BILL ANALYSIS



H.B. 1348
By: Coleman
5-2-95
Committee Report (Amended)


BACKGROUND

There are several ambiguous and conflicting provisions in the
statutes dealing with the authority of the attorney general in
charitable trust matters. In 1987, amendments to the property Code
changed the Attorney General's status from a "necessary" party in
proceedings involving charitable trusts, to a "proper" party, by
adding Chapter 123.  However, Chapter 115, which references prior
law (Article 4412a), was not changed to reflect the 1987
amendments.  Because of these ambiguities, the Attorney General has
been issued numerous citations which unnecessarily join the
Attorney General as a party in actions in which the Charitable
Trusts Section deems intervention unwarranted.

PURPOSE

To clarify existing statutes that deal with the authority of the
attorney general in charitable trust matters.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly
grant any additional rulemaking authority to a state officer,
department, agency or institution.

SECTION BY SECTION ANALYSIS

     SECTION 1.  Amends Subsection (c), Section 115.011, Property
Code, so that it conforms with changes made in Chapter 123 which
indicate that the attorney general must only receive notice of
proceedings involving charitable trust and need not be made a party
to such proceedings.

     SECTION 2.  Amends Section 123.001, Property Code, by adding
a definition of "fiduciary or managerial agent" to encompass the
broad range of people and entities that act as trustees of
charitable trusts.  The statute clearly anticipates that the
attorney general may sue members of a board of directors as
"trustees of a charitable trust" since the definition of
"charitable trust" includes a corporation.  This new definition
clarifies the issue.

     SECTION 3.  Amends Subsection (a), Section 123.003, Property
Code, and adds new subsection (b), to clarify language relating to
notice.  It sets out notice requirements, establishes a time frame,
and addresses the question of notice to the attorney general when
pleadings are amended to add causes of action or to add new
parties.  Reletters subsections accordingly.

     SECTION 4. Amends Section 123.005, Property Code, to clarify
the issue of whether the venue provision is permissive or
mandatory.  Allows the attorney general to recover costs from a
fiduciary of managerial agent of a charitable trust in a proceeding
against the fiduciary or managerial agent if the attorney general
is successful.

     SECTION 5.  This bill applies only to causes of action that
accrue on or after its effective date.

     SECTION 6.  The effective date of this bill is September 1,
1995.

     SECTION 7.  Severability clause.

     SECTION 8.  Emergency clause.

EXPLANATION OF AMENDMENTS

After introducing this bill, several clerical mistakes were found. 
Amendment #1 provides cleanup changes.  These modifications are
nonsubstantive.

SUMMARY OF COMMITTEE ACTION

The Business and Industry Committee considered H.B. 1348 in a
public hearing on May 2, 1995.  The following witness testified on
H.B. 1348:  Jan Soifer, representing Office of Attorney General. 
H.B. 1348 was left pending.  H.B. 1348 was reconsidered without
objection.  One (1)  amendment was considered for H.B. 1348.  The
1 (one) amendment was adopted without objection.  H.B. 1348, as
amended, was reported favorably with the recommendation that it do
pass and be printed and be sent to the Committee on Local and
Consent Calendars, by a record vote of 6 (six) ayes, 0 (zero) nays,
0 (zero) present-not-voting, 3 (three) absent.