Untitled Texas Attorney General Opinion ( 1942 )

i
OFFICE OP
THE ATTORNEY GENERAL
AUSTIN.TEXAS
nn Ovarruled by O;k587-a
/(.>, : i:fd I'
Lockhsrt, Chsirrlan
Ronorsble CI.;:;.
Rosrd of Insurance Commlsnioners
Austin, Texas
Opinion No. O-4587
Deer 7lr: Ile: Incorporationof title insur-
ance companies under Article
1302a, as emended; powers and
duties of the Board of Znsur-
anca Commisaionarsto prescribe
rates and policy forms for title
insurancarisks outside of Texas;
deposits and reserves required
of suoh oompanles;their liabil-
ity for franohise taxes; filing
fees required; ellgibllltyof
property to be reodved in psy-
ment of oapltal stock and sur-
plus.
We have your letter of recant date requesting the
opinion of this department on the above subjects,whioh let-
ter sets out eight separate questions. We also have your
supplementalrequest maklng certainadditions and explana-
tions in oonneotionwith question 7 and adding a ninth ques-
tion, whioh question No. 9 is divided into twelve subheads.
Your original opinion request reads in part as fol-
lows:
W!i%isis the first title insurance oompsny
attempted to be formed under Artiole 1302a a8
amended (Acts 1929, Alet Leg., Reg. Sess. p.
77, Ch. I+0as amended by Acts 1931, l&d Leg.,
Rag. Sess. Ch. 269 and by Acte 1933, l&d Lag.,
Reg. Sess. p. 750, Ch. 222). For our guidance
in the incorporetion,licensing,.examlnation and
regulation of this company, es wbll as similar
ones which may be incorporatedin the future end
companies which came utier the new legislation
above cited upon its enactment,we request yolrr
opinion upon the following points in oonnectfon
with the constructionof Artiole 13028 as it
now stands: n
Your questions are hereinafterstated and answered
individually.
Question No. 1 reads as follows:
Hon. 0. B. Lockhart, page 2
nDoee thle Board have the legal power and
duty ot prsearlblng polloy form5 for ~150lo
writlag titla insuranae outalde the State of
Texas by oompanles operating under Article
1302aV
We assume that your phrase “title Insurance outside
the state” means title insurance oontraots medo outside the
state on property outside the stete.
Seotloua Nos. 3, 4 end 5 of Artiole 13020 reed em
r ollowB t
*Sue. 3. Corporations 80 formed, au ml1
ea foreign oorporatlons en8 those oreated under
Subdivision 57, Artiole 1302, Qr tha Revised stat-
utes of 1925, or under Chapter 18, Title 78, Be-
vised Statutes of 1925, or any otheo law in 60
2ar as the buolne5s cd either may be a tltla ln-
suranae bualneso, eholl operate in Tex%s, under *
the oontrol and sunsrvielon and under suoh nnl-
form rules and regi&tlone srS to ioraw of poll-
ales end underwriting oontraotti~ and premlume there-
for, ae may be from time to time.prascrlbe4 b the
Board of Znauranoe Comdsslonere of Texas aJJ
no Texas or foreign oorporat ion, whether &or-
peroted. under this eat or any other law ab the
State of Texan, shall be permitted to Issue my
title polioy ar mertg8go oertliloate or under-
OrrLting oontraot on Texas mepertz other thus
under thla sot ana under euoh rules and rewtla-
t1ons. X0 policy of title lnsuranae af guGfmtiee
of any oheraoter on Texue titles shall be lseued
or valld unless mitten by a oorporstion oaarply-
log with all provisions oi and authariaed m:
quellfled under this aot. Before an rate we-
vfded for herein shall be fixed or o L ed, roe-
sonable netloe shall lsaue~, and c hearing atford-
ed to the oompanles ai’feoted by this aot. Every
oampuny doing business under thls act shall tile
with the Board or Insurance Odseioners the
form rb guarantee, oertlfloate, mortgage polloy
ar any polloy of title lnsuranos before the same
shall be Issued, and the form must ba apwoved
by tho Board, and be unlfara as to all compaaiee.
Under no cironmstenoes map asp oa1~0n~ use aBy
?orm until the same shall have been ausrivved bf
he Boar&
*The Board of Insurance Comailssionere &all
have the right and It shall be its duty to fix
ati promulgate the rotas to be oharged by MI?
poratlons created or opereting hereunder ir
premiums on polloles or certliloates and under-
wrftlng oontraote, .The rate Zixed by the Board
Eon. 0. P. Leekhart, page 3
shall be reaaohable tothe publle aad. non-eonfle-
oatory sa to the oaq~ny. For the purpose af
aol.l.eotIng data on yhhh to datemIne the proper
rates to be iixeb, the Boar& ahall have the
right to require the ooqanies oporsting Iu
Texas to sa&$t.suah lnfomatlon In suah form
as it may d6iPl proper, all Ihfomation as to
loss expsrIenoo, expense oi operation, and other
material matter for Its oonslderation.
“Ratea when once fixed shell not be changed
until after a publIo heaxIng shall be had by tha
Board, after proper not100 sent aih0t to all
oompaniea interested In writing this buslnera;
and after public hotloe in such manueras to
give fair publioity thereto for two weeks In ad-
vanoe. The Board must oall suoh heaxIng to oon-
e$der rate ehmgee at the re uest of a oompany
writing tit10 lnauranoe,~or i!r the Board thinks
thst a ohango In rates may be roper. zany ecm-
pany or other pcmeon Lntoreeto ii , reeling InJured
by ang aotlon of the Roard with regard to rates,
ahall hare the right to tile a,suIt In the DIa-
trlot Court of Travis ~Gounty, wIthin thhfrty’diya
after the Roard hae made such order, to review
the oatIon, In which auIt the oourt meg entor a
udgment correcting the Rosrb’s order and ilx-
3,ry euoh rntes ae may be proper, OF atfIrmIng
the eotion o? the Board, Under no ciroumstanaea
shall any rate of premium be oharged for ,polI-
ales or underwritIng oontraots bi.frew fkola
those iI@ lina promulgated by the Board, or
those fixed In a final judgment of the court
ae herdn provide&
"Sea. 4. Gorporations organIze,b under the
lawo of any other State ahell,be permitted to
do business In this State on exaotly the a~’
bssis end. subjeot to the sams rules, regula-
tions adil priosa and supenlefon a8 fIxed for
Texas oorporationa.
“980. 5. Any foreign or Uomestio oorpora-
tion issuing enr form of pollog or u&erwrlt-
lng oontreota or chargingany prtnniumrate8 to
the publIo am either ownern' or mortgageo*s
oertiilcateaor underwrItingoontracta on Texe8
other than forms and rates ~mfi
d of Xnsursnee Gommlsaiormrs here-
1 remit St8 right to 40 b&Iiluaa
In Temaa; but l&&e &all not be ooaatrued a8
t;;;;~g;g,g”~g ````~t~?&``I~
neem under this aot anA*doIng a genoral tI$l* *
Insurance busllnees ror the publIo In this Stat+
Eon. 0. P. Lookhart, pega 4
far rd.nauringor underqltlng allor anypart
0r the buaInaa8 o? an+her auah oompany to be
the same as the ahare to the pabllo.* ?l#QhaaIa ours)
‘In the oase a? Hew York Title k Mortgega Company Y.
Tarver, 51 Fed. (2d) 584, a three judge Federal oourt in oon-
atruing Artiole 1302a held as iollowsr
‘That said Title Inauramta Aot 1s held to
only relate to and iiieot ?ona o? polloles and
prsmlum rates oi auah inauran0o, eto wIth3.n
the state o? Texas, the 60Ing oi bus~n~sa with-
in tha atate o? Taaaa; m&to be oxtra-terrl-
torlal In Its erreat, lrnd aamo oannot artrot tha
form o? polIolee in use br oomplalnantr In other
states than the state o? Texas fztrrates at pre-
mium ohargea on polioles wrItton outside tha
atdt0 o? Texas not to be PSriOWed within this
state. The atato of Teas hss the power to say
what kind 0? title Inspran00 bualneas shall k
pss-formpd in the state of Texas. Bothwoll et
al. I, Buokbee, &Tears Go., 275 u. S. 2 74, M 8.
0% 124, 72 Ly .EQ. 277.”
This opinion was wr/tten on a motion Sor an inter-
lwutorp Injunction, and the oourt*a order was auatalmed by
, the Supreme hurt of the Unltod States in a memora8dat8 opln-
Ion reported in 76 L. Ed. 922~.
The laat sentonoe In the ?Irat paragraph at 8aotIon
3 above emphasized I? atanaing 8lona sight be bjord ewxgh
to oover polIap rorma wed outsldo a? this Stato in oonneo-
tlon wfth out o? state property, But tho atatiute 8hould %a
oonstrued from Its tour oornera, In the 0as0 o? G~erolal
Standard Insuranoo Campany v. Board o? Inmraoo CammlsaIem-
em, 34 9. WI, (26) 343 (error refused), the court raid:
*The &ard,aan axerolse on4 th0 authority
oonferred upon It by law an ollar and unmiatak-
able terms and will not be deeps to ba given
by implloat%on nor can It be extond0d by Inter-
enca but must be strlotlp ~onstruad.*
Your questIon No, 1 Is amswerod In the nagative.
Tour question No, 2 reads aa ?ollowar
VfDoes this Boerd have the legal power and
dut o? presoi+bing premlsm rates at wl&h oom-
pani ee operating under artlole 13Q2a shall write
title Insuraa0e rlakn outside o? Toxaa?*
Wa assume that your pa0 *tit18 Inauranee rlaka
outside o? Texaa*‘maana title MuraM (10Ptraota mado out-
side the State on property outside @ the Stat+~:
Elm. 0. P. Lookhaxt, pago 5
You will note that Saotlon 5 of Axtlele 1302a pm-
video a penalty (fertelture of right to do bWI~a8 in Tens)
f w any oorparatlon ahar&ag rates other thak those praaexlb-
od by tha Board on polIoIea on Tams picOpextlq It pmVIde8
no penalty for oharglng rates not 80 approved on property
outside or Texas. Fox t&la reason and for the raa8ona sot
out under question Ro. 1 your seaond question Is answered in
the negative.
Your question No. 3 with subdIr2sIon (0) thereof
omitted reads as r0u0wsr
“With reapsot to the QepOsIt or oaah os
aeouxltles, regulxed by Seotlon 6 of the Aat
equal to one-fourth of tho authorized aapltai
at the oorporatlon: (a) Should this deposit k
oonaidered a part of, or required In addltlon
to, the aepltal steak of the Company? (b) In
Saotlon 6 the daposlt la roqulred to be kept
‘with the Stab’Ea“rd``~s~hs````````````
tory as arrr a nsme
prorod br the Soard M Inaaranee &vmlsaiwera*,
whexoas in SootIon 2 as anmadadtha aglpp(luiea
axe granted osrtain prlvllagee with respaot to
Inveataiant of portions of their oapltal atosk
In abstraot plants in exowa of 50$ of the oap%-
tal @took, provided that the7 maintain *with
’ the ala%Iam de-
a as rot&&d .Sn
OODrPlot be met
by keepping tha deposit under the joint oantrol
at tha State Treasurer and of thla Board?. . .
(6) Can the seourltlea In this deposit IawfulLy
aonaist of real estate, or notas or other obll-
gationa aaoured by lten upon raal aatats In Tmaa
or other states where the ocmpany la ad&tad to
operate, or bath In Texw and &bar states?*
Subaaotion (e) of this question la not a.nswm&,
sinoe your auppltiantal letter dlraote that it bo mItted.
seotian 6 of &dole 1302a reads as ~o~ows:
“All oorporations, QometIo and roroign rrit-
Ing title or mortgagoo polioias or uud*rw&ng
eontracts must at all times have and ke.ep on 6s.
posit with the State heaaury air mah other da-
posltory aa may be namedby ,auoh oorporatlon and
approved by the Boar% at ~Inaurenoa Comm,l8ai~nera,
either oash or first mortgsga notes or ~auoh&ho
aaourltiaa as ara now admieslbla for lmes``
bp lIte Insuranoe aolspanlea under the iswe af
this 3tate to an smeuut eqtil ts ona-iomth @
the authorized oapltsl 0r auah ooxpmatlos; pa+
rided, however, that auoh doposit *all in na
evoat rxow4 the sum ef ~lOQ,~@CC&&*
Hon. 0. P. Lookhart, page 6 .
suoh reotion aoes not cay that the doposit e&U.
be made out of ae8eta separate from and in adaition to thoao
asaeta used in payment of oapital steak. You will notie*
that Section 10 requires the aoatnntiation of aertala rssarv.8
separately and apart from the oapital oS the a-any. That
the Legislature railed to meke suoh a requirement es to the
deposit under Section 6 is signlfioant.
Neither does Seation 6 roqulre apeaifioallp that
the deposit be msae out of ospital asseta. It merely meaaurea
the amount of the deposit by the'smount of the authorimed aapital.
In answer to subdivision (a) of question No. 3, wu
are advised that the deposit may be mede out ai any asset8
available whioh otherwise meet the requirements of sald Seo-
tion 6 of Artiole 1302s.
In eonneetion tith subdivision (b) & pueation 3
we aall pour attention to the rule that separate prolrlsi8ollcl
~of a statute will not be aonstrued as eonfliqtlng if auah
construction aen be rraaoansbly avoided.
We also oall to pour attention the fact that at tha
tfma .of the amendment to Seotion 2 (Aotr of 19331 43rd Leg.,
p, 750) whioh reit4rO to the Wmmlssioner 0r Zn8u.ranoe thqre
was oo.offlosr in Texas by that title. The otatute referring
to auah oi'ifoe was rep8aled by the Acts of 1927; 40th Leg.,
p. 329, which oreated the Board of Insurance QtisdoMr8.
All powera, duties, exu'prerogatlrea oi the QaP8intioner of
Inauranae had prior to 1933 been transferred to the Board of
Insurance Oamn.lsslcmere by Artialo 4862r, Revlard Civil Stat-
utaa. It seems reasonable therafdre that the reference In
Scotion 2 to the Commlseioner of Insurance was intended to
ba to the Board of Insurance So+uv&seioners. This isot, in
eonneotlon vdth the reference to So&ion 6 of the dot, idi-
oats8 thst all suoh deposits should be kept a8 provided ln
aaid Seation 6. We see no oompelllng reason'for keeping the
individual deposits in alfferent nmmer& We Bee nothing to
require that the aeposlts be kept under olnt ~control of the
State Treasurer and the Board. Subdivie t on (b) of question
3 Is answered in the negativs.
In subcivision (d) of QUek3tiOn 3 the phraSS "OT
othsr obligstlons* is too indefinite to fOTm a basis upon
whiah this ofriae can formulate an opinion and this opinion
will attempt to answer suoh question by disregarding auah
phrase ana oonslaering the quemtion with suuohphrase omitted.
Se&ion 6 of Artiale 1302a provides that the da-
posit shall be “either oeah, or first mortgage notea or arueh
other securltles aa are now adsd&Mble for Investment by life
insuranoe companies under the laws of this state."
The referenae to securities which twe admiesible
\ for Investment by'llfe insuranoe eompaniea rofora in our
I
800 I
Hon. 0. P. Lopkhart, pa60 7
.
/
opinicui to Artiole 4725 of the Berlaed Olvil Statutes whlah
apealriea the seouritiea in whlah luah eomp~ea aa9 fm,eat.
Suoh atatuto begina as iolbtat
"A life laauranae aompany organlard &a
the laws oi this atate may invest In or loan up-
on the iollowlng securities and none ethera.*
It is true that Artiole 4726 sets out oertaln uan-
dltlona under which such oompanlaa may hold Lana coavey real
estate but auoh artlolee does not refer to auoh real estate
aa an i nvestment.
It is therefore 0ur opitthtt that We muat look ta
Article I+725 to determine the “other seouritieaw reierreb
to In Section 6 at Artiols 1302a.
said drtiele 4725 autheriaea the iztvestmant in
rirst mortgage loana aa followat
"St may aleo mclke loane u on first llana
on'Tsa1 estate the title to whiYoh,Pa valid and
the value of which le &9$ mare than the amount
laeneh thereon.*'
l!bero are other reqitlruaente as to inauranee ,on
buildings aonatftutiag a,part of the value el'suah real ea-
tats. %ham is no repulrement that the aeaurit9 for auah
real estate loana be loaated.in Texas,
While Artlole 4724 math,orlzrs~i~vwHment in real
aatete lcena it dose net aufhoriee the pur0haae of reel l*
tat0 at4 an imestment. In this sonueotlw you are rdarmd
to our opinion No. O-4556 addressed to you aad holding that
real estate IS not a *aeaurityn *bthln th6 maetint of A&.iale
4720,
In aahaeotion pdth aubaivialon (a) af'questloll 3
YOUewe advised that the depmit required In Seatlon 6 M
Art3.cle 1302a may lawfully oonalat ai notes atieured by first
llena on rael estate, and it ia lmatarial fm the purpoa)
Q? auoh deposit whether suah reel eatate ia Moated ln Texea
OT in aoae other state in whloh tha aompanp ia permitted to
operate,
It is further out opinion that auah deposit -9
not lawfully aauaist of the Teal estate itself Tegardlaarr
of the loaatlon of suoh real eatate.
Your quaRtionHo, 4 reads a8 ioldowat
*IS th. 5% Tt8tTVt Oi f&&t &WONS &UWhUI
preaoribsd in Station 10 cxt the Aat, appl%oabie
to pTdltSl8 UpCm bualnaaa e&&dde of Toxaat
AR& %f stop and ii you should hold that the aam-
patties may lswWll9 charge, 01p that t&U Bear&
Hon. 0. P. Lockhart, pa&o 8
may lawfully preeorlbe, pramlum rat06 ior tibia
lnsuranoa risk written on property outside or
Texas different from prmiuza rates so preaorikd
or charged in Temr, then 1s rruah 5$ pramlum re-
same on premium from business outside of Toxa8
to be computed upon the premiums actually charged
and received upon suah foreign business or upon
the different rates as presodbed by this Corn-
,.&vslon and chtirged upon/Was business, whathar
.hlgher m lower than the foreign rates?n
Said Section 10 of Artiole 1302a read8 in part 1111
s0110ws:
Wvery oompany doing’s title lhsuranee buai-
naas under the provisions of this act ehall ret
aside annually as a reserve 5% of its gcoae prr-
mlums so oollected, bafore any dividends M
paid, the .totals of such reserve shall 111)var
beeiegrired $0 sxowd a totaL rasarva oi #lOO,-
. . . . . lt
Suoh provisioh roqtires tha loaumulatlon of a fund
for the protsotion cd pollopholdere ard should be oonstrued
so as to beat aooampliah that purpose. The latter part oi
Section 10 provides; .
“Funds aooumulated undsr this provision
shall never be wed ior the payment ot any ob-
ligation other than those oonneoted with title’
lnauranoe, and, la the event of the insolvency
of .a ompany, the fuud hereby provided,&all bo
uaed to protect title insuranoa polloyholderr
even though there be no acorued title lhsuranoo
claims and even though there be unpaid obliga-
tloxp 0r other sorts.”
You will note that the latter quotation does not,
cay that ths funds shall be used to protect Texas title In- .
mranoe policyholders, but merely says *title Insuraaco
po3.10yholders.H sr the rund is r0r the proteotion or all
pollayholders it oould conoelvably bs very inadequate for
that purpose if the oompany did a large business outside of
the State and the reserve was acoumulatcd from Texas bueinass
only. The statute does not say that the reserve 8haU be set
aside from pxemiume on Texas business only.
St la our opinion that the 5% reserve provided In
said Seotioh 10 of hvtiole 1302e should be sot as168 frgn
all premiums rotually oolleoted.
Your Question hT0, 5 reads a8 r0u0net
“Are oompanlea Bperating under Artlola
1302a properly taxable undar Artlole 7084 or
0. P. Lookhart, pg. /9
70647 It has been the oonotruotl~n si this Ds-
partment 00 far that 13020 osmpanies are all
taable umler Astiole 7084 and that Uhapta 18
oaauolty oampanieo doing e title lnouranos
busl.orso are taxable under Art1010 7064. 10
this construction oorroot?*
.
Seotion 7 of Article lgOZa, reads as tollowst
Vhe general levm applioable to paymant OS
filing fees and trenchlee taxes of oarporaticmo
having a oapltal stosk are hereby mods ap lloa-
~e;;oo~m~satlono ocuulag uadar the pr Qvi OiOUO
Domestio oorporatlons operatirrg
under this iaw shall not be required to pay pm-
shun taxes. n
Arjilole -7064 of the Revised Civil Statutes ppo-
video in part as followor
*Every Lnsuranoe oorpomtion, Llmyd’o, Qc
sodproealo, and eny other srgaaisstien ar o(poI
sarn tranoaotlng the business of fir., matins,
smdne inland, aooldent, orsdit, title, livs-
otosk, fidelity, guaranty, sursty, oaoualty, ce
nny other kind or oharaotcts of lnaeranoe busi-
naoo othar than the business of life lnOPan0m,
and other than rratemal bansfit lsormletlms,
within tbio state at the tlmo cd riuag lta an-
nual otatawnt, oimll report to the Bcasd oi I*
ourance Oommlodonoro the groem amount of premiums
reoelvad upon propert loaatod in this Ststs cm
on risks lasated in tL o Stoto dmlng ths prs-
Sam .j+axeO.”
mlole 7064 or ths Revised Civil Statutso pro-
vides In pnrt aa iollswo a
%very tnsuranoe 0erporation, LloyB~o, 0s
reoiprooala, and any other orgonisatlsn Br oea-
aern tranoaotlng the busloass of fire, maurino,
marina l&ml, aaoldant, oradlt, title, llrs-
otosk, rldelltg, guaranty, mrety, Oaauelty, QI
any other kind or aharaoter ai i~uraneo buoi-
neoo other than the businaso oi lit0 isauxaass,
and other than fraternal bsaei%t aooooirtb5o,
wlthln this State at the time of filing its a&-
nual statement, shall repart to the Board or In-
ourenoe Goomls~ldnar8 the groao QaoupLtisf preriUi0
received upon prbperty looat*d,in this Stat@ or
on rlekm loaatsd in this State during the pm
oedlng year, and cash of auoh insuranse oerrloro
shall my an annual tqx upon auoh @ass praaf\gl
reosipts aa r0xmst . , .*
Hon. 0. P. Lookhart, page 10
you wll,l note that this statute levies e tax on ln-
auranue aarrlers generally with oertaln axoeptlono whlah tar
$8 based on gross premium recai ta. He are of the opinion
that the tax ievled by Artlole s 064 Is the premium tax re-
ferred to in Sectim '2 oi Art1010 1302a and that domeetlo oor-
porations operating under Artiole 1302s are not requlred to
pay the tax levied by Artiole 7064.
It is true thst Artiole 7064 baa been re-enaoted
with certain anendmenta sirroe the passsge of Artlelo 1302e,
but In our opinion subh aotion did not affect the spaoial pro-
vision or Seotion '7 of Article 13020 regarding pnymant of pre-
mium taxes. In this oomeotlon It Is slgnirIoant that at the
tlme or the orlgl~l eneotmant or Article 13020 (erraoti+e
date, February 29, 1929) Inoludlhg said Section 7, the pre-
mium tax statute than In foroe, (Aota 19111 32nd Leg., ah.
108, H. B. 292) provided ror suoh a tax on lnaurenoe aompanlea
doing a title lmuranoa bualness.
It lo rurther ux opinion and you aro so advised
that In aooordanoe wlth $ otlon 7 ad Article 1302a, all om-
poratlona oomlng under the provldo~ of &t$ole 1302a are
taxable under Artlqle 7084 whleh provldeo tar general fran-
ehlse tnxes on ocxporatlona.
Are Chapter lg oaaualty aompanlea doing a tltla
Insurance bua$ness'taxabla undar Artlole 70640 The answer
to aueh question depends upon whether or not such crampties
are *operatlr& under* Article 13028 80 so to be exeegtad‘trom
the premium taxes by tha~tsma of eald Seotlon 7.
It is true that suoh qaaualty eompanlea opernta
under the supervIsIon of the Board of Insuranoe %mnnIaolon-
ers as provided in Artlole U02a 80 far en the rates and
policy f'orm used In their tltlo lnsurenoe bualneas Ia odn-
oerned. But under the provisiona ab Artiole 4989 the ISSDL
anoe of title Insurema lo only one of the numerous'purposes
ror which suoh oaapenloo xay be lmmrporeted. Suoh oaoualty
oompsnieo are subjaot to the numerous statutory provlololu
of Chtpter 18 of the Ravlsed Civil Ststutes entitled General
Casualty Gompanlesl~ and therefore .opsrate under Artlole 1302e
only to a lImIted exteat.
It lo our opinion and you are so advised that,%&+
tlon 7 of Article 13020 does not exempt general casualty oom-
panics organized under the prwla$ons of oa$d Chapter 18
from the taxes Imposed by Art1ol.e 7064 even though auoh aox-
panles are authorized to write title Insureme as wall as
general -casualty lnsuranoa.
Your question Ho, 6 reeds no followa:
wSeotlon 7 of Art&ala 13G2a refers to and
adopts the *general laws appllaablo to payment
I
Eon. 0. P. Le&hart, p* 11
0t rimg rw arsd rren0hie0 tdma 0r 00rp0m-
time having a aapitel etook.’ Thla is tha pre-
rioion on whioh wa base our oonolusion, mbodlad
in question 5 abwa, that the rrtitt0hm tarn8
am to be applied ae provided b9 Artlole 7084
rather than 7064.. Insafar as riling is08 are
oomerned, howavar , t¶oes thle prwlaion rerer
to aa8 adopt Artlole 394 or does it adopt Arti-
cle 3920 as applioebla to these oompanlas?*
Artlole 394 or the Revised Civil Statutes aete at
eortafn taoa whiah tha Seoratarg of State la authorlzed‘and
raqafrad to oharga, among whioh ia the tollowlngl
Tlpon tiling each ehertar, amendment or
supplement thereto, of a private oorpmatioz
oraatad for a09 purpoao lntaadad. for mutual pro- ’
rit or benarit,,
I rung r0a or Firty (I50.00)
Dollara, providod that ii the authorized oa lkl
atook 0r raid otlrparation ahall axoead Tan Bho&=
*ana ($l0,000*00) Dollara It shall be requika
to pay an additlozal rib0 of Tan ( 0.00) Dzllam
rar``woh additional Tan ThauaWd P~10,000.00)
Dollar8 of ita oapital steak or fraiWona1 pgt
tharaor arter the rim.*
Artlolo 3920 of the Revised Glvll Statutes rata out
oertaiz fare to ba ahergrrd and noairad by the Board of xn-
euraneo eoplaia8ion0rs whhh reeaindluda the roiiOa&r
Tar flllng aaoh daolaratlonor oartlflsd
oopy of the ohrrtsr oi an in8urenee oompany -
Sa5.oo.r
Roth of the above quoted provialozs war0 in erre0t
when &tlola 1302s baeama offeotire.
Ssotltm 7 of Artlola 1302a is eat out In the aza-
WeP to your question No. 5. Beotlon 8 of suah artiou road8
ae r0iiOw3n
The ohsrtter of oarrporatlozs inoorporstad
hereunder, and the smendmsnte thereto, ahall ba
filed with the F3oard of Ineuranga %amisaionara,
whlah asid Board shall oollaot from the a@%&
ocaapanies riusg roe8 and rranahiae tams ra-
quirod by law. *
It ;s cle’ar that tha riling ibaa, by wkatovar etat-
uts datermlzsd, are to be oollaoted by th? Board ai Ineuramao
Commlealon6ws~ Oz riret oousldaratiaz it w&d aeem log&ml
that the roes to be aOllaatad b9 the Board should k datawioab
by Artlale 3920 whloh amimarat.8 end set8 out the teea to ba
sollsotad by suoh Roard. It la alao trua that our Supram Oourt 1
in the aaaa or Daniel ‘(1. me1 & Garth Invaatlarnt Qampanp, 93
S. W. (26) 372. srpraaaly saitr
‘lion. 0. P. Lookhart, pa60 12
, "Title insurenoa Is a kind or type of ln-
murenee.*
.
Rut we are faoed with Sbotion. 7 whioh apeolrlea:
wbenerar laws applioable to riling reea end
i,fi;r;yse taxes or oorporetions having a oepital
Artlale 3914 above quoted aete out the riling reea
r0r oorporatiana generally. Certainly Artlole 3920, ao rer
aa the riung raei or oorporationa are oomeeraad, la not a0
general as Artlole 394,. beoauae Artlole 3920 rlxes the ril-
$2mzees of lnauranoa oompauiea and no other kind of oorpara-
. The Legislature has thus IQEmireSt8d its Intention
thet the oompanies inoorporatsd under Artiole 13026 ahall pa9
the larger riling rees rixed by mials 39% The reason rer
euoh intention ia apparent from the nature of oompanlee in-
oorporated uuder Artlole 1302a. Such oorperatioua map ba
oreete(lror a number of purposes In addition to the lnaurlng
0r titles. lhe9 ma9 engage la au abatraot bualnea8, aaoumu-
leta end lend azoney, and aot as a truateo. The epeoitio pur-
paaea ror which they atap be inoarperalred are eet out in Seotlon
1 Of Artlole 13026. Sines euoh oorparationa ma9 be luoor-
orated for auoh purposer;l in addltlon to the iseuanoe of title
La uranoe, it is reasonable thtat the9 ahould be required to
pa9 the larger iillng fees raqu5xed of oorporatione geuerally.
You era adtlsed thmt the amount or the rlling reea
of oompanles incorporated under Artlole 1302a should be de-
termined ‘by the apptioation Or drtiola 3914 or the RSViBed
Olril Statutss or Texas.
Pour queatlon No. 7-read8 es rollowar
"Sinea by the 1929 lot (Art. 13026) these
cmpanloe have been rsoognlasd 88 lnsuranoe oom-
penles and removed rrom oontrol or the EIeoretery
of State end put under the Jurlsdlctlon of this
Board, is our conatrnctiofi oorreot that this makea
ma provisions 0r Artio1a 4705 applicable as to
requirements far alQ,.lb~lity or seaurities In
whM~ the caDite1 Stock Or 13026 o0nwanies
- map
be inveatad?"
Ee also set out herein the portion
mental request which deals with question NO.
is a8 follows;
"In oouueotion with qumtjlon No. 7, 8ha at-
torney ror the Cornpang earnestly eontends that
because or. *the peculiar wording or Section8 6,
7, and 10 of Artiole 1302A, Artiole 4705 hoe n0
applioatlon~ to end doem uot goorernthe allgibil-
fty of' the types of eeouritlas in whkoh this tkm-
Hon. 0. P, Lo&hart, PW 13
paakmmm&vast or InItIall9 a Its 8apital
Ho, tharaOme, Uea tha positian
that al.1 of’tha aoourItioa lietad Ia tha aahadula
aooompa Sng.the arrIdavIt of the Inoorpamtore
are eligY bla under Article 13OU and lep eo ia lly
Sections 6, 7, and 10 theraoi. drtlolo 4706
governs the investment ai fuuda 41 atook Inaur-
enoo ocmpanies other than llra, health and aool-
dent cempenlaa, over and abwe the5.r oapltal stook
rids; and, of aourfba, whether mtlole 4706 Ie
a plAoabla, to this Gaiapany~wlll depend upon
w1 ether Artlole 4705 Is 6pplIaeble to It. ThIr
Department la going to require the Dompa4 to
ay in WtIally a surplw rund of at laaat
5,OOO.OG (whloh will probably result in
Ita oapltal stock to #lO0,000)
oorporatlng aud lfoaCaIng It; aAd,
will hare diraotly Iwolled also the question
or whether Artiola 4796 Is applIoebla to au&
Sarplll8. We, tharetorm, desire to au~glcmant
quaation X?o. 7 by 1nquIrW whather 4 6 Is up-
plioabla aa to t&L CUpany In the imeebaent
of Its surplus runda over and abwe ita autha-
lead oapItal stook ftmd.*
AB we underetend your question No. 7 a8 oupplrment-
rd it ma9 bc,ra-stated aa followag Does Article 4705, Reriso$
GldlStatutea govern the 0UglbtUty of preparty tha
Initially reodvad in parent of the @apIta% a,toak fir
oorpemtlon and doea Artiola 476, Revised .Givil Statutea,
govern the eligiMlity af property in Milti its aurplua ftmd8
map be ixmestad? .
That title Inf3mutaa la a type af Issuranao la no
longer an open question ainoa t&e oaaa or Daniel. t. !Pymll 0
Garth ln~sstment Gmpany, supa.
A~%iol$ i+7Q&:of the Revised Givfl St@$utaa wMah
reads 118r0mm3t ,:‘r
“Tba oapltal atouk uf any auoh iaauraana oma-
panp, axoept any writing Life, Health, and Aaol-
dent Ixiauranoe, Bhal.1 oonsistr
"1. fnlaniul money cif the United Statoa;
OT ,
In the bom¶@ oithis'mta cw angoaunty
OT inc~&atad town or &by thar&f, m In the
atookof alynatlanalbamk~ or
"3. In riret martgag upm un5noumbarad
raal eatata in this State, the title to WM.& ia
talld, and the mwkat ralue of whlah $a neb lose .
'then rorty (40) per cat mere than th* apotw
1, Hon. 0. P. Laakhart, paSo l4
loaned thbraon. Ii any part of the raluo of luah
real eatato 10 In bulldfnga, mmh buIldInga ahall
bp luaurod agalnat'losa by Piro Sor not 10s~ than
sixty (60) per 6-t at the value ther``~i#````~
E; gotme pyablo 7 au6h rompany,
0 pror slone of tai8 Artlalr, with rem-'
peat to the value af real eatato, aomparad to
the mount laaned tharoon, 8hal.l not apply to
loana seaured by real e&ate whlah are lnmrad
by the Federal Rousing AdmIniatrator.*
la iotmd in Chapter 2 of .TItlc 78 of tha RavIse4 bit11 Stat-
utos. Chapter 2 1s entitle6 Rlnaorpcestlon af Inauranae Colr
panIaa.W The words *any aueh insurance aompuap aoatainbd.*
Artialo 4705 rear bak to aorpaaetlmm tormnd under Artlali
,4699, Revised Olvll Sta tutea , whiah 10 styled wParmatlon eb
~gtmlea* end to Artiale 4700 etylad *Articles ai Inaarpara-
. w Artiaiea 4699 and 4705 -0 round with the uaeptioa
of aertala later amenbmenta not port&n& Jmro la ttm Itch
vised Statutes a? l&V a8 Axtlale8 3028 and 3Oj4 uabr tlu
ahuptor elao styled thare aXnaorparatIon of Inauranae Cam-
panls8." Xn duaawmlag Artielr 3CZii @ the Ravlsed Statutes
oS 1695: and the title on IMuruPae themln oentaiad mar 13ap-
ream aourt in tha aaae of State t. Burgess,109 S. W, glP,mXdt,
We ara thus lead to the aonaluslan that
Artiale 3028 In Its ori n~wa8, as I.a its laagw@
it la, a genaral pror?.e 9 on applleable to ali1 ln-
mranaa oarrporatlons
exoopt 8-h a# nny be 8x&a&
ed by Axtlale 3996.w
Xt Artlole 3028 (nm Astiola 46991 la a Sanaral cltatuto It
reasonably rollows that Artialaa 4705 and.4706 in the sun
title are statutes of a abaU8r nature, Fro16 the abev* wo
ara lead te aonafud% thet Artlala 4705 Is Intahclad aa a ga+
era1 statute gwernIn&z the aspIte stark requixwaaata af In-
suranoe corporatloh8 havi.aS a aapltal atoak unlara auah oe
poratloru'ara exampted from Ita reQuiremetes by Ita t$nn tams
or the terms of acane'ather Artiali,
The attorney for the iuaorporatar6 aaam'to oonae$a
that Artiola 4705 aa8 Title 78, Chapter 2, are ep lIaablo to
lxmmanoa oarporationa generally but oonteads ~8 s ollowst
"The Statutes applIoable to the rormtion
of aorPoratloni3 generally (Saatlon 57, Art.
1302, ol the Revised Statutes) parn&ttad the in-
oorparatlon of gaaraaty title oampau$an wlthaut
aupervlalon ot. any ~kfnd ar aharaataT insafar aa .
the Board of Insuraaoe ~QaP*donem we8 oon-
ssrned up until passage of ArUole 1gOZa In 1929.
Caasaquantlr, tha geuaral incorporation statutea,
luolpains the .statuta govarnlag the aapital
steek requiramante o$ all Irate mrparetlom,
gweraec¶ and aoatrolled tlr la SyiraatP aampauia8
Hoa. a. P. Lookhut, p8&a 15
u until the tlaa' of thi pa88 * Artlelo
902.. Art1010 1302a ob*ngrb r h,.~QQU@atiioa
of the general inoerpontioa ltatut*~eaW 'in .'
the partloularathoralaset 06. Rb ilad BO
referenaeof any klad or ohsraoter in Art. 1302a
to Art. 4705 ur any othar artlole of Title 78,
Chapter 2 applloable to iosuruiee aorperatlona
generally.*
One ai tho pmtloulera lq Artlole1302a. Rati&
Civil Statutes, whleh ohangee the 8p Uoatloa ob tke g``al
I lnoorporatlon atatutea la the prwia fon la Cho$loa23 %hd a0
furtheroorporatlonshellbe aharteroduader aubdlvlmlon 57
or Artiole 1302 whloh ia .thr general statute sot
purpoeea for whiah rlvat~oorpcrratlom may ,br aha
provlelon aeeme to boata the iateatlon @f not=!? .
6roatlon or tit10 lnaru'enoe ampaalea ander th* 8aarml ,q-
parrtlon statutea, Rhea the Legla~turo wlahodtomko tb,
generallaws ragerdiag illlug ier# lppllaeblr.te title iuaur-
en80 eorpavatioar, it illa80b lIgprea8 p r o vlmlo lb St ia no t
uureaaouablo to premium that t ho &glalaturo, It ft wished to
make the gonerallaowpomtloa atatufaa rdbr thur bi18 ib
atlr8aoo In arationatetote*,ap*lleaLleto aa humrum
aerpor%tIoa~7 two&&d hate done 60 by oxp?oaa povi#len.
It la trua that aorp~etloaa iarm& uatlar ArtleSe
Guard. Under aartaia ooadltioru tha Roard r$ rowka auah
oorperratleate oertlfrl8.ate of authority. The Aot~ovid0aoaaa
gww1rs3 lntwbtlon to raxsvo title inmx8am oompd.ea frpr
the ol8sa of private oorporatioaa -ally and plme thaa
in the olaaa br statue o? lnsu~anor oorporatioa8.
The mere faati.thit Artlele 1302a appoere in Per--
non*8 Annotated Civil Stetutee~uudor the tItl;;~p~va~
oorporatlons gene-rallg has ue aignltlaenoe.
passed elnao the revision of 192s ead the A6t do06 aot &or,
lgnate in what chapter of The Revised OltIl Statutesit 8hWld
be plapea.
The fipplioatlon of Artiulr 4705 and'4706 to tlblo
-1nauranoe cmpeaiaa, will not nPil%fy th4~prwlalona of SW-
tlon 2 @S Article 13028 whiah lhwa lnvratmwdi of a sertala
10 nmiatained in that eaaditlon, Tha toram of both Artlr1ea
muat give way wheta ia oeailiot rlth the tema ab Artiolo
1302a whluh Is the more aooent 8nb mare partl6uZlar atatulm,
Han. 0.P. Imkhart, pa@ 16
In answer to question Na. 7 it la the oplnlon ei I
this departmat and you a??8 so advleed that,Artlola 4703,‘.
Revised Qlvil Statutes, la epplioable to Aetiraiaa the ini-
tial aapltel atoak requiramanta of a title inaurea6e oarpore-
tion to be oraetab under Artiale 1302a RevlaeA Clvll Btat-
utas, and that &Mole 4706, Revised 0``11 Statutes, gwiraa
tha Investment of its funds over and above ita paid up aapltal
atook, Snd it la further our opinion that aueh artlolea ara
eppliaable only Insofar as they do not oonfllot with einy pro-
visions of Axtiols 13028, Revised 01~1~ Statutes.
In aooorAenaa with the Aireatluna in your supple-
mental request, question No. 8 la omdtte4 from this oplaloa.
Your question 19,. 9 aontalnwl in your aupplamantal
lotter consists or twelve aubdlvlslona and euoh queatloa to-
gether with tha exptination in oonnaatIon tjhlsrewith, sea88 es
follows:
"In atud~ng the aahaAule or easeta aa-
oclqpan@g the affidavit of the l~oorporetara,
,whloh assets will be tendered in payme* ti
aapltal atook end surplus (before eotual fib
lng the obartor will probably be rewrlttra ao
as t o divide theae smote u into a n&tlmum of
$lOO,000,caplt~l at&k and B5,000 aurplua) we
observe ttist the assets are af?irmatlvaly dia-
olaaed ta ambraoe (6) ia? tltlee to real
(b) reel eetak purahaa& ooatraota,,,Jrsd
or other mouetarg obll@ttlom &eau@#
lion upon real aatate, acane of all~%bxoeaf
whloh are located In the State at Rew &!!xiao'
end some in the Utate of Texas. Of oourae,ba-
fore eitheraharterlng or Iioenalngthla Cola,
Q~IV this Departmsnt will 8laaharge its roe-
pona~bllltg of detemalnlngwhether or not tkm
eaaete aa llated in the eahadule to the e~rrlde-
vlt @re aotuallp valid fee titles, raal estate
purchasecontraate and obligations secured by
rmit liens upon Pea1 estate, and tha laaatlon
thereof (whather in Toxas or lOen Maxlao)and the
value thereof. Eiut, r0r the purpose of deter-
mining the legal ellglblllty of tha varloua
olaeaee of aasata so tanderaA In payment of
the authorized aapltal stoak and tha aurplua
funds whiah may be set up 1nitIelly in lnoor-
porati4j this C-pa y , we ask you to anawar apa-
oirioal p tha r0im ng queatlona in additfon
to those propolinded heretofore, regard&ass of
whether you holed Artlalas 4705 and 4706 appll-
aable, ar whether you hold Artlole 13OZA a? aaaia
other extialo or artlolea of the statutes eppll-
oabla, with refaranae to the lnveetimant of the
aapltal anA surplus rum30 of this Wspa~r
Boa. 0. P. Lookbart, pa@ 17
“A. Are i6r fltlse to real estate sltwtr
o dinTen8
lllglblr to be raooirad in paJnwn0
ou the'eapltal ‘atook funds of this Company?
"B. Oan iee.titlee to JnLl estata outal&
ai Texas ba raerived in payment or oapital
hook OS t&e Campany?
q. Otm fee titles to rul eetato otltride
OS Tome bo rooepted in payxmt oi aurplue af
this aon@myt
“% Oanraal estate purahaee oontrectr up-
on real property in Taxas k aoaepted in pya#at
of oapltalgtook of this Ocmpanyt
V. Qan real estate purohase oaatraots Up-
on real property situated oataide of~Tem8 ~ba
looapted In paymat or oapital stock at this'
-mw
Oan rati lstata pur&aae ooatraets up-
on p(to&tf outside or Ton6 be aacepted’ln
payment 0r~8orplui~of air Gcmpaaj3
othermonetary obllgatloa8
apanraalestata blkni
cd aapltal ateak or thlm
by first lieno upon real a8tato 6ituated oa,lt8ide
of Texas ba rowlvad in pafment tg aapital stook
0r this oampauyt
Can aota a
other obli tlona mcrurod
by iii% lima upaa raala6tate s '5"
tuated 3.n Taxno
ba raoaived in payment of swplw of thir Qcqaay?
Caa notes artd other obli~ttone aeeured
bg ii% ttptm real ssteto crituated cstttalda
lion8
at Tmas ba no'*lY~d la payment or the SurpluB
or thb ghmgaay?"
We da mt att&pt to azwuer aubdlvl&mu E,T,,O and
~Haslnw the term "rmal aetato ptrrohasa wntraots" dam sot
No& 0. P* La&hart, Pa#$a18
AUO we dll Ulaxegaxd the pJ&raae*or othw monetary
obl&atlona” oontriaed lr~aubdivMbn8 I, J K, and L, koauao
8u.h phxaa. la too %n~.tiaLt. to b. the bsaja of an oplnioa,
Subdivlelous 4 and B of qareatlon No. 9 are anawarod
In th. nsgatlve. See Astio1. 4705, Rlav1s.d Civil statuttea,
heretoftie quoted.
Subalvlelow c: snd D ai qwetion FID. 9 am not in
our aginlon answered by the terms o? Artiole 4706; aoh
readsin parta8 followa:
m oompany, aoept any urltiag life, health,
ana aooident, lnsuraam; organlaed und.r.tho
vlaiow of thl~ ehaptsr shsll invest its ruar
war snd above lte paid up eapltal stook in inn
otbx manner than as follows; . . .*
Ztlo txui t&t ttixeot imsstmaut Inrealelrtatr is not par-
I dittad by the tsnna of oath artlole, But aa we aoaatrua yaaz
lattax allPquestion the iwtl.rstate ia thlaeasefa te In
ooavay8d to the ocaipaay on iaeqxpox~tioa a8 a glitor eea-
lsibutlon, ~fhe acioeptsaa. of aaah coatributlon la aot an in-
v.atm.at'dthin the asauingat Artlol. 4706 whfah la a pm+
cf*e statute. Wobnter dttrirats the word wlmwt* as iot
Tharafa. otw haZd5.ag a$idar qnastfon.Sa..'I d..s nat mesa that
ktlole 4706 is declalva ,ai the altuatloa maaentrd ln cub-
dl~lalaar, Oven& r) of quastiwL9. Emover, Artidle 4715 un-
der the t&tie on inauranc. prwid.,a. that the 1``8 fwez%lq
eorporatione in gmnewl shall a ply to and g0vSz-n LSUXSM.
sorporotlona lnaorparated la th ! s~atate laaufar as the aam
8~. aot lmonslstent with auah t&St& In Cbir ooaaeotien wa
direot year attention to Article U&I uUoh raada aa tollawat
*AU ~lvato’eorpoxatlona author-iaed
bay T
the mm or mxae,.to do bwlnesa In this stat.,
whoso satin pqou. la not the a.qtisiUon or
~ownsrahlp of lands, whloh hava or msy aaqu%ra
by lowe, puwhaae or Nhsr*8sriWar8land thaa
.is rrsoessary to srreblr them to olrrg on the@
bwlnes~ shall, wl)$dn fltteea earsgig
date said land Bay b8 aaqUirOd, Ll
isell and eonroy in $00 Illimptb alt landa,aa io*
quired*hiahare.notneaesrary
rw the txanaa4-
tl* of their bual1#a6,*
Aadtc Artisle l.j64?&iohrradaaa r0lloat
saw aubBjact to iarfalt\tre aad laehsat poe.wd-
-65. The Attornbr Ga&eml, a say distrlot or
oounty attorna~, whm eitherOS tkamha8 reaa0a
to b6U.m that oorporatlon la holding lands
in vio Jb ttf0n 0r t@iIa la w,
dullfa 5tltnte lult
In the mum ar the State or Toxaa, in TrWIS
County, or in any oounty in Texas wheti aueh
eorporatlon MS hare an agent, ur ln sn~‘oouat~
whwo anf part cd tha land ma ba sltuatad,
agalaat owh aorporatlon, as f a provided tar
the esaheat or astatos Or dewased persons
dyZn&wIthoutdevise thereofand having no hairs.*
In the case of 0arnpb.U v. Hoodi 35 S. W. (26) 93,
(Otau. App.1 Dec.) the oourt mldr
“For many yeare it hss born tha astebllshad
poziogor our statsto prohlblt oorporatlona, ’
with eertala axaaptlons, from aaqulrlng l&l.”
l?he aourt .rlrrther
saldr
qt 1s true, as ar$wd b the plaLntlii8
lnerror, thst ii tha oorpom i Ionhaa eon6umm9
od the deal by aoqulring the lands no one omald
hsve questioned its title sxaapt the stata.*
Wo aan rind no lsa raquirlng the wt&l or a 00~1
poxate sharter beoause it la llk.lythatawh sorpontian
ma aoqulre by oontribution lands rhieh it la not Ulmm4 to
hafd, tharerore the question Imlv.d.ln aubdlvl8lma0 and
R as to the corporation'6 right ps la& of r&&t to reaefn
and hold euah landa 1s new lar ely leabnle. St should k
dstarmlmd when it aotually ar f:ses by proper preoaadiaga tm-
dex tha tarma or Brtlale 1364abw. quoted.
Subdlvislon I af uestlon Xo. 9 1. anawexed la th.
arrimotlve provided. suoh r f rst lleo note6 on Toxw raalta
mset the requirementsor Artleli 4705,Revlsad Olvll Ststutaa,
ee to the value of the seaurlty, fire Iuaummee, et&
SubdIvIsIon J of questi,on No. 9 is awwered in the
negative beoauae Artiale 4705,RsvlrmlCivil Etatutee, npeol-
r1.arirst mortgsge notes on rosl estate In this Ststa.
In anawar to aubdlvlslona E cud L of qusatioa Iio. 9
you are sdvlsed that for the s-a ran110118 58t Outiabevoin th.
dlsouasion or subdivleloua C and D we do not pass upon the
aorpoxatlon*s rl&t.to receive br o@ntrIbutlmka end there-
after hold suah first lien notes an a part of it8 aurplu8.
However, your attantlon 1s $lreoted to Se&ten (b) of ArtIole
4706authorizing invf3stm6as of aurplua rum3 a6 r0uOpILlt
"1x3 bonds or rirat 3.l`` ~n~unlmmbered
real estate In this State OR In any other BtSt8,
oountry,or provlnoe la.whio&suoh0-w ry
k dulyllaon6ed to oondliot’4n
iMur6noebu6ln860,
ati prorUingin scloh 1tWanao ruohreal eat&o
ahall be warth at leastferty(@) p&r oontmm-0
than tho empunt lasnad thqmon: '!ka relua'of
suoh real estate shall be de&ermine6 by a ralua-
tlon nade under oath by two (2) freeholdera of
the oouaty whore the roal ~eateto is looqted; end
it the bui.ldlnga are oonaidor6d a part of the
value of the real aetato; thoy must be lmwrod
' against loss by firefor not lesa thau qixtr (60)
‘pekoent of the value theroof, *it& loaa-pa3abl.o
~olauee to suah mupang.*
. .
You are therefqe advised that a tit&o Mmiranoo 00~
pany my lnveet its surploa funds in first lien note8 on an-'
tibarad raal estate either &nthis Stst,e @r w othar atat*
in which it is duly l%oelreed to s&z&M (UQlaaaranoo bus&near
protidod the other ~equlroinents oil.&1010 4706ire uMo$i&.
.Tmitirq th%a -oplaloadll aid in tha detom&&
t&m of tho probLsm6 b6fare you, wo are
..
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