OFFICE OFTHE AHORNEYGENERALOFTEXA8
AUSTIN
-c-
--
Hoorah win.r. Larraon
J rotaryor state
iwtin, Tms
BearSir:
t of ymr letter of
Yuoh 0, 1941, on of this depart-
ac)nfi
oa the abo ux letter of lm-
puwt readat
wre Znmranae can-
rowwal ol its
oi k?tialr 1515 (a)
isat that thlr
meat iwur8rlee
now ba &ranted a
co&g to Se&ion 1E'of that artfole tkeir
ohertera *are exgresLlp oontlnued in soroe
during the ,terms or said cthartexw'. Tbet sot
was wed In 1053. In 1959, Artiole lSl5 (a)
and rb) WLR peesed prooidbg #at the Seare-
tary of State aould extend the oerprate ex+3-
tenoe of a company lnwrporated for any purpose
authorized *uadei thim titlet. ThiP aot else
Honareble 'ifur
.I.Lawson, Page 9
provides that the filin& roe to b4 paid shall
be such fee as th4 aorgoratlon would be re-
quired to pay ii it were agplying for ar new
charter. The sat ~150 reqdrse that 32x4Ssc-
rotary of Stats find that the coworation is
solvsnt and its capital unimpaired. In this
deae, the Seerstary ot 8tate could not now
.grant a charter to a state-wide mutual in-
ruranc4 company and w4 aould net find that its
capitol is unimpaired, as it has no capital
mto4k.
WI rim of these
fbot8, we wi8h to request
an oplnibn fP0A you3 48 to wbsther
Ihagartaent
th4 Seoretacy o? State ie authorized to grant
an extension ol ths Corporate srlatsncs of a
mutual assessment iwuranoe assoaiation under
Artfale 1315 (a) and lb).*
The facts disoloued in the affidavit of Xr. A, B.
Bratmen, Secretary o:’ TexailIndmgendecce Lit4 Imurencs Com-
pany, which accompanies your letter of inquiry show that
Texas IridependenceLife Insurance Company wee incorporated
tar a terr.of 40 years from th4 Bth day of January, A. 9.
1899. Thus'it is s44n that the ehartsr of sueh company ex-
gired by operation of law on the Hth day of January, 1941.
The 43rd Legislature peswd BOUW Bill Ro. 505,
now ICWWA as ChapteD 6a, Title 70 or the Revised Civil Stat-
ut48, which wan de&kg&d to place'all oorporatiocs doiw an
icearaneo business nbt then uadelrthe supertlrion of the In-
6urance Department by virtue or a pertinantrtatute under
their supsrrision.
It WE provided in such bill, oow Section l!:of
Article 4889fr
"Sac. 1. Any aorpomtion organized 8nd
ineorgorated under a pre-existing law in this
State without capital etooErand net for profit,
whioh low has been mended or repealed or r4-
maoted, and which was oocratin~ *ad actually
oarrying on in this ribateimsdiatsly prior to
January 1, 1933, the state-wide businew of
o;Utuallp !:rOteotiagOr inSum$ the liV4s Of
its zmzbars by dsseasraentsijadeupon ids mm-
hers my coxgly with the t4rms ot this Aot,
subject to ths subsequent provisions heroot.*
“:
Eonezable Wm. t. lawaon, Page 3
i%dtien e of 5ueh artlclo protides that any oorpora-
tlon d8so~fbd in seetion 1 thorsof cf3uldavail itselr or th8
rlghte an6 privileges sonfsrred by lwh law conditioned that
they did 80 within sir m&m after the effeottve date or the
ret.
The %xas Independenoe Life Insurance Company did
avail ttesli of the privileges conferred by eu5h law and has
siaoe operated under and has been known and acnunonlyreferred
to aa ,a SOS company.
It was the legielatlva intention a8 expreseed in
Rouse BU.l SC3 to 8x ressly repaal all ohartem or ineurame
oompanlea then inex !st8nce whloh failed or rofused to quali-
fy thereuader with, of eourae, axaaption of those qualifiad
under ether pertinent atatut8a. Seotion 14 thereor provided
in paPt:
The charter of eaah eorpavation
in thz &&; entitled to comply with the terms
or thin Aot wblcrhdoes mt make applfoation to
do lo within six (01 month6 after th8 bet shall
Thus it ia seen that the legislative intention rsla-
tlve to euoh corporations is plait&y, intelligently and un-
mistakably expressed. They provldod, aa they were required to
do, that the oharters of all corporations qualifying there-
under were to bs wexpressly oontlnued in rorce duri
t:mm of said ohart8rsD (Undersooriog ours). TK&iSnot
have repealed the existing charters without offering thea
opportunity to Qualiry under the regulatoryfar. 308 New
Orlean Wataxworlu Com.pany V. Riv8ra, Louisiana, 115 U. 3. 74,
eo L. Rd. 52x5. Th8 Legislature dib hot th8n provide that
the ohertern of those oorpcratlons qualifyiog we- to b8
Honorable mu. 5. L&w#ori,Page 4
thereafter rehew& or lxteaded. Statutory authodty for r8-
WWiiIg and extendin& sueh ehertern wa* not then efi@t8ot and
was nowhere provided for at that tlsls. If maeh authority na
OXiOtS it illby reallonof &vtioltv$l315(a) aad (b) lpasredat
the Re&ar and rirbt Called 8waions respeatively of the
45th Le&kturar AFti 1315 (a) reada:
WSubj80t to a finding by the Seoretary of
3%atO aa herolnaitar provided, any private OOF-
poration organized or inoorporat+d for any pur-
pose or purpo8os authorised under thl8 Title,
at any time within ton (10) yearn prior to the
8xpiratloa or ltr ehartes, or any extension
thareot, my lxtenb 6uoh ahurter and the oor-
pOPat exbtenoe Or 6ueh oePpoPation for an ad-
ditlonel period 0r not to aoeed rirty (so)
yearn from the expiration date or the original
ohmter, or any *rte~%rlon themOf, with all
the prlvilege8, pou8ra. iarmunitiecl, ri&ht or
sueo*88lon by it6 eorporPte name, and rights
0r property, real and p srsonala~~$m!&md
he1iiby it at suoh 8xp ration
@ala8iXlt8llt~ and pUI'pOE38BBS UpOn &&B&l
inoorporatlonl The nmnnor 0r extendi
suoh 8herter mhll be by a resolution?LY%t-
ing, adopted at any annual or ~peoialmest-
iag Of stoohholdera oallod ior that purpose
by rtookhold8rm holdin$ a majority or the
ehar88 or capltel stooh or SuOh corporation
then outstandi suoh nsolution to speoify
the period 0r t% 8 ror whioh the ohmtar 141
exttildod, and a OOpf Of suoh rOlVOlUt%Oo,duly.
aertifled by the seoretary of the oorporation,
Wld8r the aorpamt~ asal, ehnU be riled and
r8eOrd8d in the Ofrio Or the S8Qr8tBX.yOf
state. upon the adoption oi'such resolution
and the riling or a Oertifled oopy thereof with
the S8oretary Of State tog8th8r with ~pZU%Qt
of the filfag r88 hem& presOribed, the Ohax-
tar and OOPpOPUt8 existence Of such OOrpOI'atiOn
may be 8rtSnded for the additional period Of
tiIII8 reafted in suoh reeo2ution. The filing
fee to b8 paid for say euoh extarmion Or a
Ohart shall be eueh f80 aa oaid oor9oratloo
would be required Under the Statutea Of Texae
Honorabla Wm. 3. Lawson, Page 5
to pay in the event it was then applying for
8 new charter instead of ertonding it@ then
eristing oharter.
*8~0h etien0l)ion8,however, may be made
only in instaneeiuwhere the Beoretary of State
shall have feund, artes proper investigation
that such aOrpOration in solvent end it8 oapf-
tal unimpaired.’
Artictlo1315 (b) read88
"The proviaion8 of Art1010 1515(a) @hall
extent to and inelude all private oorporationa
incorporated under the general laws of Texas.
The period OS ten (10) years prior to the er-
piratlon of the charter or any extension there-
of referred to In Article 1315(a) shall in-
elude the period of time during whiah auah
Oorporntion rpay hare continued ito existence
under the provieioae of Article 1359 of the
Revised Civil Statutes of 1922.e
The settled rule of construction or grant8 by the
Legislature to cOrporationa whether publio or private, is
that only swh powera and right8 oan be exeroieed under them
aa are olearly aomprehended in the words of the aot or de-
rived therei’rom by necessary lmpliaation. Any ambiguity or
doubt arising out of the terms used by the Legislature muat
be resolve~dIn favor OS the publio. Sutherland DA Statutory
Con8truutlon. p. 429, oltlngr Petersburg Y. kietzher 21
Ill. 2058 Btet8on f. Kempton, 15 MaEa. 2723 Warahaohfe v.
BrOwn, 67 Tax, 519, and other authorftiea too numoroul)for
oltatlon herein.
This rule of atrfot OOnBtrUCtiOA iB dieoueeed at
great ls@th in Th~%peon on Corporations, Vol. 1, p. 397,
whe,reinhe dloouesed and quotes from the case of Paoker v.
Sunberry & Co. R. Co.,.19 Pa;).St. 211, ae follows:
-Rut to justify a strict aonmtructfon it
i8 not nooe88arg e0 oowider the nature and
olroumatances of the gartieular law before us,
for it belows to a olaa8 of atututee whiah,
by a long establiehed and well defined rule of
interpretetion in all the etateaof the UA~OA,
‘;
234
Honorable Wm. cf.Lawtaon,Page 6
as wall a# in -land, ?iurtreoeive and unlfow-
lg ham moeivti the strictest possible oonstruo-
tion. All sots o!'incorporation and aota extend-
Applyin the above rule6 of aonstru0tlon to Arti-
ole 1315 (a) and 1b), can it be urged thtstthere is no doubt
but that auoh rant o? authority Is extended to the Taxas
Indapendanoo Lffe Insurancrcl
Onnpanp and other8 Biailarly
situated? Artlale 1315 (a) expreusly provides that the
resolution to extend the eorporatb life nust be .. . . adopt-
ad at any umual or speoial meting oi eto0k:holdera. . .
by stoakholder$ holdina a majorits of the shares of aagital
atoa,. . ." [Undersaoring ours.) rt 1 ? th ld d
m*rtmh extenaiona, however, may be ~dtb%l~i%atk!ea
where the Secretary of State shell have found . . . the aor-
poration solvent and its capital &nisnpalred." Sinocl there
are no stookholdara in a mutual llfa ineuranoe 0o~pany to
pass the raaolutlon requimd, and sin00 suoh oOrpOratiOn as
oreated with ut capital atoak and presumably ar a non-profit
aorporntion required findings of the Seoretary of Stats
are rendered%, ~oesib1.eof performanoe.
Although the mrding of Artlols 1315 (b) is apparent-
ly broad enough to utiverall oorporatlonr, it is our opiu-
ion that Artiola 1313 (a) and (b) considered togsther,were
not intended to nnd do not emaompa118the type of oor$oration
involved in this opinion request. It neoesaarily follow8
that your request is answered in the negative.
Yours very truly
A!L'TCRNEYGX'J.ERAL
OF TEXAS
L