THEATTORNEYGENERAL
OF TEXAS
Aus-I-IN~x.T~~A~
Honorable C. Burtt Porter
County Attorney
8an Patrlcio County
Sinton, Texas
Dear Slrr Opinion HO. o-3821
Rer Uould the State Bo&rd of Education be
compelled to surrender bonds of Sinton
Independent School District now held by
the Board of Education, Bold bonds not
having a aall date, providing refunding
bonds be voted for the express purpose
OS refunding the outstanding bonds in
order to obtain 8 lower interest rate.
We acknowledge receipt of your opinion request of July 25,
and quote from your letter a6 Sollower
“The Slnton Independent School District leeued
bonds ,in 1933 or ‘34 which were purchased by the State
Board of Education. The following questions arise:
"1 . Would the State Board of Education or
State Treasurer, as custodian, be compelled to surrender
bonds of the Independent School District now held by the
Board of gducatlon; said bonds not having a calldife,
providing refunding bonds was voted by the people for
the express puppose of reSUndlng the outstanding bonds
In order to obtain a lower interest rate?
"2. Where an Independent school district has
out&an&g bonds that are owned by the State Board of
Education, and three (3s) per cent refunding bonda could
be issued to retire the five (5%) per cent bonds, would
the State Board of Education be required to surrendtr
the 5% bonds, although such bonds had no call date.
Ue have been unable to locate a Texas case squarely in point
but we believe that the well established rule is laid down by the Supreme
Court of Kansas In the case of State ex rel Parker, Attorney General v. gtz
School Fund Commission, et al, 103 Pac. (2d) 8011
“It 1s well settled that ln the absence of a
provision thereSor, either In the bonds or an applicable
statute, municipal bonds issued for a certain number of
years are not redeemable before maturity without the con-
sent of the persona holding them”.
'Itonorable C. Burtt tarter, We 2 o-3821
_
66
Ok la .) Pac. rW)
l a lso
10591
44 C.J. 1235; Ikte v. Keith (8upretae Court of
Brenham v. Oenmn-AmericanBank, 144 U.S. 173.
There 18 no constitutional or 8tatutory rovlslon ln this
Itate provldlng th8t bonds may be redeemed Before mater Pty at the option of
the rchool dirtrict. The aahool district may, however, reserve In the bonds
an option to redeem.
In view of the foregoing It Is our oplnlon that a school
district has no authority to call bonds prior to their maturity date
against the will of the owner, in the absence of express stipulation there-
for' in the bonds.
Therefore, both of your questions are answered in the
negative.
Trusting that this answers your question, we are
Very truly yours
ATTORNEYOENERALOFTXXAS
By s/ Claud 0. Boothman
Claud 0. Boothman
Assistant
COB-E-WC
APPROVED AU0 21, 1941
a/ Oerald C. Mann
AWORNIE QmBRAL OF TBXAS
Approved Opinion Committee By s/(tvB Chalrman