Court Opinion

ID: 4137946
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:30:46.338218+00
Date Added: 2024-06-11T14:36:44.473622
License: Public Domain

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                                                    ENERAI.

                                    May 10, 1949.

            Hon. Raymond E. Hagee      Opinion MO. v-826.
            County Attorney
            Calveston County          Re: The applicabl1ity of stat-
            Galveston, Texas              utes prescribing bonds for
                                          sale of real estate to es-
                                          tates of decedent8 and
                                          Suardlans when the flducl-
                                          ary is a oorporqtion qual-
                                          ified to aat nlthout bond
                                          under Article 4982 of
                                          Chapter 16.
            Dear Mr. Magee:
                      Your request for an opinion IWadS, In part,
            as fO11OW8:
                     "The County Judge has addressed a OORIN-
                nioation to me asking for an opinion constru-
                ing several probate statutes.
                     "The question In my mind   involves the "
                appllcabllltY of the statutes   prescribing
                bonds for sale of real estate   to estates of
                decedent8 and guardlanm where   the fiduciary
                Is a corporation quallfled to   aot without
                bond under Article 4982-86. .   e .
                     "He ha8 applications pending by a bank
                which Is quellfled to act as guardian by com-
                pliance ulth requirement as to deposit of se-
                curities with the State Treasurer in which
                they Seek authorIt to sell a8 Admlnlrtrator
                without bond.
                      "Re has the same question in an estate
                 of a ward whose guardian Is a Trust Company
                 qualified in compliance with the requirement
                 a8 to deposit of securities.
                        "The questions which he wants clarified
                 are:
Ron. Raymond E. Magee, page 2 (V-826)

          "1. May the admlnlstrator be authorized
     to sell without complying with quoted Article
     35760
          "2 . May the guardian be authorized to
     sell without complying with quoted Article
     42011"
             Artlales 4982 and 4983, V.C.S., provide:
     "Apt. 4982 . . .

          "Any person or association of persons,
     any State banking corporation or any other
     domestic corporation, or any corporation or-
     ganized under the laws of any other State,
     provided such foreign corporation complies
     with the laws of this State relating to ln-
     surance other than life, may exercise the fol-
     lowing powers by complying with the provisions
     of this subdivision:
          "1. Qualify as guardian, aurator, execu-
     tor, administrator, assignee, receiver, trus-
     tee by appointment of any court or under will,
     or depositary of money In court, without alv-
     lng bond as such.
          "2. Become sole guarantor or surety In
     or upon any bond required to be given under
     the laws of this State, any other statute to
     the contrary notwithstanding." (Emphasis add-
     ed throughout.)
     *Art. 4983 . . .

          "Those Included In the provisions of this
     subdlvlslon shall:
           "1. Deposit with the State Treasurer
     fifty thousand dollars aonsistlng of cash,
     treasury notes of the United States, or gov-
     ernment, State, county, municipal OP other
     bonds, notes, or debentures, secured by first
     mortgages or deeds of trust, or mortgages or
     deeds of trust on unencumbered real estate In
     Texas worth at least double the amount loaned
     thereon, or such other fir8t class securities
HOIt, Raymond E. Magee, page 3 (V-826)

       as the Comlssloner may approve.   Said bonds
       or securities shall not be received or held
       at a rate above par, but Ii their uarket val-
       ue Is less than par they shall not be held
       above their actual market value. The State
       Treasurer shall require any such depositor to
       replace any securities 80 deposited on wh%ch
       the interest shall not be paid within six
       months after maturity, by other securities
       equal In amount to those removed, upon which
       the interest ha8 not been defaulted. The
       funds 80 depOSitedshall be prlBarily liable
       for the obll~atlens of the depositor in any
       Capaolty herein luthorlmd, and shall not be
       liable for &my other debt or obllgtior  of
       the depositor until all 8Uoh tl'U8t1iabllitle8
       have been discharged.
            “2.  SatiStj the C@mSSiOtNr   Of it8 801-
       vency . The Commissioner shall Issue any such
       depositor, when SatiSfled It Is solvent and
       has made the required deposit, a oertifloate
       8hOWiry;8UCh facts.
            "3. Uaintain a prem.lumreserve of the
       amount required to reinsure all outstmding
       risks, to be determined by taking fifty per
       cent of the premluu o? all unexpired risks
       that have la88 than one Jsar to run, ad a
       pro rata of all gross prerium on risks that
       have more than one year to run.
            "4. File with the Comlrslsaer, within
       sltty day8 after the first day of each Jmuua-
       ry, a report 8wCrn to br it8 presideat and
       searetarJ or by two of its prlneipal liiio er s,
       as to the surety and bond burlnerr (Lone by the
       8am during the preceding year.

            '5. Pay taxes on It8 surety and bond
       buzm78  a8 required of other surety oompa-

          It was held In Attorney Oeneral's OPlnlOn Ho.
2541 under date of January 11, 1924,
                                -.   (Opinions of Attor-
ney General, 1922-1924, page 306) construl   Art1c1es
540 to 545, Revised Civil Statute5 of 1911 now Artia1er
Hon. Raymond E. Magee, 'page 4 (v-626)

49?? and 4983) that_.since
                      -. . the laws of the
                                    _ -. . State
                                            . . of _Texas
aumorize ana perPut mate mm8      ana maze Dau ana
trust companies to act a8 guardlan~admlnlstrator, etc.,
without bond, National bank associations doing business
In Texas nay be authorized and empowered by the Federal
Rersrve Bo8xd to perform suah powers and functions in
TOX88. Following this op'lnion,it was held In Attorney
t3eneral's Opinion Ilo.O-5929 that where a State or a
National bank complies with the deposit requirements of
Artiolea 4982 aad 4983, it ha8 met the full requirement8
of law and may functiolain such fiduciary eapaclty wlth-
out a bond.   It was further held in this opinion thr
  ti 1 a01 required the execution of a l8ale68 bond
ref8idiess of whether or not the bank actually executed
a general' bond and regardless   of the fact whether the
bank had made the required deposit under the term8 of
Article 4983. SUbSeqUent to the above mentioned Attor-
nej aeneral's Opinions, Artioles 3576, 4201, and 4216,
V.C.S., have been amended so as to provlde the following:
     'et.   3576 . . .
          Vhenever any property of an estate Is
    ordered to be sold by the county judge, such
    order shall be entered upon the rinutee of
    the uourt, Shall describe the property to be
    sold, the time and Dlace of sale, and the
    terms of said sale,-and shall re&lre the ex-
    ecutor or admlnlstrator to file a good and
    sufflolent b d Subject t the approval of
    the court, $    if the sure&es on said bond
    are naturiiilpersons, same shall be In an a-
    mount equal to twice the amount for which suoh
    real estate 18 sold, but If the surety on said
    bond Is either a dOBeSt    or for8ign cerpora-
    tion permitted t0 do bUslne88 in thi8 State
    for the purpose of ls8ulng surety, guaranty,
    or Indemnity bonds guaranteeing the fidelity
    of executors, admlnlstrators and guardians,
    same shall be equal to the amount for which
    8UCh real estate 1s sold, plus any additional
    sum the court shall find necessary and fix
    for the protection of said estate; provided
    that where the sale of Such real estate is
    nade to the owner or holder of a secured
    clalr against the estate the sale of the real
    estate securing suah claim, and.ls In full
Hon. Ramond E. Magee, page 5 (V-826)

    payment, liquidation and satisfaction there-
    of, no bond shall be required except for the
    amount of cash, If any, actually received by
    auch~executor or administrator in exoesa of
    the amount necessary to pay& liquidate and
    satisfy such claim In full.
     "Art. 4201 . . .
          "An order for the sale of real estate
    shall state: (1) The property to be sold, g%v-
    lng such desoriptlon of It as will Identify
    it. (2) Whether it 1s to be sold at pub110
    auction or at private sale, and If at public
    auction, the time and place of such sale. (3)
    The neoeaslty 8nd purpose of such sale. (4)
    That no sale made by the guardian pursuant
    thereto shall be confirmed nor shall the tlt-
    le of the ward to such real estate pass to
    the purchaser unless and until It shall first
    be found and determlned by the court, by an
    order duly made and entered to that effect
    kh t the guardian's general b d If the s&e-
    11:s thereon are natural oers:iia:la In an
    amount equal to double the value of the per-
    sonal property then on hand, Including the
    amount for which said real estate may be sold,
    plus such additional sum as may, In the opln-
    Ion of the court, be neoessary to protect the
    estate of the ward, and that the sureties on
    such bond are solvent; but if the surety or
    sureties qn,aald bond 8re either a domestic or
    foreign aqrporatlon or corporations permitted
    to do buSine88 in the State for the purpose of
    issuing surety, guaranty, or lndemlty bonds,
    mmxanteelns? the fldellts of auardlana. the

    to protect the estate of the ward as above
    required, an additional bond shall be filed
    In accordance with the above requirements.
    However, where the sale of such real estate
    18 made to the owner or holder of a secured
Hon. Raymond E. Hagee, page 6 (v-826)

     claim against the estate and the same la of
     the real estate securing such claim and la In
     full payment, liquidation, and satisfaction
     thereof, only the amount of cash, If any, ac-
     tually received by such guardian In excess of
     the amount necessary to pay, liquidate and Sat-
     isfy such claim In full, shall be considered
     together with other property of the estate in
     passing upon the aufflclencg of the bond as
     hereinabove required. (5) It shall require
     the sale to be made and the report to be re-
     turned to the court in accordance with the
     law."
     “Art. 4216 . . .
         "At any tWe after the expiration of floe
    days after the filing of a report of sale, the
    Court shall inquire Into the manner In which
    such sale was made, and hear evidence In sup-
    port of or against such report, and If satls-
    fled that such sale was fdlrls made and In
    conformity with the law and that the uardlan
    ha8 on file a good and 8ufflclent*d enera
    in an amount, If the sureties thereon are nat-
    ural persona; equal to double the value of the
    personal property then on hand, Including the
    amount for which said real estate Is being
    sold, plus such additional sum as may, In the
    oplnlon of the court, be necessary to protect
    the estate of the ward; but If the surety or
    sureties on said bond are either a domestic or
    foreign corporation or corporations permitted
    to do business In the State for the purpose of
    lseulng surety, guaranty or Indemnity bonds
    guaranteeing the fldelkty of guardians the
    bond shall be In an amount equal to theylue
    of the personal property on hand Including the
    amount for which said real estate may be sold
    plus such additional sum as In the opinion of
    the court may be necessary to protect the es-
    tate of the ward; and if and when the guardi-
    an's general bond has been examined by the
    court and found to be In the amount above re-
    qulred with good and sufficient sureties there-
    on, or if the guardlan's general bond is found
    to be lnsuffl~lent, then an additional bond
    shall be filed in accordance with the above
Hon. Raymond E. Hagee, page 7 (V-826)

    requlreQent8; a8 evidenced by an order duly
    made and entered b;lthe oourt'to that effeot,
    the oourt shall cause to be entered a dearee
    ConfIrmIng such sale, and order the report of
    sale to be recorded by the clerk, and the
    proper conveyance of the property sold to be
    made by the guardian to the purchaser, upon
    compllanae by such purchaser with the terms
    of sale. The provisions of this Article shall
    be mandatory, and unless the court shall first
    determine that the guardian's bond is adequate
    and solvent as above set forth, an evidenced
    by an order made and entered by the court to
    that effect, any sale of real estate hereafter
    made under the provisions of this Title shall
    be void.*  (Emphasis added.)
          It will be noted that Articles 4201 and 4216
now state that If the "general bond" of the guardian IS
sufficient, as evidenced by an order duly entered by
the court to that effect, real estate may be sold wlth-
out the necessity of a "sales" bond In addition to the
'general* bond.' There is no comparable provision ulth
reference to administrators.
          Therefore, it U.our opinion that where a bank
has qualified to act as guardian or admlnlstrator by
compliance with the requirements of Articles 4982 and
4983, by making the required deposit of securities with
the State Treasury, such bank may act as guardian or ad-
ministrator without giving a wgeneral* bond as required
by Articles 4141 and 3386, V.C.S. It is our further
opinion that suah bank aannot sell property as admlnla-
trator without filing a speolal *sales bond as required
by Article 3576. However, such bank may sell real ea-
tate under the provlslons of Articles 4201-4216 as
guardian wlthout filing an addltlonal *salea" bond if
the court Is of the opinion that the deposit of securl-
ties with the State Treasury is of sufficient value to
protect the estate of the ward.
                        SumaARY
          A bank uhlch has quallfled to act a6
     $uardlan or administrator by compliance rith
     the requirements of Articles 4982 and 4983,
     by raking the required deposit of seourltles
     with the State Treasury cannot sell proPert
Hon. Raymond E. Hagee, page 8 (v-826)

    as administratorwithout riling a special
    "sales" bond as required by Article 3576.
    However, such bank may sell real estate un-
    der the provisions of Articles 4201-4216,
    as guardian, without filing an additional
    "Eales" bond, if the court 1s of the opln-
    lcn that the deposit of securities with the
    State Treasury Is of sufflclent value to
    protect the estate of the ward.
                               Yours very truly,
                           ATToBlEY OAL       OF TBXAS

JR:bh

                           FIRST ASSISTNW
                           ATTORRBY OBNBRAL