"P'arcA~r0mv~Y GENERAL
OFTEXAS
September 15, 1958
Honorable J. M. Falkner Opinion No. WW-500
Commissioner
Department of Banking Re: Whether or not the Finance
Austin 14, Texas Commission of Texas may,
under the provisions of
Article 342-112, Vernon's
Civil Statutes, authorize
the expenditure of moneys
for costs and other expenses
incurred by the State Bank-
ing Board in the trial of a
case brought under the pro+
visions of Article 342-115,
Dear Mr. Falkner: Vernon's Civil Statutes.
You have requested the opinion of this office as to
whether the Finance Commission of Texas may, under the provi-
sions of Article 342-112, Vernon's Civil Statutes, authorize
the expenditure of moneys for costs and other expenses incurred
by the State Banking Board in the trial of a case brought under
the provisions of Article 342-115, Vernon's Civil Statutes,
based on the following factual situation.
Some time ago,several lawsuits were brought against
the State Ranking Board in connection with certain applications
for charter of a State bank under the provisions of Article 342-
115, Vernon's Civil Statutes, which provides that the findings
and determination of the State Ranking Board shall be subject
to review by a court of competent jurisdiction. After the dis-
position of these cases in the trial court there was an appeal
to the Court of Civil Appeals at Austin, Texas, in one of the
cases, and incidental to this appeal, the Court Reporter of the
98th District Court of Travis County, Texas, furnished copies
of the Statement of Facts in certain of these cases to be used
by the Office of the Attorney General of Texas in preparing the
briefs for the State Ranking Board and the members thereof as
appellees.
The statements for the services rendered by the Court
Reporter were presented to the Department of Ranking for payment
from its funds, but since no allocation of funds had been made
for such purposes, the account is still unpaid. However, the
Hon. J. M. Falkner, page 2 wi- 5001
Finance Commission, acting under the'provisions of Article 342-
112, Vernon's Civil Statutes, has recently set aside funds for
the purpose of paying these bills if it may legally do so.
It is the opinion of this office that the Finance Com-
mission of Texas may under the provisions of Article 342-112
Vernon's Civil Statutes, authorize the expenditure of money f&
costs and other expenses incurred by the State Ranking Boardin
the,trial of a case brought under the provisions of Article~342-
115, Vernon's Civil Statutes. The State Ranking Board, which is
composed of the Attorney General, the State Treasurer and the
Banking Commissioner, is a State agency and subject to be sued
in a court of competent jurisdiction to set aside its findings '
and determinations, as was done in this case. (Article 342-115,
Vernon's Civil Statutes). It is the duty of the Attorney General
of Texas to defend any action brought against the State Banking.
Board and the members thereof by reason of any official act.
(Article 342-207, Vernon's Civil Statutes). The suit in question
was an action brought against the members of the State Ranking
Board by reason of an official act, and, therefore, it was the
duty of the Attorney General of Texas to defend them in such
Court.
While it is true that Article 342-1128, Vernon's Civil
Statutes, provides that the Banking Department shall cause to be
transferred each year of the biennium the sum of Four Thousand
(&,OOO.OO) Dollars to the General Fund to cover the cost of gov-
ernmental service rendered by other departments, such provision
only covers the services rendered by the Attorney General of
Texas in defending the action under the provisions of Article
342-207? but does not include and is not intended to include ex-
penses incurred by the Attorney General in conducting the defense
of the suit to its final determination. The cost of furnishing
copies of the Statements of Fact by the Court Reporter to the
Attorney General was a legitimate expense incurred by and on be-
half of the State Banking Board in the defense of the action.
Article X42-112, Vernon's Civil Statutes, provides in
part as follows:
11
. . . Fees, penal'tiesand revenues collected
by the Ranking Department from every source.whatso-
ever shall be retained and held by said Department,
and no part of such fees, penalties and revenues
shall ever be paid into the General Revenue Fund of
this State. All expenses incurred by the Ranking
Department shall be paid only from such fees, pen-
alties and revenues; and no such expense shall ever
be a charge against the funds of this State. . . .'I
Hon. J. M. Falkner, page 3 WJ- 500 1
Since the above quoted portion of Article 342-112'
provides that all expenses incurred by the Banking Department
shall be paid only from such fees penalties'and revenues, and
the expenses incurred onebehalf oh the Banking Department for
the services of the Court,Reporter being legitimate expenses,
you are advised that the Finance Commission of Texas may au-
thorize the payment of these obligations.
SUMMARY
Court costs and expenses incurred in defend-
ing an action~against the State Banking,Board
under the provisions of Articles 342-115 and 342-
207, Vernon's Civil Statutes, may be legally paid
from sums appropriated by the Finance Commission,
of Texas under the provisions of Article X42-112,
Vernon's Civil Statutes.
Yours very truly,
WILL WILSON
Attorney General of Texas
CKR:jl:wb
APPROVED:
OPINION COMMITTEE
Geo. P. Blackburn, Chairman
William E. Allen
Jack Goodman
Tom I. McFarling
Leonard Passmore
REVIEWED FOR THE ATTORNEY GENERAL
BY: W. V. Geppert