Untitled Texas Attorney General Opinion ( 1988 )

P November 22, 1988 Honorable Jack M. Rains Opinion No. JM-984 Secretary of State P. 0. Box 12697 Re: Whether a filing with the Austin, Texas 78711 Secretary of State is necessary to perfect a security interest in manufactured housing held as inventory (RQ-1469) Dear Mr. Rains: You ask whether a filing with the Secretary of State's office pursuant to chapter 9 of the Texas Business and Commerce Code (UCC) is necessary to perfect a security interest in manufactured housing held by the financer as inventory. You direct our attention to a possible conflict in article 5221f, V.T.C.S., (the Texas Manufactured Housing Standards Act) and section 9.302 of the Business and Commerce Code relative to the perfection of security interests in manufactured housing. Section 19(i) of article 5221f, Acts 1981, 67th Legislature, page 3088, chapter 815, section 4, effective August 31, 1981, provides: A lien on the manufactured homes in the inventory is perfected by filing a security agreement with the department [Texas Depart- ment of Labor and Standards] in a form that contains the information the department requires. Section 19(n) of article 5221f states: (n) The express provisions of this article supersede any conflicting provisions of the Business & Commerce Code: otherwise, the provisions of the Business & Commerce Code apply to transactions relating to manufactured housing. P. 5023 Honorable Jack M. Rains - Page 2 (JM-984) Section 9.302(c) of the Business and Commerce Code, as amended by Acts 1983, 68th Legislature, chapter 290, section 8, page 1533, effective August 28, 1983, provides that the filing of a financing statement otherwise required by this chapter is not necessary or effective to perfect a security interest in property. subject to (2) the following statutes of this state . . . the Texas Manufactured Housing Standards Act, as amended (Article 5221f, Vernon's Texas Civil Statutes): but durinq Y veriod in which collateral is inventorv iild for sale bv a verson who is in the business of sellinu soods of that kind, the filins vrovisions of this Chavter (Subchavter D) avvlv to a security interest in that collateral created bv him as debtor: or Subchavter A. Chavter 35, Title 4. Business & Commerce Code, relatins to utility securitv instruments. (Emphasis added.) Section 9.401 of the Business and Commerce Code requires filing with the county clerk to perfect a security interest where certain specified items constitute the collateral. This section also contains a general provision requiring that the filing "in all other cases" be with the Secretary of State. It is the latter provision that applies to the instant scenario. Section 18 of article 5221f as amended bv Acts 1987, 70th Lecrislature, chapter 1134, page 3888, effective June 18, 1987, provides: (b) A violation of any of the provisions of this article is a deceptive trade practice in addition to those set forth in Section 17.50, Business & Commerce Code. The vro- visions of all laws. varts of laws, ordin- ances, rules or resulations which are in conflict with any of the vrovisions of this article are suverseded and oreemoted to the extent of such conflict. (Emphasis added.) Where laws deal with the same subject matter they should be harmonized and construed together as though they were parts of the same law. Gordon v. Lake, 356 S.W.Zd 138 (Tex. 1962). When statutes are inconsistent and irrecon- cilable they both cannot stand at the same time. In the event of such conflict, the later expression of legislative intent controls and, to that extent repeals the earlier P. 5024 . Honorable Jack M. Rains - Page 3 (JM-984) statute. State v. Easley, 404 S.W.Zd 296 (Tex. 1966 ): Shultz v. State, 696 S.W.Zd 126 (Tex. APP. - Dallas 198 5, writ ref'd n.r.e.). Section 18 of article 5221f as amended by the 70th Legislature is the latest enactment germane to your question. Since it provides that any laws "which are in conflict with any provisions of this article [article 5221f] are superseded and preempted to the extent of such conflict," it follows that the provisions of article 5221 control. Thus, a lien on manufactured homes in the inventory is perfected by filing the security agreement with the Texas Department of Labor and Standards. SUMMARY A filing with the Secretary of State is not necessary to perfect a security interest in manufactured housing held by the financer as inventory. JIM MATTOX Attorney General of Texas MARY XELLER First Assistant Attorney General LOU MCCREARY Executive Assistant Attorney General JUDGE ZOLLIE STEAXLEY Special Assistant Attorney General RICK GILPIN Chairman, Opinion Committee Prepared by Tom G. Davis Assistant Attorney General P- 5025