GSC Enterprises, Inc. v. Carole Keeton Rylander, Comptroller of Public Accounts of the State of Texas And John Cornyn, Attorney General of the State of Texas

Court of Appeals of Texas

GSC Enterprises, Inc. v. Carole Keeton Rylander, Comptroller of Public Accounts of the State of Texas And John Cornyn, Attorney General of the State of Texas

Court of Appeals of Texas·Decided August 30, 2002·No. 03-01-00409-CV·Published

Opinion

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-01-00409-CV

GSC Enterprises, Inc., Appellant v.

Carole Keeton Rylander, Comptroller of Public Accounts of the State of Texas;

and John Cornyn, Attorney General of the State of Texas, Appellees

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT NO. 98-05733, HONORABLE W. JEANNE MEURER, JUDGE PRESIDING

Appellant GSC Enterprises (AGSC@) appeals from the district court=s grant of summary judgment in favor of the Comptroller and the Attorney General (collectively Athe Comptroller@) and denial of GSC=s motion for summary judgment. GSC=s appeal hinges on the interpretation of section 72.103 of the Texas Property Code. See Tex. Prop. Code Ann. ' 72.103 (West Supp. 2002). Because our interpretation of section 72.103 supports the district court=s judgment, we will affirm.

FACTUAL AND PROCEDURAL BACKGROUND GSC is a Texas corporation that issues, administers, and redeems money orders. It typically partners with small retail outlets such as convenience stores and independent grocers. Money orders have blanks in which the purchaser identifies the sender and the payee, but the retailer typically retains only the money order=s amount and serial number. Most money orders are promptly redeemed, but a small percentage remain unredeemed. Purchasers of GSC money orders agree to pay a monthly service charge on unredeemed money orders. Prior to July 1998, GSC had a policy of

charging one dollar per month from the date of purchase if the money order was not redeemed within one year of the purchase date. This policy was generally not enforced against retailers who accepted these money orders. After July 1998, GSC charged one dollar per month from the date of purchase if the money order was not used within two years of the purchase date. A service charge accrued until the money order was redeemed, the service charge exceeded the money order=s face value, or the money order was deemed abandoned.

GSC must track its unredeemed money orders and eventually report them to the Comptroller as abandoned property. At the time of the events germane to this lawsuit, the Texas Property Code deemed a money order abandoned five years after it was issued or five years after the last communication from the owner. Once a money order is considered abandoned, GSC must turn it over to the Comptroller.

After a 1998 audit, the Comptroller issued GSC a deficiency notice for the money orders GSC surrendered in 1996 and 1997, stating that under the Comptroller=s interpretation of the property code, GSC should not have withheld service charges from the money orders. GSC disagreed with the Comptroller=s interpretation and in May 1998, filed a petition for declaratory judgment against the Comptroller. GSC deposited the contested funds in the court=s registry. The Comptroller answered with a general denial and counterclaimed against GSC to recover the deficiency, plus penalties, interest, and attorney=s fees. In 2000, the parties filed competing motions for summary judgment. After hearing the motions, the district court granted the Comptroller=s motion and denied GSC=s motion. By four issues, GSC appeals the judgment, claiming that the trial court erred (1) in its interpretation of the property code, (2) in granting the Comptroller=s motion for summary judgment and denying GSC=s motion, (3) in rendering judgment that GSC take nothing, and (4) in rendering

judgment that the Comptroller recover penalties and interest. At stake is the $1,689,728.01 deficiency, plus accumulated interest, penalties, and attorney=s fees. 1

DISCUSSION

Standard of Review The parties in this case filed competing motions for summary judgment. When examining cross-motions for summary judgment, the reviewing court should analyze the summary judgment evidence produced by each side and determine all questions presented. Commissioners Court v. Agan, 940 S.W.2d 77, 81 (Tex. 1997). The reviewing court should then render such judgment as the trial court should have rendered. Id.

Both motions for summary judgment turn on the statutory construction of Texas Property Code section 72.103; thus, the case is ideally suited for summary judgment. A[M]atters of statutory construction are questions of law for the court to decide rather than issues of fact.@ Johnson v. City of Fort Worth, 774 S.W.2d 653, 656 (Tex. 1989). The purpose of summary judgment is to provide a method of terminating a case when it is clear that only a question of law is involved and there is no genuine issue of material fact. Gaines v. Hamman, 358 S.W.2d 557, 563 (Tex. 1962); Jones v. Texas Pac. Indem. Co., 853 S.W.2d 791, 794 (Tex. App.CDallas 1993, no writ).

The appellate court reviews issues involving statutory construction de novo. Texas Dep=t of Pub. Safety v. LaFleur, 32 S.W.3d 911, 915 (Tex. App.CTexarkana 2000, no pet.). The

1 The court awarded the Comptroller penalties of $29,341.38, interest of $21,202.60, plus accumulated interest in the court=s registry, and attorney=s fees.

court=s primary task when construing a statute is to give effect to the intent of the Legislature. Tex. Gov=t Code Ann. ' 312.005 (West 1998); Helena Chem. Co. v. Wilkins, 47 S.W.3d 486, 493 (Tex. 2001). To accomplish this, the court scrutinizes the statute=s language. Id. The court should not Aattribute to the legislature an intention to work an injustice@ or to produce an absurd or unreasonable result. Southwestern Bell Tel. Co. v. Public Util. Comm=n, 888 S.W.2d 921, 927 (Tex. App.CAustin 1994, writ denied) (quoting State v. Mauritz-Wells Co., 175 S.W.2d 238, 242 (Tex. 1943)).

Property Code Section 72.103 When legislative intent is plainly expressed in the language of the statute, the court should give this intent effect. See Tex. Gov=t Code Ann. ' 312.005; Helena Chem. Co., 47 S.W.3d at 493. In addition, the court should consider the statute as a whole, in an attempt to maintain harmony among all of the provisions. Helena Chem Co., 47 S.W.3d at 493. The general intent of section 72.103 is evident from its title APreservation of Property.@ The value of unclaimed property is to be maintained. As GSC points out in its brief, the primary purpose of the unclaimed property laws in Texas is to reunite owners with their property. See Melton v. State, 993 S.W.2d 95, 97 (Tex. 1999). Property which cannot be reunited with its owner is turned over to the State. See Tex. Prop. Code Ann. ' 74.301 (West Supp. 2002). Specifically, section 72.103 provides:

Notwithstanding any other provision of this title, a holder of abandoned property shall preserve the property and may not at any time, by any procedure, including a deduction for service, maintenance, or other charge, transfer or convert to the profits or assets of the holder or otherwise reduce the value of the property. For purposes of this section, value is determined as of the date of the last transaction or contact concerning the property.

Id. ' 72.103 (emphasis added).2 We look to the statute itself for definitions of terms used. Hayek v. Western Steel Co., 478 S.W.2d 786, 793 (Tex. 1972); 67 Tex. Jur. 3d Statutes ' 106 (1989). AAbandoned property@ as applied to money orders is defined by Texas Property Code as follows:

2 In 2001, the Legislature amended section 72.103, to take effect June 1, 2002, as follows:

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