of a mutual insuranceaesociationwhose subscribersare stockholders - . . v
EM. E. G. Moseley,pagelq (O-924)
in such company,Buch as the Texas Employers' InSuraxe A8scziatf~on,it has also been held that such provisionof the Constf.t.xkimdoes not pro%blt a city from taking out employer'sliabilityinsurancelu an old line Insurance company. Nor can liabilityto an employeeof a city who acceptsinsurance thereunderbe defeatedon the groundthat such CMtr8Ct ia jllegalor ultra virek as to the city. The insurer 16 estoppedfrom denyingthe validityof the contracta6 to the employeewhere It collectsand retain6premiumsthere- on. 30 Tex. Jur. , pp. 528, 529, Section291, and cases cited In notea: 32 C.J., p/1351, Section631, and cases cited in notes."
We, therefore,feel it incumbentupon us to overruleconferenceopinion No. 2860, inasmuchas the express-languageof our appellatecourtsIn the ca8e8 quoted,written since the above numberedconferenceopinion,clearly indicatethe opinionof the learnedjudgesto be that politicalsubdlvisions cannotlegallypurchaseinsurancefrom mutual companiesbecauseof Section 52 of ArticleIII of our constitution.We have been unableto perceiveany possibledistinctionin law betweenmutual fire insuranceand mutual employ- <' ers liabllltyor Workmen'6CompensationInsuranceinsofaras the constitu- tional provisionsare applicable.
We recognizethe effortof the LegislatureIn the enactmentof Article 4860a-8,supra,to attemptto sanctionsuch itI8uFanCe by publiccorporations, and we realizethe effect of our opinionwill be to declarethat part of the statuteunconstitutional.We perceivesuch to be our duty In view of the ex- pressionof our Texas courts.
After carefuland exhaustiveinveetigationof all availableauthorities, we are of opinionand you are respectfullyadvisedthat I)allas Countycannot legallypurchaseinsurancein mutual fire or casualtycompanies;that such purchasewould involvetaking mmubershlpin or becomfnga 6tockholderin such corporation,associationor companyin directviolationor the provisionaof the Texas Constitution.
We, therefore,overruleConferenceOpinioaNo. 2880, and all other opin- ions and expressionsof this departmentholdingcontraryto this one.
Trustingthe above satisfactorily atiswers your inquiry,ws are
Yours very truly
ATl'OBNEY GEEEEALOF TEXAS
By /a/ Ben,jemlnWoodall BW:ob BenJamb Woodall; Assistant This opinionhas been consideredin conference,approved,and 18 now or&red recorded. :' /s/ GeraldC. Mann P- Gerald C. Mann AttorneyGeneralof Texas P;'---"'