July 28, 1965
Honorable Robert S. Calvcrt
Comptroller of Public Accounts
Austin, Texas
Opinion No. C- 472
Re: Construction of the term
“counnercial hotel, motel,
or other commercial lodg-
ing establlehment~’ within
the meaning of Section 15
o? Article V of the Oeneral
Appropriation Act of the
Ders Hr. Calvert: 59th Leglalature.
Your requqat for an opinion on the above subject matter
asks the followlpg questions, in view of the provislonr of
parqraph a of Seution 15 of the @enerr Approprlatlc)n A+
of the 59th Leglrlature:
“Pleaw rdvlre &at rate of per diem
should be allowed UndeP the following con-
ditions?
“1. Military property auditors of the
Adjutant Qeneral’s Dcpirtment while travel-
Ing to Houston, San Antonio, Ikllas and El
Pas0 stay at the reapeative mllit&ry baeea -
Blllngton Air POxye BaaOr Auckland Alr Force
Ea;,z*;d Pralr%e Naval Air Station and
. These 8uditorCb 8re oharged a
small rate per night by these installations
for their lodging.
“2. State emplogeen ite often in
traveling to educational anr eleemoaynarg
institutions in the performance of their
duties obtein lodging at the, institutions
visited, for whloh a aharge 14 made for
quarters.
-2237-
ii?& ~‘Robert S. .CaJVePt, page: 2 iC-472 )
“Please define’ for ‘jne the teqn’oommer-
clal hotel;~ motel and other, commapclal ,lodg-
lng establlshmentsi”
Paragraph a o$ Section 13 dC Artlcle:W of the Generai
AppropFiatlon Act of the 59th’Legislature provides:
~“Ratea of allowance. Each employee
.traveling on State bueilness .lnslds the~boun-
darles of the. State of Texas. shall be allow-
ed,.. in lfreu of actual expenses .incurred for
nso’ls and lodging;. 8 flat per diem r&ate of
iiqt ‘to’+xoeed twelve dollars ($12) provided
there 1s. attached. to hls’ expense account when
submittgd. a, ,“Pald” :blll’ gr receipt from a
cMaIercla1 hotel, motel, or other commeFcla1
lodging qtablishment $or Ns lodglng,~ Qut
‘provided further that if .‘such receipt .is not
submittrdr. the’ flat’ per. diem ,rate ahalL not
exceed sevens dollars. ($7!. 1’.,
Artlcla.~k906. ‘Revladd Civil Statutea 61 !lkaa. 1925;.
In Merchanta’.Red
T19-11939 ,),.
Merchants Red Bok
Companjroonat%tuted’ a. ~dosiarc$al~ rtgency” br “oommerclal ;
reportl~:ccredit.ogsnC~” rlthsn-fhe pul’irian of Article 7al;
Revlegd Civil Statutes o?~Tali4~, 1925, which article provSded
for t~xtis, upon groea. receipts off certa$n ,btislnessea therain
named. In that.’case, lkwas held:
V It Bppeari with reasonable ;cert&in-
tg that ‘tlie’ierps .Um#cahtlle ggmcles’ and
Vaommerclal.agencie6,‘~ bplng regarded ‘as ayn-
~onymt%a,. ‘have .?or a.. long time had .a def*nlte
meat&i@.. ‘See 40 Corpus, Jurls,~, p; 636.. 1~
the case of Clty.of Bzbokf%eld v. Kltahen, 163
+a. 546, 63 6 .w. 825~, 826; the. ~Supreme-. Court
Of Ml8SOtrr1, sp(rakir~&~OiQXmunerciql or mer-
Mntile’~.a&ncles, ! sa$$:“~.l.Such agen~eles are
defined. to: be. eatablllihments which make a busl-
nesa of aoUecting’ lnformatlon~rq~~tfng: to the
‘oredltl t2hrrae.t+ri -r&8#onslb.ilifji, and repu-
totlon of’. meirchants for. $hij puCpoae ol furnish-
'irigthe lnformatlon to subsci%bera; -' e.g.
,Ri. Q.Dun & CQ~.~Agency; Bradstredt COmp&ny,.etc.
Hon. Robert S. Calvert, page 3 (C-472 )
5 Am. dc Eng. Enc. Law (let Ed.) p. 280;
Web.,Int.Mct.’
*Corpus Jurl6 glvar the following deil-
nltlon: ‘A cosuwrclal or mercantile agency
may be defined aa a person, firm, or corpor-
ation engaged In the business of collecting
Information as to the flnaWla1 etandlng,
ability, and credit of persons engaged In
bualneemr and reporting the 8ame to subsarlb-
era or customers applying and a I
. . . f-emphaala by the Courg- therefo?.’
“TechnIcally .speaklng, It may be that
the Legislature In the original enactment of
Article 7061 had In mind just such agencies.
We are lncllned to think,’ however, that the
@eatIon should not be determined.solely from
the fact that In one Instance the information
furnished pertains to those engaged In busl-
nesar while in the other It pertains only to
curtomera or purchasers. It is altogether
‘probable that a corporation or lndlvldual could
engafse ln the buslneaa of collecting at their
own expense lnrormatlon concerning the credit
rating of individual purqhasers and customer8
and sell thlr InSormatlon to.retall merohants,
In the form of a red book or by repolrtr, or
both, and build up a large and profitable en-
terprlse. Sudh a buslneaa would then uridoubt-
edly take on the character of a ~comerCIa1~
credit- report agencyr such am R.O. Dun &
Co. and other ?mi
s lar agencies undoubtedly
are. Obviously, auqh agencies come under the
statute. We think, however, the situation
here is dlstlnatly dltferent. Thla enterprise
1s undoubtedly so related to the conduct oi'
the business of retail merchants as to really
be an indispensable part of same, or an lIftpoP
tant Incident thereto. . Disregarding
technical rules ot owner&h It may appro-
priately be said that tN8 business Is owned
to as large extent by the subscrlbers,a8 by
the Chlltona. Ita oreatlon and existence haa
been brought about by the cooperation of’ the
merchant8 them&elves. We da not .thlnk th&t
the fact that ‘the Qhlltona are. paid rather
substantially for their servlcea makes this
a fcommeraIall enterprise, In the senae of
-2239-
Honorable Robert S. Calvert, page 4 (C-472 )
being one organized and operated for profit
to those who are it8 8010 promotem. It is.
more properly epeaklng a cooperative enter-
prise between the Merchante Association and
those who act in the aapaclty of managers,
and for thla reason we do not think the Legis-
lature Intended to tax a business of thle kind.”
In view of the foregoing, It Is our opinion that the
phraee !‘commerclal hotel, motel, or other commercial lodging
eatabllshrfient” refers to those persons, firma, corpora@lanis,
aasoclatlone or establishmenta, engaged in the business of
furalrhlng~.lodglng to the public generally Par pay, and
.does not include military lnstallatlons of either the S&e
or Federal Bovernment, nor does It Include educational 1s
stltutlona or’eleemoeynery lnatltutlone of the State.
In anewer to your first question you are therefore
advised that when employeea o? the Adjutant Oeneral’s Depart-
ment, while traveling on official buslnessr obtain lodging
at the reapectlve military baeea , such employees are entitled
to reoelve $7 per dlemfor t3avellng on State bualnees Inside
t&e boundarlea of the State, rather then 412 per diem. In”
. anawelr to your second question, you are advised that when
State employees, while traveling on official business, obtain
lodging at educational or eleemoaynary Instl~utlonr o? the
St&e, such employees are &titled to receive $7 per diem for
~tzaveling inside the bounda&ee of the,, State on. State buel-
need, rather than $12 per diem.
SUMMARY
The phraee “commercial hotel, motel, or
other aonnnerclal lodging aatabllehment”
ueed in subdivlalon a of SiWtlon 15 of ,,
Article V of the Qeneral Approprlatlop
Act of the 59th Legielature, Mtlatlng-t0
the ratee’of allowance for State employees
traveling on State buainesa, refers to
thoee persotie, fira$, corpOratlonar a88o-
clatlona or eetabllahmente engaged In the
budnese of f’urnlshlng lodging to the
public generally for pays and doea not
-2240-
Honorable Robert S. Calvert, page 5. (C-472 )
Include military lnetallations of either
the State or Federal government nor educa-
tionsl or eleem0eynerJr inetltutions of
the State.
Yours very truly,
WAQGONER CARR
Attorney General
John Reeves
JR:&
APPROVED:
OPINIONCOMMITTER
W. V. Geppert, Chalrman
Pat Bailey
Paul Phy
Arthur Sandlin
APPROVED
FORTRE ATTORNEY GENERAL
BY: Hawthorne Phillips
-2241-