Court Opinion

ID: 4143111
Source: CourtListenerOpinion
Date Created: 2017-02-18 03:29:47.452352+00
Date Added: 2024-06-11T14:33:57.871272
License: Public Domain

OFFICE OFTHE   AHORNEYGENERALOFTEXA8
                               AUSTIN

-c-
--

      Hoorah win.r. Larraon
      J rotaryor state
      iwtin, Tms
      BearSir:

                                              t of ymr letter of
      Yuoh 0, 1941,                              on of this depart-
      ac)nfi
           oa the abo                            ux letter of lm-
      puwt   readat
                                          wre   Znmranae can-
                                           rowwal ol its
                                           oi k?tialr 1515 (a)
                                            isat that thlr
                                           meat iwur8rlee
                                        now ba &ranted a

           co&g    to Se&ion 1E'of that artfole tkeir
           ohertera *are exgresLlp oontlnued in soroe
           during the ,terms or said cthartexw'. Tbet sot
           was   wed In 1053. In 1959, Artiole lSl5 (a)
           and rb) WLR peesed prooidbg #at the Seare-
           tary of State aould extend the oerprate ex+3-
           tenoe of a company lnwrporated   for any purpose
           authorized *uadei thim titlet. ThiP aot else
Honareble 'ifur
              .I.Lawson, Page 9

      provides that the filin& roe to b4 paid shall
      be such fee as th4 aorgoratlon    would be re-
      quired to pay ii it were agplying    for ar new
      charter. The sat ~150 reqdrse that 32x4Ssc-
      rotary of Stats find that the coworation is
      solvsnt and its capital unimpaired. In this
      deae, the Seerstary ot 8tate could not now
     .grant a charter to a state-wide mutual in-
      ruranc4 company and w4 aould net find that its
      capitol is unimpaired, as it has no capital
      mto4k.
             WI      rim    of these
                              fbot8, we wi8h to request
      an   oplnibn     fP0A   you3     48 to wbsther
                                       Ihagartaent
      th4 Seoretacy o? State ie authorized to grant
      an extension ol ths Corporate srlatsncs of a
      mutual assessment iwuranoe assoaiation under
      Artfale 1315 (a) and lb).*
             The facts       disoloued in the affidavit   of Xr. A, B.
Bratmen,    Secretary       o:’ TexailIndmgendecce  Lit4 Imurencs Com-
pany,   which accompanies your letter of inquiry show that
Texas   IridependenceLife Insurance Company wee incorporated
tar a   terr.of 40 years from th4 Bth day of January, A. 9.
1899.    Thus'it is s44n that the ehartsr of sueh company ex-
gired   by operation of law on the Hth day of January, 1941.

          The 43rd Legislature peswd BOUW Bill Ro. 505,
now ICWWA as ChapteD 6a, Title 70 or the Revised Civil Stat-
ut48, which wan de&kg&d to place'all oorporatiocs doiw an
icearaneo business nbt then uadelrthe supertlrion of the In-
6urance Department by virtue or a pertinantrtatute under
their supsrrision.
          It WE            provided in such bill, oow Section l!:of
Article 4889fr
             "Sac. 1. Any aorpomtion    organized 8nd
      ineorgorated under a pre-existing law in this
      State    without capital etooErand net for profit,
      whioh low has been mended or repealed or r4-
      maoted,     and which was oocratin~ *ad actually
      oarrying on in this ribateimsdiatsly prior to
      January 1, 1933, the state-wide businew of
      o;Utuallp   !:rOteotiagOr inSum$   the liV4s Of
      its zmzbars by dsseasraentsijadeupon ids mm-
      hers my coxgly with the t4rms ot this Aot,
      subject to ths subsequent provisions heroot.*
“:

     Eonezable Wm. t. lawaon, Page 3

               i%dtien e of 5ueh artlclo protides that any oorpora-
     tlon d8so~fbd in seetion 1 thorsof cf3uldavail itselr or th8
     rlghte an6 privileges sonfsrred by lwh law conditioned that
     they did 80 within sir m&m    after the effeottve date or the
     ret.
                The %xas  Independenoe Life Insurance Company did
     avail ttesli of the privileges conferred by eu5h law and has
     siaoe operated under and has been known and acnunonlyreferred
     to aa ,a SOS company.
               It was the legielatlva intention a8 expreseed in
     Rouse BU.l SC3 to 8x ressly repaal all ohartem or ineurame
     oompanlea then inex !st8nce whloh failed or rofused to quali-
     fy thereuader with, of eourae, axaaption of those qualifiad
     under ether pertinent atatut8a. Seotion 14 thereor provided
     in paPt:
                         The charter of eaah eorpavation
          in thz &&;    entitled to comply with the terms
          or thin Aot wblcrhdoes mt make applfoation to
          do lo within six (01 month6 after th8 bet shall

               Thus it ia seen that the legislative intention rsla-
     tlve to euoh corporations is plait&y, intelligently and un-
     mistakably expressed. They provldod, aa they were required to
     do, that the oharters of all corporations qualifying there-
     under were to bs wexpressly oontlnued in rorce duri
     t:mm of said ohart8rsD (Undersooriog ours). TK&iSnot
     have repealed the existing charters without offering thea
     opportunity to Qualiry under the regulatoryfar. 308 New
     Orlean Wataxworlu  Com.pany V. Riv8ra, Louisiana, 115 U. 3. 74,
     eo L. Rd. 52x5. Th8 Legislature dib hot th8n provide that
     the ohertern of those oorpcratlons qualifyiog we- to b8
Honorable mu. 5. L&w#ori,Page 4

thereafter rehew&   or lxteaded. Statutory authodty for r8-
WWiiIg and extendin& sueh ehertern wa* not then efi@t8ot and
was nowhere provided for at that tlsls. If maeh authority na
OXiOtS it illby reallonof &vtioltv$l315(a) aad (b) lpasredat
the Re&ar   and rirbt Called 8waions respeatively of the
45th Le&kturar     AFti    1315 (a) reada:
            WSubj80t to a finding by the Seoretary    of
    3%atO aa herolnaitar provided, any private OOF-
    poration organized or inoorporat+d for any pur-
    pose or purpo8os authorised under thl8 Title,
    at any time within ton (10) yearn prior to the
    8xpiratloa or ltr ehartes, or any extension
    thareot, my lxtenb 6uoh ahurter and the oor-
    pOPat exbtenoe Or 6ueh oePpoPation for an ad-
    ditlonel period 0r not to aoeed rirty (so)
    yearn from the expiration date or the original
    ohmter, or any *rte~%rlon themOf, with all
    the prlvilege8, pou8ra. iarmunitiecl,   ri&ht or
    sueo*88lon by it6 eorporPte name, and rights
    0r   property, real and p srsonala~~$m!&md
    he1iiby it at suoh 8xp ration
    @ala8iXlt8llt~  and pUI'pOE38BBS UpOn &&B&l
    inoorporatlonl The nmnnor 0r extendi
    suoh 8herter mhll be by a resolution?LY%t-
    ing, adopted at any annual or ~peoialmest-
    iag Of stoohholdera oallod ior that purpose
    by rtookhold8rm holdin$ a majority or the
    ehar88 or capltel stooh or SuOh corporation
    then outstandi       suoh nsolution to speoify
    the period 0r t% 8 ror whioh the ohmtar 141
    exttildod,   and a OOpf Of suoh rOlVOlUt%Oo,duly.
    aertifled    by the seoretary of the oorporation,
    Wld8r the aorpamt~     asal, ehnU be riled and
    r8eOrd8d in the Ofrio Or the S8Qr8tBX.yOf
    state. upon the adoption oi'such resolution
    and the riling or a Oertifled oopy thereof with
    the S8oretary Of State tog8th8r with ~pZU%Qt
    of the filfag r88 hem&       presOribed, the Ohax-
    tar and OOPpOPUt8 existence Of such OOrpOI'atiOn
    may be 8rtSnded for the additional period Of
    tiIII8  reafted in suoh reeo2ution. The filing
    fee to b8 paid for say euoh extarmion Or a
    Ohart      shall be eueh f80 aa oaid oor9oratloo
    would be required Under the Statutea Of Texae
Honorabla Wm. 3. Lawson, Page 5

     to pay in the event it was then applying for
     8 new charter instead of ertonding it@ then
     eristing oharter.
          *8~0h etien0l)ion8,however, may be made
     only in instaneeiuwhere the Beoretary of State
     shall have feund, artes proper investigation
     that such aOrpOration in solvent end it8 oapf-
     tal unimpaired.’
          Artictlo1315 (b) read88
           "The proviaion8 of Art1010 1515(a) @hall
     extent to and inelude all private oorporationa
     incorporated under the general laws of Texas.
     The period OS ten (10) years prior to the er-
     piratlon of the charter or any extension there-
     of referred to In Article 1315(a) shall in-
     elude the period of time during whiah auah
     Oorporntion rpay hare continued ito existence
     under the provieioae of Article 1359 of the
     Revised Civil Statutes of 1922.e
            The settled rule of construction or grant8 by the
Legislature to cOrporationa whether publio or private, is
that only swh powera and right8 oan be exeroieed under them
aa are olearly aomprehended in the words of the aot or de-
rived therei’rom by necessary lmpliaation. Any ambiguity or
doubt arising out of the terms used by the Legislature muat
be resolve~dIn favor OS the publio. Sutherland DA Statutory
Con8truutlon. p. 429, oltlngr Petersburg Y. kietzher 21
Ill. 2058 Btet8on f. Kempton, 15 MaEa. 2723 Warahaohfe v.
BrOwn, 67 Tax, 519, and other authorftiea too numoroul)for
oltatlon herein.
          This rule of atrfot OOnBtrUCtiOA iB dieoueeed at
great ls@th in Th~%peon on Corporations, Vol. 1, p. 397,
whe,reinhe dloouesed and quotes from the case of Paoker v.
Sunberry & Co. R. Co.,.19 Pa;).St. 211, ae follows:
          -Rut to justify a strict aonmtructfon it
     i8 not nooe88arg e0 oowider the nature and
     olroumatances of the gartieular law before us,
     for it belows to a olaa8 of atututee whiah,
     by a long establiehed and well defined rule of
     interpretetion in all the etateaof the UA~OA,
                                                              ‘;

                                                                    234

    Honorable Wm. cf.Lawtaon,Page 6

        as wall a# in -land,   ?iurtreoeive and unlfow-
        lg ham moeivti   the strictest possible oonstruo-
        tion. All sots o!'incorporation and aota extend-

              Applyin the above rule6 of aonstru0tlon to Arti-
    ole 1315 (a) and 1b), can it be urged thtstthere is no doubt
    but that auoh rant o? authority Is extended to the Taxas
    Indapendanoo Lffe Insurancrcl
                                Onnpanp and other8 Biailarly
    situated? Artlale 1315 (a) expreusly provides that the
    resolution to extend the eorporatb life nust be .. . . adopt-
    ad at any umual or speoial meting oi eto0k:holdera. . .
    by stoakholder$ holdina a majorits of the shares of aagital
    atoa,. . ." [Undersaoring ours.)    rt 1 ? th           ld d
    m*rtmh     extenaiona, however, may be ~dtb%l~i%atk!ea
    where the Secretary of State shell have found . . . the aor-
    poration solvent and its capital &nisnpalred." Sinocl there
    are no stookholdara in a mutual llfa ineuranoe 0o~pany to
    pass the raaolutlon requimd, and sin00 suoh oOrpOratiOn    as
    oreated with ut capital atoak and presumably ar a non-profit
    aorporntion    required findings of the Seoretary of Stats
    are rendered%, ~oesib1.eof performanoe.

              Although the mrding of Artlols 1315 (b) is apparent-
    ly broad enough to utiverall oorporatlonr, it is our opiu-
    ion that Artiola 1313 (a) and (b) considered togsther,were
    not intended to nnd do not emaompa118the type of oor$oration
    involved in this opinion request. It neoesaarily follow8
    that your request is answered in the negative.
                                         Yours very truly
                                      A!L'TCRNEYGX'J.ERAL
                                                       OF TEXAS

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