THEA~TORNEY GENERAL
OFTEXAS
Gerald C. Mann
Hon. M. .O. Flowers Opinion No. O-1925
Seoretary 0r State Rer Are companies such as John
Austin, Texas Hancock Mutual and Jef’rerson
Standard subject to the Real
Attention or Mr. K. King Estate Dealers License Aot?
Dear Sir:
Your request for an opinion on the above stated ques-
tion has been received by this department.
Your letter reads as follows:
ItIt is the desire of this office to secure an
opinion from the Attorney General as to whether
companies such as John Hancock Mutual and Jefferson
standard. etc., are subject to the Real Estate Deal-
ers Liceise Act.
“These companies operate their own loan and
sales department, paying straight salaries instead
of commissions.~
You further inform us that Jefferson Standard is a
regular life, health and accident insurance company, organ$zed
under Chapter 3, Title 78 of Vernon’s Civil Annotated Statutes.
Companies such as John Hancock Mutual and the Jefferson Stand-
ard make loans upon first liens upon real estate ana occaslon-
ally it Is necessary for such companI.es to foreclose such liens
and sell,the property obtained by such foreclosures.
Article 4818, Vernon’s Civil Annotated Statutes, pro-
viaas in part:
“Mutual life insurance companies shall invest
their funds in accordance with the provisions of the
third ohapter of this title, concerning investments
of life Insurance oompanies in this State;. . ..”
Article 472.5, Vernon’s Civil Annotated Statutes, set-
ting out the seaurities in which a life insurance company organ-
ized under the laws of this State may invest or loan money,
provides among other things:
Hono M. 0. Flowers, page 2 (O-1925)
”. . ..It may also make loans upon rirst liens
upon real estate, the title to which is valid and
the value of which is rmty (40%)per cent more
than the amount loaned thereon; or upon first liens
upon leasehold estates in real property and improve&
ments situated thereon, the title to which is valid,
and the leasehold has not less than thirty (30)
years to run before explratlonj provided that the
duration of any loan upon such leasehold estates
shall not exoesd a period or ten (10) years; or upon
any obUgatlon secured collaterally by any suah
rlrst liens. a .n
House Bill No. 17r as passed by the 46th Legislature,
commonly known and tit ad as “The Real Estate Dealers License
Act’1 reads in part as followsr
‘lSeo. 2, The following terms shall unless the
context otherwise Indicates, have the roilowing mean-
Ings:
‘I (a) e (1) e The term ‘Real Estate Dealer’ shall
include every person ,or company, other than a sales-
man and licensed and registered attorneys, who for
anof her or others for compensation or other valuable
consideration, or who with the intention or in the
expectation or upon the promise of receiving or col-
lectlng compensation or other valuable consideration,
list’s ror sale, sells, exchanges, buys or rents or
o%rers, or attempts, or agrees to nego e iate a sa e,
3.
exchange, purchase, or rental of an estate or inter-
emst in real estate, or collects, or offers, “r at-
tempts, or agrees to collect rent for the use of
real estate , or negotiates, or offers, or attempts,
or agrees to negotiate a loan, secured or to be se-
cured by mortgage or other lnaumbrance upon or trans-
fer of real estate! or auctions, or offers, or
attempts, or agrees to auction any real estate; or
appraises, or offers, or attempts, or agrees to ap-
praise any real estate! or who advertises, or holds
Itself, himself, or themselves out as engaged in the
business of selling, exchanging, buying, renting, or
leasing real estate, or assists or directs in the
procuring of prospects, or the negotiation or closing
of any/transaction which does or is calculated to re-
sult in the sale, exchange, leasing, or renting of
any real estate or who buys or offers to buy, sells
or ofrers to se i 1, or otherwise deals in options on
real estate or in the Improvements thereon.
Hon. M. 0. Flowers, page 3 (0-19,225)
“(2). The term ‘Real Estate Dealer’ shall
also include any person or company employed by
or on behalr of the owner or owners of lots or
other parcels of real estate at a stated salary,
or upon a oommission, or upon a salary aa .oom-
mission basis, or otherwise, to sell such real
estate In any parts thereof, in lots or other par-
cels and who shall sell or exchange, or offers,
or ac tempts, or agrees to negotiate the sale or
exchange of any such lot or parcel of real es-
tate; provided however, if the owner of lots
or other parce i s is engaged in the business of
buying selling exchanging, leasing, renting of
properly and hoidlng himself out as a full or
part-time dealer in real estate, then such person
employed by said owner may be licensed as a sales-
man of said owner if said owner has been licensed
as a dealer in real estate.
” (3). The term (Real Estate Dealer’ shall
include any person or company engaged in the busi-
ness of buying, selling, exchanging, leasing
renting 0r property on his or its own accoun 4 ana
holding himself or ltselr out as a full or part-
time dealer in real estate.
” (b) . The term ‘Real Estate Salesman’ shall
mean and include any person or company employed
or engaged by or in behalf of a licensed real
estate dealer to do or deal in any act acts, or
transactions set out and comprehended by the defi-
nition of a ‘Real Batate Dealer’ In Seotlon 2,
Subsection (a) of this Act.
“‘(0). If the sense requires it, words in
the present tense include the future tense; in
the masculine gender, Include the feminine or neu-
in the singular number, Include the
In plural number include the singu-
may be read ‘or’; and Ior1 may
“Sea. 3. The provisions of this Act shall
not apply to and the terms ‘Real Estate Dealer’
and ‘Real E&ate Salesman I, as above deflned,
shall not Include:
“(a). Any person or company who, as owner
or lessor, shall perform any of the acts set out
*
.
Hon. 14. 0. Flowers, page 4 (04925)
in Section 2, Subdivision (a) with reference
to property owner or leased by them, or to the
regular employees thereof with reference to the
property owner or leased by such pers.on or corn-
pany where such acts are performed in the regu-
lar course of, or as incident to, the management
of such property and the investment therein,
unless such person or company is engaged In the
business of buying, selling, exchanging., leas-
ing, or renting of property and holding himself
or itselr out as a full or part-time dealer in
real estate.
” (b) o Persons acting as an attorney in
fact under a duly executed power of attorney
from the owner authorizing the final consumma-
tion by performance of any contract for the sale,
leasfng, or exchange of ,real estate; services
rendered by an attorney at law, recefver, trus-
tee in bankruptcy, adminfstrator, or executor,
or any person doing any of the acts speclfled in
Section 2, Subdlvislon (a) ~of this Act under or-
der of any court; a trustee acting under a trust
agreement, deed of trust, or will, or the regu-
lar salaried employees thereof.
“Cc) 0 Any person, partnership, or corpora-
tion who has secured a license under Texas Se-
curlties’ Act, House Bill No. 521, Regular Ses-
sion, Forty-fourth Legislature 0
Wet. 4. An one act set out in Section
‘2, Subdivision (a ‘; of this Act when performed
‘for another or others for compensation or valu-
able consideration or who with the intention or
in the expeotation or upon the promise of receiv-
ing or collecting compensation shall constitute
a person or company performing, offering or at-
tempting to perform such act or acts, a real
estate dealer or a real estate salesman within
the meaning of this Act.”
The provisions of the above mentioned act do’not
apply to, and the terms “Real Estate Dealer” and “Real Estate
Salesman’* as above defined by the statute, do not include
any person or company who, as owner or lessor perform any of
the acts set out in Section 2, Subdivision (a3 with reference
to property owned or leased by them, or to the regular employ-
ees thereof with reference to the property owned or leased by
such person or company where such acts are performed in the
Hon. M. 0. Flowers, page 5 (O-1925)
regular course of or as Incident to, the management of such
property and the investment therein, unless such person or
company is engaged in the business of buying, selling, ex-
changing, leasing, or renting of property and holding himself
or itself out as a full or part-time dealer in real estate.
We believe that the buying, selling, exchanging, leasing, or
renting of property obtained under foreclosure proceedings by
the companies above named or like companies would be acts per-
formed in the regular course of, or as Incident to, the man-
agement of such property and the investment therein.
Therefore, you are respectfully advised that it Ls
the opinion of this department that the John Hancock Mutual
Insurance Company and the Jefferson Standard Life, Health and
Accident Insurance Company and like companies when engaged in
the above mentioned acts would not be subject to the Real Es-
tate Dealers License Act.
Trusting that the foregoing fully answers your in-
quiry, we remain
Very truly yours
ATTORNEY
GENERALOF TEXAS
By /s/ Ardell Williams
Ardell Williams, Ass&stant
APPROVED FEB 16, 1%
/s/ Gerald C. Mann
ATTORNEY GENERALOF TEXAS
APPROVED:OPINION COMMITTEE
BY: BWB,CHAIRMAN
AW:AW:wb