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,.-a OFFICE OF THE ATTORNEY GENERAL OF TEXAS
1.3 AUSTIN
Honorable Jno. Q. ?&Adams
commissioner
Department 0r Banking
Austin, Texas
Dear Sir:
t of the amount of
on the above stated
oovsrs33 in sohedule form. i .
form bond may be written for this
we would like to know the smount f’or
whioh such’bood shoud be made.”
The provision of the Banking Code oited in your
letter reeds as follows:
_.
:..”
_. 783. _
Boaorabls Jno. Q.- XaAdaw Pam 2
The Couxaissioner, then Deputy Commlasioner,
the Departmental Zxamiaer the Liquidating
Supervisor, and eaoh sx and ner, assistant ex-
aminer, and speoi’al agent’, the Building'an%
Loan Supervisor and esoh building and loan
examiner and each other offiaer and, employee
apacified by the Commiasionar shall, before
entering upon the .dutisa of his office; take
an oath of offioe and make a fidellt bond i
lo the sum of Ten .Thourand Dollars (~4 lO,OOO.OO)
nayable to ths Governor of the State of Texas.
ana his auooesaors~in offloe, in indiridual; W
schedule. or blanket form, cxeouta by a suretl
aDpeering upon the list of apEnovea Wreties
acesptsbis to the Units&I Stat& Government.
Any bond provided under this artiole shall be
on a form approved by the T’inanca Coobniaeioa.
The pramiuma far aaoh bonds shall be paid
out of tha fund6 ap,propriatad for. the.opsratioa
cf the Banking Department~~(?..phasis added)
Aa oan readily be aesn, the atatute expressly
authorizes the use of a blanket form of bond, subject--
as Is the ease whether the bond be, Individual’, aoheduie
or blanket--to th8 requuirsment, that t&s form of saoh
bond be approved by the Finance Commission orsated by the
new Solking Code. Your firat question is tharefora
answered in the affirmative.
The plain intsndment of the.above statute is that ,
a fidelity bond in the aaounf of $10 000 ahall 009er thr
aots of each of the oZ?loera and empi oyees enumerated therein
ao that, in the event of the &efaloation of any or all of
auoh persons, reoovery map be had up to this amountfor
each of the Erring individuals. .Statad diffarentlp, the
puipose of the statute is to proteot the State from the
malfesaanoe of the petaona named therein to the extent
of ,$lO,OOO for eaoh suoh person, regardless of when saoh
malfeasanoe shall ooour~and regardless of the oiroumstaaoes
under which it shall take plaoe.
The rollowing examplea will perhaps s0r9e to
make this clear:
(a) Zither A or 3 or C alone eznbezxlaa $10,000 and
15 immediately dateotsd,
t.
.
784
xonoraBl4 anor Q. mudarm, wee 3
1 (b) A, B and,C, aotlng la oonorrt or at the mm4
' the, sash embexzl6 $10,000 and -8 i5amdlatsly
dsteeted.
(0) A embezelee $10,000 and his aot remains
uudrteobed; B subasqusntly ambexxlea a like amount
and he too is unapprehended; 0 later fe guilty of
like aotion, but at this time all three 4mhea2l4-
nents we dlaootersd.
Ia our opinion, the pm 086 of the Statute was to
afford full and oomplatb protsot Pon.to the State in eaoh
of the situations lllu8trated above, end in similar situations,
Ii a bond oorsring A, B aud C ehould, be exeauted
Only for the sum of $10 COO, 8aOh Of 3uch p8rfiOnS would,
in one 881148, be cover84 by a $10,000 bond, sin04 a raaoterp
Of this a!QOUXttcould bd haa in'the 8V8nt that aX#' oll4 Of
thm should violate the oonditlona of the bond. Thus full
oovera&e would result in th4 situation llluatrated in (a)
abOt8. UorooTer, ii A alone should 8mb82218 ~10,000 and
if this amount should be rsoorersd on thd bond, a new ‘bond
of #lO,OOO would be neoeesary to rsplaoe th4 impaired
security and suoh n8w bond aould be avsllable if % alonr
or C alone should subssqnsntly be guilty of like aotlon.
Rowetor, It is apparent that such a bond would la
no w afford in11 proteotion in the situations illustrated
In (b"i ad (o), for the mariama liability OS the surety of
such bond would be but $10,000 regardless of how many dsfsl-
oatlons should ocour and regardles~a of the extent thereof.
Tbos, in (b) and (0) the Stats oould reaomr but .$lO,OOO
despite the faot that,its total 104684 were $30,000.
Ir w4 oould aaaume that poaalble malfeasors will
a&i ShI&y and in l8qU8DO8, with each suooeedlng pereon
waiting until hla pr,edeoaaror hea bsen apprehendsd and
until ths impaired aaourity has again been built up to
$10,000, a b.>nd of this mount would oonfom to the purpose
of the statute, Obvl.~usly, however, no auoh assumption
is tenable. To aa28 ior eituationo of ths typo illustrated
In (b) and (0) abora, and siiallar situaticnr, it ia neoesaary
that the bond-be one which oovms each individual to the
extent of $10,000 re$ardleaa of nbsn ho aots' and regardless
0r the action of hls r4110m.
ainoe we 434 not authorlaed to presorlbr the rorm of
suoh bond, no do cot hero ettempt to stats pr48184ly what
the ‘iamount of such bond shell bs. Perhaps it will be 04044-
sery for ths emu.&t or the bond to be that craount wi~ioh is
obtained bg a<iplyiag ;3lO,OOO ~bp the amber of persons to
‘be Inoluded in the bout% Cn the other tend, p&mps It wi3.l
be :oseible to obtain. a bead rhio2 nhili, bearing a is00 mount
of but $10,000 or saw SM in SXOBSStheeof will norerthelrss
be oonditianed in suoh o w that the neoaasar eorsrs@ will
be ObMinrd. u"onsaqueatly, we z~r1y:mable to gi TB d aaimwriosl
xmw? GO ytur sseond question. 3swm%r, in aprmer to mob
question, you am ?rspefMull~ addrised that th0 tueiWt Of
the bond auwt .ba auoh that under the SoMitiOn8 thsreof p+a-
tsotion~to the extent of P,10,000 will In all oircu~stmoes be
sff?3ded the Stats against t4e yxslbls tisdaeda ai each
iadlviduel covared by the.bond.
l'?Usttn& that. the t4T8gOiilg Sat~S2hOtOril~ &UW3
yaw ia31iri48, we ere
Yours very truly