. .

April 7, 1971

Hon. James L. Slider, Chairman State Affairs Committee House of Representatives State Capitol Austin, Texas 78711

Dear Mr. Slider: Opinion No. M-831 Re: Validity of House Bill 442 of the 62nd Legislature, R.S. 1971, prohibiting members, employees and agents of the State Board of Insurance from receiving any compensation from an insurer doing business in Texas within six years after leaving his position with the State. Your request for anopinion asks whether the provisions of House Bill 442 of the 62nd Legislature, Regular Session, 1971, are valid, TheBill amends Article 1.09-3 of the Texas Insurance Code to read as follows:

"Article 1.09-3. "(a) All members of the State Board of Insurance, Commissioner of Insurance, and all employees and agents of the State Board of Insurance shall be subject to the code of ethics and the standard of conduct imposed by Chapter 100, Acts of the Fifty-fifth Legislature, Regular Session, 1957. "(b) Inaddition to the code of ethics and standard of conduct imposed bySubsection (a) of this Article, noperson subject to Subsection (a) mayreceive, within six years after leaving his position orjob with the Board, compensat;on from any insurer doing business in this state. Section 19of Article Iof the Constitution of Texas reads: "Sec. lg. Nocitizen of this State shall be deprived of life, liberty, property, privileges or immunities, or in any manner disfranchised, except -4025-Hon. James L. Slider, page 2 (M-831)
by the due course of the law of the land

.‘I The liberty of contract which includes the ccrrespcndir,: right to accept acontract proposed, is aconstitut~ionai right protected by the orcvisions of Section lo of Article 1of the Constitution of Texas, above quoted. In St. Louis Southwestern RY. co. v. Griffin, 1.06Tex. 477, 171 S.W. 703 

## (lgiqthe Supreme Court stated:

“The citizen has the liberty of contract as anatural right which is beyond the power of the government to take from him

. . (at p. 704). Weare aware that the freedom of contract may’be limited where there 

### arevisible reasons of public policy for the limitation and the right to contract while protected by Section 19of Article I is not anabsolute right and is subject to reasonable regulation in the interest of public welfare. International Brotherhood v. Huval, 140Tex. 21, 166 S.W.2d 10 ’1 (ir?rimri,i?ge v. HomeLife & A-c. Ins. Co., 246S.W.2d 666 (Tex.Civ.App. 1931, nowrit!- - It is therefore our opinion that the prohibitions contained in this Bill are violative of anindividual’s constitutional right of contract which is protected bySection 19of Article I:of the Constitution of Texas.

You are accordingly advised that the provisicns -f House Bill 442 of the 62nd Legislature, Regular Session, lr71, are unconstitutional, being in viclation of Section 19 zi’ Artile i of the Constitution of Texas, SUMMARY

--~- House Biil, 442 of the 62nd Legislature, R.S. 1971Iwherein it would prohibit all members, agents and employees of the State Board of Insurance from receiving compensation from any insurer witnir six years after terminating their official positio- cw:th the State violates Section 19of Article Iof the Constitution of Texas. Very truly yours, CRAWFORDC. MARTIN Attorney General of Texas

First Assistant -4026-Hon. James L. Slider, page 3 (M-831)

Prepared byJohn Reeves Assistant Attorney General APPROVED: OPINIONCOMMITTEE Kerns Taylor, Chairman W.E. Allen, Co-Chairman Jay Floyd James Quick Wardlow Lane Ivan Williams MEADEF. GRIFFIN Staff Legal Assistant ALFREDWALKER Executive Assistant

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