OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
gooorable Ld. 0. ?lowora
Becretary of State
Austin, Texas
Dear Sir;
We are in receipt f October 16, 1989, In
which you submit the followi thle DoperWent for an
@Qinlon 1
tar 0r a oorpora-
t1on in the erfaiament or
1389, IJubairislosl
aontlnus to accrue arter
nt for the benbflt of
active except for xlnd1n.g
ubdlvlsion 7, Rerfsed Civil Strtutoe, 19E8,
ie afosolvea
:
-9. Whenever a ocrporatlon ugoa proper ltulloial
aeoertalxmnnt ia found ta be inaolrent.a
13 iay3ie ve. ieybe, (T.C.k. 1920) 820 9. W. 897, p%alatlff
inrtltudsd suit on a note erimited by Leyhc %uao C6mpary and to
foreolose n lfen. After the exeoutian ot the note the layaCr Piano
54
Eon. k. G. Flowers, Page 2
Company was adjudged a b&crupt and followlq such odjudloetion -de
a CornposItIon with its uneeeurea oreditors.
It was held by the court:
“The next propoeltlon advanced by appellants la to
the effeot that nci judgment oould be taken after die-
miaeal of two of the dlreotore or the oorporation. We
are lnallned to think that this proposition is also well
5. it. 823. by virtue of the statute the alreotora OS the
oorporatlon at the tIete OS Its dieeolutlon beoame trustee%
to wind up its &faire, R.S. hrt. leoa. They act In said
capacity colleatIvaly and suit oould not ba maIntaIned
to estublieh a oorporate 1iab:lIty against any of them
elngly.”
%a have been unable to find any other oaee In this jurle-
alotlon passing upon this question and must therefore re?oipllta the
above cited oaee es oontrolling your first question.
An assignment for the benefit of aredItore~lr en absolute
unuondl~Ional and Irrevocable voluntary oonveyance OS propertf by
the debtor to the assignee in trust for tho purpose ot paying debts
out of the proceeds thereof. The aeeIgnea takes absolute title to
the property for the trusts expressed In the Instrument. 5 Tax.
Jur. p. 59. A corporation r&ay make an a8eigmant Por the beneiit
or orsaltors. Uller vs. Goodman, (T.C.A. 1897) 40 S. iY. 7425. The
legal enity continues to exIet notwXth6tending there nay have been
an aeelgnaent for the benefit o? oredltore sInoa Artiole 1%7,
Revised Civil %atutee, 192s. which provides for the dleeolutIon
ot corporatI&a does not provide that suah action shall dI8solYe
the corporation.
Artiole 7084, Revleed Civil Statutes, 1926, provlaee that
“except as hereIn provided every aomeetlo and roreI$n OCrpOratiCn
hertatofore or hereafter ohartered ;or ?iuthorleed to do business In
Texas . . . a?iall pay In a&vanes to the Secretary of State a fran-
oblae tax ror the year ~ollowlag,~ as theraln provided. We find
no exception exempting oorioratione that have made assignment8 iOr
banelit of creditors. Article 9099, Revlead Clvll Statutes, 1925,
rate out a alffarant formula for oomputfng the tax of a oorpow*Ion
‘aotually in prooeee of llquiaatlon.~ No doubt meiny aorporatlons
whloh have made asslguments for the benerlt of ore&tore are In
aotuel proooea ot’llquldatlon Jocklng. to a oomplete disfolution
Ot the corporation, and would be governed by the terms of this
etatute in oomputlng thair iranohlee tax.
54!
yion. M. 0. Flowers, ?a430 8
Ii Ic oertaln Instancea It tight eeem Inequitable that
euoh oorporatlona are required tc pay a franohlse tax, It mat be
noted that they ere not wlthout remedy alma they my affect a die-
solution under Artlola l?JSl, Gevlsad Civil Statutes, 1985, or make
a reduotlon In their capital etock.
It Is our opinion that an ordinary adjudloatlon In bank-
ruptoy OS a Texas corporation Is a judiolal aeoartalnmant of in-
aolvanay within the n;tenlnf: of Artlola X%9, SubdlvIaIon 7, RevIsad
Olvll Statutes, 1925.
fn answer to your eecond queatlon, It Is cur oplnlon that
the exaoutlon of a generel arslgumant for the benefit of oradltcre
by a oorporatlon does not within lf88lt exempt euoh OOrpoIUtlOn
rrcmthe papent oi a iranohIS8 tax.
Yours very truly
ATTORNRY GR%?.CRAL
OF l'RXM3
Assistant
OCCIR
.: ATTOFMEY GEEUW, OP !Cn