Honorabl*Claude Isbell
Socrotuy of State
Austin, Tcur

D.u Mr. Isb.11:                   OpinionNo. O-7383
                                  Rot Authorityof l foreign aorpora-
                                  tion as t*stam*ntnrytrust00 of prop-
                                  arty in Tens to oarry out th* term
                                  of th* trustwithout l permit to do
                                  burin.ss in Texas.

    You requestour opinionupon th* lboTo atatmd subj*ctmtt*r in the
followingl*tt*r:

We hand you herewitha photostatiooopy of * lottar r*oeiv*din this
offio* on August 22nd from th* law firm indioatodon suoh letter, tog*th-
*r with a photostatiooopy of l till, the sanr king reforrodto in such
letter.

"You will note fromth. hot. outlinedin such letterand from th. will
that such till lrtablirbr atrurt, prrt of whioh *uoh trust oonstint.of
ma1 properbylooatod in Houaton,TOXM. 'l%*trurt**appointedby suoh
will is th. Am.riom Trust Company,a Cliforniaaorporation,which do..
not have a powitto do businessin T*xa* from this affioo or from any
other Tout authority.

"W. ar. of th. opinionthat it i. not n.o.sraryfor thlr Californiaoor-
porationto qualifywith thir offioo or with •~ oth*r Ton8 authority
in ardor to administ*rth* trust 80% up in suoh will.

Will you, hh.r.for.,pl.a~o ldvis. us a8 to wh*th*r or not under the
hot. .trt.din auoh 1.tt.r .nd under UN provirion.of auoh till, it ir
neo.souy for thi. Californiacorporationto qualifyunder th. Ton.
rtatuter,and if so, uudorwhioh suoh statute?"

   A lottar fromM*s.rs. Uya.r, LiddolldcAu&in, which aooompani..
your r*qu*st,is *o follows:

"In aaoordanoowith our t.l.phoneconversation of today rolativ.to th.
~o...ity of a foreignoorporation'.qualimng un8.r Tms law. to do
businessin thir stat* kforo rating a* truste*under a will, rnd your
desir. to suhait the quertionto %h* AttorneyGeneralkforo mawaring,
w* ar* herewithsuhnittinga oopy of the will in questionwhioh contains
th. .ntir.trust inntrum.nt.
                                                  -   ,__




HonorrbloCl4uds Isbell- p4g4 2 (O-7383)


  'The frets 4re 48 follows: The AmorioanTrust Company,the Trust404pint.d
  by the will, is 4 C4liforni4oorpor4tionh4ving no permit to do businessin
  Texrs. The Test4trix,Theophil Uppat, it do4d, mnd th4 oonditionoxprossed
  in the will upon which the trust IS to beoomo l
                                                ffeotiv4,the death of Ign4ts
  Lippet Menst4g without livinghair or hairs of his body, h4s been met,
  Disnst4gh4ving survivedthe Tost4trixand l4t.r h4vingdied under the condi-
  tions indio4tod,4nd the Amerio4nTNSt Companyis now seekingto obtrin
  possession4nd controlof the Trust Propertyin ardor to 4of 4s Trust..under
  the terms of the mill. The Trust pro rty consistsof a 50' x lOO* traot of
  14nd locatedin the downtown4ro4 of E uston on which is situ4ted4 three
  story building. The propew is under 4 99 ye4r leas.,exeoutodin 1910,
  providing4n 4nnu41 ront41 of #4e000.00por year.

  "We should like to know whether tis AmorioanTrust Comp4nymust qu4lifyunder
  Toxrs 14ws boforo 4cting 48 Trust..,4nd, if so, under what statuteor
  8t4tut.8."

          The provisionof the will om4ting the trust is     46   follows,

  eThird: I give, deviso4nd bequeathto my klovod son, IgnataLippotDionstag,
  th4t certainre41 propertyowned by me 4nd situ4tionin the City of Houston,
  St4to of Tu4s, 4nd b4ing dosign4t.d4s the North h4lf of lots 9 4nd 10 blook
  55. 8.8.R.B.4ttho oorner of San J4ointoStroot 4nd PrairaeAvonuo, in said
  City of Houston,during the tow of his natur41life 4ud upon his do4th to 4ny
  hair or heirs of his body in equ41 portions,share and sh4ro 4liko.

  W!, upon the do4ty of q 84id son, thoro shall k no hair or heirs of his
  body living,thereuponurd in th4t went 4nd in memory of ng~belovedbrothor
  )&4xDienstrg,I horoby givu, devise 4nd kquo4th the said 14st montiorndprop-
  erty, 4nd tb who10 theroof,to the horiom Trust Compqg of S4n Fr4noiso0,
  4 oorpor4tion,in trust, howovor,for the followingpurposes,to-wit:
  'To rooeiv~ the rents, issu44,prefits4nd inoom4 of the s4id Trust Est4t4
  4nd porpetu4llyto distribuk suoh rants, issues,profits&d in&o twloo a
  you and ip l qu41 portionst0

           I. I$ Nation41J&ish Hospit     for Consumptives,D&or,
           :c Color4do.
          II. The P4bifioHobrew OrphanAsylum 4nd Home Societyof 84n
              Frunoisco,C4liforni4.

         III. $4 H4dasslhand the ZionirtOrg4ni44tionof Sm Fr4noiso0,
              C4liforni4,

   respeotivoly4nd by the s4id rospotive oh4ritiosand l4oh of thomto b used
   for oh4irtrbl4purposes. And I haroby give unto the s4id Tru4t.8,tbo Amoriorn
   Trust ~omp4ny of S4n Fzmncisoo,C4liforni4;full power 4nd authorityto m4n4go,
   oontrol4nd dial in 4nd withthe iiid Tru& property,in its disorotion,for
   th4 plrpos.of the s4id Trust, subjootonly to suoh roetriotion8a8 w   k im-
   posed upon the s4id TNrteo by 14~. And I direot that the s4id Post shall
BgnormblsCludo Isbell,pago 3 (O-7383)



llmys bs lmoxn mnd dosignmtod48 'The Menstag Trust.'"
         No foreign >orpomtion m4y omrry on its corporatsb usinsssthir
                                                               in
Stmto without 4 permitto do so.

        Homo of the opinionthmt the lxooutionof thiatrust would ho the
omrryingon of businosawithin this Stmto. It noooss4rilyoonoornsrem1 *I-
t&o within th* Stmto, lnd, moroowr, the nmturo of tho trust is such that
tha mats of the trust04in lug0 me8suromust n*oOSS8rilybe performedin
Toxrs.

         We have strtutesauthorizingour St&e banks mnd trust oomprniesto
mot 4s trustees,4nd likewiseauthorlAng other oorpormtionsto met 4s trusteo
in any duly ostrblishodtrust,notrbly subdivision49 of Article1302 of the
Revised Civil Watutos authorizingoorpormtions.Furthornore,the legislature
hrs recentlyonactod4 oomprohensivo Mll.rogulating trusts. (Article7425b,
R.C.S.,Vernon's Codificrtion).

         The things to be done by the testlmentmrytrusteoin executingthe
trust would be preoisolythe things thmt 4 Tous trustoowould be roquirodor
luthorieedto do, mnd nooossarily,w think,would be the doing or tmnsmoting
of the trust businessin Toxms,requiring4 permit.

        Corpus Juris Socundumthus st4tssthe ~1. in compendiumform:

"The genaml rul* is th4t,when 4 foreignoorpormtiontnnsmots somo substmn-
timl p4rt of its ordinuy businessin the Strto, continuousin character,it
is doing, trmsroting, carryingon, or lngmging in businesstherein within
the mo4ning of the stmtutesunder considormtion."Vol. 20, p. 46, 1 1829.

        The PM* authorityfurthersmysc

"A foreigntrust oompanyis dsingbusinomrwithin the rtmtowhere it seeks to
oxoroisomotive powerrunder the trurt dood o rother instrument,unless its
mot* mro moro inoidontmlor isolatedtranamotiona. . . .' - Vol. 20, p. 62,
p 1842.

        Ws think the 04.84of Midiohig4n
                                      "-:st Carmprny
                                                   St 41~. Turney,36 S.W.
(2) 787, olemrlymomoswithin the generalrule 4boa quotedfrom Corpus Juris
Sooundum,making the rule n pmrt of tho jurisprudenceof this state. In the
course of the opinionJuatiooHigginsamid:

WI* MiohiganTrurt Compmnyis 4 foreigncorporationwithout4 permitto do
businessin Tox48. In the dischargeof its dutios 4s exeoutormd in orrry-
ing out the terms of the trust 48 providedin the will, it must necossmrily,
for 4 term of yomrn, h4ve as~sumodmotivemenmgemonturd controlof tho'bus-
iness propetios in El P480. Clearly,it would hmvo been necessaryfor it
to tmnsmot businessin this rtato oy*r 4 term of yo8r8 *ioh it couldnot
14wfullydo oxoapt by filingwith the ssoretrryof stat* 4 duly oortifiod
Hon. Clmudo Isbell,page 4 (0-738s)



copy of its mrticlcs of insorpx3tlon, etc., as r~squir0d
                                                       by article 1529, R.
S.; PennsylvanirCo., Oto., v. Bauerie,143 Ill. 459, 33 Be E. 1663 Michigan
Trust Co. vs Bronson,192 Cal. 505, 221 p. 626e"

         W& think, thor0for0,t"hatthe Ame~lcrlw.
                                               Tmast Cmnp0nywill bs required
to have 4 permit to do businorsin this State Iwfcw0it nny 14wfulIytrmsaot
its corporrtsbusinessin this Stat0 by exwuting tha trust committedto it.

        We we not rdviring4s to the terms of such p0mit, md, of courso#
0xprossno opinion48 to tho ,validity
                                   or oomrkuotion of the tru8.tinvolved.

                                             Very truly yours

                                         AT'IORNSY
                                                 GENERAL.
                                                        OFTEXAS

                                         Ey /a/ Ocdo Spear

                                                 0~10 Spaor
                                                  Assists&

APPROVEDSBP 14, 1946
/s/ Carlo8Ashley
FIRSTASSISTANT                                     'Approved
ATTORIIEY
        GEKa                                    OpinionCmiuitteo
                                                    ByBWB
OS-MR:egw                                           Chairman
