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,.-a            OFFICE   OF THE ATTORNEY         GENERAL OF TEXAS
1.3                                   AUSTIN




       Honorable    Jno. Q. ?&Adams
       commissioner
       Department     0r Banking
       Austin,    Texas
       Dear Sir:




                                                             t of the     amount        of

                                                            on the    above    stated




                                oovsrs33    in   sohedule     form.     i .
                                    form bond may be written for              this
                                we would like to know the smount              f’or
                whioh   such’bood   shoud be made.”
                   The provision   of the    Banking    Code oited        in your
       letter      reeds as follows:
                                                                  _.
                                                                  :..”
                                                                  _.     783.   _


Boaorabls    Jno.   Q.- XaAdaw       Pam     2




          The Couxaissioner, then Deputy Commlasioner,
      the Departmental Zxamiaer        the Liquidating
      Supervisor,   and eaoh sx and ner, assistant     ex-
      aminer, and speoi’al agent’, the Building'an%
      Loan Supervisor and esoh building       and loan
      examiner and each other offiaer       and, employee
      apacified   by the Commiasionar shall,      before
      entering upon the .dutisa of his office;        take
      an oath of offioe   and make a fidellt       bond    i
      lo the sum of Ten .Thourand Dollars (~4 lO,OOO.OO)
      nayable to ths Governor of the State of Texas.
      ana his auooesaors~in    offloe,    in indiridual;     W
      schedule. or blanket form, cxeouta        by a suretl
      aDpeering upon the list of apEnovea Wreties
      acesptsbis   to the Units&I Stat& Government.
      Any bond provided under this artiole        shall be
      on a form approved by the T’inanca Coobniaeioa.
      The pramiuma far aaoh bonds shall be paid
      out of tha fund6 ap,propriatad for. the.opsratioa
      cf the Banking   Department~~(?..phasis     added)
           Aa oan readily be aesn, the atatute expressly
authorizes   the use of a blanket form of bond, subject--
as Is the ease whether the bond be, Individual’,    aoheduie
or blanket--to   th8 requuirsment, that t&s form of saoh
bond be approved by the Finance Commission orsated by the
new Solking Code.    Your firat   question is tharefora
answered in the affirmative.
           The plain intsndment of the.above       statute is that  ,
a fidelity   bond in the aaounf of $10 000 ahall 009er thr
aots of each of the oZ?loera and empi oyees enumerated therein
ao that, in the event of the &efaloation        of any or all of
auoh persons, reoovery    map be had up to this amountfor
each of the Erring individuals.       .Statad diffarentlp,    the
puipose of the statute    is to proteot the State from the
malfesaanoe of the petaona named therein to the extent
of ,$lO,OOO for eaoh suoh person, regardless        of when saoh
malfeasanoe shall ooour~and regardless       of   the oiroumstaaoes
under which it shall take plaoe.
            The rollowing   examplea will     perhaps s0r9e to
make this    clear:
       (a) Zither A or 3 or C alone         eznbezxlaa $10,000   and
       15 immediately dateotsd,
                                                                    t.
.
                                                                           784


            xonoraBl4   anor   Q. mudarm,   wee   3



       1    (b)   A, B and,C, aotlng  la oonorrt or at the mm4
        '   the,   sash embexzl6 $10,000 and -8 i5amdlatsly
            dsteeted.

            (0)   A embezelee $10,000 and his aot remains
            uudrteobed;  B subasqusntly  ambexxlea a like amount
            and he too is unapprehended;   0 later fe guilty of
            like aotion,  but at this time all three 4mhea2l4-
            nents we    dlaootersd.
              Ia our opinion,      the pm 086 of the Statute was to
    afford full and oomplatb protsot Pon.to the State in eaoh
    of the situations  lllu8trated      above, end in similar situations,
               Ii a bond oorsring A, B aud C ehould, be exeauted
    Only for   the sum of $10 COO, 8aOh Of 3uch p8rfiOnS would,
    in  one 881148, be cover84 by a $10,000     bond, sin04 a raaoterp
    Of this a!QOUXttcould bd haa in'the     8V8nt that aX#' oll4 Of
    thm should violate    the  oonditlona   of the bond.     Thus full
    oovera&e would result in th4 situation       llluatrated    in (a)
    abOt8.   UorooTer, ii A alone should 8mb82218 ~10,000 and
    if this amount should be rsoorersd      on thd bond, a new ‘bond
    of #lO,OOO would be neoeesary to rsplaoe        th4  impaired
    security   and suoh n8w bond aould be avsllable       if % alonr
    or C alone should subssqnsntly      be guilty of like aotlon.
               Rowetor, It is apparent that such a bond would la
    no w    afford  in11 proteotion    in the situations    illustrated
    In (b"i ad (o), for the mariama liability         OS the surety of
    such bond would be but $10,000 regardless         of how many dsfsl-
    oatlons  should ocour and regardles~a of the extent thereof.
    Tbos, in (b) and (0) the Stats oould reaomr but .$lO,OOO
    despite the faot that,its     total 104684 were $30,000.
               Ir w4 oould aaaume that poaalble malfeasors will
    a&i ShI&y and in l8qU8DO8, with each suooeedlng pereon
    waiting until hla pr,edeoaaror hea bsen apprehendsd and
    until ths impaired aaourity has again been built up to
    $10,000, a b.>nd of this mount would oonfom to the purpose
    of the statute,     Obvl.~usly, however, no auoh assumption
    is tenable.     To aa28 ior eituationo    of ths typo illustrated
    In (b) and (0) abora,     and siiallar situaticnr,   it ia neoesaary
    that the bond-be one which oovms each individual         to the
    extent of $10,000 re$ardleaa      of nbsn ho aots' and regardless
    0r the action of hls r4110m.
              ainoe   we 434 not    authorlaed      to presorlbr    the rorm of
 suoh bond, no do cot hero ettempt to stats               pr48184ly     what
 the ‘iamount    of such   bond  shell    bs.    Perhaps   it will    be 04044-
 sery for ths emu.&t or the bond to be that craount wi~ioh is
 obtained bg a&ltiplyiag         ;3lO,OOO ~bp the amber of persons           to
‘be  Inoluded      in the bout%     Cn the other tend, p&mps            It wi3.l
 be :oseible       to obtain. a bead rhio2 nhili, bearing          a is00 mount
 of but $10,000 or saw SM in SXOBSStheeof will norerthelrss
 be oonditianed       in suoh o w       that the neoaasar         eorsrs@    will
 be ObMinrd.         u"onsaqueatly, we z~r1y:mable to gi TB d aaimwriosl
 xmw?      GO ytur sseond question.            3swm%r, in aprmer to mob
 question,      you am ?rspefMull~          addrised that th0 tueiWt Of
 the bond auwt .ba       auoh     that   under   the    SoMitiOn8     thsreof      p+a-
 tsotion~to   the extent of P,10,000 will In all oircu~stmoes                             be
 sff?3ded   the Stats  against t4e yxslbls  tisdaeda  ai each
 iadlviduel   covared by the.bond.
             l'?Usttn&    that.    the   t4T8gOiilg     Sat~S2hOtOril~      &UW3
 yaw   ia31iri48,    we    ere

                                             Yours     very   truly
