The Attorney General of Texas 

December 13, 1979 

#ARK WHITE 

.ttorney General 

Honorable Geoge W. Streke, Jr. 

Seoretaq of State 

Office of the Secretary of State 

Austin, Texas 787ll 

Opinion No. MW- 9 9 

Re: Incorporation of local recording egen* life insurance agents, 

end physical therapists under the 

Texas Professional Corporation 

Act 

Deer Mr. Strekc 

You ask several questions regarding incorporation under the Texas 

Professional Corporation Act, V.T.C.S. art. l628e. Your first question is as 

followa: 

Can the Secretary of State approve ertkles of 

incorporation pursuent to the Texas Professional 

Corporation Act thet have es a purpose the authority 

to act es a local recording agent under the Texas 

Insurance Code? 

Article 2L14 of the Texas Insurance Code, which provides for the 

licensing of local recording agents, was emended by the sixty-sixth, 

legislature to permit iezuence of a license to “a Texas Cotporetion omenieed 

or existing under the Texas Business Corporation Act or the Texes 

Professional Corporetion Act. . . .” ins. Code art 2L14, S S(c)@ Acts 1979, 

66th Leg., ch. 800, et 2043. Prior to this amendment, a license for a locel 

recordng egent could be issued only to a colporetion organized or existing 

under the Texes Business Corporation Act (TBCA). Acts l969,6lst Leg., ch. 

225, S 3, et 668. 

A.cotporetion may not be ogenieed under the TBCA if it engages in 

eny activity which requires a license from the state end if a corporation may 

not hold such a licenma. Tex. Bus. Corp. Act. Ann., art 2.OlB(2). The 

learned professions could not, es a general matter, incorporate under the 

TBCA end this could not derive the tex advantages of doing business in 

corporate form. See Hell, Professional Incolporetion in Texas - A Current 

Look, 48 Tex. L.Ev. 84 (1969). ln 1969 the legislature enacted the Texas 

Professional Corporation Act (TPCA), V.T.C.S. art. l628e, effective 

January 1, 1970. The TPCA authorized the formation of corporations to 

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Honorable George W. Strake, Jr. - Page Two (NW- 99) 

render a “professional service,” defined as any personal service which cannot be rendered 

without obtaining a license and which could not legally be performed by a corporation 

prior to the passage of the TPCA. V.T.C.S. art 1528e, S 3. Corporations could be licensed 

as local recording agents prior to the effective date of article l528e, and thus the TBCA 

was the appropriate statute for fncolporation of local recording agents 

The recent amendment to article 2L14 of the Insurance Code permits issuance of a 

license to corporations organized under the TPCA for the purpose of acting as local 

recordng agents In our opinion, this amendment should be construed as an authorization 

for local recording agents to incorporate under the TPCA. In Attorney General Opinion 

M-551 (1970) this office construed the following amendment to the architecture statute, 

V.T.C.S. art 2494 as specifically authorizing the profession of architecture to be 

performed by a corporation: 

A firm, partnership or corporation carrying on the practice of 

professional engineering . . . may engage in the practice of 

architecture in this State. . . . 

Acts 1969, 6Jst Leg., ch. 802, S8, et 2360. This language was held to authorize the 

practice of architecture under the TBCA, despite language in the TPCA making that 

statute expressly applicable to architecture. V.T.C.S. art 1528e, S S(a); Attorney General 

Opinion M-551 (1970). See also R. Hamilton, Corporations end Partnerships, 24 SW. L. J. 

9L98 fl97OL Construed as authorization for incorporation of local recording agents under 

the TPCA, section 3(c)(l) of article 21.14 becomes en exception to the general proviso 

making the TPCA inapplicable to professions which could incorporate under the TBCA 

prior to 1970. In case of conflict between a general provision end a special provision 

dealing with the same subject, the former is contrdled by the letter. Trinity Universal Ins 

Co. v. McLaughlin, 373 S.W.%d 66 (Tex. Civ. App. - Austin 19631, reh. den., 374 SW.2d 

350, no writ Moreover, the amendment to article 2L14, as the more recently enacted 

statute, prevails in the event of conflict with earlier enacted provisions. State v. Easeley, 

404 S.W.Sd 296 (Tex. 1966). In answer to your first question, you are authorized to approve 

articles of incorporation pursuant to the Texas Professional Cotporation Act for 

performance as a local recorcing agent under the Texas Insurance Code. 

Your second question is as follows 

Can the Secretary of State approve articles of incorporation 

pursuant to the Texas Professional Corporation Act that have as a 

purpose the authority to act as a life insurance agent under the 

Texas Insurance Code? 

The sixty-sixth legislature emended section 4(d) of article 2LO7-1 of the Texas 

Insurance Code to allow the licensing as a life insurance agent of a corporation formed 

under the Texas Professional Corporation Act as well es one formed under the Texas 

Business Corporation Act. Prior to the enactment of the TPCA, corporations could not be 

licensed as life insurance agents See Acts 1955, 54th Leg., ch. 213, S 4(d), at 623. 

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Honorable George W. Strake, Jr. - Page Three (MW- 99) 

However, article 2L07-1 was amended in 1977 to allow the licensing of colporations 

formed under the TBCA. Acts 1977, 65th Leg., ch. 579, S 5, at 1428. Now the 1979 

amendment to article 2LO7-1 allows the licensing of corporations formed under the TPCA. 

In our opinion, the Secretary of State may approve articles of incorporation pursuant to 

the TPCA for the purpose of serving as a life insurance agent under the Texas Insurance 

Code. Service as a life insurance agent fits the definition of “professional service” under 

section 3(a) of article 1526e, V.T.CS. It cannot be rendered without obtaining a license, 

see Ins. Code art 2LO7-1, S 3, end prior to the enactment of the TPCA, it could not be 

performed by a corporation. Moreover, the reasoning relied upon in our answer to your 

first question also requires en affiimetive answer to your second question. 

Your third question is as follows: 

Should a corporation having as a purpose the authority to act as a 

physical therapist be incorporated under the Texas Professional 

Colporetion Act or the Texas Business Colporetion Act? 

When the TPCA was enacted, physical therapists were not required to be licensed in 

Texas and your office allowed their incorporation under the TBCA. Since January 1.1972, 

physical therapists have been required to be licensed by the Texas Board of Physical 

Therapy Examiners See V.T.C.S. art 45l2e; Acts 1971, 62nd Leg., ch 836, SS 8, 18, et 

2542. Your office in&s us that physical therapists have incorporated under both the 

TPCA and the TBCA. 

In our opinion, the Texas Professional Colporetion Act is the appropriate statute 

under which physical therapists should incorporate. The definition of “professional 

service” in the TPCA consists of two parts: (1) any type of personal service which cannot 

be rendered without obtaining a license and (2) which prior to the passage of the TPCA 

could not by reason of law be performed by a corporation. In our opinion, these two 

conditions are linked so that the second condition is premised upon the assumption that 

licensing was required of a particular profession prior to the passage of the TPCA. The 

professions listed as examples in section 3 of article l528e were all licensed professions 

prior to the enactment of the TPCA. See e. 

38, et 63 (attorneys); V.T.C.S. art 4la, s”” 

V.T.C.S. ah 30s; Acts J9l9,36th Leg., ch. 

8; Acts 1945, 49th Leg., ch 315, et 517 (certified 

public accountants); V.T.C.S. arts. 4548, 4548a; Acts 1919, 36th Leg., ch 31, et 50 

(dentists); V.T.C.S. art 7465a, S ‘I; Acts 1953, 53rd Leg., ch. 342, et 844 (veterinarians). 

We do not believe the second con&ion is applicable to professions which could be 

practiced without a license prior to the enactment of the TPCA. Therefore, the fact that 

physical therapists could incorporate prior to the enactment of the TPCA would not 

prevent them from incotporeting under that statute. 

Physical therapists may not now, in our opinion, incorporate under the TBCA. They 

are within the article 2.OlB(2) exclusion to that statute because they engage in an activity 

which requires a license and the license cannot be granted a corporation. An examination 

of article 4512e, V.T.C.S., indicates that a physical therapist license may be issued only to 

individual applicants and not colporetions. See SS 3, 8,13, 19. See also Attorney General 

Opinion H-442 at 5 (1974). Thus, they may nolonger be incorporated under the THCA. 

p. 308 
Honorable George W. Strake, Jr. - Page Pour @tW- 99 ) 

Your final question is as follows 

If a corporation may ba formed for a purpose authorized under the 

Texas Business Corporation Act, is the formation of a corporation 

under the Texas Professional Corporation Act for that same 

purpose necessarily prohibited by the Texas Professional 

Cotporetion Act? 

We believe that the TBCA end the TPCA were intended to be mutually exclusive 

when the latter statute was enacted In prior opinions, this office has treated them as 

mutually exclusive. Attorney General Opinion H-442 (1974) states as follows 

This Office has held that by virtue of these provisions, after the 

effective date of the TPCA, any profession except the practice of 

medicine can be incorporated end the services can be performed by 

a professional corporation- Attorney General Opinion No. M-551 

@370X The only question Is under which act may those engaged in a 

particular activity Incoiporete. 

The constmction of the TPCA which we adopted in answering your question concern@ 

the incorporation of physical therapists is based on the assumption that professions wllI be 

able to Incotporete under one or the other of the two statutes However, as our answers 

to your first two questions show, the TBCA and the TPCA are no longer mutually 

exclusive. The legislature clearly has the power to chqe the mutually exclusive 

character of the two statutes, and we believe it has done so in its amendments to the 

Insurance Code See w 187 S.W.2d 917 (Tex. Civ. App. - Austin, writ ref’d) 

(one legislature c=t bind its successors). In the absence of express language like that 

Included in the recent amendments to the Insurance Code, we believe the mutually 

exclusive character of the two statutes persists 

SUMMARY 

The Secretary of State may approve articles of incotporation 

pursuant to the Texas Professional Corporation Act that have as a 

purpose the authority ‘to act as a local recording agent or a life 

insurance agent under the Texas Insurance Code. Physical 

therapists may incotporete under the Texas Professional 

Corporation Act but not under the Texas Business Corporation Act 

The Texas Business Corporation Act end the Texas Professional 

Corporation Act are as a general matter mutually exclusive, but 

the legislature has acted to permit specific professions to 

incotporete under either statute. 

&gy;g * 

Attorney General of Texas 

P. 309 
Honorable George W. Strake, Jr. - Page Five (MJ+99) 

JOHN W. PAINTER, JR. 

First Assistant Attorney General 

TBD L. HARTLEY 

Executive Assistant Attorney General 

Prepared by Susan Garrison 

Assistant Attorney Qeneral 

APPROVED: 

OPINION COMMITTEE 

C. Robert Heath, Chairman 

David B. Brooks 

Bob Gammage 

Susan Garrison 

Rick Gilpin 

Tom Pollan 

Williem G Reid 

Nancy Ricketts 

Bruce Yow@hod 

P. 710