AUUSIN. -I3 78711 April 7, 1977

The Honorable Gibson Gayle, Jr. Opinion 80. H- 974 President State Bar of Texas Re: Whether non-lawyers -Austin,Texas 76701 may represent corporations 

### aa individualsat administrative

hearings of state boaxds aud agencies. :.

'. Dear Mr. Gayle:
You have requestedour opinion as to whether representation of corporationsand individuals by non-lawyersbefore the IndustrialAccident

### Board aa the State Board of Insurance constitutesthe unauthorized practice of law.

It is well establishedthat the purpose of laws land decisions prohibitingthe performance of legal servicesby non-lawvexs is to protect the public from unqualifiedpersons. Hexter Title 6 AbstractCo. v~Grievance &ttee, 179 m ~~(T~ac~ aevance thmaittee & De S.W.Zd 126 (Tex.Civ. App. -- Austin 1945, uo =+I %iele 430a of the Penal Code, repealed in 1949, defined various servkes as the practik o$,lqw and.prohibitednon-lawyers from rhm3ering such services. Prior to its repeal, several courts noted that the judiciarymay have the final **authority** to define -the

practiceof law, but failed .torule od the question and based their decisions,uponthe statute. Hexter Title 5 Abstract Co. v. Grievance Committee, aupra; Carr L 'Ee:al;l;iWF '310 (Tex. Civ. App. **--Ft.** Worthm3, In Carr, the court held that representation of persons &f&e the RaEad Commission in Rule 37 proceedings was not includedwithin the definition contained in article 430a and thus did not constitute the practice of law. The court noted the power of the judiciary under authoritiesin other states bu't

did not'apply any independent judicial examination to the services involved. However, in Grievance Committee v. bean, BUPrl)., an 90 S.W.ZdT3mex. Civ. App. -- w.0.m.), the court held that the definition of article 430a was not exclusive and that the judiciary retained the power to define the practice of law.

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. -- i li’ .I ” - - I. ,.. Y The HonorableGibson Gayle, Jr..- page 2 (R-974) *

Following the repeal of article 430a in 1949, the responsibilityfor defining the practice of law rested exclusively with the judiciary, although the Legislaturecould act in aid thereof to protect the public. Bryant v. State, 457 S.W.2a 72 (Tex.Civ. App. -- Eastlana 1970, wrE ref'd **n.r.e.1.** In Southern Traffic Bureau v. Thompson, 232 S.W.Zd 742 (Tex. Civ. App. -- San AntonioT950, writ ref'd n-r-e.), the court dealt with the a&ions of the Bureau in presentingand prosecutingclaims against rail carriers. The **court** held that the Bureau's activitiesunder agreements with shippers which gave the Bureau discretion to settle claims and accept settlementoffers constitutedthe practice of law. See also Quarles v. State Bar of Texas, 316 S.W.Zd 797 (Tex.G.- ApT R&~l~,~.writ). Rowever, the court held that various investigational proceduresdid not involve the practice of law and stated:

The rule limiting the practice of law

. . ; should not be extended beyond the requirements

of the comaongood. Southern haffic **Bureau** 5 Thompson, supra at 749. Thus, any decision concerningthe definitionof the practice of law should be based upon an analysis of the dangers apd benefits to the public. Of course, these factorswill differ dependingupon the substanceand nature of particularadministrativeproceedings. In some instances,federal law is relevant. reasons, See ;.&20 C.F.R. 404.971 (1976). For these

it wou impossible to answer-ageneral question conceru5xqthe representation of persons aud corporations before all state agencies. Accordingly,we will address only ~+hethe specific.agencies mentioned in your request, the Industrial

Accidentboard and the State board of Insurance. The Industrial

Accident **Board** was createdby the Legislatureto admgnister the State's Workmen's Compensation V.T.C.S. arts. 8306-8309h. In Sooth v. Texas "::B&liZ court explained: Em 

### i0 ers* InsuranceAssociation, 123-2r3ZZex.

[Ilt is apparent that the Industrial Accident Board is **not** a court but an adminietrative

body, that claims filed before.it are not pleadings, and that the presentation

or hearing of claims is not intended to be attended or governedby rules or formalitiesappropriateto trials in court.

p. 4055I

. .

The SonorableGibson Gayle, Jr. **page 3**  **m-974)**

. . . . .

It is importantto the successful perfonaance

of the duties of such administrativeagency and to the attainmentof the generalpurpose of the Workmen's Compensation

Law that the board be permittea to entertainand promptly decide claims submittedto it, unhamperedby unnecessaryformalityzna unrestrainedby the rules of pleading and evidence that prevail in the courts. It is often desirable that the~~injuria

employeebe able to file his claim for compensation **and** submit it to ~. the **board** without the assistance of'an attorney at law. g. at326.
The court further **noted that**  **the Board**  **was empowered**  **to make**  rules not inconsistent with law. Prior to 1975, article 8307, section 10(b) expressly rewgnized that nonlawyers might representparties before the IndustrialAccidentBoard, In the enactment of,Senate Bill 1010 by the 64th Legislature,the language 'theirattorneys or the duly authorizedagents of the parties,'was deleted from section 10(b). This could have been an inadvertant omission which was beyond the scope of the conferencecommittee's authority, since the languagewas in the bill as presented to the committeeand was not a subject of disagreement between the two houses. Senate Rule 96(a), SR4, Senate Journal, 64th Leg., p. 4 (11475); House Rule 25, section 8, HSR 12, Rouse Journal,Vol. 1, 64th Leg., p. 63 (11675). In addition, the deletionwas not accomplishedin accordance with the rules pertainingto amendment of existing **statutes;** that is, the phrasewas not bracketed and marked through as required by Joint Rule 22(c), SCR 17, Senate Journal, 64th p. 979 (42575). Accordingly, in our opinion, the %ion of this language from article 8307, section 10(b) was not a clear indication of an intent on the part of the Legislature to prohibitnonlawyers from practicing before the Board.
The Industrial

Accident Board has informed us that nonlawyers are permittedto representparties at prehearing conferencesand at hearingsbefore the Board. See Board -

P- **4056**.

The HonorableGibson Gayle, Jr. - page 4 (H-974)

Rule 5.080(b) [Texas Compensation **MdnUal).** They may likewise do so before the State Board of Insurance. Rule 059.01.04.008. (Rulesof Practice and Procedurebefore the State Board of Insuranceand the Commissioner of Insurance,.Dec. 31, 1975). This is not to say, of course, that a non-lawyer is required
or entitled to represent an individual in the same manner as an attorney is or that he may charge a fee for such representation. This has long been the practice in this state and neither the judiciarynor the Legislaturehas seen fit to alter it. As previously stated,any prohibitionof such representation by non-lawyersmust result from an assessment of the public welfare. In our view, the Legislatureand the agency involved are in the **best** positionto make such an assessment.
The settlementof claims by an insurance adjusterwas authorizedby the Statement of Principles approvedby the State Bar in 1946. 22 Texas Bar Journal 69 (1959). Similarly, in a meeting of members of the Unauthorized'Practice of Law Subcommitteeand insurance representatives

on November 5, 1976, a consensuswas reached that *activitiesof insurance adjusters and personsrepresentingclaimants at prehearing wnfe,rencesdo not presentany great problem or danger to the

. . . public at the present time" and that the appearance of non-lawyersbefore the IndustrialAccident Board and the InsuranceCommission *does not. of itself. constitute (the1 practice of law." See Carr <-Stringer, m See also m- Sooth v. Texas EmplGrnnsurance Association, supra, ~diEctheinformal nature of IndustrialAccident Board hekings:

In the many briefs filed with this office in this matter, there is no referenceto any detriment to the public resulting from representation **by** non-lawyers **before these**  **agencies.** In our view, such a showing should **be** made in order to disturb the long standing practice of the agencies. Accordingly, in our opinion , representationof parties before the State Board of Insuranceand the Industrial Accident.Board

does not constitute the unauthorized practice of law so long as such representationis permittedby the agencies and is not prohibitedby an act or decision of the Legislatureor the **courts.**

**We** are mindful of the case law of other jurisdictions which would in some instancespreclude representation before agenciesby non-lawyers. See Annot. 2 A.L.R.3d-724. the decisionsare not consxent; However, they.varywith the terms of the various statutesand the differing views of the

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The RonorableGibson Gayle, Jr. - page 5 (R-974)

public welfare on the part of the courts. See Eagle Indemnity Co. v. I.A.C. of California,18 P.2d 341 (Calf. 1933); Denver -- Bar Ass~o~v. Public UtilitiesCommission,(~ :9:2)467 TZlvoFFmeister v. ma, 349 s.w.za 

## 5

. ; Goodmanv. Beall, 200 N.E.T7mOhio 1936).

- SUMMARY Representation

of parties before the State Board of Insuranceand the Industrial Accident Board does not constitute the unauthorized

practice of law so long as such representation is permittedby the agencies and is not prohibitedby any act or decision of the Legislatureor the wurts. Very truly yours,

Attorney General of Texas

OpinionCommittee
klU1

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