EXHIBIT 3.3
WINSTON & STRAWN
200 Park Avenue
New York, New York 10166-4193
January 19, 2001
Van Kampen Focus Portfolios, Series 269
c/o The Bank of New York, As Trustee
101 Barclay Street, 17 West
New York, New York 10286
Dear Sirs:
We have acted as special counsel for the Van Kampen Focus Portfolios,
Series 269 (the "Fund") consisting of Morgan Stanley High-Technology 35 Indexsm
Portfolio, Series 18A, Morgan Stanley High-Technology 35 Indessm Portfolio,
Series 18B, Internet Portfolio, Series 26A, and Internet Portfolio, Series 26B,
(individually a "Trust" and, in the aggregate, the "Trusts") for purposes of
determining the applicability of certain New York taxes under the circumstances
hereinafter described.
The Fund is created pursuant to a Trust Agreement (the "Indenture"),
dated as of today (the "Date of Deposit") among Van Kampen Funds Inc. (the
"Depositor"), American Portfolio Evaluation Services, a division of an affiliate
of Depositor, as Evaluator, Van Kampen Investment Advisory Corp., an affiliate
of the Depositor, as Supervisory Servicer (the "Supervisory Servicer"), and The
Bank of New York, as trustee (the "Trustee"). As described in the prospectus
relating to the Fund dated today to be filed as an amendment to a registration
statement heretofore filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (respectively the "Prospectus" and the
"Registration Statement") (File Number 333-51624), the objectives of the Fund
are to provide the potential for dividend income and capital appreciation
through investment in a fixed portfolio of actively traded equity securities the
type denominated in the Trusts' name. It is noted that no opinion is expressed
herein with regard to the Federal tax aspects of the securities, the Trusts,
units of the Trusts (the "Units"), or any interest, gains or losses in respect
thereof.
As more fully set forth in the Indenture and in the Prospectus, the
activities of the Trustee will include the following:
On the Date of Deposit, the Depositor will deposit with the Trustee
with respect to each Trust the securities and/or contracts and cash for the
purchase thereof together with an irrevocable letter of credit in the amount
required for the purchase price of the securities comprising the corpus of the
Trust as more fully set forth in the Prospectus.
The Trustee did not participate in the selection of the securities to
be deposited in the Trusts, and, upon the receipt thereof, will deliver to the
Depositor a registered certificate for the number of Units representing the
entire capital of the Trusts as more fully set forth in the Prospectus. The
Units, which are represented by certificates ("Certificates"), will be offered
to the public upon the effectiveness of the registration statement.
The duties of the Trustee, which are ministerial in nature, will
consist primarily of crediting the appropriate accounts with cash dividends
received by the Fund and with the proceeds from the disposition of securities
held in the Fund and the proceeds of the treasury obligation on maturity and the
distribution of such cash dividends and proceeds to the Unit holders. The
Trustee will also maintain records of the registered holders of Certificates
representing an interest in the Fund and administer the redemption of Units by
such Certificate holders and may perform certain administrative functions with
respect to an automatic reinvestment option.
Generally, equity securities held in the Trusts may be removed
therefrom by the Trustee at the direction of the Depositor upon the occurrence
of certain specified events which adversely affect the sound investment
character of the Fund, such as default by the issuer in payment of declared
dividends or of interest or principal on one or more of its debt obligations.
Prior to the termination of the Fund, the Trustee is empowered to sell
equity securities designated by the Supervisory Servicer only for the purpose of
redeeming Units tendered to it and of paying expenses for which funds are not
available. The Trustee does not have the power to vary the investment of any
Unit holder in the Fund, and under no circumstances may the proceeds of sale of
any equity securities held by the Fund be used to purchase new equity securities
to be held therein.
Article 9-A of the New York Tax Law imposes a franchise tax on business
corporations, and, for purposes of that Article, Section 208(1)(d) defines the
term "corporation" to include, among other things, "any business conducted by a
trustee or trustees wherein interest or ownership is evidenced by certificate or
other written instrument."
The Regulations promulgated under Section 208 provide as follows:
(b) The term corporation include... any business conducted by
a trustee or trustees wherein interest or ownership is
evidenced by certificate or other written instrument.
(2) A business conducted by a trustee or trustees in which
interest or ownership is evidenced by certificate or other
written instrument includes, but is not limited to, an
association commonly referred to as a business trust or
Massachusetts trust. In determining whether a trustee or
trustees are conducting a business, the form of the agreement
is of significance but is not controlling. The actual
activities of the trustee or trustees, not their purposes and
powers, will be regarded as decisive factors in determining
whether a trust is subject to tax under Article 9-A of the Tax
Law. The mere investment of funds and the collection of income
therefrom with incidental replacement of securities and
reinvestment of funds, does not constitute the conduct of a
business in the case of a business conducted by a trustee or
trustees. 20 NYCRR 1-2.5(b).
New York cases dealing with the question of whether a trust will be subject
to the franchise tax have also delineated the general rule that where a trustee
merely invests funds and collects and distributes the income therefrom, the
trust is not engaged in business and is not subject to the franchise tax.
Burrell v. Lynch, 274 A.D. 347, 84 N.Y.S.2d 171 (3rd Dept. 1948), order
resettled, 274 A.D. 1073, 85 N.Y.S.2d 705 (3rd Dept.1949).
In an opinion of the Attorney General of the State of New York, 47 N.Y.
Att'y. Gen. Rep. 213 (Nov. 24, 1942), it was held that where the trustee of an
unincorporated investment trust was without authority to reinvest amounts
received upon the sales of securities and could dispose of securities making up
the trust only upon the happening of certain specified events or the existence
of certain specified conditions, the trust was not subject to the franchise tax.
See also Fibreboard Asbestos Compensation Trust (Advisory Opinion) Commission of
Taxation and Finance, TSB-A-97(3)(C) and TSB-A-97(1)I, January 21, 1997, CCH NY
St. Tax Rep.P. 402-649; and Petition of Richards, TSB-A-94(2)I, Commissioner of
Taxation and Finance, February 1, 1994, CCH 1993-1994 NY New Matters Transfer
Binder atP. 401-477.
In the instant situation, the Trustee is not empowered to, and we
assume will not, sell equity securities contained in the corpus of the Fund and
reinvest the proceeds therefrom. Further, the power to sell such equity
securities is limited to circumstances in which the credit-worthiness or
soundness of the issuer of such equity security is in question or in which cash
is needed to pay redeeming Unit holders or to pay expenses, or where the Fund is
liquidated subsequent to the termination of the Indenture. In substance, the
Trustee will merely collect and distribute income and will not reinvest any
income or proceeds, and the Trustee has no power to vary the investment of any
Unit holder in the Fund.
Under Subpart E of Part I, Subchapter J of Chapter 1 of the Internal
Revenue Code of 1986, as amended (the "Code"), the grantor of a trust will be
deemed to be the owner of the trust under certain circumstances, and therefore
taxable on his proportionate interest in the income thereof. Where this Federal
tax rule applies, the income attributed to the grantor will also be income to
him for New York income tax purposes. See TSB-M-78(9)(c), New York Department of
Taxation and Finance, June 23, 1978.
By letter dated today, Messrs. Chapman and Cutler, counsel for the
Depositor, rendered their opinion that each Unit holder will be considered as
owning a share of each asset of a Trust in the proportion that the number of
Units held by such holder bears to the total number of Units outstanding and the
income of a Trust will be treated as the income of each Unit holder in said
proportion pursuant to Subpart E of Part I, Subchapter J of Chapter 1 of the
Code.
Based on the foregoing and on the opinion of Messrs. Chapman and
Cutler, counsel for the Depositor, dated today, upon which we specifically rely,
we are of the opinion that under existing laws, rulings, and court decisions
interpreting the laws of the State and City of New York:
1. Each of the Trusts will not constitute an association taxable
as a corporation under New York law, and, accordingly, will not be
subject to tax on its income under the New York State franchise tax or
the New York City general corporation tax.
2. The income of the Trusts will be treated as the income of the
Unit holders under the income tax laws of the State and City of New
York.
3. Unit holders who are not residents of the State of New York
are not subject to the income tax laws thereof with respect to any
interest or gain derived from the Fund or any gain from the sale or
other disposition of the Units, except to the extent that such
interest or gain is from property employed in a business, trade,
profession or occupation carried on in the State of New York.
We hereby consent to the filing of this opinion letter as an exhibit to
the Registration Statement relating to the Units and to the use of our name and
the reference to our firm in the Registration Statement and in the Prospectus.
Very truly yours,
Winston & Strawn
