E 

### GENERA OF TEXAS

Hon. Baacom Giles, Chairman 1 Ihrrrul4

Veterans' Land Board Land Office Building s 'cg Austin, Texas OpinionNo. S-79

Re: Legality of computing interest on veterans' land loans to the next semiannual installmentdate uhen payment in advance Dear Mr. Glles: of due date Is tendered.

You have requested the opinion of this office
on the following veterans' landmatter:

"OnMay 

### 18, 1950, this office executed
a forty year contractwith Mr. Joseph P. Hart for purchase of land through this Program. The contract executedbetween Mr. Hart and theVeterans' Land Board provided for semi-annual installmentspayable on or before the 1st day of each May and November.
"Underdate of September 8, 1952,Mr. Hart wrote this office that he had made arrangements to pay off his veteran's loan in the near future, and requested that we forward abstracts of title on the tract of land for examinationpurposes. After securing the required deposit for loan of the abstract, it was forwarded to Mr. Hart on September 

### 16, 1952, Under date of October 29, 1952,Mr. Hart made a written request that this office advisehim of the balance due on hia contract togetherwith the daily Interest accrual rate. The request was received In this office on October 

### 30, 1952,but due to the heavy press of Incomingmail at that time was not reached

"

.Hon. Bascom Glles, Page 2 (OpinionNo. S-79)

for action until November 5, 1952. On that date we advised Mr. Hart inwriting of the amount of principaldue on the contractand Interest calculateduntil May 1, 1953,which
was the next installmentdate. Mr. Hart has objected to payment of this interestbeyond the date on which his remittance was made to pay off his contract in full.
"The entireVeterans' Land Board unanimously determined that due to the wording of the contractwhich was based on Section 17, Senate Bill 29, Acts of the 51st Legislature, and Section 7, S. B. 351, Acts of the 52nd Legislature,which is a revision of the first named section, that interest shouldbe computed and charged until the next installment date following the remittance of any payment over and above the current amount due on the contract."
The date on which Hart remitted thebalance of the principal Is not stated inyour letter,but from accompanyingpapers It appears that remittancewas made sometimebetween November 5, 1952, and January 8, 1953. The portion of your contractwith Mr. Hart which ismaterial to this present problem reads as follows:

"3

. The total considerationfor this

if urchase is Sixty-fiveHundred and OO/lOO $6500.00)DOLLARS, of which the sum of Three Hundred and twenty-fiveand OO/lOO ($325.00)DOLLARS has been paid. The unpaid principal of Sixt Seventy-five ($6175.00 3-oneHundred and DOLLARS shallbe amortieed over a period not to exceed 40 years with annual interestat three (39%) per cent upon all unpaid principal. Buyer shallpay or cause tobe paid Installments or principal and Interest semi-annually to the Conmissioner of'theGeneral Land Office at Austin, Texas, on or before the first day of each May and November hereafter until the total purchase price is paid. The amount of One Hundred & thirtythree and 06/100 ($133.06)DOLLAHS shallRon. B&scorn Giles, Page 3 (OpinionNo. S-79)

be due and payable on or before the 1st day o'f FovembeF, 1950, and the amount of One Hundred:& thirty-three and 06/100 ($133.06) DOLL&K? shallbe due and payable semlannually on or before the first day of each Meg and November thereafter until the total purchase price and interest have been paid. All interestand principal which shallbecome delinquent shall bear penal interest at the rate of five (54%)per centper annum fr;; ;;fd;;;er samebecomes delinquent. agreed and understood that buyer may on any installmentdate pay or cause to beg paid any or all of the unpaid principal, but payment of a portion of the unpaid pHncFpa1 will not relieve buyer from payment of the regular semi-annual installments thereafter in the amount of One Hundred & thirty-three& 06/100 ($133.06) DOLLARS."
Section 17 of Senate Bill 29 (Acts 51st Leg., R.S. 1949, ch. 318, p. 597), which controls the terms of thin contract, and also the act as amended,Article 5421~ 8 17 (Acts 52nd Leg., R.S. 1951, ch. 324, p. 55O),provldes "that the purchaser shallhave the right on any Installmentdate to pay any or all installments still remaining unpaid."

It can readily be seen that the wording In the contractrelating to premature payments of the principal
was taken from the portion of the statute quoted above. The phrase "installmentdate" appearing inboth the contract and the statutemust be explainedby the portion of the contract relating to the installments. The.lnstallments are therein required to be paid "on or before the first day ofMay and November," and therefore the phrase "installmentdate" clearly refers toNovember 1 and May 1 of each year, since these are the dates upon which the lnstallmentsbecome due. Lovenberg v.Hen- 104 Tex. 550, 140 S.W. 1079 (1911);National Bank of Co&erce v. Kinney, 98 Tex. 293, 83 S.W. 3w (1904) Fenner, Beane &Under; leiderv. Donoshy, 62 S.W.2d 264 nex.Ci ai5m.1 v.App. 1933, errorHon. Bascom Giles, Page 4 (OpinionNo. S-79)

Both the statute.

and the contract .requirethat any prematurepayment "Installmentdate." shallbe made on or as of the next The "installmentdates!' arena shotin by the contracts

to be Noyember 1st and May 1st of each year. We therefore agree. with the Board that Halrt'sentire obligation included Interestup to the next lnstallment date following the date of remittance oftthe unpaid ~~II;IEX~ and that:lntereetwas properly charged to May

, .

SUMMARY

that intereston veterans' land loans~ be computed to the next semi-annual installment date when payment In advance of due date is tendered.

APPROVED
,JesaeP. Luton. Jr. nd Division
Willis E. Gresham Reviewer
Mary,K.Wall Reviewer Yours very truly,

JOHN BEN SREPPERD Attorney General 

# ByA- &

Thomas~~Black Assistant
Robert S, Trottl Pirst Assistant
John Ben SheDpperd Attorney General