I_.. TEE 

## A-IITO~Y GENERAL

OF%-EXAS

Aus-ruw 1,. TEXAS

Honorable Tom Moore, Jr. District Attorney Waco, Texas - OpinionNo.

## ww-502
Re : Interpretationof Section 1 Article 3926, Vernon's Civil Statutes, regarding fees of County Judges. Dear Mr.Moore:

We have which you request receivedyour letter of Augusts5, 

## 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 seekyour opinion.

. . .I*
You includedwith 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 thecounty 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 propertieswhen'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." (Emphasisadded)
We have assumed that such securitieswere 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 informationbefore us on how the securities were originally inventoried upon probate of thewill, 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 opinioncites as its authority Terrill v. Terrill, 

### 189 S.W.2d 

### 877,writ refused, which reached such result on the question of cashingSavings Stamps, United States Post Office. Such is the rulewhen these obligations are cashed, as distinguished from being sold.

InAttorney General's Opinion

### O-5654 (19431,it was determined that cash received as "liquidatingdividends"was taxable under Section 1 of Article 

### 3926 The amount thereunder considerationwas in excess of the inventoriedvalue of stock owned in a lumber company and such opinionwas 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.anguagein such opinion however, thatmight be construed as holding that the County 3 udge would be entitled to such commission on all money collectedwhen property constituting original corpus of the estate is sold for cash, even if the arnomwz received equaled or was less than the inventoriedvalues. do not feel such an expanded construction of the opinion Would be a correct statement of the law. Opinion

### O-5654relies 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*asused in kticle 3926 ~do.notcontempleite a commission'tobe paid on any and all money thatmay be collectedby the executor:

"We believe that the expression %ctual cash.~ receipts' has a more restrictedmeaning than 'cash actually received'. In the first expression, 'actual cash' describes 'receipts' while in the second, 'actuallyrecelvedl:ldescri&es Icash'.;~

Cash may be.,capital,.

or the..corpus

of anestate,,while the word Irecelpts'is synonymouswith 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 'actualcash receipts;%iould be held to specificallydescribe money received by the executor other.than the cash or cor~u of the estatewhich was on hand when the testator died, because the words used point to and imply that meaning,

. . .I1 (Emphasisadded)
In the case of &llbert v. Hine5, 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 insurancewas 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." (Emphasisadaed)
In addition, the &Crorv case cited. above, states:
"Itwould 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 taxablewith a Judge's commissionunder.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 Governmentbonds and obligations,as,Y.

Honorable.TomMoore, Jr., page 4, 

## (m-502)
.distinguished from the cashing of such obligations. Cashre.distinguished cashing obligations. ceived representing,increase,bverthe inventoriedvalue of

representing,increase inventoried would,, course, accrued administrasuch corpuswould,,of course,have accruedduring administra- tion and would be taxable. 

# my, .‘,

Under.Section 1 of Article 3926 Vernon's : Civil Statutes,when securities constituting original corpus ,ofthe estate are 'soldby an e'xecutor,

the County Judge .mayreceive commisslons on only that portion of the cash so receivedwhich represents increase over the inventoried value of the'securities;the same rule applieswhen United States obligationsare sold, as.

distinguishedfrom cashed. .(, ?o&s very truly,,

., '. WILL WILSON 'Attorney

General of.

Texas 

# :
TIMc:st:wb Assistant

APPROVED: OPINIONCOMMITTEE .,I
Geo. Pi Blackburn,Chairman William E. Allen Jack Goodman Leonard Passmore
REVIEWED FOR THE ATTORNEY GENERAL
BY: W. V. Geppert