Honorable Jesse James

State Treasurer of Texas Opinion No. C-475

Drawer X, Capitol Station Austin, Texas 78711 Re: Whether personalproperty held in Texas by foreign corporationsfor persons whose last known address Is outsldeTexas or is unknown are required to be reported to the State Treasurerunder Article 3272a; and whether unclaimed wages must be reported Dear Mr. James: pursuantto such statute?
Your recent letter requesting the opinion of thls office reads as follows:

"As you know, the United States SupremeCourt has held in the case of the State of Texas vs. State of New Jersey, Et Al, 379 U.3. 674 (1965) that the debts owed by a corporationare subject t; escheat only by the State of the last known address of the creditoras shown by the debtor's books and records, or if there is no address at all, or If the last known address Is In a state which does not provide for escheat of the property owed them, then the debts owed by the corporationare subject to escheatby the State of corporatedomicile subject to the right of - the State of last known address to recover, if and when Its laws make provision for the escheat of such property. "Also, the Supreme Court of Texas, In the case of Southern Pacific Transport Company,Et Al v. State, 380 S.W.2d 123 (Tex.Clv.App.1964 error refused), has held that the holder of unclaimedwages may plead that the two and four year statutes of limitationhave barred the actions of the persons to whom the wages are owed and therebydefeat an action by the State to escheat such wages.

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"In view of these two recent decisions, It will be appreciatedIf you will advise this office by official opinionupon the followingquestions:
1. Whether It Is necessary for a corporationchartered In a state other than Texas to report to the State Treasurer pursuant to Article 3272a,Vernon's Civil Statutes,personal propertyheld In Texas for persons whose last known address, accordingto the books and records of the corporation, Is outside the State of Texas or whose address Is unknown?

2. Whether It Is necessary for unclaimed wages to be reported to the State Treasurerpursuant to Article 3272a, Vernon's Civil Statutes?"

You are hereby advised that in our opinion both of your questionsmust be answered In the affirmative.
Article 3272a of Vernon's Civil Statutes requires that certain personalproperty specified therein be reported to the State Treasurer of Texas. ~Sectlon l(b) of such Article defines the term "personalproperty"and reads as follows:

"The term 'personalproperty' Includes,but Is not limited to, money, stocks,bonds and other securities,bills of exchange claims for money or Indebtednessand other written evidences of Indebtedness,

dividends,deposits,accrued Interest,purchasepayments,~sums payable on certified checks, certificatesof membership In a corporationor association,amounts due and payableunder the terms of any insurancepolicy securitydeposits,unclaimed refundsand deposi& for utility or other services,funds to redeem stocks and bonds, undistributedprofits,dividends, or other Interests,productionand proceeds from 011, gas and other mineral estates,and all other oersonal orooertvand Incrementsthereto.whether tangiblebr intangible and whetherheld'wlthln this State, or wlthout'theState for a person or beneficiarywhose last known residencewas In this State:," (Emphasisadded)Hon. Jesse James, page 3 (C-475)

The above emphasizedlanguage of the statutes has been before us for Interpretationon a previous occasion. We then held that such language required that reports of property subject to escheat include all personalpropertyheld In Texas, regardless of the last known address of the person for whom such property Is held. AttorneyGeneral's Opinion~~-1180 (1961). This would, of course, Include those situationswhere the name or address of the person entitled to such property Is unknown. Attorney General's Opinionw-1189 (1961).

We have also previouslyheld that Article 3272a requires the reporting of personalproperty In the form of an Indebtedness against which the statutes of llmltatlonmay have run. General's Opinion ~~-1232 (1962). Attorney Unclaimed wages necessarily fall within the scope of this previous holding.

We perceive no reason to abandon our prior holdings In this regard, or the reasoning In support thereof,unless we are In some way so compelledby the decisions in Texas v. New Jersey, 379 U.S. 674, 85 S.Ct. 626, 13 L.Ed.2d 596 (1965)and Southern Pacific Transport Co. v. State, 380 S.W.2d 123 (Tex.Clv.App. 1964, error refused).

In Texas v. New Jersey supra, the question for determination was not whether the escheat'lawsof the various states Involved encompassed the property In question,but rather which of the states having escheat statuteswhich applied to the property In question were entitled to escheat. The solution to the controversy was not determinedby the validity or Invalidityof any procedural or substantiverequirementof the escheat statutes of the various states involved. The Court made this clear when it stated at 85 S.Ct. 631:

"We realize that this case could have been resolved otherwise,for the Issue here Is not controlledby statutory or constitutionalprovisions or by past decisions,nor is It entirely one of logic. It Is fundamentallya question of ease of admlnlstratlon and of equity. We believe that the rule we adopt is the fairest, Is easy to apply and In the long run will be the most generallyacceptable to all the States."
The rule laid down by the Court merely establisheda ranking or priority of right to escheat under the facts presentedby the record.

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Hon. Jesse James, page 4 (C-475)

In the Southern PacificTransport Co. case the Court held that In a suit to escheatunclaimed wages, a plea by the holder that the claims of the wage earners were barred by the two and four year statutes of llmltatlon,would preclude the escheat of such wages in the absence of a showing by the State that facts [ i existed which avoided the plea of limitations.
After a study of all of the provlslonsof Article 3272a we 1 cannot conceive that anyone could contend that the reporting of property required by the statute Is tantamountto taking such property under the statute. If a holder of property reported I 1 under Article 3272a should feel that the state Is not entitled to take such property,then he may refuse to deliver such proj
perty to the State Treasurerand await the Institutionof a i
suit under Section 4(d) of Article 3272a to compel delivery of j such property. In such proceedingthe holdermay raise such i defenses as he may think are available to him and the state will have the opportunityto introduceany evidence which Is available to avoid such defensivepleas.
The Legislaturehas met twice since Attorney General's Opinions ~~-1180, W-1189 and WW-1232 were rendered. The 59th Legislature was In session on January 27, 1965, when the Supreme Court of Texas entered Its order refusinga Writ of Error In Southern Pacific TransportCo. v. State and on February 1, 1965, when the Unlted States Supreme Court rendered its opinion in Texas v. New Jersey. They are presumed to have known of these court decisions and the constructionaccorded the reporting provisions of Article 3272a by the opinionsof this office. 39 Tex.Jur. 248-250, Statutes,B 132, and cases there cited. The 59th Legislature In fact amended Article 3272a on May 26, 1965, without changing the language interpretedby this office In ~~-3.180,

W-1189 and WW-1232,and without Indicatingthat our interpretationwas In error. In view of these circumstances, It must be presumed that the Legislaturehas acquiesced in such Interpretationand for us to now hold that the reporting of the personal property Inquiredabout in your letter Is unnecessary would be an unconstitutional usurpationof the legislative prerogative. Section I of Article II of the Texas Constitution.

SUMMARY
Personalpropertyheld in Texas by foreign corporationsfor persons whose last known address, according to the books and records of the corporations, Is outsideTexas or whose address Is unknown

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must be reported to the State Treasurerunder Article 3272a; unclaimed wages must be reported to the State

such personal property.
Very truly yours,
WAGGONERCARR AttorneyGeneral

APPROVED: OPINION COMMITTEE

W. V. Geppert, Chairman Gordon Cass Ben Harrison Pat Bailey Gordon Zuber

APPROVED FOR THE ATTORNEY GENERAL By: Hawthorne Phillips

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