                                                   641




                      July 16, 1947


Hon. Jesse James,            Opinion
                              .-     No.,V-307
State Treasurer;
Austin, Texas                Re:   Construction of Ar-
                                   title 1524-a, V.C.Q. ,.
                                   with respect to   1
                                   transfers of secur-
                                   ities and releases
                                   thereof, deposited
                                   with the State
                                   Treasurer.
Dear Sir:
            Your letter of request for an opinion upon
the above titled subject matter is as follows:
     “In compliance with the provisions of Ar-
     ticle 1524-a, one of the investment OOD-
     panies has been depositing with this De-’
     partment certain real estate notes. When
     these notes are deposited, Transfers of
     Lien are furnished this office, said.trans-
     fers having first been filed.in the county
     clerk's office of the county in which the
     property is located. A blank form of such
     transfer is enclosed herewith.
     When the notes are withdrawn from this of-
     fice, we execute another Transfer of Lien,
     transferring ownership back to the company.
     This .transferalso is enclosed.
     "The question has now arisen as to whether
     we are using the correct language in such
     transfers, as the ones now being used pur-
     port to transfer ownership by actual sale,
     when as a matter of fact, the ownership is
     transferred only in trust.
     "To clarify this situation, we kindly request
     your opinion of the following questions:
                                                                  .




    Hon. Jesss    James - Page~2   (V-307)


           “1.   Are the forms furnished herewith cor-
           rect,  or, should the purported cash don-
           sid+ration  be left out and the words Iin
           trust’ be added? If you have further
           sugqestions to make on what the correct
           forms should be, we will appreciate   your
           views.
           “2.   If the enclosed forms we not cor-
           rect, should the transfers  of lien now in
           force on the notes now deposited be a-
           mended so as to correct the error?
           “3.   Should the State Department of Elank-
           1% approve, in writing,   each Transfer of
           Lien, before it is aocepted by this office?*
            For convenience we shall answer your questions
in the Order in which they are stated.
\            1. The form of transfer of the deposits con-
templatea under Artiole   1524-a of Vernon’s Civil Statutea
which acoompanies your letter   Is that of an absolute oon-
veyance to the Treasurer.    It makes no reference to the
statute nor does it specify that the conveyance 1s in tzu&
of any charaoter.
             We think, however, the form is sufficient for
the statutory purposes mentioned.   A deed, absolute In form,
;z; ;“, shown to be a conveyance in trust or mortgage.   Oar-
         Carter, 5 Tex. 93; Young v. Fit%s, 183 S.W. (2d)
186; Lionard vs. Smith, 186 S. W. (28) 284.
             It would. not be amiss, however, to add to t&e
granting clause the words “such conve     nce being in statu-
tory trust”,  although this is not ind r spensable.
             Your form of the conveyance by the Treasurer
to the depositor  is an absolute sale upon a nominal oonsid-
iration.  We think this form is sufficient  for the same
reasons we have statea above in support of the transfer   to
the Treasurer.
                   2. Since we have held the forms to be suffi-
    cient , it   is unnecessary to answer your question No. 2.
            3. The State Treasurer should not aocept any
deposits under Article  1524-a - whether as an original  or
replacement deposit -  without certifioate of appr,oval by
Hon. Jesse <Tames- Fage 3, V-307


the Banki.&;Commissioner as being eligible and suffi-
cient in reasonable market value for the purpose of
the deposit. This certificate of eligibility and suf-
ficiency, however, does not absolve the Treasurer from
the duty of requirin;;the proper leeal transfers of
such deposits to the State Treasurer. We hand youhere-
with copy of Opinion No. O-957 by this department writ-
ten to your predecessor, Hon. Charlie Lockhart, which
may be helpful.
                           SUMMARY
              1. Transfers of real securities to the
        State Treasurer under Article 1524-a of Vernon's
        Civil Statutes, may be in the form of absolute
        conveyance. Carter vs. Carter, 5 Tex. 93; Young
        vs. Fitts, 183 S.tV. (2d) 186; Leonard VS. Smith,
        186 S. W. (2d) 284.
              2.  The Treasurer should   not accept any
        such deposits, unless they are   accompanied by
        the certificate of the Banking   Commissioner as
        to eligibility and sufficiency   for the purpose
        of deposit.
                                     Yours very truly,
                                ATTORNEY CENERAL OF TEXAS


                                BY
0S:wb                                !ilikke
                                     Assistant
Encl.

                                APPROVED:


                                ATTORNEY GENERAL
