DAN MORALES

ATTORNEY CENERAL 

### @ffice of tfje Rlttornep QBeneraI Qtate of ZEexae November 26,199l Mr. William Treaty Executive Director Opinion No. DM-457 Texas State Board of Public Accountancy 333 Guadalupe, Tower III, Suite 900 Austin, Texas 78701-3900 Re: Whether state indemnification and defense in certain legal actions pursuant to chapter 104 of the Civil Practice and Remedies Code is available to a volunteer performing services for Mr. Wayne Scott Executive Director Texas Department of Criminal Justice P.O. Box 99 Huntsville, Texas 77342-0099 a state agency (RQ-905)

Dear Gentlemen: Civil Practice and Remedies Code section 104.001 requires the state to indemnify those individuals listed in that section for damages, court costs, and attorney fees if the damages are premised on an act or omission that occurred during the individual’ s service to the state. Section 104.004 requires the state to defend those same individuals. Section 104.001 does not list volunteers. You both ask whether the state must indemnify and defend a volunteer’ who provides services for your agency if a civil action is brought against him or her for an action performed in the course and scope of the voluntary services? The Department of criminal Justice inquires generally about volunteers who provide services for it,3while the Board of Public Accountancy asks about its constructive enforcement volunteers, who assist the board with investigations. Because vohmteers are not among those individuals listed in section 104.001, we conclude that they are not entitled to indemnification from and legal representation by the state.

‘See Gov’tCode5 2109.004(a) (listing reqtdmments

to whichstate

agenciesthat

wish to establish

a volunteer progl-anl mustadhere).

‘Attorney

General OpinionDM-173(1992) concludesthatsection 101.063of the Human Resources

Code accorded i

nummity from liability to volunteerombudsmenin the Texas Depqent of Aging long-termcare ombudsman

program forthegood-faith

performance

of theirfi~~c.tions

as volunteers,

andAttorney

General Opinion DM-206 (1993) concludes that this statute

also applied

to interns in the volunteer

ombudsman

prognun ‘Il~ese

two opinions address a specific pmvisii of theHuman

Resources

Codeadopted

to complywitha federal

requirement,

and theydo not address

tbequestion

of immunity

forvolunteers

in general.

‘See Gov’tCode.

5 501.009 (requiring

Department

of Criminal

Justice to encourage

volunteer organizations to provide

various programs forinmates).Mr. William Treaty - Page 2

Mr. Wayne Scott (DM-457)

The executive diitor of the State Board of Public Accountsncy also asks whether a constructive enforcement vohmteer may claim an absolute or quahtied privilege if the volunteer is sued for defamation for his or her official work. We conclude that, in appropriate circumstances, the volunteer may claim one or the other. We will consider first your questions about the extent of Civil Practice and Remedies Code chapter 104. Section 104.001 of that chapter requires the state to indemnify certain individuals for damages, court costs, and attorney fees:

In a cause of action based on conduct described in Section 104.002, the state shall indemnify the following persons, without regard to whether the persons perfoned their services for compensation, for actual damages, court costs, and attorney’ s fees adjudged against: (1) an employee, a member of the goveming board, or any other officer of a state agency, institution, or department; (2) a former employee, former member of the governing board, or any other former officer of a state agency, institution, or department who was an employee or officer when the act or omission,

. . occurred, (3) a physician or psychiatrist

. . . who was performing services under a contract with any state agency, institution, or department or a racing official performing services under a contract with the Texas Pacing Commission when the act or omission.

. . occurred; (4) a person serving on the governing board of a foundation, corporation, or association at the request and on behalf of an institution of higher education,

. . . , not including a public junior college; (5) a state contractor who signed a waste manifest as required by a state contract; or (6) the estate of a person listed in this section. [Emphasis added.] Section 104.002 limits indemnification to damages based on sn action or omission committed in the course of the individual’ s service to the state, with certain qualifications irrelevant here4 Any public

‘An appropriation

to pay a claimunderCivilPractice and Remedies

Codechapter 104is to be madehm otherwise unappropriated

amounts in a special

fundoranaccount

that maybe appropriated

to theaff&ed state

agency, to the extent Ihat tends are available. Id. $5109.002(b),

003, ,007(excepting

certain claims hm chapter

109). Iffunds are unavailable,

the appropriation

maybe madefromthe general revenue fund. Id. $109.003.

Thecomptroller

will (continued...)
p. 2557Mr. William Treaty - Page 3

Mr. Wayne Scott (DM-457)

s-t who is entitled to indemnification under sections 104.001 and 104.002 similarly is entitled to be defended by the attorney general? To conclude that a volunteer is entitled to indemnification under section 104.001, we must interpret the section in one of two ways: either the list of positions numbered (1) through (6) is exemplary and not exclusive, or one of the listed positions includes volunteers. Because you ask about vohmteers whose service fits under none of the listed categories except perhaps employee, we will consider only whether the term “employee” in section 104.001( 1) enwmpasses volunteers6 We believe the section’ s plain language precludes either conclusion. Because we find the language clear, we need not rely on legislative history to determine what the legislature intended the section to mean. ’ We first conclude that section 104.001 provides indemnification to only those individuals explicitly listed. A statute that creates an entitlement and designates the individuals who may claim the entitlement should be wnstrued restrictively to infer that any individual not expressly described is excluded* unless the statute clearly states the wntrary.9 Section 104.001 contains no language clearly stating the contrary, nor does it imply that the class of positions entitled to indemnification is broader than those positions specifically listed. The section does not, for example, require the state to indemnity those public servants including those listed. Similarly, the section does not suggest that the listed positions are described as an example. Nor does the list establish a seventh, open-ended category indemnifying, for example, any otherpublic servant. Second, we do not believe the term %mployee” includes volunteers, even though the section refers to individuals who are not compensated for their service to the state. This office refused in

‘ (...wtltiilued) reduce theappmpdion forthestate agency in s.n smount notto exwed $S,ooO

perclaii orfivepercent

of theagency’s appmpriation

forthatf=cal yearforall claims. Id 5 109.004. 'Id. 5 104.004(a). 6We do notconsider

in thisopinion

whether s state employee is entitled to indemnification

andrepresentstion foran act01omissioncommitted in the course

of volunteer

work.

‘SeeBoykin

v.St&e, 818 S.W.Zd

782,785-86a.4 (Tex.Grim. App. 1991)(explaining

that, despite Govemmnt Code’s invitation to extie legislative

history regardless

of statute’s

clarity, courtgenerally

shoulddeclineto do so where language of statute in question

is unambiguous);

Lumbermen's

Undenwiterr

v. State Bd ofIns., 502

S.W.Zd 217, 219 (Tex. Civ.App.--Austin1973,writrefd n&e.)(citing53 TEX. JUR. 2~ Statutes

$ 125, at 182 11.17)

(stating that, whenleg&law plainly

hasexpressed

itsintent in statute’s

language, intent mustbe effectuated

withoutattempting

to conshue or interpret

law). 'See Bidelspach

v. State, 840 S.W.2d 516,518 (Tex.App.-Dallas 1992).writdism'd, 850 S.W.Zd183 (Tex. Grim. App. 1993) @a cwiam); ~ANORMAN J.SINGER,

STATUTES

AND STATUTORY

CONSTRUCTION

5 47.23 (5thed. 1992). ?k 2A SINGER,

supranote8, g 41.23.
p. 2558Mr. William Treaty - Page 4

Mr. Wayne Scott (DM-457)

Attorney General Opinion DM-409 to construe Health and Safety Code section 777.007, which requires the state to indemnify under Civil Practice and Remedies Code chapter 104 %n employee” of a regional poison control center, to require the state to indemnity a regional-poison-control-center vohmteer.“’ In that opinion, we distinguished an employee from a vohmteer on two bases: employer control and an express or implied contract for compensation.” An employer has control over an employee, but little over a volunteer. I2 In addition, an employee has an express or implied wntract for wmpensation with the employer, while a volunteer has no such contraw” We believe the same rationale applies here. Our wnstruction of section 104.001 does not render the phrase “without regard to whether the persons performed their services for compensation” meaningless, although our conclusion necessitates a finding that an employee cannot be uncompensated. In our opinion, the phrase refers, at the least, to board members, officers, and former board members whom the state must indemnify. We understand from one of the briefs we received on this issue that individuals serving as board members and officers generally are not compensated for their services, and evidently this fact caused confusion as to whether an individual must be compensated to be entitled to indemnification and defense. The smendment thus rectifies this incongruity and “clearly indicates that board members and former board members sre entitled to indemnification,

. . . whether or not they perform their services for monetary wmpensation.“r4 Finally, with respect to your joint question, because a volunteer is not entitled to indemnification from the state under section 104.001, a volunteer is likewise not entitled to the attorney general’ s defense under section 104.004. We turn now to the additional questions posed by the executive director of the State Board of Public Accountancy regarding the board’ s constructive enforcement vohmteers. Under the board’ s direction, wnstructive enforcement volunteers are asked to do various investigative tasks including: (1) on-site investigations;

“‘Attorney

General OpinionDM-409(1996) at6-7. “See id. at 4-6.

‘ *See id at 5 (citiagHaavzktola v. Community

Fire Co., 812 F. Supp. 1379, 1386(D.C. Md.),rev’don other ground.~, 6 F.3d211 (4th Ci. 1993)). “Id. at 5-6. “Letter fromDelmar

Caii General

Counsel,The TexasA&h4 University

System,to SarakShirley, Chair, Attorney Gerteral OpinionCommittee

(Oct.23, 1996)(on tile with the OpinionCommittee, Of&x of theAttorney General).

p. 2559Mr. William Treaty - Page 5

Mr. Wayne Scott (DM-457)

(a) taking photographs, (b) obtaining statements; (c) gathering evidence such as letterhead or business cards; (2) locating witnesses; (3) making telephone calls to verify compliance with the Act, the Rules and Board Orders; (4) testifying at administrative hearings; (5) reviewing contimting professional education sponsors’ courses; and (6) carrying out other investigative tasks, as needed. The executive director inquires whether sn absolute privilege against a suit for defamation would apply to its constructive enforcement volunteers. Chapter 73 of the Civil Practice and Remedies Code defines defamation as follows:

A libel is a defamation expressed in written or other graphic form that tends to blacken the memory of the de& or that tends to injure a living person’ s reputation and thereby expose the person to public hatred, contempt or ridicule, or fmsncial injury or to impeach any person’ s honesty, integrity, virtue, or reputation or to publish the natural defects of anyone and thereby expose the person to public hatred, ridicule, or financial injury. [Footnote added.] There is an absolute privilege for communications in the due course of ajudicial proceeding made by thejudge, jurors, counsel, parties, or witnesses.t6 Such communications will not serve as the basis of a civil action for libel or slander, regardless of the negligence or malice with which they are made.” The privilege attaches to all aspects of the proceedings, including statements made in open court, pre-trial hearings, depositions, affidavits, and any of the pleadings or other papers in the

‘sRecovery

maybe had fordefamation of the deadonly uponproofof irju$ to the reputation of theperson by or forwhomthe actionis brought. Renfio Drug Co. v. Lawson, 160 S.W.Zd 246,250 (Tex. 1942). ‘4/ames v. Brown, 631 S.W.Zd 914,916-17 (Tex.

1982); Reagan v. Guardian Life Ins. Co., 166 S.W.Zd

909, 912 (Tex. 1942). “Jamq 631

S.W.Zd at916-17;Reagan,

166 S.W.Zd

at 912. p. 2560Mr. William Treaty - Page 6

Mr. Wayne Scott (DM-457)

case.” The privilege barring defamation suits applies to proceedings before executive officers and boards and commissions that exercise quasi-judicial powersJ9 Also subject to the absolute privilege are out-of-court communications made by attorneys preliminary to ajudicial pmceeding or in connection therewith, if the statements relate to ajudicial proceeding in which the attorney is employed and are in lktherance of the representation?o In a suit for damages instituted by a woman who was involuntarily hospitalized upon the application of her son and daughter, the Texas Supreme Court held that reports by three psychiatrists to the probate judge in the mental health proceedings were absolutely privileged?’ A letter by one of the psychiatrists to the attorney for the plaintiffs children was also within the privilege because it was written in contemplation of ajudicial proceeding. ‘2 Accordingly, we believe that the constructive enforcement volunteers would have an absolute privilege against a civil action for libel or slander for statements made as witnesses in a quasijudicial proceeding before the State Board of Public Accountancy and for communications preliminary to a proposed proceeding in which the volunteer will testify, if the communication has some relation to the hearing.” Whether a preliminary communication is related to the proceeding is a question of law, to be determined by considering the entire communication in its context.”

‘sJames, 637 S.W.2dat916-17. ‘9Reagan, 166 S.W.Zd

at912 (Board

of Insurance

Commissioners);

Putterv.Anderson,

601 S.W.Zd

73.76 (Tex. Civ.App.-Dallas 1980,writnf d n.r.e.)(internal affairs division of citypolicedeparhnent

wheninvestigating citizen’s complaint

about policeofficer);

see also Odeneal

v. Woffoni,

668 S.W.Zd

819,820 (Tex.App.-Dallas 1984, wit ref d n.r.e.)(St&z

BarGrievance

Committee). ~Rtmell v. Clark, 620 S.W.M865,869 (Tex.Civ.App.-Dallas 1981,wit refd me.); see also Odeneal, 668 S.W.2d at820 (privilege

applies to letter written by attorney

whois subject

to grievance

proceeding).

Thequestion

of therelationship

ofthedefamatory

matter toa judicial proceeding

is a question

oflaw,to bedetermkd by theCOIUI by considering

theentire emmum ‘cation initscontext

andextending

theprivilege

to any statement

thatbears some relation to ajudicialpmceediag.Russell, 620 S.W.Zd at 870. “James, 637 S.W.Zd at91617. 221d. at 917. TheJames

courtdescribed

the scope of theprivilege

for matters

written in contemplation

of a judicialproceeding:

A wi!ness is absolutely

privileged to publishdefanmbxy

matter concerning

another in communications

preliminary

to a proposed

judicial proceeding

or as a:part of ajudicial proc&iig in which

he is testifying,

if it has some

relation to theproceeding. Id. (quoting**from** THE **RESTATEMENT** 2~ OFTORTS $! 588 (1981)). “Id. uRwsell, 620 S.W.2dat 870.

p. 2561Mr. William Treaty - Page 7

Mr. Wayne Scott (DM-457)

You also ask whether a conditional or qualified privilege might be available to constructive enforcement volunteers in defamation suits. This privilege applies to bona fide communications, oral or written, made in good faith on any subject matter in which the author has an interest or with reference to which he has a duty to perform, to another person having a corresponding interest or duty.rr It does not change the actionable quality of the words published, but merely rebuts the inference of malice that is imputed in the absence of privilege and makes a showing of falsity and actual malice essential to the right of recovery.26 The communication of alleged wrongful acts to an official authorized to protect the public from such acts is protected by a qualified privilege.27 In our opinion, a constructive enforcement volunteer acting at the direction of the State Board of Public Accountancy or of paid employees who supervise volunteers would have a sufficient interest in the work of the board to invoke this privilege for communications to the board or to employees that have a corresponding interest or duty with respect to the substance of the communication. Whether this privilege would apply in a particular situation must be decided in light of all the facts and circumstances. We wish to emphasize that the privileges we have discussed apply only to utterances that are made the basis of a subsequent suit for libel or slander. zs An action taken by a witness may be the basis of a civil suit on other grounds, even though it is the subject of the witness’ s testimony fin a judicial or quasi-judicial proceeding. 29 Communicating investigative fmdings to the board and testifying at hearings are only two of many tasks that constructive enforcement volunteers might perform for the board. Causes of action other than an action for defamation might arise out of a volunteer’ s other activities on behalf of the board?”

%ay@ld v. Gleichert,

484 S.W.Zd

619,625 (Tex. Civ.App.-Tyler 1972,no wit). ‘6rd. at 626, 27.Zzrafe v. Corfinm, 553 S.W.Zd 652,655 (Tex. Civ. App.--Corpus Christi1977,no wit) (accusation filed with sheriffs office accusingdeputy countyclerk

of unauthorized

loanof countyequipment). “Charter Med.Corp.

v.Miller, 605 S.W.Zd

943,953 (Tex. Civ.App.--Dallas 1980,wit ref d n.r.e.). *9James, 637 S.W.Zd at 917-18 (defamation

actioncannotbe basedon do&s communication to ccnuiof diagmsesofplaintiffs mental condition, butdiagnoses

themselves

maybe actionable

on other grounds, suchas medical malpractice).

‘We.do notlmowtheFidel

extent of the services

performed

by constructive

enfonxment volunteers,

because, as the. executivedirector

of the Boardof PublicAccountancy informsus, theirserviceincludes“carrying out other investigative

tasks,as needed.”

p. 2562Mr. William Treaty - Page 8

Mr. Wayne Scott (DM-45 7)

SUMMARY A person who serves a state agency as an unwmpensated volunteer is not entitled to indemnification against actual damages, court costs, and attorney fees adjudged against him or her under the circumstances described in section 104.002 of the Civil Practice and Remedies Code. Likewise, a volunteer is not entitled to be defended by the attorney general in suits subject to chapter 104 of the same code. Constructive enforcement volunteers who assist in investigations for the State Board of Public Accountancy would have an absolute privilege against a civil action for defamation for statements made as witnesses in a quasi-judicial proceeding before the board. They would have a conditional or qualified privilege against a defamation suit under appropriate circumstances. The conditional or qualified privilege applies to bona fide wmmunications, oral or written, made in good faith on any subject matter in which the author has an interest or with reference to which he has a duty to perform, to another person having a corresponding interest or duty. The absolute and conditional privileges apply only to a defamation suit and not to other causes of action that might arise Out of a volunteer’ s activities on behalf of the Board of Public Acwuntancy.

DAN MORALES Attorney General of Texas JORGE VEGA Fit Assistant Attorney General SARAH J. SHIRLEY Chair, Opinion Committee Prepared by Susan Garrison and Kymberly K. Ohrogge Assistant Attorneys General

ps 2563