of the violation of any or all the conditions of this contract. 'Theabove provision Is given in addition to any remedy the pledgeemay have In any suit ;;n;tht;

on this contract in any court in this

. "Weare assuming that the value of the securities pledged is sufficient in amount to cover the funds mentioned In your inquiry,and this opinion IS limited to a conslderation of the security of these fundsby reason of the nature thereof. Although the languageused In the pledge agreements substantiallyconforms to the statutoryrequirements set forth In Article 2547, the depositsmentioned In your letter are not specificallydescribed in the pledge agreements as being secured. "However,on the date of execution of the pledge agreements, February 25, 1957, therewas in effect a statutory provision for the security of funds collectedby county officers In their official capacity,which are deposited in the county depositoryby the County Treasurer. Article 1656a,R.C.S., which provides for this security,reads In part as follows:

'TheCounty Auditor in countieshaving a population of one hundred ninety thousand (190,000) or more according to the last preceding or any future Federal Census shall prescribe the system of accounting for the county and the forms to be used by the District Clerk, the District Attorney and all county and precinct officers and by all persons In the collectionand disbursementof countyrevenues, funds, fees, and all other moneys collected in an official capacitywhether belonging to the county, Its subdivisionsor precincts, or to, or for the use or benefit of, any person, firm or corporation;

. . . All of the fees, commissions,funds, and moneys herein referred to shall be turned over to the County Treasurerby such officer as collected,and such money shall be deposited in the county depository in a special fund to the credit of such officer and draw interest for the benefit of the county,which funds,when so deooslted in such depository, shallbe secured by the bond of such depository.

. . .' (Emphasisadded) 'TheAttorney General of Texas, in his Opinion WW-86, datedApril 5, 1957, has ruled that the amendment to this act, which purported to manditorilyrequire the deposit of suchHonorable Henry Wade, Page 4 (Ww-341).

fundsby the County Treasurer,was unconstitutional, but that the act was effective ,a8originally enacted, and that such funds should be depositedwith the County Treasurerwhen required by the County Auditor.
"In construing the pledge agreementswhich were given under the authority of a statute, It is presumed that the intentionof the partieswas to execute the agreement as the law required, and the statute constitutes a part of the agreement as if incorporatedin it. Crane County vs. Bates, 90 S.W. 28 243 (OpinionAdopted by Supreme Court); New Liberty Common School District vs. Merchants and PlantersBank, 273 S.W. 330, (Writof Error Dismissed);American Surety Company va. Tarbutton, 248 S.W. 435 (Writof Error Refused); 10 Tex. Jr. 316.
"Wewill consider the

. . . .bank accounts mentioned in'your letter separately: 1. County of Dallas Child Support Clearing Account
We are advised that the funds deposited in this account represent paymentsmade for the care and welfare of specificallynamed children, which paymentsare made to the Chief Probation Officer of Dallas under orders of our District Courts, to be disbursed promptly by payment from the Chief ProbationOfficer to named individuals. Unless the procedure prescribedby 1656a is adopted, it is our opinion that the moneys deposited in this account do not constitute a deposit secured by the pledge agreement. In the event,however, that the procedure prescribed in said article be adopted, the fundswould then be securedas specifically providedby that article.
Count of Dallas Juvenile Department,Child 2* &t-i%visron HoldingAccount
We are advised that the funds deposited in this account constitute support paymentswhich have been made to the Chief ProbationOfficer under order of the District Courts In those situations where the named obligeehas not been located for paymentby said Chief ProbationOfficer. There are also deposited to this account sums of money ordered to be paid by District Courts to named individuals for restitution of damages caused by juveniledellnq,uents'.. Further, this accountHonorable Henry Wade, Page 5 (w-341).

representsmoney to be disbursedby the Chief ProbationOfficer in providing for the welfare of wards of the county.
As the funds deposited in this account are largely to be used in making payment for the use and benefit of named individuals, It is our opinion that the principalpart of such account is not securedby the pledge agreement of the depositorybank unless the procedure established in Article 1656a is adopted; and In the event that such procedurebe adopted and required by the County Auditor, such %ccountwould be secured under the terms of the pledge agreement as set forth In said article."
statement this In our opinion the foregoing is a correct of the law and aa euch is adopted as the opinion of office.
SUMMARY Funds of the County of Dallas Child Support ClearingAcco,unt and County of Dallas Juvenile Department,Child Support Division Holding Account are not sec,ured under the bond of the County depository banks, unless these funds are deposited through the County Treasurer, or there is an express contractualagreementwith the County depositorybanks to that effect. Very truly yours, WILL WILSON Attorney Genera1400f Texas

GC:mg APPROVED: OPINION COMMITTEE
Geo. P. Blackburn, Chairman
J. C. Davis, Jr. John Reeves Leonard Passmore MiltonRichardson By Jr. .I

REVIEWED FOR THE ATTORNEY GENERAL By: JamesN. Ludlam