OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
Honcr3bls Sfdnry kthaa
Sscratarg or stat8
Autln 11, ‘Sexa8
War Sir:
Loare or the aorporetion, through their
questioned our zmthod of ooa&iutlng the
:ExL"P" mount of 5% or th8 iranahiee tax for aaoh
3o::th or rm0ti0a part of 43 mnth, as provided ror
in .irtlala 7092, iL C. S. 1925.
-It has been ths pra&4~8 ot thle depert~aent :O
c3.:puta the’ 5.5 on the axouut of tax due, for whloh
t3x the right to do busineee was rorreiited, ror each
;c:lth of tk6 rorralture even though the rorreitura
:..:c run for aevsral years. It has also been the
-~actlce to compota the additional 55 on the tax
i.ccrulnc~ in subaequcrnt years tram ‘itip lat ot sash
pear to date or pays3nt.
;;arjombl8 SidnaT'Lsthaa, ~888 2
*Your damrtaant, in Opinion MO. O-72, ZJoYexibar
22, 1939, hrld t&t the 5% drrlgnatad 88l M YiM l ia 8
should b8 aoltot8d ror th0 entire period 0r rorraitian
cjnt5.l th8 roorurd tax and prnaltlrr ar8 paid. Tha rrt-
tomay ror the oorporatlon har aoaordrd that this math04
is probably oo?raot, but rhould apply only to the lmo ua t
0r tax dur r0r whLOhthr torr8ltan um8 drolmd, and
Um8S that it iO SOt OOOt88Ipi8kd h Arti& 7092 that
th8 fee lhOUld 8180 be OO%putd On th8 fMOOhiIi8 t8X88
acox'~iag in 8Ubtl8~8Ot 788M 8Ob whloh lUllsiltOnpaid.
It 1s conteadrd, t,hrrafOn, that tha OpiniOIl Oit8d dO88
cot nnawar thle qu88tloa.
"Xt 1s ierthar urgrd th8t thr rr8oOhls8tax law8
ara pur8ly r8v8nu8 meenur88 sad that thr plmlty either
ror late r8turn or let8 paymat 18 the erknt or th8
-~.:teta*s rraotlooa aft8r.rorr~lturr and th8t thr r8rivel
.~ S88 ap3li88 wholly to thr lmaat or tar dU8 at th8 time
or r0rr8ikr8. Your opinion, th8nfOr8, Ir MqU88tad
on this quertloar
*(should a oorporatlon whom rl&ht to do bueiM88
=.15 forrrltid en s8ptaab8r 3, 1941, ror rallw8 to pay
.a>balanoe Of frtX1ch18. tsr ~8OOnriOg &%y 1, ~19& and
whloh oorporatioa 1%rilllng to .@a~ the. -5%prr Moth
paaelti im raid bcilandh~,' tor~vitdch~~tat ltr right .to do
btlein8sa.we8 iOrt8itad,b8 r8qUiMd to wf 55 glF'-nth
._rrrita1 r88 oath8 muohI8r tar88 8oorulPg on kfay 1,
19Lz. May 1, 1943, and &tar 1, 19451, rttrr the r&ht
to ,do buslnars was rorrrlt8d Oh tipisxbrr3, 19bl”
I'& fOMgOiag 8itMtiOO i8 Clo+.rO8& by th8 &WOYi8iOn8 Or
Chapter 3, Title 122, V. A. C. 3. 1925, and the 8pprOpriati 8tatut88
will ba au.arizad auiilOl8~tly to drY8loop tha oontrollIn& qU88tiOa
without ssttlw thea Out IO full. (al rmpbaais OUTS).
It ia provided that; *%orpt aa herein provided,
all oarporatlon6 now requlrsd to pay aa a~~::ual fmnQhi88
tax shall., batman 'January 1st and Usroh 15th of l0h
y$ar, 35~.v.aa #worn raport to tha s;aoratsry Or atots - -
s:\onisg its condition on the last day of th8 maeding
ya:+r, in dsisult of which rrport it shall be ikbl@
f:r racslty or 10s or ths a.aount or th8 innohiso tax
due by gush corporation - - - cogrthsr with its iremhla*
R Art. 7C89, FL ? 1925, as amndsd by Acts 1931,
::i h.iJ.j?.Lkl, ch.-i65, 0 2. Varnon'a A00. CiV. St.
..rt. 7C89.
.: :;:>i>;,j. :,?dns9 Litha .,
:t is FlWid4d
_ that, *8xcapt 04 hanin
provld4d,
rl7drr doatwtla - - - 4OrFOl%t~Oll hsr4tOfOr4
Or b8N-
rifter chsrt4rrd or autborizad to do burlma In Tama,
shsll, oa or boiora Uay 1st of rach year, pay in ad-
van48 to tb~‘Seor6tary of Stata a rr4anohl84 tar ror
the year rOllouin&* to ba aoqutrd upon the nport
or Its oondltlon rrqulrrdin Art.7089,oupra. Art.
7C84 il. 3. 1925, PI swndrd.by hot8 1941, 49th Leg.
P* 2i9, Ch. 184, AHi, VSII, 6 1, Vornoa’8 Ann. Clr.
\.t. -h-t. 7084.
it Is protidrd that ii *any do5ratlo 4orForot~O3
:ir.411 isi1 to $4~ the tar provided In Art. 7084, aupm,
:han due as provided, it shall br liable for a pmalty
oi 25% or t&a amount of the delinquent tax, end ii
.-rid tax and canolty br not paid in gull by July 1,
tksreartar, the corporatloo shall rorr4it ita right
to do boslnre~ in Taca, such r0rrhhm to bs sirrot-
Eated by the 34cr4tsry of Stat0 8s therain provided,
3f t-r notlor ) ond thr corporation shall thrnce ror-
mrd br danlad tha right to bring Or dalend suits
in+Jm courtr oi th4 3tat4, ualssr Its right to do
\ ~bueInsaa ohall br ravlv8dw (a8,FrovIded In Art. 7092,
now. to, br notload). Art. 7091, R.. + ?9?5.
It is provided In Art. 7092, 8. S., 1925, ab fol-
low4 : Vho tharrtary or Stata, shall during t .4 aoath
or %y or rash year.,notify oaat do-mstla and rOr8lgn
oorpomtlon whI4h iuy br or bscom subject to a franat&o
taqundrr any law or this Stata, which haa fallrd to p%y
such frsnonlse tax on or bsrorr thr flrat day of Ysy,
tL:;lt u.a.le~s such ov?rdua tax tovathsr with aald p4mlty
tf:sreon ehall be paid on or before thu first d4Y 0s
;ulg mxt tollowing, the rIaht of euch aor?oretIoa to
do susitis~s In tt,Ia State will be tOrS4ItOd wlthout
judicial aocsrteinaeat. --- Any oorporation whose rieht
TV do buaineaa ?ray have been iorf4itad, as provided In
t.hIa dhaptar, shall ba rrllavrd fro5 3LOh forfritufr
by royl~~ to the ::acrrtary of Stats ally tizs Within
oil 3oft,hS after such forf8iture the lull alount 0f
T,:;~ ~~r~~r~4h.is4 tax md Fsnalty due by it, toq4thor 7iit.h
3~ ai rlrst day or January ncrt rollowing the rav$val,
(rorfsitur8), thr amount8 nrooeaarp to satIt it to
kre its right to-do busi~lrss rsrIvsd under thr provl-
sloae, of this chapter, such iailurr ahall ooartltuta
~urfici8nt ground for th8 rorrrltum, by !ud&m8nt or
my oourt of oorpatont jurlsdiotion, or the ahdarter
of auoh dossstio 40TpOratiOn.~
And It 1s provided in Art. 7G95: *Tha Attorney
~?
.. ..!:enersl &all brlng~sult th8rrfOr agcllmt 813~ aor-
;oratlon which msy b8 or broom rubjeet tC or lisbld
for any ?ranahIar tax or pmml:yAund8r this law; and,
in 43~ there my no% b3 or shall haraaftor rrlat valid
Crouoda ror the forloltur8 or thr ohartsror e~y COxE8stlQ
pfitatb oorporatlon, or tailcra So pay any rra~ioniaa tar
or franohlar taxes .or pec+i.ty or Faaltios to FhI4h it
any &vr b4oom or shall hsmaLit@r be or beoomr mbJ84t
or llabla under this or fOraIm law, ho shall bring suit
for a forfsltura of suob 4hsrtW. ---*
Ia your raquaat you state In part a8 roiiows:
n--m,,
“It has bqan the praotloeof this U8;art.33nt to
00 ;3u t6 ehs 5:;on the of
amount tax due, for which tax
t;;3 right to do bualnsss was forfalted, for 3aOh month
or tb3 :0rf3it,ur3 3~30 thou+ Chs forfrliturs has Pun
fcr ~evaral yaara. It hss aloo barn the gmctfcs to
COW-U~~ th3 additiocal 5F oa the tax accruing in sub-
s?,.;osnt years fron ::.ay 1st 01’qsch mar to data of
-.:.y-.jnt, - - en
282
;;axrnbla 3idnry Letkm:, page 5
The opinion of thir drpartmnt, Ho. o-72, sorsaber
-“~4,
.. :‘)39, approved the drpartaental
oOnatruOtiOU tharatofors umd
by ~or=ot seorrtarlrr of Stat0 60 to thr ohargo oft fire par
witi mar month on tha unpaid amount of tai for whhioh fallurs
CO 31 thr right to do burfnaormaa forrritad,ror asah ~-100otb
of ~h0 rorrriton won thou* thr rorrrltan hrra run ror *row31
,::‘:ra, but the opinion did not oovrr tha qUr8tioo a8imd In the
:ns:cnt caaa alnor no nqurat ma udr thorrror.
Eorersr, the r0llowing rxoepta from thr opinion xv-
:,uest of !iovaobar 14, 1939, upon rhloh tha aborr opinion nea
;I?& reveal ,tharollant~ raotual alturtion thwaln:
Tar your intornatlon end ettantlon w submlt
?ohsdulr of ths tam8 and pensltlardur by this
oorromtion ror the 24 year parlod, an roll&s:
?rsnohferfezas, 24 years at 90.00 par year 3 24G.00
10% penalty for late report (Art. 7069) 24.00
25:; pczalty for letr payseat (Art. 7C91) 60.1
xbtctal .: 33, I
$wciyal'fee(Art-. 7C92)
1.:
Vou nil1 note tha revival ira la r&urrd on a
basis of 24 yeara and amount8 to a clubetantlal
sulnof
201my compared with thr s.munt of tsxsrr sild prcaltler,
due. ,,a arm la doubt a8 to mhhrthar we crhould oollrot
thla &?lral fee tor the period or 6 inontho, or thr
antire period Of ~Winqki6n0y.- - ww
The only conoluslon-ehlch oan be reochrd fro3 t&is ra-
qua.& and tk..e opinion rondsrsd tCsrron 1s that St tile titi of We
i’e~uSst, 1939, It WIS the cor.struotlon by ti:e tken Ssorrtary or
Stata acd the um~e thereunder that *the additional m.unt Of
five vgr cent or suoh tax ror aeoh month, or freotloual purt
or 3 :zntn, a.k.ich shall olarsa arter such rorfalzurr~ (Art. 7092
Y .t..: ;325) ~8 t.3 30 baaed on not only the tranohlsa tax delfn-
;;;ant :rr t:.a yam in WAoh th forfeitureOS the rl&ht to do
busi:less occurred, but also on seoi~ unpaid franchioa tax ~coruing
thoraortar, whia:i 1~ y :~ur ;raaaat prrtc:;lcr us stated In your Ia-
;;u:3st, sul~x*?,
Tionorabl8 Sidney Zethrm, page 6
It is established law ln Texas that departmental
oonstruotlon or lntarpratatlon will be rasorted to only where
the statute ir rmblguow. See XoCalkm 1. Aea. Ret. Credit
"on of .?uetln, 41 5. il. (2) 46 (Corn. App.), in whloh I.&.
Juetloe Srltz wrote ln part es r0iiow0:
“The Court oi Civil Appeals a180 holda that
the statute article 7094, should be given the oon-
strucfion that It exempts the Aesoolatlon from the
tax because te) the adralnlstratlre orriotir or the
state, the searetery of state, charged with the
duty or oolleotlhg the tax, has 80 oonetrued the
Rtatute ror several years, and, (b) beoause the aeore-
" tary of state has ror several year8 so oohatrued an
opinion or the Attorney OanWal. This holdlng la
error.
"The rule that a departmental ruling adhered to
-
through years or admlnletsrlng of a statute will be
- given Weight, ohly applies to statutes of doubtful
construotlon. Suoh a rule has no,apPlleation to a
statute, euoh as this, that 58 not of doubtful oon-
struction or applloatlon. Ramsey 0. Tod. 95 Tex.
614, see body of opinion page 626, 69 S. 'il. 133, 136,
93 Am. St. Rep. 875."
T&t Artlolae 7091 to 7092, VACS 1925, are in pert'
aiabi&oue IS demonstrated in that they have been judlolally oon-
strued by the Supreme Court of Texas in three outstanding asses
es tollo-iis: .Federel Crude 011 Co. 0. Yount-Lee 011 Co., 122 Tex.
21 , 32 S. 'Jr (2) 56; ROSS AxQI~o~ 011 CO., T. State, 134 TAX. 626,
1% S. ‘:. (2) 798, end Federal Crude 011 Coi, v. State, 169 S. X.
PA6283 (err. rd.1 cert. denied, 64 S. Ct. 66, 320 vs. 758, 88
Fowwer, in none of these oases did the Suprenm Court
Pess'on the question here presented.
10 view 0f the rsot that prior to the year 1339, it
*es the departmental construction of Article 7092 by the L%C-
retery or State’s orrlce to compute the five per cent (52 1
additional amount on all delinquent rranohlse taxes as they
284
aacrued until the final revival by the peyment of all
delinquent fraaohise take6 and panaltiea, and that
ittornep Goneral* O$inlon No. 042, aupra, baaed upon
such departmenta oonstruotion approved suoh oustom.and
usage'aa @ matter of legal oonetraotlon of euah Artlole,
it is the opinion of this department that Attorney Gen-
orsl's Cpinion No. O-72, dated November 22, 1939, fully
mswers your query and the anmier is therefore mxi.*
Very truly youra
ATTOR!QSY
OX3X!lAL OF TXL&S
BY
C. IL Rloharde
Assistant
CKR:zd