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                             April         12,1948

    Hon. Gibb’ Gilchrist.   President
    A &-M College of T&s
    College Station,    TeXa.5 opinion         No. V-539.
                                     Re:    Several quest ions relative
                                            to H,B. 326, Acts 50th Leg-
                                            islature,    which makes work-
                                            men’s compensation insm-
                                            ante available    for certain
                                            employees of institutions
                                            under the direction    of Texas
                                            Agricultural    &Mechanical
                                            College.
    Dear President   Gilchrist   :
                Reference is made to your request for an o’pin-
    ion on the above-captioned   subject, from which we quote
    as follows:     .
               We would like for ,you to & ve us logal
         rulings on the following  Westions:
               “(1) Is the Board of Directors   of the
         College required to put into effect   the Work-
         men’s Compensation Inrurance, provided for by
         this Act?
               “(2)  May the Board of Directore  of the
         College place the Insurance    rovlded for under
         this Act, or any part of auc1 insurance with
         the ‘Texas Employer’s Insurance Aasoclation   or
         with a commercial insurance concern authorir-
         ed to do business in Texas and pay the prem-
         ium on same?
               “(3)   Under Chapter 229, Acts of the 50th
         Legislature,   raveral statutes are adopted by
         reference    particularly   in Sections 2-5, 2-6,
         2-7, and in Section 7 it8elf.       The 8tatuto8
         make no prevision     for rrubrequrnt amendments
         to the adopted Act, and’we here proceeded in
         the belief   that the Law, as passed for the
Hon. Gibb Gilchrist, Page 2,   V-539.


     A. and M. College System, is to be inter-
     preted in accordance with the adopted stat-
     utes until the Legislature itself might take
     action to make other provisions of the Gen-
     eral Laws applicable to U.S. Particular ref-
     erence is made to Chapters 113, 307, and 349,
     50th Legislature. Are we correct in this in-
     terpretation?"
          H. B. 326, Ch. 229, Acts 50th Leg., was pat-
terned after and is substantially identical with Acts
1937 45th Leg., p0 1352 ch. 502, codified in Vernon's
Civil Statutes as Art. 6b74s, which made workmen's com-
pensation insurance available to employees of the State
Highway Department. The latter Act became a law on June
11, 1937, but was not put into effect by the Highway De-
partment until January 1, 1938.
          Throughout this opinion, we shall refer to
H. B. 326, Acts 50th Leg., as the Texas A & M >nlorkmen"s
Compensation Act, and we shall refer to Art, 6674s, as
the Highway Department Workmen's Compensation Act,
          The leading,case on the Highway Department
Workmencs.Compensation Act is State Highway Department
v. Gorham, 139 Tex 361, 162 S. W. (2d) 934, by the Texas
Supreme Court. As the two acts are substantially iden-
tical, and as the inquiries you have made are closely
related to the holding in that case, we shall quote from
it at length,
          Question No. 1:   Is the Board of Directors
of the College required to put into effect the Workmen's
Compensation Insurance provided for by this Act?
         'It is the opinion of this office that the Board
of Directors is required to put the program in operation
within a reasonable time after It became a law. We base
our opinion on the language of the statute and on the
holding of the Court in the Gorham case.
          Let us examine the portions of the .Texas A & M
Workmen?s Compensation Act having any pertinence to dis-
cretion.in the Board of Directors in so far as initiating
the'program.
          From the caption:
Hon. Gibb Gilchrist, Page 3,   V-539.


         "An Act providing Workmen's Compensation
    Insurance for certain employees of the insti-
    tutions and agencies under the direction or ,
    government of the Board of Directors of the
    Agricultural and Mechanical College of Texas
    . . 0rr
         From the body of the Act:
         "Sec. 3. After the effective date any
    workman, as defined in this Act, who sustains
    an injury in the course of his employment shall
    be paid compensation as hereinafter provided,
         "The institution is hereby authorized to
    be self-insuring and is charged with the admin-
    istration of this Act. The institution shall
    notify the Board of the effective date of
    insurance, stating in such notice the nature
    of the work performed by the workmen of the in-
    stitution, the approximate number of workmen,
    and the estimated amount of pay roll.
         "The institution shall give notice to all
    mrkmen that, effective at the time stated in
    such notice the institution has Fovided for
    payment of insurance e . .('
         "Sec. 4. If a workman of the institution
    sustains an injury in the course of his employ-
    ment, he shall be paid compensation by the in-
    stitutionmereinafter      provided."
         "Sec. 12. The institution shall hereafter
    keep a record of all injuries famr     othcr-
    wise, sustained by its workmen in the course
    of their employment. e .tR
         "Sec. 13. The institution is authorized
    to promulgate and publish such rules and regu-
    lations and to prescribe and furnish such forms
    as may be necessary to the effective adminis-
    tration of this Act,. '. .I1
         "Sec. 19., The institutions covered by
    this Act are hereby authorized to set aside
    from available           Lens other than item-
                   appropriat:
    ized salary appropriations an amount not to
    Hon. Gibb Gilchrist, Page 4,   v-539.


        exceed two er cent (2%) of the annual work-
        man pay rol! of the institution for the pay-
        ment of,all costs, administrative expense,
        charges, benefits, and awards authorized by
        this Act." (Emphasis supplied?)
              It is immediately apparent that certain por-
    tions of the Act use the imperative verb Qhall" while
    other portions speak of merely "authorizing" certain
    action which connotes a permissive admonitiond Yet
    a carehul scrutiny of those sections which say that
    certain action zshalln be done indicates that such sec-
    tions contain the'substantive parts of the Act, while,
    on the other hand, the sections which indicate mere
    "authority" set up the administrative and procedural
    aspects of the coverage under the statute. It is our
    opinion that this precludes optional discretion in the
    Board of Directors as to whether they will institute
    the Act or noto
              Any doubt there may have been on this point
    is removed by the holding in the Gorham case. Let us
    compare the Texas A & # rWorkmenrsCompensation Act with
    the Highway Department tiorkmencsCompensation Act, for
    thepurpose of observing the disposition made on the
    issue of discretion in the State agency in the holding
    in the Gorham.case.
              Both Acts provide that the respective employ-
    ers are authorized to promulgate and publish rules and
    regulations, and 60 prescribe and furnish such forms
    as may be necessary for the effective administration
    of the Acts. They both recplirethe designation of a
    convenient number of physicians and surgeons to make
,   physical exsminations of all persons in the employ of
    the State agency, and to determine those who are phy-
    sically fit to be classified as employees or workmen.
              There are provisions in both Acts to the ef-
    fect that no person shall be certified as an employee
    or as a workman unless and until he has submitted him-
    self to a physical examination and is found to be phy-
    sically fit for the duties to which he is assigned.
              Both Acts authorize the employer in each in-
    stance to set aside from their available appropriations
    an amount not to exceed a specific percentage of the
    annual pay roll for the payment of,all costs, adminis-
    trative expense, charges, benefits, and awards rilthor-
    ized by the Acts, Both employing State agencies are
Hon. Gibb Gilchrist, Page 5,   V-539.


charged with the duty of keeping a record of all injur-
ies sustained by their employees or workmen in the course
of their employment, and of making a record thereof to
the Industrial Accident Board.
          Then turning to the Gorham case, we conclude
that a necessary implication therefrom is that such pro-
gram must be instituted within a reasonable time, au-
thorizing the institution only to take sufFicient time
to set up the necessary machinery to administer effect-
ively the plan but not to have discretion over whether
it will ever inaugurate the plan or not,
          In support of this position, we quote the fol-
lowing from State Highway Department v. Gorham, supra:
         "After June 11, 1937, the department
    was authorized and required to promulgate
    rules and regulations, and to prescribe and
    furnish forms for the effective administra-
    tion of the law. It was authorized to set
    aside from its appropriation an amount not
    to exceed 33% of its annual labor payroll,
    to cover all costs of the program. It nec-
    essarily had to investigate the number of
    employees to beincluded, the risks covered
    and the probable'cost to the department*
    The department was required to,designate
    a convenient number of doctors, and was au-
    thorized to conduct physical examinations
    of employees. Since the program was to be
    administered in connection with the Indust-
    rial Accident Board, the statute prescribed
    that the Board be notified of the nature of
    the work performed by the employees, the ap-
    proximate number of employees, and the esti-
    mated amount of the payroll.' T;ei,"";,'&:;-
    ture must have contemplated tha
    %ake a reasonable time to put this program
    In operation. O O
          We believe, when we read the Act as
     a whole, that it was the intention of the
     Legislature to leave it to the department
     to set up the rules, regulations and mach-
     inery necessary to put in operation the
     method of paying compensation to employees
     for injuries sustained while in the employ
     of the department; and that such insurance
Hon. Gibb Gilchrist, Page 6,   V-539.


    could not take effect until the department
    had inaugurated the system and notified the
    Industrial Accident Board of the effective
    date of such insurance. In any event, there
    are no pleadings in this case that the de-
    partment was negligent in any manner in get-
    ting the plan in operation, or that it was
    guilty of any unreasonable delay 0 0 0n
          A holding that the Highway Department had a
reasonable time within which to put its Act into oper-
ation is incompatible with the view that the Denartment
had the absolute discretion as to whether they would
put the Act into operation, In view of the foregoing
language qoted from the Gorham case and from the Act
we conclude that the WorkmenPs Compensation System is
required to be put into effect.    _
            estion No. 2: May the Board of Directors
                         insurance orovided for under
this'Act, or-any part of such insurance with the Texas
Employercs Insurance Association or with a commercial
insurance concern authorized to do business in Texas
and pay the premiums on same?
          The Act specifically says that the institu-
tion is authorized to be self-insuring and is charged
with the administration of the Act and the payment of
awards; an appropriation therefor is provided; and
there is no provision in the Act authorizing the Board
of Directors to place such insurance with the Texas
Employet@s Insurance Association or with any other,com-
mercial insurance concern, all of which preclude the
Board of Directors of the College from placing the
wkmenvs   compensation insurance with any insurance
concern0
           Question No. 3: Under Chapter 229, Acts of
the 50th Legislature, several statutes are adopted by
reference , particularly in Sections 2-5, 2-6, 2-7, and
in Section 7 itself, The statutes make no provision
for subseqent amendments to the adopted Act, and we
have proceeded in the belief that the Law, as passed
for the A. and M, .College System, is to be interpreted
in accordance with the adopted statutes until the Leg-
islature itself might take action to make other provis-
ions of the General Laws applicable to us0 Particular
reference is made to Chapters 113, 307 and 349, 50th
Legislature. Are we correct in this interpretation?
Hon. Gibb Gilchrist, Page 7,   V-539.


          In substance, you have asked whether the
Texas A & M Workme?fs Compensation
                      .     .,     Ayt is affected
                                          ^ ..
oy sunsequenn amenaments no nne portions 0s cne gen-
eral workmen's compensation statutes that are adopt-
ed'in the Texas A & M rlorkmenfsCompensation Act by
direct reference.
          This issue has been conclusively and direct-
ly determined by the Texas Supreme Court in Trimmier
v. Carlton, 116 Tex. 572, 296 S, !.L10700 It was
there held:
          "Statutes which refer to other stat-
     utes and make them applicable to the sub-
     ject of legislation are .called freference
     statutes,' and are a fami.liarand vslid
     mode of legislation. The general rule is
     that when a statute is adopted by a speci-
     nc reference, the adoption takes the stat-
     ute as it exists at that time. and the sub-
     sequent amendments thereof would not be with-
     in the terms of the adopting act. 0 .'I
          Other authorities su porting this rule in-
clude Dabney V* Hooker 121 OkPa. 193, 249 P. 381*
Johnson v. Laffoon, 25'1Ky. 156, 77 S. W. 2d) 345;
Williams v. State, 100 Fla. 1570, 131 So. B64; 39
Tex. Jur, 129 Set, 66; Sutherland on Statutory Con-
struction, Voi. 2, p* 548.
          We, therefore, conclude that the statutory
changes to the general workmen(s compensation stat-
utes, embodied in Chapters 113, 307 and 349 of the
Acts of the 50th Legislature, do not affect the'cover-
age of the Texas A & M Workmen's Compensation Act.
          Although certain sections of the Chapters
you have enumerated amend sections of the general
workmen's compensation statutes specifically adopted
by reference in the Texas A & M Workmen*8 Compensa-
tion Act,they all became effective after the Texas
A & M Workment~ompensation Act becameeffective;
and therefore, they are subsequent amendments to
adopted statutes, which do not affect the coverage.
Hon. Gibb Gilchrist, Page 8,   V-539.


                       SUMMARY

         1. The Board of Directors of Texas
    A & M Col'legeis required to provide the
    workmen's compensation insurance for hork-
    men employed in the institutions and agenb
    ties covered by Chapter 229, Acts 50th Leg-
    islature, 1947, within a reasonable time
    after it became a law. State Highway Dept.
    v. Gorham, 139 Tex. 361, 162 S. W. (2d)
    934.
          2. The Board of Directors of Texas
    .A &M College is not authorized to place
    'the insurance provided for under Chapter
     229 with the Texas Employer's Insurance
     Association, nor with any other commercial
     insurance concern e

          3. Chapters 113, 307 and 349, of the
     Acts 50th Legislature, tiich embody amend-
     ments and additions to the general workmen's
     compensation statutes, do not affect the
     Texas A &.M Workmen's Compensation Act (Ch*
     zz,',Acts 50th Leg.) 'which specifically
          s certain provisions of the general
     worrmen's compensation statutes. Trimmier
     v. Carlton, 116 Tex. 572, 296 So WD 1070.

                          Yours bery truly
                     ATTORNEY GENERAL OF TEXAS




DJC:jmc
                         RNEY GENERAL,.
