             THEA~TORNEYGENERAL
                      OFI‘EXAS
GROVER SJZLLRRS




    Honorable J. P. Gibbs, Commissioner
    Casualty Insurance Division
    Board of Insurance Commissioners
    Austin, Texas
    Dear Sir:                 Opinion No. O-7300
                              Re: What constitutes an abstract plant
                                   as such term is used in Section
                                   21, Article 1302a, Revised Civil
                                   Statutes, and related question?
            This Department has received your request for an opinion
    as follows:
            "Section 21, Article 1302a, Revised Civil Stat-
        utes of Texas, 1929, provides, among other things,
        that a title company can appoint as its representa-
        tive in any county, any person, firm or corporation
        owning and operating an abstract plant insuch county
        and making such arrangements for a division of
        premiums as may be approved by the State Board of
        Insurance Commissioners. In light of the above pro-
        vision, we submit the following questions to you for
        an opinion:
             "1. What constitutes an abstract plant as
              such term is used in Section 21, Article
              1302a, Revised Civil Statutes?
             "2 . May the Board of Insurance Commission-
              ers approve or revoke an arrangement with
              reference to division of premiums entered,
              into between a title company and a represen-
              tative, if the plant of the representative
              does not come within the meaning or meet
              the requirements of an abstract plant as
              such Is defined or stated in answer to Ques-
              tion No. l?
            "In view of the fact that an abstract plant is not
        defined by the Title Act (Article 1302a), the Department
        feels that it is necessary to secure an opinion in order
        to clarify the matter, and in order that the Title Act
        may be better administered by the Board of Insurance Com-
        missioners."
Hon. J.P. Gibbs, Page 2         0 -7300


        Section 21 of Art. 1302a, V.A.C.S., which is Section
21 of H.B. No. 153,Chap. 40, Acts 41st Legislature, Regular
Session, 1929, page 77, is as follows:
       "No commissions, rebates, discounts, or other
   device shall be paid, allowed or permitted by any
   company, domestic or foreign, doing the business
   provided for in this Act, relating to title poli-
   cies or underwriting contracts; provided this shall
   not Drevent anv title comDanv from avvointina as
   its representative in any-county any‘berson,-firm
   or corporation owning and operating an abstract
   plant in such county and maklng such arrangements
   for division of premiums as may be aDDrOVed by the
   Board of Insurance Commissioners.!' ‘(Allemphases
   herein are supplied)
        The caption of this Act is in part as follows:
        "An Act authorizing the creation of corpora-
    tions for the purpose of compiling and/or acquiring
    and owning abstract plants in this or any other state,
    and to compile and sell abstracts of titles therefrom
    and to insure the title to lands and interests there-
    in and liens thereon, . . . .'
       Section 1 of the ACt is in part as follows:
        "Private corporations may be created for the
    following named purposes:
       '!(l) To comDile and own, or to acquire and own
   records or abstracts of title to lands and Interests
   in lands; and to insure titles to lands or interests
   therein. both in Texas and other states of the United
   States, ,and indemnify the owners of such lands, or the
   holders of interests in or livenson such lands, against
   loss or damage on account of incumbrances upon or de-
   fects in the title to such lands or interests therein.
        "Such corporations may also exercise the following
    powers by including same in the charter when filed
    originally, or by amendment:
        "(2) Make and sell abstracts of title in any
    counties of Texas or other states."
        A careful search of Revised Civil Statutes of Texas, 1925,,
and all acts of subsequent legislatures up to and including the
49th Legislature, fails to reveal any statutory definition of or
Hon. J. P. Gibbs, page   3       0-7300


reference to the words “abstract plants" other than as contained
in the Act, save and'except insofar as corporations may be formed
for the purpose of making, compiling and owning abstracts of title
to lands and liens of all character on any property or any other
abstract of records in this State, or County thereof, required
by law under the provisions of Section 56;.Article 1302, R.C.S.,
1925. It will be noted that the Article last referred to does
not use the words "abstract plant." A careful search of the
opinions of the Appellate Courts of Texas fails to reveal any
judicial definition of the term "abstract plant."
        One of the fundamental rules of statutory construction
requires that a legislative enactment be construed as a whole
and that all of its parts be harmonized if possible, so as to
give effect to the entire act according to the evident intention
of the Legislature. In accordance with this rule, In interpret-
ing the statute, the Act in its entirety should be considered,
each part in connection with every other part.
        Another of the fundamental rules of construction is
that where ambiguous or seemingly conflicting language is con-
tained in the statute, the circumstances attending its passage
which bear upon the legislative intent, and the state of the law
at the time of its enactment, the conditions designated to be
dealt with, and good intended to be accomplished and the mischief
sought to be remedied, should all be taken into consideration.
        Judge Sharp, speaking for the Supreme Court of Texas in
the case of Magnolia Petroleum Company v. Walker, 83 S.W. (2d)
929, held as follows:
        "No Inflexible rule can be announced for the
    construction of statutes. However, the dominant
    rule to be observed is to give effect to the inten-
    tion of the Legislature. Generally the intent and
    meaning is obtained primarily from the language of
    the statute. In arriving at the intent and purpose
    of the law, it is proper to consider the history of
    the subject-matter involved, the end to be attained,
    the mischief to be remedied, and the purposes to be
    accomplished. . . . .'
        It is manifest that the legislative intent as stated in
the caption above
             ^    referred to was to .-.
                                      authorize the creation
                                                      . .    of
corporations f'ortne purpose or compiling and/or acquiring or
owning abstract plants, and to compile and sell abstracts of
title therefrom and to insure the title to lands and interests
therein and liens thereon.
        It will be noted that the purpose clause under Subsec-
Hon. J. P. Gibbs, page 4        O-7300

tion (1) of Section 1 of the Act above referred to in pursuance
of the caption authorizes private corporations to be created
"to compile and own, or to acquire and own records or abstracts
of title to lands and interest in lands; and to insure titles
to lands or interest therein both in Texas and other States of
the United States and indemnify the owners of such lands or
holders of interest in or upon such lands against loss or damage
on account of incumbrances u!on or defects in the title to such
lands and interests therein.   The Legislature also authorized
the additional business named in Subsection (2) supra, authoriz-
ing such corporations to make and sell abstracts of title in
any county of Texas or other States.
        The Appellate Courts of Texas have defined the words
"Abstract of Title" as follows:
        "A statement, in substance, of what appears
    in the public records affecting the title, and
    also a statement, in substance, of such facts as
    do not appear upon the public records but are
    necessary to perfect a title." Hollifield v.
    Landrum, 71 S.W. 979; Sparkman v. Davenport, 160
    S.W. 410; Wright v. Butt, 163S.W. 360.
        It has also been defined as
        "An abstract of title is a written or
    printed methodical summary of the documents and
    facts of record which affect the title to land
    that may be in effect. . . .' MacMillan v. First
    National Bank of Bowie, 119 S.W. 709.
In addition there are other Texas cases defining abstracts of
title In practically similar language.
        Although persuasive, in the absence of a legislative
definition thereof, the term "abstract plant" has been defined
by the Supreme Court of Minnesota, in the case of State v. St.
Paul Abstract Company, 196,N.W. 932, as follows:
         "The abstract plant consists of abstracts
    of title to real property in Ramsey County, taken
    from the official public records and assembled in
    books with,copious indexes, together with the articles
    of equipment used in connection therewith. The matter
    contained in such books is collected from the public
    records, and in no manner partakes of sci~ent!,fic
    discoveries, nor sre they like the msnuscripts of
    an author, or a copyright, as contended for.'
.   .




        Hon. J. P. Givvs, page   5       O-7300

                Construing the caption with subsectlon (1) of Section 1
        of the body of the Act, it is plain that the Legislature intend-
        ed to define an "abstract plant" as used in connection with the
        title Insurance business to be "records or abstracts of title to
        lands and interests in lands" which might either be COmDi.h3d and
        owned by the corporation or acquired by purchase or otherwise
        and owned by the corporation. These records or abstracts of
        title, when compiled or acquired, are to be used as the basis
        from which the title insurance company may determine whether or
        not it will issue a title insurance policy upon such lands or
        interests therein.
                Since the Legislature has defined the term "abstract
        plant" without any limitation as to the area or locality to be
        covered by the records or the abstracts of title, the conclusion
        nest be drawn that the title insurance company may confine its.
        activities to any given area, no matter how small. In the course
        of ordinary and careful business usage as an insurer, it may,
        therefore, if it desires, compile and/or acquire and own only
        such records or abstracts of title to such lands or interests
        in land upon which, as insurer, it offers itself to the public
        at large as being willing to issue title insurance policies.
               Section 2 of the Act provides in part as follows:
               "Any corporation organized hereunder having
           the right to do a title insurance business may
           invest as mch as fifty per cent of its capital
           stock In an abstract plant or plants, provided
           the valuation to be ulaced upon such slants shall
           be approved by the Board of Insurance-Commissioners
           of this State." (Emphasis ours).
                The words "abstract plant" appear only three times in
        the entire Act. First in the caption above referred to, second
        in Section 2, and third in Section 21. Following the rules of
        statutory construction above set forth it unzstbe concluded that
        the term "abstract plant" as used in all three sections was in-
        tended by the Legislature to m;an "records or abstracts of title
        to lands or interests therein, for the purpose of the regulation
        or the construction of the entire act.
                Therefore, the qualification prescribed by Section 21 of
        Article 1302a, supra, Is that the %epresentative" own and operate
        in the county wherein he is designated 8s such, an "abstract
        plant" as that term is uniformly used in Article 1302a, which we
        have defined hereinabove. In other words, the "representative"
        of a Title Insurance Company is not required by Section 21 of
        Article 1302a, to own and operate an "abstract plant" with com-
        plete records or abstracts of title to $Q of,,thelands in the
        county where he acts as such "representative,
Hon. J. P. Gibbs, page   6       0-7300

        Your second question is as follows:
        "May the Board of Insurance Commissioners
    approve or revoke an arrangement with reference
    to division of premiums entered into between a
    title company and a representative, if the plant
    of the representative does not come within the
    meaning or meet the requirements of an abstract
    plant as such is defined or stated In answer to
    Question l?"
        It is a well-known rule of statutory construction that
an officer or department of the State Government is only vested
with such powers as may be granted to it by either the Consti-
tution of Texas or by the Legislature of Texas. The power must
be based upon some specific delegation by either of the sources
above mentioned and power by implication will never be presumed
or implied unless it is practically indispensable and essential
to execute the power actually conferred.           et al. v.
Water Improvement District 283, S.W. 151, $%"~~p.).
        In the case of Commercial Standard Insurance Company v.
Board of Insurance Commissioners, 34 S.W. 2d, 343 (writ refused)
which discussed some of the powers of the Board of Insurance
Commissioners, Judge Baugh wrote as follows:
        7,
         * . . . . The board can exercise only the
    authority conferred upon it by law 'in clear and
    unmistakable terms, and will not be deemed to be
    given by implication, nor can it be extended by
    inference, but must be strictlv construed.' 51
    C.J. 56; State v. Roblson (Tex. Sup.)30 S.W. (2d)
    292, 297. If (Emphasis ours).
        Again in the case of Board of Insurance Commissioners
v. Guardian Life Insurance Co. et al, 180S.W. 2d 906, the
Supreme Court of Texas, citing with approval the Commercial
Standard Insurance case just quoted, lays down the rule of law
as follows:
        "The board can exercise only such authority
    as is conferred upon it by law in clear and un-
    mistakable terms and the same will not be con-
    strued as being conferred by implication."
        Following such rule of statutory construction it is
necessary to look at the plain and unambiguous language of Sec-
tion 21 which provides in part:
        "This shall not prevent any title company
Hon. J. P. Gibbs, page 7         O-7300



    from appointing as its representative in any
    county any person, firm or corporation owning and
    operating an abstract plant in such county and
    making such arrangements for division of premiums
    as may be approved by the Board of Insurance Com-
    missioners." (Emphasis ours).
        The language of the emphasized part of the act just
quoted can lead to the one conclusion that the authority of
the Board of Insurance Commissioners thereunder Is to approve
or disapprove that part of the contract which has been entered
into between the title insurance company and its representa-
tive for the division of the premiums. The Board of Insurance
Commissioners has no authority to approve or disapprove the con-
tract of appointment by the title insurance company of the per-
son, firm or corporation owning or operating an abstract plant
as its representative. Nor can it inquire as to the qualiflca-
tions of such representative other than to satisfy itself that
such representative owns and operates an "abstract plant" as
above defined.
        As to the other powers delegated to the Board of Insur-
ance Commissioners by virtue of the other sections of the act,
none of them specifically or by implication would authorize the
Board of Insurance Commissioners to exercise any supervision
over the acts and conducts of the representative of the title
insurance company other than to satisfy itself that the arrange-
ment for the division of premiums was being carried out In accord-
ance with the contractual agreement as approved by it.
        You are therefore advised that the authority of the
Board of Insurance Commissioners to either approve or revoke
any arrangement between the title insurance company and its
representative is as hereinbefore defined.
                               Yours very truly
                            ATTORNEY GENERAL OF TEXAS
CKR:ms:wc                      By s/C-K.  Richards
                                     C.K. Richards
APPROVED AUG 21, 1946                Assistant
s/Carlos C. Ashley
FIRST ASSISTANT
ATTORNEY GENERAL
Approved Opinion Committee By s/BWB Chairman
This Opinion Considered And Approved   In   Limited Conference
