OFFICE OF THE ATTORNkY GENERAL OF TEXAS 

AUSTIN 

’ GROVER SELLERS 

ArrORNEY GLNLlllrL 

: ; 764 

Penor8ble II. A. Juisea 

cemiSdOXWe ~jW@IIOXIt Or m~khg 

Au attn - 14 0’ %x8S 

De8r Yr. Julsm: opinion Ro. 04lwT 

Iour lottor 

i. 88 ?0110*8: 

rit to do bu 

018, 4.8 8ppF48Oboplnioa regwdiag 

d w OIlI' OpOOi81 

pomtlon ~hosa home oft300 la ia lQwin,@ield, 

vhioh time OlaOnt 08ll80S OUr inqUiW lVll8tiVO 

to expenses to be 00p0ooi8lYf pertinent. 

Smhe qUeStiOXl tb8t OOllO8l'llS 11s 18 Wheth4l Or 

not our ropreSsnktltos BI8r be reimbnrmd to tbe 

extent of expames 8otu8lly inourred by permitting 

the OOr~F8tiOllS inVOlV@d t4 is-0 their UpenW 

- 

.- 
EonOt8ble A. A. J8misOll - p8ge a 

W8ttMfS direotly to the teprWWdc8tiVO Ot tOptOsenktires, Or does it fOllOW tb8t 8 bill for lRlOb 

erpenaeo mst be diteoted to the ootpot8tlons involved 8nd obeok mode pal8blO t0 this dOp8ttaent 

rifb the 8meunt dOpO8ited in the 88mO m8nnet 88 

eS8mfn8tiOn fee8, pell81tie8 8nd other tetWUeo 

oolleoted by fhi8 drpatbent with tbe ex8minotm 

or tepresent8tl.ter bein toqaltsd to 1-t the 

8mOU?It of theit 0181~8 4 or telmbutnl to M.00 pet 

d8ye ph#, O? OOPtMs 8OtU81 eXpeIJ8Om inautted te 

tt8lls~tk~iOll Oh8tge8. In Chic oonnsotiim your 

8ttenfion is invited to iMotIon B of the 8?otem8Pid 

Attiole. 

sYou ate further 8dvised th8f it h8s been 8 

pt8OtiOe of this Deprttment to permit itm tepteSeXltPtiVeS to 8OOept 8 oheok from the OOt~t8tiOns 

involved made p8y8blo to thorn in an 8mOUnt tepteSenting 8otu81 expenses lnoutted tot many years. 

This plrotioe peth8ps b8sed upon opinion No. 551 8s 

written by the then oifioe oounssl, the lionot8ble 

Oole spoet. We h8Te tOd8y tete8d th8t opinion and 

8s indlO8bd To feel the need Of 8 018tifJing exptessio?I te the subjeot in 8drMoo Of 8 speoial 8ssignment fo examiners of this deprttatent glbt8Oing 

the 81u1~81 teTieT 8s t0 the~8OnditiOn Of the k0 

cotpot8tions involved. It follows, of course, th8t 

in tespeat to the pt8otiOe hetein8bove mentioned no 

0181~1 for expenses h8s been filed rlth the State b7 

the ex8mlnet8 lnvolvad in aonneotion with euamina- 

< tions rde, oinse 88 stated the OOtpOt8t+iOns h8te 

p8id the full 8mount of the expenses ineutted diteot 

to the ex8mlnets eng8ged In the 8nnu81 terievs. 

'YOU 8te further 8dVised fh8t this subjeot m8ttat 18 Of ~peOi81 oonoetn t0 us by te8aOn Of the 

f8Ot th8t We h8Ve 8OtU81 knowledge Ot the eXtt8Otdinot7 expanses rhioh 8te involved in 8 trip beyond 

tbe borders of out St8te of the n8tute hatein desotibed. Thus Ii it should be bold th8t suah ex8minets will bo limited to 8x1 expense 8006un1nt O? M.00 

Pot d8y - OOtoting me8ls, 8OOOm!EOd8tiOns 8nd other 

items, We sh8ll foe1 disposed to @TO spOCi81 OOUddet8tion to Efeotion 10 of Atffole 15248 which h8s to 

do with the 8OOeptinOe on out p8tf Of eX8ldn8t.iOn tepotfs 8s nnde by other qenoles. This, We think, 

would be neoess8ty in aonsidet8tion of the thougbt 
ionOt8blO Il. A. Judson - p8ge 8 

that to 8m&g1 one of out exuinete to nuke the axuln8tione dosotibed on 8 b8eie Of $4.00 pet d87 

8110T8~Oe would be knt8mOUnt t0 requiting th8t exmnlnet ot'ox8minets to 8bsotb 8n out OS pocket expense that would likely inTOlT8 mote than $200.00. 

sPtooeedlng, theteiote, to o ut l ea o nd Inquiry 

8Ud In oOntempl8tiOn Of the thought th8t itm8y be 

held Sh8f the $4.00 limitation 8ppliO~ rnd th8t the 

ootpotatione inTOlT8d must pay the department diteotly the raount of expenses InOutCddr is the 18~ 

gu8ge of Seation 10 of fihe 8fOteinWtiOned 8ttiole 

suS?ioientl~ bro8d in its etlpulations as to justify this orrioe in foregoing Its pt8otiae to ex8mine 

the aotpot8tione inrolted and aooept in lieu theteOf Pn OTW-811 oXamin8tiOu topOtt 88 made by other 

8genoiesb fe use the word 'otet-all' delibotrt,el~ 

for such reports do not gire speaial 8ttention to 

the position of an lndiridual St8te, but t8thet 8s 

iudio8tOd Ombt8Ce tb0 genetal 0Otpotat.s p0siti0~. 

"Out om examineto, in teepeat to their examlnatiOn Of +h388 OOtpOtatiOnS, being OOtpOt8tiOns that 

h8TO issued 8nd sold t0 Tex8S OitdZonS their inVest.- 

ment oettlfiaote8 in amounts 8ggtegrtlng several millions OS dOll8ts, OOnoOntt8ta p8ttiOUl8tly upon the 

oonttols that 8x-e established 8s to the ootpot8to 

118bilitJ t0 TeX8s oreditors and eanII8tked 8ssots 

pledged Sot their ptoteotinn~ with 8 speaial TOtifying ptOOedut8 made 8 p8rt Of 08Ch oxamin8t.ion. FUtthermore, 8s m8y be knOWn t0 Your own Judge Bpest, 

the assets so pledged Sot the benefit of Texas oteditote 8re held by the St&9 %'telrsWat or 8 %X88 

trustee. In respect to the 18tter it la the policy 

of our examiners to obtain listings from the trustee 

before le8Ting for the home offloe of the ootporation, this listing h8Ting to do with 8ssets pledged 

8nd #f?iOiOntlj ooaplete 8s to enable thorough TeriTio8tion with the teootde m8int8inOd in ui11Es8pOlis. 

We rarely mention tbie pb8mOf the ptoaedute to ampb8dSS tb8f my report which we might 8COept from 

8nOtbOt 8gOUOr rould f813 f8t 8hOtt Of the OOmplOtenoes outlined shore insOf8t 88 Texas creditors 8re 

oonoernod, and it ooaurtod to us th8t this referents 

to out exaain8tlon ptocedute might hare some besting 

in the oonsidetatlon of the question ia~olred In Seotion 10 of the Aot.. 
, 

767 

Honot8ble A. A. J8StiSOn - page 4 

Seotion 1 of Artlole 16248 defines the 0188s of oorporations embtaoed within the L68U rad Bioke+8ge COap8nles Aot. 

Sootion a is 8s ?ollows: 

vhe'68nklllg Cosmdedoaer OS teX8S eh811 oxamine or 08uie to be exdnod suob eOtpotatdOn8 

8nnu8lly or oftenet if he deems If neoee88ty. 

Said OOtpO+8tiOll ah811 p8I the 8OtU81 tt8TSlin6 

expe8eeer hotel bill's, and 811 other l otu81 expense inoident to mch exminatioa and 8 fee not 

oxoeedlng Twenty-five Dollats~($25) pet d8y pet 

person engaged in such examination. IS suob aotpotation hrd not sold In TeX8s its bonds, notes, 

oottiSloites, debentures, et other oblig8tlons 

8nd does IIOt Offot ?Ot s818 Ot 8811 in TOX8s its 

bonds, notes, oett1?1oates, debont.ures or other 

oblig8tione, the Banking Comnlesionet of Pex8er 

in lieu of an examination shall 8ooept 8 Sin8n0181 l t8t,ement. mode on suab form, containing such 

idorm8tion as he desires. Guch fess, together 

rith any other Sees, penalties or terenues oollooted by the Commissioner pursuant to the ptolidons of this Aot or pursuant to other lors of 

this State tel8tire to corpot8tione under the 

mpWTi8iOn of the Banking Dopattatont, ah811 be 

paid by the Commissioner to the State Tt08mWSt 

to the otedit of the &3net81 ROToUuO Lund. The / 

expenses of examin8tion and of the.Cormnissionet 

\ in enfotoing the ptoTisiOus of this Aot ah811 be 

p8id upon tho aettifioate of the Commissioner by 

r8ttPnt of the CompttOllOt upon the 6t8tO TtePs- utj.* 

Foreign corporations, such 8s those inTOlTOd in your 

per:- inquiry, orp;ani8ed under the laws of 8nOtbOt st8ter 8tO 

mitted ,,O do business in Tez8s only 88 proTided in Ch8ptet 19 

of the BoTioOd CiTil St8tutOs of SeXas, 8nd this nee88Mtilf 

means they 8tO to comduot suah business in Texrs in 8oootdanoe 

ritb and subject to the 18TS of TOX8a. 11 Tex. Jut., CotporatiOns, e 178. 

Such permitted ootpot8tions h8To been under the superTision of the B8nking Department for m8ny years, during wbiah 

time they h8TO been tegulrrly examined by the Dop8ttznent'e ex- 
honorable II1 A. Jamiaou- page 6 

amlnsrs, where they bare ieeued and sold their bonds, notea, 

oertliloatesr debentures , or other obligations in Texas. The 

reason ia not far to seek. It Is the proteofion of the purohaserx in Texas of the oompanies' obligations sold bore. 

The examination is neoessar~ to the proper maintenanoe of 

the seourities put up by such companies, under Iteotlon I of 

the Aot. 

Sooh ferelgn oorporation 18 epeoially made arbjeot 

to exsmiaation of. the Banking Commissioner of Texas, under 

penalty of forieiture of its penslt by the terms o? seation 

10 of the Aot. 

As pointed out by y@u, It has been the praotloe of 

the Banking Denartment, under its aonstruotion of the pertinent statutes, to aolleot from maOh out-of-&ate oorporation 

all the fees presoribed by statute , and likerise the expenses 

such as travel, hotel, meals and the like, from out-of-state 

aorporatloa, paying the fees into the State Treasury as prescribed by Seotion 2 of the Aot , and applying the expenses to 

reimbursing the examiner for his actual expendlturos In oonntation sitb such examination. 

Opinion X0. 361 by your offloe counsel referred to 

by you, is as iallorsl 

*In the matter of superVision of Building 

Loan Associations and Loan d: Brokerage Companies, 

you are sometimes called upon to qo beyond the 

borders of the State, incurring extraordinary axpenses and the question presents itself whether ' 

c or not such expenses may be paid directly to you 

by the institution involved in the examinatinn 

or investigation, as the ease may be, or whether 

or not such matter is within the statute of fees 

and expenses0 Undoubtedly it Is tha sound publie policy, and therefore the law, +hat the compensation, whether salary or fees, of public oPfiaers is made matter of statute and the compensation there provided Is, of coarse, aonollr8ire 

of the compensation and exoluslre of any other. 

"In other words, a pub110 official is entitled only to such salary or oompensation as 

is clearly provided for in the law creating his 

office and fixing his aompensation. See my Oplnion S2 to the Banking Commissioner of date Deoember 6, 1923. 
Boporable 8. A.’ Jamiwn - page g 

stbo item of expenses of aa ottiolal inourred by him in hi8 offioial oapaoitr, is in 

essenoe publie. An o?tlaial ordinarily oannot 

per?orm his official duties oufslde the limits 

of the Stata under whose authority he sots. 

ills rots beyond the territorial lim%ts, therefore, being extra o??ioial, are not gooterned by 

the lar rith respeef te ot?lolal duties. 

s?he prinelple is illustrated in the la8 

of reTardm* It im the gener a l llooepted y dooWine that when a publle officer performs the 

servioes for mhieb a reward Is offered, by sots 

outdde the soope and line of his duty, there 

la no rule of publlo polioy whloh forbids his 

olalming the reward and henoe he is entitled to 

it. Karling vs. Morris, (Tex.1 9 8. '1. T3S, 

Tobin YS* MaComb, 168 8. W. 267, 64 C. J. IBE, 

Sea- 32. The rule of publio polioy forbidding 

extra oompeneattion from private wuroes to pub110 ot?lolale for performing their ottialal duties, l ppYles generally to rewards. Benoe the 

analog between rerards and expenses or oompensatlon is a good one. 

'Undoubtedly, the law might Impose upon a 

state ot?lolal the speo%?lo Qu~tyM psr?omihC; 

eerrioe~~begond the State line, when of aourse, 

the rule prohibiting extra compensation rould 

acplr* The real test, therefore, lies In the 

nature of the services performed. It the serrioes pertermed be outside the scope and duty o? 

the offloer, he may acoept prirate Oompensation 

or expenses, but I? suoh services be rithin the 

scope of his ot?ioial duty, he may not do w. 

.T’bere is Involved in euoh matter a possible ethios that would forbid a public ottloial 

to l ooept oompensatlon or expenses in aonneotion 

even with an aot entirely beyond his offloial 

duty, if moh aot im in the general nature o? 

his official dutiesa ldentioal with that of compensation and is governed by preoisely the same 

prinoiple. 

l By the General Appropriations Act of 1938 

(General Laws 44th Leg. Reg. Sesa. page 1001) 
Honorable Ha A. Jar&son - page T 

your oompeneation am superrising examiner 18 

definitely fixed and the same is to be paid 

only from tees or aeseamsents oolleoted from 

the institutions under supewIsion~ Snob tees 

and assessments from xhiob your compensation la 

to be paid, are OxpremslT appropriated by the 

Aot. Therefore, your ooapensation, whether ulary or expenees, I# payable threugb the ordinary 

ohannels provided for the payment out of pub110 

?undm. 

.Tbe rule of pub110 polioy would forbid, 

therefore, that you reoeire oompensation or 

tees from any person or in any other ray, with 

respeot to your official duties then that speoltioally provided in the statute. It ma7 happen 

and often does happen that you are oalled upon 

to perform an ottioial aerrloe for which there 

IS no speoiflc oompensatlon made In the law. Such 

a eerrioe $8 z o??iCio and is iaposed upon you aa 

a publio officer, without compensation other than 

the general oompensation l ttaohed to the offloe. 

sTbe application of these principles would 

forbid your l ooepting any extra remuneration from 

any private institution for the pertormanoe of 

any otfloial duty* But this adrioe is Tolunteered 

since you hare not asked me any mch question. 

sI am of the opinion, hoverer, that inso far 

as is lnrolred the question of expenses inourred 

\ by you out&de the State of Texas, the statutes of 

compensation hare no application. In other words, 

the statute and rule of public policy deal with 

the performance of official duties, but this oonsideration is purely, I think, one of ethlos and 

propriety involving to no extent rhaterer any queetlon of regularity or legality. Personally, I Can 

see no Impropriety in an ottlcial accepting remuneration to the extent o? aatual expenses inourred 

by him In periormlng a serrloe entirely beyond his 

actual ottlolal duties, even though such servloe be 

in tbe line o? him ordinary ottiolal duties when 

within his State.. 

It is the opinion of this Department that the praotioe 

and policy heretofore followed by your Department Is the proper 

I/ 

one. 
gonoable tl. A. Jamlwn - page b 

Beation 2 of the Aot,alreadp quoted herein, requiring feea, penalties and revenues oolleoted by the Coxanlsslonor to be pald~ to the Mate Treasurer to the oredlt of the 

General Rer,snue Fund, as has already been stated, has at ail 

times heretofore been follored by your Department, as We understand tbe aituaticn, but the l otual and neoesaary expensea 

inourred bV the examlnar, auoh aa hare heretofore been mentioned, hare not been thus paid into the Treamwy, but hare 

been applied by the examiner to the llquldation of his olaim 

for expensemr and no olalm or olalms theretor hate at any 

time bean made against the Treasury or been paid by t&e 

Trea snrer. This, we think, ia in l ooor&noe and perfeat 

keeping with tbs statutes , for emah aotual and neoeocarT 

expense8 are not *fees, penalties “or relenues oolleoted bV 

the Gomissioner’, under the statutes. 

The statutes, provisions of appropriation Aots, 

court dealsions and departaaental opinions with respeat to expenses o? out-of-state trips upon State business hate nothing 

to do with the question under consideration, sinoe such expensea are not paid out of the Treasury. lo statute, approprlation rider, oourt opinion, departmental opinion, or publia 

policy whatsoever is violated by the oourse of your Department here approred. 

Very truly yours 

ATTORHgY G~NERALi$F TEXAd 

BY o*$e&/+ 

Assistant 

/ -.