        OFFICE   OF THE   ATTORNEY      GENERAL     OF TEXAS
                               AUSTIN




Honorable Sldnsj Latham
Seoretary oi State
Aurtin, Texar


Dear Sir:




            You ham                               ropored ohartor
of “Parkview, Ino.’                               on on the follow-
lag queationrr




                                          divisions o? the
                                        er oonetitute a
                                        t upon the statutory
                                         the ohtarter?
                           light   Of the WUlOUEi 8UbdiT-




      Honslng Aot or other Fadoral       authority7

            ‘$0  If the Federal Housing Ad.&ki~tratiO~,
      as auoh, oannot own euoh stoak, oan it hold auoh
      ato& through a trustee or the Yrderal Hourlng
      Commisrionsr or Administrator?
                                                               366   ‘




Honorable SIdmy   Latham, Page 2


            *6. Does the oharter provide for an
      unauthorized delegation of authorltg to thr
      owner of the Clase A preiarred atook In oohtra-
      ventloo or &tiOlb   1327 or other provlsIons of
      tEe Texsr Statutaa?

            “7. 10 thsre a burden on thir Department
     to exa~inr into aatailed by law apaterlalor 40.‘1-
     tra0tua.lrights  that might br Inoorporated Into
     a proporad olmrter,  and if 80, wEat would be
     thr rffrot of the ap roval by t&I4 Departsent
     Of a oharter  OOAtaiAPIl& dotriled 4Oatraetual pro-
     vIaion that might ultIuat61y bs held llltgal?
           -6. Should the ohartrr br apprmed an4
     filed by this Department 44 bring in oomplIanoo
     with the lawr of Texae governing suoh zntters?*
            Tour oonoln4Ion4 together with faots giving rlsr
to your Inquiry as oontalnsd in your letter are:
           “It I4 the view of’thie Dspsrtuentithat
     rsvrral of the ohartor rovlslons contravene
     the lplrlt, if not the Potter, of the ststutos
     of T&as govornlng such uatter4* and that mcb
     of t&o material In the ohartrr i4 thb roper
     4ubjeot matter for the bylaw4 and/or tIi
                                            4 doed  -
     of trast ok other contzecta to ba sntsred Into
     by the omipany.
           %6Ctfon 2 of the oharter atat4o verbatia the
     pup060 as oxteinad In auhdivIrlon 47 ai Arti010
     1302, a. C. 3.) 1925 bat thir p$poy,hJ(;.rthr
     ol.TboretedIn subsso~lona (a)*
            we aonrtrue ths word ‘rent@ L 4ukvoObIoU
     Ia) ‘of motion 2 of the ohrtar and the rohd ‘loaso’
     lg aubaeotion (b) 44 enlargemsats  of the rtatatory
     parpoae as provided  by subdivlaion 47 of ArtIob
     L302. $v oanstzua aubseotlon (0) of seotion 2 of
     the rharte+ as belag oontrary to tha EtatUtWy
     purpose whlah aathoriaaa suoh a OOrpOratIOn~‘to
     aoouclulate and      money,’ but the authority to
   .




Honoroblo   SlQe~r Letho=,     lU*     3


       borrw  mao    aigbt ba proper under orotlon 7
       of Art1010 I 320, R. 0. s., 1925. #4 bonotruo
       the 18aguogo *a4 OT 011 Of tho Obf4Oto Of 188
       buolnroo~ a4 oontalnd IA oubo4obIon (0) OS
       oaotlon 2 of the ohrter lad clhr langPa@ @thb
       lOoW89llslIm~t    of   ~9     oa4    or -8      O? thO pnrpslru'
       am owUoIn6d    la rubaro%ior [e) of oqotlon 2 d
       tha ohrtrr;.eo    Indloating,a dual pwpom    OS the
       oorpurotlon omtrary to’ the otatutso.     The  lp p & l*
       at   oonlundo thot 011 oooh l   ~&~IvIoI~ao ate Mro
       lImItotI6ao upon thm aala l  tatutbr)  puropoeo 4111~0%
               “TN to@al at~it81           otook    io 29 858 ohor;
               I value   ot   on4    dollar oaoh,       ofoosifI4d
       :: toI%?v#*
                                           PO. of Sharwq       Valao
            a2488 d Prefsrred steak
            ~glB3y~arr64             Stook


              “It appaaro from the affIdav%t attaohed to
       the &arteP that   th8 one bun&ad ohalro 61 C24oo
       A pre~crrod 8toaL hao bean luboorIb4d and old in
       by ‘cfileyJO&OOA a8 Truotoo for ths Ired4raP XOuoing
       kdminiotntlon, and w4 are auvioad by Hr. ,‘obnoaa
       that thir rtocrk la to be trmoforred  to tha Frbrral
       HOWin@ COQOli8OfOAO~~ Srotloa 7, oub4ItIoIono
                          tOgeth4r wltb oth4r aootlono oi
                  -, grant brood poaro of oontrol to the
          I o pter,
       3P%-
       orm4~  of the Claso A pafsrr4d #took in lm4 In-
       etamao 4roaedIng th4 porrrroof the diroot~8.’



             ‘X. The purpoor for whloh it IO fofa4d IO
       to ar4Ot or rrprlr ml building O? IWmta*to,
       ad to aoammlatr and lend SOAOJ for la ldpUWOO~4,
       ad to purotuor, 0~11 end oubdlrlda PO41 PrOS’*-Y
       in towno, cltlrr and vIll4g44 and the12 rubwbr,
                                                        368   _




Boaorabla Sldnsy Latham, Page 4


     not extending more than two mile8 beyond thrlr
     limits, and to aooumulatr and lend money ior
     that purpore.
           % ordar.to   oarry out thr purposa o?
     the oor oration, a8 herolnabote ret out, it
     18 the fntsntion of tho lnBorporator8 herein
     to prooeed a8 iollou8:
            "(a) To errata 8 prlrrtr oorporatlon
       to provide houalng ror rea8:or ~18, and
       to aoqulrr auy real wta$a or lntrra8t or
       right8 therein or appurtenant therot and
       anr aad all peroo.ualproperty In oonarotloa
       therrrith.
           l(b) To lmproto and operatr, and to
       8811, Oonf8J, arelgn, mortgage or 18aaa
       any real estate and any"personal property.
            .(o) To borrow aonry aad lerue rridono8
       OS lndrbt8dne88 in furthoranoe o? any m all
       oi the objeotr of its bualnrar; to 8eouro the
       aame by mortgage, dead of trust, pledge or
       other lima.
            "(a) To apply ior and obtain or oauso
       to be obtained from the Federal Housing
       Comml8sloner a oontraot or oontraotr o?
       mortgage ln8uranoe parruant to the prorl8-
       Ions o? the Rational Hourlng Act a8 amended
       ooTerlng bondr, note8 and other erldenoes o#
       indebt&lne88 188uad by thlr oorporation and
       any indenture o? Mortgage or Deed oi Trust
       reourlng the 8ame. 80 long a8 any property
       of thl8 o,mporatlon 18 enoumbered by a mOrt-
       gage or deed or tru8t insured by the Federal
       Hourlng Uofamlm8loner it sheill engage in n3
       burlno   other than the OOn8trUOtlOn and
       operation of a War Howlng Projeot or ProJeot8.
   ,                           . ?..”                                                             369




H0n0rabl8       Sh%aO~ Lathsa,           P8gr    5



                   “(8)   To wt8r   into,  and wrry   porton
            OUt    OOIltr88t8 Of Uy   kln6      to, O?  lLOO888W~
           in oo~ootiw  with, or laoidental to,   the
           8ooompll8&mat of ary 0~ or ai010of t&a
           pIW~08OS Of th8              OOR$QYSt~Ofl."

                   Parapaph         2 a? the rbartor           (with     the OXSO $1011
Of th8 8UbdiViSiOW               thIW8Of)       18   tak80    VSPbttin      fU    SOidiV18lQa
47, Ar8lol.        1302 f.       Al 0. 8,
                   It   8Uh8O~t~OU8 (S),             (b)     (8)    6)    Ulb (8)     WESt%tUtO
an llu g a m8a   upont thr purpose 8oa~ala8~ a Fwagraph 2 rush
ohartsr  would be oondoaned 88 ooatalniag    a010 than on8 purpose
UfIdSt th8 authority   Of RWIISO~ V. Tad, 69 S. W. 1 5, M6 Gordon
v. PI88pt~lr8iorRlocr dh Irrlgatloa Co. 82 9. X.      3.
                   A omrotul ooasldetatloa Of 8UbdiVi8iOn8 (a), (b)
(8).  (d) SJd (0) load8 US t0 th* 00&8~lI810R that that UI), dth
Oil8 exorptlu herrlnaft8r noted, but S~~hKISt0r~   Of th8 author-
1184 PWpOSS.    I?lMPll bh. SOF~OrStiOIIOOUld 60 ILlit886 811
thing8 smntlonsd ia Su4h 8UbdiVl8i0a0    Lf     were aOt OOatainbd
in the ShartU   and henoe SuOh rnuoratsd    ri t8 &a EOt ooaStitUt@
8a lalsr~Oah8at of the rl&tr  an6 powers of ths ooxpo~atloa ai-
twdad by $UbdlVl8i0a   47 0t hrtielr 1302, aqira.
                   2910 148t      80nt0ao8      or 8oM1v18108            (a),    rssdlaur
         “SO lOIt  88 rS# pXO&?OTt~ OtthiS                     WHpOP8tiOAiS
         mogplbard   bl a rort&a$o  or do04                    oi trurt inllzcwd
         by tho Federal @USa               &XdSSiWSr   lo 8hdL la-
         88@0     in a0 bUSin~88       other thUI t& OOWtPUOtiOlb
         end opwatioa            of 8 war 8owlJM Proj88t PQ ProJ*st8*'




                   IS 8000?6&@~   aaawsr roar qrurtionr 1, 2 and                            3 W
giving    ow      approval to the p-D080  818U8o I8 Wltt*a*
                                                                                                           370
                                                                                                                 .




Eonomblr             bldnsy bktma,                  Pa50 6



                            YOU    StrtS       that tho 002               r8tiW       Uu&ht W b8 tSSmS6
18 80 &SW              (ifhpit81 8 oak Oi $29 r j8.00 Md                                IS $0 bo fU\rrtha
tinaaosd by lorns of                         b%00,000&O             trw     brnkr      Wloh 1-s     mro
to IN lnaured by th4                         Yuloral         1Jou8laghadd8tP8ttOiI.
             'low quertloar 4 aa6 i 6081 VlCh the pow? 02 Sk4
f8dwrl K0mw Admlalstratloa to ora 8$o4k Fa 0oyporatloM OY
8 eSif~o8~1) whather or not 8u8h authority 0m or0 oam huadrrc)
(b~r~;~:,:.                  Of    Glm38      A hrrforrrd               StOOk    in   the prop@ord ?U&S
                               ws b6llrvo        that   the dotrrdiutlon        of            l
iMOt8r          88     it      iilVO1V~Sl        OOAStZUOtion    Of tb8
(Oh*     13,     at14             12    U*    aa 0. A. 8OOCiOU      1701-1732
a setter          the b do
                 toe                          r allttho,arltlea to gau up00
888VS0, tW t&O mpOS8                            Of t&l8 OpiS~W, that
                                                        qU.SttOllhU           Std
baa      Stl8Wrsd ia th0 S~tirIR4ltiV~. Th4 Only ~USStlOE with tkioh
va dll oonovn ow8elve~ im rhatimr or not uadw M, P@x88
Statutes      CM Rational aOwia4f h&ltiatratlan or thr AdaidSCr8tu
my Gm atook la l TlXSti Ooi~~atiOa.
                            Our    StatUt48         do     not     lrtsblish tho qUP~itiO6tiOkNJOt
StOOkhOb!AP8.                     no    r&W         and      OZ+pSOib~ of any     mo wCOlubsorib6
iOr atook in l T*raS Ooi~CWatiOili8 ~0VUa.d r y th6 g6MWti I’U1*8
of the Law ot Contrrota,       10 TSX, J\rrr 699, A!.~Sbin ve StrOa6     1
3. ;r.(26 $72, 3 8, W. (2d) 225. ti dn6w6r to your ~tiSStiOfl@
           La afar as the ~axar Statot68 6r6 ooaoernrd        th0    ?sder.al
~Ot%&diidlIi8tr8t~OII      Or the Administrator   aa) 9Wl :toek bl
Texas oorporstlon8.      8Wil.l~ 88 lKMlJWW~d,it iOllOU8 t&t       it oall
be parahased   In the a6.m of a '&xist6@. 8 80ura6~ th8 rS~tiOlb=
ship      of    t ha        tiUSt.0         with    the priaaips~               vtOc;lUbe gOVOrUd   bt   the
rule4         ot ideaoy,               10   ‘TaxI   Tur.         699.

            ~.'h~V~ OUStt&    QXMiMd   ths ~i7Vi81ORS Of
psrsgrspb 7 of the ahikrt&, to0 18a&thy to h8re 848 aU*, and
crlthougbjwrf Of the prOViSiona 8?e SllOh88 BrO USUti1r WA-
trolls6 br the bylsws, ~9 Cid no rt@tutry prohlbitMa    la%rus
ineop orat-   thw $a t&o dharterr\,.Ye60 not bali6t6 thor 6OUld
bo hS& tOr36lSW &?tt814 132?#   % & cs a* rea4ti8

            *Tbr ttlr8Otws &haU &a*0 UlO ESmit61 HIM$*
      pleptor the attelrr of tha OOP ratios,     sad w    Qlr
      pQ80 Or Oh4 rBSidU4   Of t&s WP r kl 8twk at 6      blao
      r~~&~lng tumubrorib~,     in 8ueh aatlaer a8 tb03 r-18-
      5ay preso*llH.:
&dor #aah p~4ViSiOM tk8 dirrOtOP8 UI) W8t.d with th* I-*-l
wEm6jit    of th0 OO?pOt0tlOn wlthln oleerly urtine~ boounhr9
                                                                                       371
    ,     .I      -




Honorable 81dne~ Latham, Peg. 7


Thoro ia no unrubsorlbed Cn ital Stook in tho lartmt    omo.
wo rooordlngly 8aaw8r your Bth paastioa la the nogatlvr.
            In aa8wor to your 7th quoatloa, wo bolioro it to
bo your dut to oxaaiao iato all proririona  ooatainod in l
OhMtOP 8pJ'3tO8titUlt0 dOt8rSfmO rhrth8r OF IlOtw   p?Ot181On8
theroia        are PO uga8at    to tho   1~8   of   th8   Stat..   If    IQIIIO pro-
tlrloa rhoala g 0 hOT8dtOr hold ill8881 the ohartor r0uia not
aooorrarlly bo void, but only that   portion hold 1110681 would
hare a8 foroo.   Bt8aOkO 1e %ttlQ&O,   175 S. W. &b.
                      a0 bolleto tho ohmtor     8pplioatloa 8hOUid bo
appromd         aa ttlad.
                      wo rorpoottully rotuma    tho   lpplloatlaa       ?or ohartrr.




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