Opinion ID: 895260
Heading Depth: 2
Heading Rank: 1

Heading: The Statutory Conflict

Text: When the Lottery Act was first enacted, lottery prizes generally could not be assigned, and to the extent they could be assigned, the assignment had to be pursuant to an appropriate judicial order that resolved a controversy involving the prize winner. See Act of Aug. 12, 1991, 72nd Leg., 1st C.S., ch. 6, § 2, 1991 Tex. Gen. Laws 197, 218 (current version at TEX. GOV'T CODE § 466.406). In 1999, the Act was amended and restrictions on assignment of prizes were relaxed. Act of May 30, 1999, 76th Leg., R.S., ch. 1394, §§ 2, 4, 1999 Tex. Gen. Laws 4717, 4717-18. The amended provisions authorized prize winners to assign all but the last two installment prize payments if certain requirements were met. [1] TEX. GOV'T CODE § 466.410(a). Under the amended Act, however, prize payments due within the final two years of the prize payment schedule may not be assigned. Id. The apparent statutory conflict in this case arises because thirteen days before amending the Lottery Act in 1999 the Legislature amended the UCC and included winnings in a lottery or other game of chance operated or sponsored by a state as part of the definition of account. Act of May 17, 1999, 76th Leg., R.S., ch. 414, § 1.01, 1999 Tex. Gen. Laws 2639, 2640 (codified at TEX. BUS. & COM. CODE § 9.102(a)(2)(viii)). Under the UCC, accounts are assignable. See TEX. BUS. & COM.CODE § 9.406(a). The UCC amendments, however, did not parallel the Lottery Act amendments that prohibited assignment of the last two installment payments of a lottery prize. To the contrary, the UCC reinforced the assignable character of accounts by specifying that rules of law, statutes and regulations purporting to prohibit or restrict assignment of accounts are ineffective: [A] rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation: (1) prohibits, restricts, or requires the consent of the government, governmental body or official, or account debtor to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account or chattel paper.... Id. § 9.406(f). The amendments to the UCC were effective in 2001. In 2001, section 9.406(f) was amended in part and reenacted; the provisions making conflicting statutes ineffective were not changed by the amendment. See Act of May 17, 2001, 77th Leg., R.S. ch. 705, § 11, 2001 Tex. Gen. Laws 1403, 1405 (codified at TEX. BUS. & COM. CODE § 9.406(f)).