Untitled Texas Attorney General Opinion

Honorable-Weldon Hart Opinion No. S-115 Chairman and Executive Director Texas Employment Commission Re: Necessity that Brown Building property acquired Austin, Texas fob the State at a sheriff's sale be disposed of ‘ins the Dear Mr. Hart: manner acquired." You have requested'our opinion on certain ques- tians dealing with'the sale or disposition of 'property acquired by-the estate at a kherlff’s sale PoUowing~judg- ment for unemployment taxes. We quote a portton of your letter: "The Texas Employment Commission has in the past proceeded in accordance'with 'Opinion of the Attorney'General of'Texas No. C-1115, dated Au- gust.5, 1939'. A copy'of.that.opinion is attache&. A question has been raised; however;ab to the propriety of' the Coinmission% contemplated sale of certain real property acquired for'the State by'the Commlssion's'attorney at a.aherlff's sale G following the levy'of execution under a $7,558 judgmentsfor unemployment taxes against the owner of the land. . . . "Our attention has been directed to that language in Article 4403 V.A.C.S., which seems to require that property acquired for the State at a sheriff’s sale be sold or otherwise disposed of ‘in the manner acquired'. At the same time, the article directs that the disposition be made, with the advice and consent of the Attorney General, upon such terms and conditions as are deemed most advantageous to the State by the agent or attorney of the State who bought Fn the property at the sheriff's sale. There appears to be ~direct con- flict between the quoted portion of Article 4433 and its other terms. Honorable Weldon Hart, page 2 (S-115) "I respectfully request that ~you furnish us your answers to~tlie'sixspecific questions treated~ by Opinion No. 0-1115,"mentloned above, with special attention to question~nuniber(4): 'How is such sale to a subsequent purchaser accomplished?'" The questions treated by Opinion No. O-1115 follows "(1) Is a representative of the Texas Unem- ployment Compensation Commission authorized by law to bid In In the name of the State the proper- ty levied upon? "(2) If a representative of the Texas Unemploy- ment Compensation Commission is not authorized to bid in the property, who is so authorized to bid in the property under the laws of this state? "(3) When property is bid in at a sheriff's sale'in the name of the State, who is'authorised to pass title to a subsequent purchaser from the State? "(4) How is such sale to a subsequent purchaser accomplished? "(5) What disposition must be made of purchase money realized from such sale? "(6) Would the answer to the above questions apply to real property a8 well as personal property?" We affirm Opinion No. O-1115 in so far as the answers to questions (l), (2), (5), and (6) are concerned. We reform and affirm the answer to question (3) by stating that when property Is bid in at a sheriff's sale In the name of the State, pursuant to,Article J~401, Vernon's Civil Statutes, the Attorney General is authorleed to pass title to a subsequent purchaser from the State upon compli- ance with the provisions of Article 4403. A careful reading of the "answerItto question (4) in Opinion No. O-1115 will disclose that question (4) was not really answered. Article 4403 Is paraphrased but the word "acquired" after "manner" Is omitted. This word is vital to the proper construction of Article 4403. --- -... Honorable Weldon Hart, page 3 (s-115) Articles 4401 and 4403, as amended, are the principal statutes involved herein. They dare derived from Chapterlj, General Laws, 16th Legislature, Special Session, 1879, p. 9, being Sections 1 and 3, respectively. Article 4401 provides: *If any'prdperty shall be sold by virtue of any execution, .order.or (sic) sale issued upon any judgment in favdraf the State or sale by virtue of~any deed of trust -- except executions issued upon judgments in cases of scire faclas the ageht representing the State by and'with the advice and consent of the Attorney General is hereby'authoriaedand required to attend such sales and bid on and buy in for the State said property when it shall be deemed ~proper'tdpro- tect the interest.of the State In the collection. of such judgment and debt. His bid.Bhall not exceed the amount necessary to satikfy'aaid judg- ment and debt and all costs due thereon." . I Article 4403 provides: "The agent or attorney of the State buying for the State such property at such sales shall be authorized by and with the advice and consent of the Attorney General, at any time to sell or otherwise dispose of said property so purchased In the manner acquired and upon such terma and' conditions as he may deem most advantageous to ~- the State. If sold or disposed of for a greater amount than is necess?ry to pay off the amount due upon the judgment or debt, and all costs accrued thereon, the remainder shall be paid into the State Treasury to the credit of the general revenue. When such sale is made, the Attorney General shall, in the name of the State,.execute and deliver to the purchaser a deed of conveyance to said 'property,which deed shall vest all the rights and title to the same,in the purchaser thereof.* (Emphasis added throughout.) Articles 4401 and 4403 were amended by Chapter 243, Acts of the 40th Legislature, Regular Session, 1927, P. 361. Honorable Weldon Hart, page 4 (S~115) The material change -in Article 4401was the additionof the phrase "or sale by virtue of any deed of trust." : .'. The addition to Article 4403'was the word "acquiredn after "manner;" thereupon causing theamended portion to read.". ; .~to sell or otherwise dispose~of said property so purchased in the manner acquired. . .,' and the words "or debt" after "judgment." It should be noted-that Article.4401 concerns property "sold.by virtue'of 'any execution, order or (sic) sale issued upon shy judgment in favor of the StaG or sale by virtue of any deed of trust" except executions issued uponjudgments in cases of scire. facias. .._ ~~ . In conhection.with.the~foregoing'paragraph it is elementary ~that'any property sold in the manner des- cribed therein would~necessarily have to be sold at public sale. '(Rules-647-650 Texas Rules of Civil Procedure and Article 3810, V;C.S.j This being'true; the on1 manner in which-the State could acquire property un+ er Am 4401 is at public sale. The phrase 'such property at such sales'!in Article 4403 refers to the 'property" sold under the provisions of Article 4401. Inasmuch as property bought by the State under the provisions of this last named article would be property "acquired" at a public sale; ' the on1 manner In which the agent or attorney "buying for m9e State such property at such sales* can "sell ore, otherwise dispose of said property so purchased in the manner acquired" is at public sale. Surely the legisla- ture could have intended no less when It amended Article 4403 by inserting "acquired" after nmanner.n By the foregoing we do not mean that a sheriff must sell the property at public sale. The agent or attorney of the State, by and with the.advice and consent of the Attorney General, is authorized to sell it at public sale after proper advertisement as in the case of a sheriff's sale under execution. The requirement "upon such terms and conditions as he may deem most advantageous to the State" does not conflict with any other portion of Article 4403, nor pre- vent the agent or attorney of the State from selling the property "in the manner acquired." The fact that the sale would be public would In no way prohibit the agent or at- torney of the State from agreeing with the purchaser on the - , Honorable Weldon Hart, page 5 (S-115) terms and conditions-ofthe sale; If the sale were un- satisfactory to the agentsor attorney of the State; there is no-reason why the property could notbe'withdrawn from the sale and another sale attempted after proper advertise- ment, if so desired.~ There is a serious constitutional question as to the sufficiency of the caption of the Amendatory Act' in so far as the.addition of the word'"acqulrcdn is con- cerned. However, IInorder that purchasers may be fully protected'it is believed that all sales made by virtue of Article 4403 should be by public sale until the statute is otherwise construed by the courts or until it is clari- fled by legislative action. SUMMARY 'Property boughtlnthe ~name of,the State pursuant to~provis~ons of Artkle 4401, V.C.S., if sold to a'subsequent purchaser ~froni the'state, should be,sold at public sale. Article 4403, V.C.S. Yours very truly, APPROVED: JOHN BEN SHEPPERD Attorney General L. P. Lollar Taxation Division John Atchison Reviewer Mary K. Wall Reviewer Robert S. Trotti First Assistant John Ben Shepperd Attorney General JAA:amm