Untitled Texas Attorney General Opinion ( 1942 )

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OFFICE OF THE ATTORNEY GENERAL OF TEXAS
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3-GHANR
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AUSTIN
I Honorable William J. Lawson
Seoretary of State
km t in, Texas
Dear Sir:
Be: one 00
Lone star GM Oorpor ce holding oompnny,
and it8 subrldiari
tion, UommunltyEia
Tex8s Cltler Ga8 0
store and oreatr two
e assets ot all tha ol4
rations are idimiri84
it is propose4 that oor-
00mpany,~ an4 that
Corporation "Au will not
0t Arti0ie 1302, v. A. 0. s.
Base4 upon euoh iaot situation,you propoun4 the
pueetion:
V&n CorporationA, whloh will be ohartere4
under eubdlviaion36 of hrtiole 1302, ati whioh
will engage in the purohasr, trmalniseionand .
dietributlonof natural gas to the gsnera;lpublio,
Honorable %SIllIamJ. Lawson, page 2
own ond hold the stock of CorporationB,
which will also be ohartared under subdivl-
slon 36 or Artiale 1302 and whiah will engage
IA the 011 and g&e produalng business, it be-
ing understood that CorporationA will not
itself dlreotly engage IA the 011 an4 gas
producingbusiness, but will engage thereln
lndlreotly through Its ownership of the
stock of CorporationBP"
Sub4lvlsIon 36 or Artlole 1302, V. A. C. S., as
amended by Rots or 1935, Forty-rourthLegislature,Page 296,
Ohapter 110, reada:
wiirtiole 1302 - Purposes - The purposes ror
which private oorporationsmay be formed are8
a * l *
“36. To store, transport, buy an4 sell oil, gas,
salt, brine and other mineral solutions an4 llquI-
rle4 minerals; also sand an4 olay for the manu-
raoture and sale or clay pro4wts.w
Wq held In our Opinion MO. O-3003 that the rights, '
benelite an4 privileges oonterred by Chapter 15, Title 32,
V. A. C. S., oould be adopted by those oorporatlonsohartered
or holding a roreign permit uader aubblvialon 36 oi Artlole
1302, eupra.
XrtIole 1502, V. A. C. S., oontained IA Chapter 15,
arrorde one ot suoh right.8an4 privileges en4 It Is
:~p&.artlale to whloh we must look for the answer to the
epeolrlo queitlon berore'ti. It reads:
*In lieu or engagfng dlreotly IA the oil an4 gas
pro4uofngbusiness IA any State or oonntry, a oor-
jioratloaorganized under this ohapter an4 authorized
to ewhge in said produoing business may own the
stock of other aorporetlonaengaged therein, provided
that It shall not own the etoak of more than one pro-
ducing corporation,or one pipe line crorporation,
organized under the laws of this or any other single
State. No oorporatlonorganIze4 In any other state
or country shall be permitted to own or operate oil
pipe lines or engage In the oil produolng business
In this State when the stock of suoh oorporation
icromed In whole or In part by a oorporatlonor-
ganized un3er this ohapter."
There la no question but that a r?OrpOratiOA oreated
mder subdivision36, supra, has the right to enga@e in the
oil an4 gar pro4uoIngbuolnesa. Article 1499 also oontalned
in Chapt8r 15 expressly OOArer6 euch rights.
It Is our oplnlm that the propose4 oorporatlon *A’
sin lieu of engaging direotly In the 011 and gas pro4uolng
busiPeesW may own stook of the proposed oorporatlon crB.n
We era returning the instrumentssubmittedwith your
lettsr 0r request.
Your8 very truly
ATTCRNEY Gl?NERE,L
OF TECS
BY Lloyd Awstroag
Assi8tant