Court Opinion

ID: 4132635
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:28:46.886889+00
Date Added: 2024-06-11T14:27:21.271097
License: Public Domain

‘Ihe Honorable     Jesse James                      Opinion   No.      H- 745
Treasurer,     State of Texas
State Capitol Building                              Re:     Procedure      for return to
Austin,    Texas 78711                                      insurance     companies     of
                                                            matured    securities    filed
                                                            as collateral     with the
Dear   Mr.   James:                                         State Treasurer.

     You have requested   our opinion concerning   your authority   to utilize
certain procedures   with regard to the return of matured     securities     to an
insurance   company upon instruction   from   the State Board of Insurance,

    As required      by the Insurance        Code, the State Treasurer        is the
custodian   of various     securities     pledged by insurance       companies.      Ins.
Code art. 1. 10, 5 17(a); see arts.          3.15, 3.23, 8.05,      9.12, 14.10, 17.25,
19.06.    Upon order of theommissioner                of Insurance,     the Treasurer
is to “release,     transfer   and deliver       such deposit or deposits      to the owner
as directed     in said order.”       Ins. Code art. 1.10, 5 17(e).

    Due to the costs and risks involved           in the transmission       of the securities,
you have asked the, following questions:

         (1) May the State Treasurer           require   insurance
         companies  making deposits          to designate    a local
         agent to whom the securities          can be delivered?

         (2) May the State Treasurer         or the Commissioner
         of Insurance    require   insurance    companies  to deposit
         only registered    securities   in his care?

         (3) May the State,Treasurer     deliver the securities
         to the Board of Insurance   for subsequent  delivery
         to the companies?

                                   p. 3163
The Honorable      Jesse    James,    page   2     (H-745)

      While the State Treasurer       has no expressly    provided     rule making
authority,   he may exercise       those powers    necessary    and proper      to the
fulfillment   of his statutory    duties.  Terre11 v. Sparks,        135 S.W. 519
(Tex. Sup. 1911); Corzelius      v. Railroad     Commission,     182 S.W.2d 412
(Tex. Civ. App. --Austin       1944, no writ).    The State Treasurer        has the
statutory   duty to deliver    these securities.     However,      the legal delivery
of a document does not necessarily         entail a manual delivery.         Henry v.
Phillips,   151 S.W. 533 (Tex. Sup. 1912). The court in that case held
that the deposit of a deed with a bank constituted          a sufficient    delivery.
In Brown v. Rodgers,        248 S.W. 750 (Tex. Civ. App. --Amarillo             1923,
no writ),   the court stated:

              Any act or declaration        on the part of the
         grantor,     denoting an intention to give a present
         effect to the executed      conveyance,       is said to be
         sufficient    to constitute  delivery.      (citations
         omitted)     Thus leaving the deed with the notary
         or an attorney,      to be delivered     to the grantee
         when called for, delivery        to the recorder       for
         registration     with instructions     to deliver    to the
         grantee when recorded,          deposit in the post office
         addressed      to the grantee,    and acts of such charac-
         ter have been held sufficient        to constitute      delivery.
248 S.W. at 750.

See also,   Tyler  V. Bauguss,    148 S.W.2d 912 (Tex. Civ. App. --Dallas
1941, writ dism’d.    jdgmt.  car. ); Wvcoff  Warehouse,    Inc. v. Public
Service   Commission,     403 P.2d 168 (Utah 1965).

    Since article     1.10, section 17(e) is silent with respect   to the manner
of delivery,    it is our view that reasonable     procedures   may be adopted
for the delivery     of the securities.   Accordingly,    while we do not believe
the designation     of a local agent may be required,      in our opinion it may
be indicated   that delivery     will be made in Austin,    Texas,  to the owner
or his authorized      representative.

     Your second question     is whether   companies     may be required    to deposit
only registered   securities.     Article 1.10, section 17(a) and article     3.15 of
the Insurance   Code require     only that the securities   governed   thereby be
legal investments    of the companies.      Articles   8.05 and 19.06 require     only

                                       p. 3164
The Honorable      Jesse   James,        page    3   (H-745)

that the securities    be one of those listed in article        2.10.    See also
Ins. Code arts.    9.12, 9.18.     Only article    14.10 regarding      mutual
assessment    companies     and article     17.25 regarding     county mutual
companies    do not~definitively     provide   which securities       are acceptable.
Those statutes allow      “convertible     securities    subject to approval      of the
Board” of Insurance      to be deposited.       In our view where the type of
securities  is expressly     limited   by statute,    neither the Treasurer        nor
the Commissioner       of Insurance     may require     these securities      to be
registered,   for powers may not be implied where a statute is explicit
on the point in question.       Creager    v. Hidalgo    County Water Improvement
Dist. No. 4, 283 S.W. 151 (Tex.Comm’n.App.                1926, jdgmt.     adopted).

     Your final question       is whether   the Treasurer     may deliver     the
securities    to the Board of Insurance        for subsequent   delivery    to the
various    companies.      Article   1.10, section 17(e) provides      that the Treas-
urer shall “release,        transfer    and deliver   such deposit or deposits       to
the owner as directed        in said brder. ” Since the statute expressly          re-
quires delivery      by the Treasurer      to the owner it is our view that he may
not merely     deliver   the securities    to the Board of Insurance,

                              SUMMARY

             The State Treasurer   may indicate                that delivery
         of securities will be made in Austin,                 Texas,   to the
         owner or his authorized  representative.

              Neither   the State Treasurer     nor the State Board
         of Insurance     may require  cleposited   securities   to be
         registered    where the type of security     is expressly
         limited    by statute.

              The Treasurer   may not merely             deli,ver the
         securities  to the Roard of Insurance            for subsequent
         delivery.

                                    p.    3165
     The Honorable   Jesse   James,    page    4    (H-745)

     APPROVED:

T232b.J                                  .o,.m

     DAVID   M.   KENDALL,     First   Assistant

     ;--L
     C. ROBERT   1SEATH,     Chairman
     Opinion Committee

                                          p.     3166