. ’



# The Attorney General ofTexas January 19, 1978

Honorable L.Alvis Vandygriff Commissioner Texas Savings and Loan Department P.0. Box1089 Austin, Texas 76767 Dear Mr.Vandygriff: Opinion No.Ii- 1117 Re: Cumulative voting at annual meetings of savings and loan associations.

You have requested our opinion as to whether a member of a savings and loan association may cumulate his votes where the association’s charter and bylaws donot address the subject ofcumulative voting. Section 3.06 of article 852a, V.T.C.S., the Savings and Loan Act, provides, inpertinent part:

In the absence of any bylaw provision to the contrary, in the determination of all questions requiring action by the members, each member shall beentitled to cast one (1) vote by virtue of hi membership, plus an additional vote for each share or fraction thereof of the Permanent Reserve Pund Stock ofthe association, if any, owned by such member, and an additional vote for each One Hundred Dollars ($100) or fraction thereof of the withdrawal value ofsavings accounts, if any, held bysuch member. The Texas Businern, Corporation Act, which authorizes the practice of cumulative voting, is not applicable to savings and loan associations, except to the extent that the Savings and Loan Act

containfsl no provisions in regard to some of the matters provided forinthis Act

.... Bus.Corp. Act art. 9.14. lhus, we must determine the extent to which article 9.14 is applicable to the practice of cumulative voting by members of a savings andloan association. This question was resolved with regard to banks in Robertson v. State, 406 S.W.2d 90(Tex. Civ. App. - Fort Worth 1966,writ reM n.r.e. . that

p. 4567.--” ,,

Honorable L.AlvisVandygriff - Page 2 (R-1117)

case, the court found that, although the banking statutes donot pacifically either validate or prohibit cumulative voting, they do %ontain specific provisions pertaining to the election of directors,” which provisions are, for our purposes, virtually identical to those of article 852a. Id. at 92. The court held that cumulative voting was, in fact, “inconsistent witrand repugnant to the provisions ofthe Texas Ranking Code pertaining to the election ofdirectcrs.n & at 93. Robertson was premised largely upon a statement in article 342-101of the Texas Ranking Code, which declares the Code to be “a complete system of laws governing the organization, operation, supervision, and liquidation ofstate banks.” Because of thii declaration, the court found “no cause to supplement [the Code’s1 provisions with those of a separate act.” 406 S.W.2d at 93-94. Although the Savings and Loan Actdoes not itself contain any provision as to its completeness, the caption states that it is

[aln act arranging the Statutes of this State affecting savings and loan associations and their operations in appropriate Chapters and Sections into a consistent whole and underasingleAct

. .. (Emphasis added). Acts 1963, 58th Leg., oh. 113,at 269. In our opinion, this statement as to the completeness of article 852a furnishes ample basis for concluding that the answer to your question iscontrolled bythe court’s de.cision in Robertson. It.isthus our view that, in the abeence of any bylaw provision to the contrary, amember ofa savings and loan association may not cumulate hisvotes. SUMMARY In the absence of any bylaw provision to the contrary, a member ofa savings and loan association may not cumulate hisvotes.

/ @FIN L.HILL ,,Attorney General ofTexas APPROVEI):

p. 4568Honorable L Alvls Vandygriff - Page 3 (H-1117)

Opinion Committee

p. 4569