                      OFFICEOF THE ATPORNRt
                                          GENERAL
                                                OF TEXAS
                                        AUST3N

                                             .
     GERALD C. EIANX
     ATTORNES?GESERAL

     HonorableGeorgeIi.Sheppard
     Comptrolleroi’PubltiAcoounte
' Austin, Te.xs~

     Dear slra    :                     OpinionNo. O-4158
                                        Ret Whetherperson, firm or corporation
                                            who engages In businessof lendlng
                                            money throuzhthe “bill of sale”
                                   .~       aystkm is siibibjecf
                                                               to proiloloniof
                                            Subd. '13, Art. 7047, R.C.S., tit,
                                           .6146. R.C.S. and Art. 6148. R.&S..
                                            and i%lated~question& -
             I

                   This Is in answer to you??letter of Harch 23, W&2,,
     whereln.yourequestthe oplnldnof this ,department  In responseto the
     following.
              questions:                          :                  :
 _.,                      18 8 peison,?Zrm Oti,
                        “1.                     corporationwho
         &gages       in the business
                                   of’ lending money throughthe
 i
          ‘billof sale’ system,sub ect to the provlslcins      of
~:        subdivision13, Article70i7, R.C.S., Article6146,
          R.C.S.,and Article6148, R.C.S.?.For example,the
          ‘billof sale’ system is used’as follows;
                    “IA,I who wishes to obtain.  the. use of a
          certain sum OS money for a period of thtity (30) dayye,       '.
          deliverssome articleof value.to *B’, who will pur-           ,‘.
          chase the ortlclefOr~.an  E~r&d amoi?nt. ‘A’ delivers:
          a ball of sale for the artloIs’to IBl with the .verbal
          understand- that ‘A* will,have.theprivilegeof se-
        ..purchao%ngthe same articleon or ‘beforethirty (30) ~.        :"
          days, at a price equal to ten per.cent more than JA’
          received for the articlewhen he sold it to ‘B’.
                    “2. Has the Comptrollerof”Public Accounts
                        under Artlole6148, RiC+Si~,
          the autholrlty,                          .to Inspect‘.
          or examlnethe books or recordsof’a p@rson, firm or     .,
          corporatZon,for~thepus?poso of determtilngwhether or
          not such person,etc.,,Is en$aged in businessas a
          pambroker, as definedby Articlo6146, R.W. a and
          therefore liable for,theoccupationtax levladby Sub-~ ~
          divlslon13* Article7047, R.C.S.?     ','

                    "2% Under’what conditionsor cfscuiistanuen               *
          nay this right of,inspectionbo lawfullyexercisedby
       _~ the Comptrollerof Public Accounts? ,Iirey  it be exercised :
          In instance!5where the .Comptrolldr, in his official dis-
          ca?etion,has rcaeonablegrounds to believe,under the
          &$tendS.ngfaCta and olrcum3t3noe3~ that, a p.erson,firm or   ^
HonorableGeorge X. Sheppard,Page 2        -corn*          G-13158


     corporation13 engaged In such buslncss,althoughsuch
     person,firm or corporation,dcnlen that such buslnese
     13 be%ng pursued and refuse3access to the records?"
          .._.
            _,
             ..    . ._
                Subdivision13, Article7047,R.C.S., provldeothat an
nrnual occupationtax of one hundredand fifty dollarsshall be collecte
from every p3wnbroker.
               Article 6146,R.C.S.,definesa gownbrokeras follows:
              'A ~poxnbrolcer
                           1s one who pursuesthe buslneon
    of lendingmonoy upon Interestand reoolvingupon deposit
    anypersonal propertyas security.forthe paymentof 3uch.
    loan end interest.*
            !Phewords "pawn“and "pledge"mcen the s2rzzthing, 33
Tcx.Al?.687. Under our statuteto pawn or pledgepropcrQ mean3 to
&posit It ulth a oredltorto securethe oymentof a debt,
WCC of SMth vs. Anderson,27 S.W.775,t Tex. Clv. Apn 18D1nh:&q
tkt a transfer of dock.  on the books of a corporation*io  3&1m  th;
paymentof a loan nlth interest,tho*ugh 3uch transfer ~~33 absoluteon
          ~3 a pI,edgeand not a 3ale, the court sald:
lts.,r"acei
              "The characterof the transactionbetween the
    parties 13 to be dctermlnedby-their intention,znd it
    zsttersnot what languege~lsxsed, or what the Form or
    ‘iz txatPer was, If It na8 lnten~edto secure the na -
    ment of money it m3t be construeaas a pled?+
    it necessarythat the conolderatlonbe a pre~e~l3tlng
    lndebtednes3;it Is aufflclentlf It be a presentadvanoe-
     ment: (Italicsoura)
              The f&&s statedby you ungueatlonablypresent a debtor-
;rei;torrelatlonshlpas opposedto the relatlonshlpof vendorland'
 ez 6; St i’ollo~that under the law, a8 statedln Smith v. Anderson,
supra,a person,f%rm or CorpOratlonwho engages111the businessoi'
lendingmoney through,the"blllof sale" systema8 Illustratedby your
examplo.13&gaged ln the buolnessHOPa pavanbroker
                                               a3 definedby
Artlole6146,R.&S.
               Article 6148,R.C.S.,read8 as follows:
               "I&h pawnbrokershall keep a well bound book,
     to be kept open for inspectionin which he shall register
     all his transactions03 a broker at th3 tine the same
     occur3. Such registershall show:
               “1. An aoouratedesorlptionof the artlcol
     pawned.
               9.   l?rora
                        whom received.'
               "3. The tl.meand the amount for which the artl-
     cle I3 pawned; Lt3 probablevalue and the rate of interest
     agreedupon.
               "4. The final dl3posltlonmade of such property,
     and lf sold to whom sold and the amount for which each
     articzewas sold,"      .,
Jionorable
         QcorgePi.Sheppard, Page 3                        O-4158


               This articleauthorizesthe Comptrollerof Public Ac-
counta,or any other Interestedparty to intpcctthe books there-
r-eqzlr-dto be kept. It will be noted, hovcver,t%t the provlsiox
        Article6148 apply only to pambrokers.
UT i-.‘zh                                        zii31CGDhe is e?GnZcd ~
zr,the buclneasof a pambroker one is not ,‘equixdto keep such a
0~: of books, and unless he I8 engagedin such buslneas,this article
~VCC no omthe prlvilcge   of lnsgoctlii his boo!a. vi?nust annoxer
Gour cuestlons2 and 2a thuat As a conditiongecedent.to lnc~ectlon
‘;frhd books requiredto begkept by Artlclc’.  6148, R.C.S., it mzot be
establlnhodthat the perroon whose books are to be inspectedlo engaged
irrthe buslmss of a pawnbroker,and Is roqulredby such articleto
her, said books. It fellows that auoh books .,could not be cxazxined
w&r the authoFitvof said articlefor the ~urw3e       of dc?temSnl~~
wdther he isengqed In the businessof a p&&roker.
                                   Yours very truly
                                                                   ,. .   _


                                ‘. By &T?ovlor Roberts
                                        i?owlorRobeots
                                        Assistant
fEi:eJ:wo


APPROVRDAPRlL 8, 15~42 ,, ‘,:
0/ &over Sellers
FIRST ASSISTANT                       .~
AT’%ZX3!   CiENERi%                    ,-

Apprwed Opinion       Connaietee
                               Ry s/lWR Chafman
