                             TEEAITORNEY                     GENERAL
                                             OF TEXAS
                                      Au-.      TEXAS78711
  aOEN      L.     BILL
A¶-ro-           Q-AX.

                                              October 24. 1974


         The Honorable Joe Resweber                          Opinion No. H-   430
         County Attorney
         Harris County Courthouse                            Re:~ Questions concerning
         Houston, Texas 77002                                certificate of deposit under
                                                             Article 2372 p-3, V. T. C. S.
                                                             (S.B. 383, 63rd Leg.), the
                                                             Bail Bond Licensing Act.

         Dear Mr.         Resweber:

                 The 63rd Legislature enacted Article 2372 p-3, a comprehensive
         act covering the licensing and regulation of bondsmen. (Acts 1973, 63rd
         Leg., p. 1520, ch. 550). You have asked us a series of questions con-
         cerning it. The constitutionality of this Act was upheld in Robinson v.
         Hill,
         -     507 S. W. 2d 521 (Ten. 1974).

                  In counties having a population of 150,000 or more a County Bail
          Bond Board is created, composed of various county officials, to have
          authority and control over licenses to be required of bondsmen. (Sections
          3 and 5). Section 6 sets out the requirements for a license, one of which
          is the deposit with the county treasurer    of a cashier’s check, certificate
         ‘of deposit, or cash,in the amount of $5,000 as one means of guaranteeing
          that any forfeiture will be satisfied.   Section 6(d)(l).  Section 6 (f) provides:

                              Before application of the cash deposit, cashier’s
                              check, or certificate of deposit, or before any
                              action is taken to liquidate property held in trust,
                              the sheriff or his agent shall make demand of the
                              licensee to pay the judgment.    In the event of failure
                              or refusal to do so within 30 days of the demand, the
                              sheriff may apply the deposit to pay the judgment or
                              liquidate the trust and apply the proceeds to pay the
                              ju,dgment. The licensee ahall keep the sheriff notified
                              of the mailing address to which notice of a judgment may
                              be sent, and the mailing of notices by certified mail to
                              the address provided by the licensee shall be sufficient to
                               comply with the notice requirements of this section.


                                                   p. 1988
.



    The Honorable Joe Resweber      page 2    (H-430)




           Your first question is: “In whose favor is the certificate   of deposit
    made in the Bail Bond Act styled S. B. 383?”

            The alternatives, it would seem,are that the certificate be made
    either in the name of the licensee bondsman or in the name of the County
    Treasurer.

            The obvious purpose of the required deposit of Section 6(d)(l) or
    the execution of a trust deed to the sheriff conditioned that the property
    may be sold to satisfy a forfeiture (Section 6 (d)(2) ) is to place resources
    in the hands of the County with which to satisfy a forfeiture without having
    to resort to court proceedings.

            A certificate of deposit, whether or not negotiable, is an acknowledge-
    ment by a bank of receipt of money with a promise to repay it. Section 3.104
    Texas Business and Commerce Code. In our opinion if the certificate were
    payable to the bondsmen, the purpose of the act would be defeated.     We
    therefore answer your first question that the certificate of deposit should
    be made in the name of the County Treasurer or in a manner that the
    sheriff can reduce it to cash without any action by the bondsman.

           Your second question asks:     “Who owns the accumulated interest? ”

             Just as the principle of the certificate of deposit “belongs” to the
    bondsman until applied to a forfeiture,     so too, in our opinion. interest
    on it also belongs to the bondsman until applied to satisfy a forfeiture.

             Your third question is: “If partial payment occurs on a deposited
    certificate of deposit, what happens to the residue? How is the forfeited
    money replaced ? ” Section 6(e), we believe, specifically answers these
    questions.   It provides:

                   The cash deposit or the funds realized from the trust
                   may be used to pay the judgments of any bail forfeitures
                   that result from the person’s execution of a bail bond, if
                   the licensee fails to satisfy the judgment within 30 days
                   subsequent to the date of issue by presentment of final




                                        p. 1989
i



    The Honorable Joe Resweber        page 3   (H-430)




                   judgment to the county treasurer. When any sums are
                   depleted from the deposit or trust to pay a judgment
                   resulting from a forfeited bond, the licensee shall, as
                   a condition to continuing as a licensee, replenish the
                   amount so depleted.    When the licensee ceases to
                   engage in the business of executing bail bonds and
                   ceases to maintain his license, he may withdraw his
                   security deposit or trust upon presentment of a
                   release by the sheriff, if there are no judgments or
                   bond liabilities outstanding against the license.  Any
                   portion of the deposit or trust not used to pay judgments
                   shall be returned to the licensee or his heirs or assigns
                   upon’presentment of a release by the sheriff. (emphasis
                   added)

           You next ask:   “When a certificate     of deposit matures,   is it to
    be cashed? ”

            It would be our opinion that, so long as the bondsman otherwise
    meets the security requirements of Section 6(d) he may be given authority
    to withdraw a cer.tificate.

            Your fifth question asks: “Is the cashier’s check described as one
    alternative to be cashed or held i,ntact? In whose favor is to be made?”

             Section 6(f) snpra, speaks of application of the cash deposit,
    cashier’s check, or certificate of deposit.   We interpret this to mean
    that the cashier’s check, like the certificate of deposit, is to be kept
    in that form for use when needed. Also like the certificate of deposit,
    the cashier’s check should be made payable to the County Treasurer.

           The court’s decision in    Robinson v. Hill, s,          specifically
    answers your sixth ques’tion as   to the law’s constitutionality.    Your
    seventh question asks whether,     if the law is constitutional, the bondsman
    should make the deposit before    final approval of the.bond “as per section
    6, paragraph (d) (l’)? !’




                                         p* 1990
                                                                   - -._   .




The Honorable Joe Resweber       page 4    (H-430)




        Subsection 6 (d) (1) calls for the deposit upon notice that the
applicant has been tentatively approved.

        We therefore answer your seventh and last question in the
negative.

                                 SUMMARY

                    Certificates of deposit and cashiers checks
                deposited to satisfy the bail bondsman’s licensing
                act should be executed in the name of the County
                Treasurer.




DAVID M. KENDALL,        Chairman
Opinion Committee

lg




                                     p. 1991
