OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
trlct conrt.
27, ls40, a-
for aA0 opixdcn tho dove srptionea
mbfatit mxttw,
wt08rUlpsr
0 failure of tao
a litm upn hi.6
a#wmant , ln orrsot # dbor%inater the
lam of the bank to the Lien armted to
secure the fedoral agency insofar 80 tha
bank’s lijrais 8 lian 011 the
lnc1ta%r an qgremt on the
ii- Coxd8doner not to
farmrinthollmofh%stool8ad8toak
duringtheeodngcropyJlu. Th+Cam-
zdssloa3r is oi the opisma th8t it ir to
the bestlatcuostoi thobaak ta aaouto
the agroemaxlt.
'(2) ?ha baa& bold8 a llm n
stoekot *ralne1e8s than tw asmunt or
its a&at, nrd the ommr of the stock, tind-
ing a prcohasorsho Lowi11lngt0 m 8
tnir pie0 ror the stock, popose* to ml1
th38tQck;mb~ y the pwweds of t&e
sala to his debP , lorting the balmae of
t& MobtodPeas still owl@ the bfusk. It
zill b3 necessary for the Ccudsslomr,
%ithW 0xpoa61~ or by iaplit%Btiotl, to ro-
lwse tha lien of thebankupon the stock
sold..
O(3) The saao eituation 38 that
a&ailed la PQM;TO~ (2) abow, quite ofton
arises sit& ref3roneo to real obtote loeoo
3'33rail-01s or 0 prt Of the lard GocUr-
ing the Mabtoclr#Po is sold cn3 the ysooml.s
aj@led oa the debt, the ComAsslaner Being
requimd to axwute 0 prtlal or full re-
lease of t&S lien.
'(4) B&ore the clo&.ng of the
baaitaqzim3s alieaupnperscmaltf
uxbr ,c pledged contra& coatpinzzrg a PO+-
-.wof Sal0 allthorixbg thobaaktooOll
tha peruaoslty at public or ipri~ate SC&~.
ThO Coxiiaosion3rrizYlsa person who is
willing to bti the rowmnablo value o?
tha poperty at the Bale clnddGcidea to
persilt the Fojerty to bo strwk d'S to
tm tbiml party arxlersuch bid.
O(s)
Tlaebank holds P lien apm
Live etock a~3 the dabtor, tithout axq
epoeifio ~setiaent that the stock is to bo
taken la ~ollat.%on of th debt alqly
turns the stock in to the coudrirfonor uml
indicat3s that be is xm*1~~&0&
In tha truleaotlon.
anoppetunltyto Eelltbb rtoetforo
reason8blsralne ant decide8to Bakethe
sale.
s(O) Tho dabtor, as in vsgra#
(8) abow, turzm the stock i8 to the M
butspeclxiasll;l8psesthstth@Csmlsr
iona? is to Ml1 tho stockend rpply the
poceads to the debt,leatinE; thennprid
bskuiae still osiag.
‘~6ZlStSCtiOll6 SUch 66 6bofO OUtl%lld
usurlw inr0i~0 ~popsrty or 86ui YO~UO,
and If the Cousdssioner 3.6 rrqulrad in
ev$ry aase to rp lo to the court or tbo
jl.l&gs
far autho4 ty to mrry out the m
posals, a consldersblo portion of tEe
ta1uo Gf tizap-opert7 invOlTetlx4.11be
uood in oaurt costs* It i6 t&S desire
of this Dc+prrrtwnt to exaraise every jre-
caution lal;allymmesssq, but at the
6;iE8 t.iW, not t0 USS1eS61Y VMte th0 M-
sots in its Umds by sm unnoowsafy
court costs.
*In tLe~lFC;btof IJioakavc, I respeot-
fully suhalltthe follosiry qnestioar
ml8 it ncae*a8ay, under tie lav, for
the Co~dcwr tcropol;r'
to tha Dis-
trict court for uuthGrit7 to cs.rT7
but iug or all Gr Lb0 prSpcsal6 as
outlined la rsaragraphsx~~&srerl (1) to
(5) abow@
A fw words Tith Z’espOOt to th3 notut’s ati 8SIEWal
powrs of the ii* Comilssi~~!~ rfll not bo emis,. 38
th a c o ntr a r y, sudb l sktewnt will fumisb the key to the
jmb10ss,ima others Of a skilpr naturrt,subr.dttsdin your
-P-7.
The StrteBaakingCossids(LIomr is a State officer
6xidsb7 1s~ su~lmtSm&at ad tnst@MtOr ef the State's
bankIng system of Texas. (WV. Cit. Stat., ArtAcls 347)
iiais clotksd ritb the pcmr of tisitrtioa of State banklag
lnstltutloM, 81th authorit to C&OS8 orp 1lutitut10n riolot-
ing t&o lama ot Lt10 State, SS S@t tSPt& in the St8tUt36. Be
iebr Los mda the liquidator of olosedbanks cOsdx& lat.0his
2c
haml8, (8eY. CiY. Itam., Art. 3tl)) 8xaept ln tlloae a88eE
uilcreheroluntaril7rsCerstbe satter to theAtt~Cea-
*al for julsdal 11puidrt1on.(BOY. CiY. stats ., Art. 370).
LB t&O WttW Of liQUid8ttrgSUOb 8 blUik.thO
C0mtAeel0uw is euthorited to eo11est PINS, claims, end
debto dua to su6h inSOlrS8t bank8 aXadpsriSX% such rats as
are nee?nsary to oormerro its 8eHts and baslwms, ud to
1iqdlbt.e the aftdrs of rmab hmlmnt b-.' (Rsr.Civ.
8Lats.,Art. 463).
It will be borw In odrd flut the autharit~ of
theBuWngComzlseionerbe10~ tehiub~tirtoo of his
~podtion a6 a state 05?16w axl net w tirtus OS al?y aoFt
of appointmnt~ ug ooptf as aFeeelv* 0rU@dater,
(Lain OIuuary Co838 of l.ns01relseypoowdlngs.
TheCo~Joaaracts uponhis emninitirtiraaod
irrbependentl7
of tbe crders of tbe court, exoept onl7 In
thoso illSt&8lCSSUhb-ro t&s St8tUt3 ha6 6ps0iii6Sd1j WW@.P0d
the approval cf' t&e District Court of the county wherein the
insolvent bank i8 loeatod. Zhis 118a5tation upon his other-
sisa coupleta power, %nsofar as ft is jmrtlmnt to 7am in-
qu&rbs, is found la Artlole484 of th7 statutes,as follov~~
sUgon ths ordsr oi!the Dlstriat
court of the oeuut~la which aroh
bsnkls loeated,it in session of
the jadgo thereof, if %a rraatL,
the Corrndsdonw ray sell or eom-
pound all bad or doubtful debt6,
6a3d a67 sell real or psrsowl pco-
pert7 OS such banka on such tsror
as the aourt sbsll direot, RX@ un-
derlike OllderOt Said OOUTt,or
the jud&e thereof, bo aq sell or
ooupouml bd or doubtful stMk-
holders' tb6MsswntS fbndssll
stockholders* ussasswnts levied
ageinatstookbolders of sxacbben%
OPsuchtermsest.beCem%sh8l1
dlroet. a0 SOOb OPdOr 6htil b0
enterea or sale sad0 vltheut8o-
ties 0x3 t~eardng.~
A6 8 liquidator of t&bMk, the COnr JisdOnW is l
tFustee, t&e dapofitors, other erediters end the stooMxoldere
($8 8 ssar;o) t&e ‘uoasliCiSPt66 , ylJhsncohs my do every-
thing wcesaaa-y to ooaearve the asaets of rho bzmk. (536
Zsll~~ bmkka 8nd i&&in&, Vol. Vt * 6311). ?lot w k
this tLw general rule, but it is &he statutoq rule ia
‘KQxu, ILS sho%fnb7 &tic10 483 oi the StStUtQ6 ObWe qUOt-
od. Of cowe, say sot uf his In thr aonsarvatioa of t&a
au&s in his lmrub is subjeor to tha expcou rememtion
of the sLatuto contalnsd ln Artfcle 464 pit& reaps& te
tb~ a110 of assets, the c-s oc aoxqs-odse of dabts
tiethe bank sxi t&b like.
a0 c~~OQSr’6 8OtS pith X%MqeOt t0 tbf3 CoI)-
somrtion OS Lhe oreots$n hi.6
should be thOs@ which ha!XlS
a sauna axl fair osslci%l useretio?J surgests to him as
fha &roper tXl6h.XWS ona oifiai%l Courmd. ms dutiee Era
those that aoulS ba extwcis~ b7 80 orddmrily tubIrf3twm-
alL’iLr
C;UltloUS,oo@blo poreon oCoupg* his offIcIa1 ml-
tion. such oipio2ol wts cl hi6 are end em wt.
i’i.zaal
subject tc appeal or rwiw by amy other tHb#lklOrWtlFt
sbatso~?ar It- io only t&a abuse of bls pouers that muid
l
be macLad a-w by tcoourt of eqnit7.
Fitb tieso ~-x&era1but Im¶Is~teble pInelplss
in dlxl, vo %nwer your inquirlw in t.hooraer In uhhh
you hays propcunied the&~ 00 followat
(1) ma aubowtlaa egreewat, rruob:aa mm-
Uonod b7 7m, clearly, if tb3 iaOtS jl?stw i.t,is One
rbich th3 ii- cowdasiowr in t&o 0xaruiso oi) his an-
cLCsputJC.right and duty of conseru~tlm oi the auetm in
IlisIisldS*husthopowrtowke. lfth~aaUlouab7
another to the tarrisw’ SOP the wr*oSS of t#%bl~ hflp to
mke a crop, S6 rawmabl~ nooassarj cx=holpfkl to the
Ced6&owr io malising upoa bi6 cmn clrrir, the sribro-
sat&on irtSwor of the ow tnklng such nm loan is ea
at of conservation suthorzEed b7 16s. uad not Is eq
SB~SO a aah of an assot of tba bank, WC Is it o e01p1
protdse or co-g of ua iadobtodness ,due the bank.
(2) There Is a ditfsmnue batweoa 8 debt and a
llea respring the ps7wnt of sueb debt. Sacb 1s polerty,
OS course, but the lien baa no separrrteexistewe &de--
Ont of the debt, a& o8mnot be se~@&d tbwe?roe am3
8old as EII asset wltbln Itself. Z?m ease pxt by you in
Us qu~ticn is a mare oouvoaticxml mthtibf qrewcnt
of t.ilc&artAeo cowollzQa to rcm?o1ose t%Aa lfon e apply
thbo procrmds al tLs 6S10 to t&s debt. TM8 is in 1Qgal
aifsat enfamemmt of the lien for the purpose of colleat-
. -
x
lx.& the d&t -- a thing the Coxmirrsianaris camrmndsd
by 1~8 tC do.
aaid aboro ritb r3spact
__ - -to
qu3st1cn 82' 1s 3150 rpy1rcama to your qu3st1on -8.
.i3+ fact rhat th.3 mcurlty consists of lcuxlrather than
of p.8rscnalgxoperty rzcnkes
no dl.ftsenw in ulo losttar.
(4) In a casd rhora tha bank asset is a noto
socurs& by a pl%lgo of collataral tto situatien is no
difforont tram that disenssad in quostlono .r and 'P
abwe~ The pledged lisn niy bo fomcloaed by t&s Cop-
I;36~ionarIn scc0rdm2.3 rith,.theterm or the plodgo
contract zd *Aa wthad on~z~ast-d a you my, of course.
bo POllarDd* This is collacticn and not wls or mqmmd-
ing 12 anydoo.
(5) trh83-0the Cowdssioner pase3ably take8
pao~~?&co of c#rtgiged pwprty, as he ZXL~ 53 authorimd
to Lo by thz tams of the instrumnt, or v?lcr> ths dabtor
mrQ surrmdorg tha cxwtgagod property to tb3 Comdas-
ionor umier tho mortg*:6, vlthout any agroamnt Jhat3ver
as t-0tli~z&h&l of foraolosure IUXIapgllcdion of tbo
proc2#28, the Comchsionor is aut3orlzod to call and ap-
ply ti.12~~roe.mds to the debts, but h3 should follow the
tarca of the oprtgago as to tha zi8thml of foreclosure;
tiiat is, he should re60rt to a comt formlosure xml3er
zotl;ar cc sugary z&ho5 Is authorisad by that instru-
rant .
(6) Hera the debtor, howcwr, turns the mrt-
gag& projmty owr tc the Codssicner ax& qp3ee that
the Conlssicnor is to sell th3 sm.3 an2 amly th9 pro-
C3OCr CL* tta Labat, there is tk3 ccnmntianal cz agr3ti
fomclo~s, :.::I;:
t;;3 Colcisslonar cay pwco:~ according-
ly sithczt resort ccit&3 court for a fufUci~.lforxlosura.
Go Gist, it is tfio o;:inicn cf this dqmrtnmt
tbt nc court crder is mcessary, but tie Correisr~onw
t;ry g~0c33q in suob cases as you etate as ber~lnabcwe
-c+btod.
v-7 t-Y P--J