I_.. 

TEE A-IITO~Y GENERAL 

OF%-EXAS 

Aus-ruw 1,. TEXAS 

Honorable Tom Moore, Jr. 

District Attorney 

Waco, Texas - 

Opinion No. ww-502 

Re : Interpretation of Section 

1 Article 3926, Vernon's 

Civil Statutes, regarding 

Dear Mr. Moore: fees of County Judges. 

We have 

which you request 

received your letter of Augusts 5, 1958, in 

our opinion on the following question: 

"The estate of the late Madison Cooper 

of this County consisted, among other things, 

of several hundred thousand dollars in various 

stocks and bonds. During the course of administration of the estate, the executor sold 

some of these in the amount of $5l5,114.%. 

This money was later invested in other stocks 

and bonds. Our County Clerk has assessed a 

fee of * of one per cent against the proceeds 

of these sales under Article 3926, V.R.C.S. 

The attorney for the estate disputes this 

charge and we have been, asked to seek your 

opinion. . . .I* 

You included with your request a copy of the executor's verified account for final settlementwhich reflects the 

properties inque,stion included corporate stocks, and stock 

rights, corporate bonds 

vision bonds, c 

municipal and other political subdicertifica es of deposits,and United States Government Bonds. You desire to-know if the county Judge, under Section 1 of Article 3926, Vernon's Civil Statutes,, may tax a commission of one-half of one percent upon the funds realized from 

the sale of such properties when'such funds are later used to 

purchase similar properties. 

Section 1 of Article 3926 reads as follows: 

"The county judge shall also receive the 

following fees: 

"1. A commission of one-half of one per 

cent upon the actual cash receiuts of each executor, administrator or guardian, upon the approval 
,,,’ 

Honorable Tom Moore, Jr., page 2 (W-502) 

of the exhibits and the final settlement of the 

account of such executor, administrator or 

guardian." (Emphasis added) 

We have assumed that such securities were held. by 

the testator as part of the corpus of his estate at the time 

of his death, and, further, that such securities (the ones 

later sold) were held by the estate when the executor qualified. Since we have no information before us on how the securities were originally inventoried upon probate of the will, 

nor what values were assigned thereto, we can give you only 

what we consider to be the general principles applicable~ here. 

In Attorney General's Opinion V-398 (1947), it was 

determined that when a personal representative cashes United 

States Government Bonds, he is merely exchanging one form of 

government obligation for another, and that, therefore II. . . 

such sums should be classified as cash on hand at the time of 

the'death of the testator, and the County Judge is not entitled 

to any fees under Article 3926 on said SLUIL~~ Such opinion cites 

as its authority Terrill v. Terrill, 189 S.W.2d 877, writ refused, which reached such result on the question of cashing Savings Stamps, United States Post Office. Such is the rule when 

these obligations are cashed, as distinguished from being sold. 

In Attorney General's Opinion O-5654 (19431, it was 

determined that cash received as "liquidating dividends" was 

taxable under Section 1 of Article 3926 The amount there under consideration was in excess of the inventoried value of 

stock owned in a lumber company and such opinion was concerned 

only with the amount so received in cash. The cash received 

represented increase accruing to the estate during the course 

of administration. We feel such opinion correctly states the 

law applicable to the question there under consideration. There 

is,l.anguage in such opinion however, that might be construed 

as holding that the County 3 udge would be entitled to such commission on all money collected when property constituting original corpus of the estate is sold for cash, even if the arnomwz 

received equaled or was less than the inventoried values. 

do not feel such an expanded construction of the opinion Would 

be a correct statement of the law. Opinion O-5654 relies in 

part on Goodwin v. Downs, 280 S.W. 512, (Comm.App.) which is 

authority for the proposition that all funds received by the 

representative pursuant to completion of the descendent's contract would be so taxable and not just that amount representing 

profit to the estate. We do not believe such case controls the 

question of the conversion of a portion of the corpus of the 

estate into another form of asset. 
Honorable Tom Moore, Jr., page 3 (WW-502) 24,:!? 

'. '.. 

The case of ,McCrory v. ichi a C un v 261 S W.2d 

867 establishes that the words n!ctuat cazh ie&eiptsP*as used 

in kticle 3926 ~do.not contempleite a commission'to be paid on 

any and all money that may be collected by the executor: 

"We believe that the expression %ctual cash.~ 

receipts' has a more restricted meaning than 'cash 

actually received'. In the first expression, 'actual cash' describes 'receipts' while in the second, 'actually recelvedl:ldescri&es Icash'.;~ Cash 

may be.,capital,. or the..corpus of anestate,, while 

the word Irecelpts' is synonymous with lincchpe:l, 

'issue', "product' 'yield ' 'returns' and.,tproceeds ' . . . .' And the term fproceeds&as been $efined as I,. . . '#the amount proceeding or accruing 

from some, possession or' transaction.! a :. .,.!I: _. 

ho, see m‘v. Harvg;y, 26 S.W.2d. 288, which states: 

" It is thought the term 'actual cash 

receipts; %iould be held to specifically describe 

money received by the executor other.than the cash 

or cor~u of the estate which was on hand when the 

testator died, because the words used point to and 

imply that meaning, . . .I1 (Emphasis added) 

In the case of &llbert v. Hine 5, 32 s.w.2a 876, the 

following statement is made which we feel accurately disposes 

of the question here under consideration: . / '. 

*'We, therefore, hold that the claim for war 

risk insurance was a Dart of the Corvus of the estate, and, when thi; claim was later,a verted. into 

and-paid to the guardian, its status;~ 

Of the COrDUS of the ward's estate‘ was unchanged, and no commissions to the guardian could 

be allowed thereon." (Emphasis adaed) 

In addition, the &Crorv case cited. above, states: 

"It would be the same estate in a different 

form, and would be only once receiveLtl 

We, therefore, conclude that when assets constituting 

a portion of the original corpus of an estate are sold the 

cash received therefor is not such "actual cash receipts" as 

would be taxable with a Judge's commission under.Section 1 of 

Article 3926, if the money received did not exceed the inventoried value of such assets. The same rule would apply to the 

sale of Vnited States Government bonds and obligations, as 
,Y. 

Honorable.Tom Moore, Jr., page 4, (m-502) 

.distinguished .distinguished from the cashing cashing of such obligations. obligations. Cash received representing representing ,increase ,increase ,bver the inventoried inventoried value of 

such corpus would,, would,, of course, course, have accrued accrued during administra- administration and would be taxable. 

my, .‘, 

Under. Section 1 of Article 3926 Vernon's : 

Civil Statutes, when securities constituting 

original corpus ,of the estate are 'sold by an 

e'xecutor, the County Judge .may receive commisslons on only that portion of the cash so received which represents increase over the inventoried value of the'securities; the same 

rule applies when United States obligations are 

sold, as. distinguished from cashed. 

.(, 

?o&s very truly,, 

., '. 

WILL WILSON 

'Attorney General of. Texas 

: 

TIMc:st:wb Assistant 

APPROVED: 

OPINION COMMITTEE .,I 

Geo. Pi Blackburn, Chairman 

William E. Allen 

Jack Goodman 

Leonard Passmore 

REVIEWED FOR THE ATTORNEY GENERAL 

BY: W. V. Geppert