Court Opinion

ID: 4145436
Source: CourtListenerOpinion
Date Created: 2017-02-18 03:56:42.880333+00
Date Added: 2024-06-11T14:49:37.990974
License: Public Domain

OFFICE     OF THE   AlTORNEY     GENERAL      OF   TEXAS        y

                                      AUSTIN

~gRALDc.
       MANN
 A---r

        Hoaorabls TomL. Beauchqp
        sooretery of .stete
        Austfn, Texan

       'D8ar sir:

                     out hne

                                                malt' wina grente& oa
                                                 lw?, end perlitltt4
                                                uot or transaot the

                                       agent   for   the   performawc,   dr

                           he C T Corporation Symtuadaily presents
                    to this oitioo through the United 9tates md.8
                    applications, together rLth al;l acmmpaaylqg
                    pfwr~, of forslgn oorparetfone to do businms
                    In the StAta of TWYUJ.     Aoaoarpanying tha appl,i-
                    oations and the eu~portfapg   papers ie a letter
                    from the C T Corporetlon 6ystaP advising thilr
Honorable   Tom L. Beau&amp,   Page 2

            offioe that 'et the lnntnaoe and request of
            the law firm of Doo and Roe of Blank City,
            u. S. A., the following papers are presented
            to your ofrioe.*

                 *The writer is of the opinion that the
            C T Corporation Syrtem seeks to aonduot thla
            business under Artlole 13C2, Sootion 49, whiah
            provides as follower

                 "*For any one or store or *he rollowing
            purposes:  To aoouatulate and lend leoney, pur-
            ohese, sell and deal in notes, bonds and
            securities, but without banking and dlaoount-
            ing privileges; to aot as trustee under any
            lawful express trust oodtted    to them by
            contract and as agent for the performanoe or
            any lawful sot.’

                 "Artlole lSZ4a proridae that oorporati&
            organized under Seotion 49 ahall be sub&of to
            oertaln regulations whioh are oontained in
            Saotlon 1 to 10, lnolu8lvo, oi said Artiole
            1524a. The C T Corporation System has ooak
            plied wfth all the requirements set forth in
            said Artlole.

                 "This orfioe has bad presented to it an
            epplloatlon for oharter for a domestie eorpo-
            ration whioh states that the purpose for whloh
            said proposed corporation is formed Is 'to aet
            ea agent for the perfomanoe  of any lawrul act
            such as to assist members of the bar In organi-
            zation, reorganization, qualirioation and repre-
            sentation of oorporations including notifioatlon
            service and generally sating in a statutory
            oepaaity rot oorporetfone*.  You will riots that
            this is the ldentloel language used to grant the
            C T Corporation System Its permit to do business
            in the State of Texas.

                 "The following questions present themselves
            end this Department wiehes to request an opin-
            ion from you on them:
,Eonorable Tom L. Beeuahemp, Page 3

               “(1) Ia the C T Corporation System, under
          Its purpose olause, authorized to fender the
          eerx!loes outlined above?

               Y(E) Does the drawing end filing of appll-
          OatiOAe for ;?crmits t0 do buslnese iA Texas OA
          behalf of rorew     OOrpZtItiOAf3, at the instance
          end requed of members of the Bar of forelga
          etetea , ,OOAStitute the praotice of law?

               “(3)    If  you have  stated that It does oon-
          stltute the praotloe of law, 1s suoh preotloe
          of lnw unlawful eAd in violation of iirtlale 430a
          oi the Penal    Code of Texas?

               “(4) Would this offloe be authorized to
          grant a ohartcr to a do!xestlc aorporatlon having
          the ebove referred to Furpose olause?

               w(5)  If you have answered thiit this offloe
          would be authorkzied to $raAt a oharter to eald
          oorporetlon, would it be authorized to render
          the same servloee for attorneys as the C T Cor-
          poration System Is now rendering wlthout being
          in violation of hrtlole 4SOa of the Penal Code?

               “(6) Xould said domektio oorporatlon be
          authorized to prepare end file applications for
          perzilts to do bualnecm in the Stat3 or Texas ror’
          oorporatlone, and if it would be 80 euthorlzed,
          would the rendering of said service be in vlola-
          tlon of Xrtlole 433~ of the Penal Code?”

          Article 430e of the Penal Code reads es Tallows:

               “.5x. 1. It shall be unlawful ‘for any oor-
          poratlon or any person, i&m, or assoolatloA of
          persons, emept natural persona who em members
          of the Bar regularly admitted and lioenaed, to
          praatlce lsw.

               Y%C. 2., Zor the purpose ot this ir6t, the
          practice of lew is defined as followsr Whoever
          (a) In a,repreeentntive capeoity appears as aA
          advoazte or drau,a papcrs, pleadlnge, or doouments,
Ronornble   Tom I.. Beauohamp, Page 4

            or perSome any act In oonneotiol; with prooeed-
             1~s peAdin& or prospeoClve berore a Oourt or
            e justloe of the peaoe, or a body, board, oom-
            mlttee, 00~it1118610~or.otrloer oonstituted by
            law end having authority to take evidence in
            or settle or determine oontroveraiea     in the ex-
            erclse of the judlolel power of the Steto     or
             subdivision thereoft or, (b) For a oonsidera-
            tion, rewerd or pecuniary beAeflt, present or
            antlolpeted, direct, or lodlreot, advises or
            oounsels  another as to eimular law, or draw4
            a paper, dooment or instrument affeoting or
            relating to seoulm right*; or,       (0) For P
            oonslderatlon, reward, or peouniary benefit,
            present or ontlolpated, dlreot or indlreot,
            does any act lo a regresmtatlve      oapsolty ia
            behalf of another tfiAdIAg to .obtain or aeoure.
            Sor auoh othsr the prevention or the redrew
            of a wrong or'the etioroement or establlsh-
            ment of a right; or, (d) For a ~OOAeid8retiOn,'
            dlreot or lndlreot., gives .4A opinion 48 to
            the valldlty of the title to real or personal
            property, or (8) ks e voo6tIon. entorees, 400
            cures, settles, adjuste,or compromises de-
            fauLted, oontroverted or disputed aooouAts,
            olalms or demands between persona with Aeither
            of whom he la tn prlvity or in the relation of
            employer end employee in the ordinary sense;
            1s praotlolng law. Nothing in this section
            shall be construed to prohibit any psrsoA,
            firm, assoclatlon ok oorporatlon, out or oourt,
            from EtteAdfIIg to and caring f'or his or its
            OWA buaine:s,   olalms  or demands, or the olaim4,
            demands or traffic business ot said oorpora-
            tion or of the indiVidtl31 members of said oor-
            poratlons or aesoaiet~oAs;     wzir from preparing
            abstraots of title, aertlf:~ing, guaranteeing
            ,or lcsurlnp- titles to property, real or per-
             sonal, or an intareat therein, or a lien or
            encumbrunae thsreon, nor shall aAythlng in
            this section be oonstrued as prohlbItlAg Amy
            back or trust aoqnny     wlthout resorting to
             aourt a&ion from aotlng Zor.lts oustomsr      In
             eniorclng, seo@.Ag, settling or eddusting
            any ltam mentioned in subdivision (8) above,
Honorable Tom L. Beauohagp, Page S

          nor ah,!11 anything ln thlie section prohibit any
         person or a%0ooIation of persons from puraulng
         as a vocation the buainesa of adjusting lnsur-
         ame or freight rate olalme; provlded'further
         that nothing in this Aot ahnll prohibit any
         person or assoalatlon of parsons from appearing
          b&ore     any Board, Comlealon  or AdmInistrative
         body in oonneatlon with their voaatlon of ad-
          justing Insuranoe or Jkel t Rate alelms; pro-
          vlded.that subdlvlslon (e? hereof shall not pro-
         hlblt any ludlvlduel~~~;company, odrporatlon or
         assoolatlon, owning, operatlug, managing or aon-
          trolling any oolleotlng egomy, oommerolal agenay,
          or commerolal reporting credit agenop within this
          State, subjeot to an oooupation tax under Artiolr
          7001, Chapter 2, Title 122, Revised Civil Statute%
          1925, or Texas, rrom ruxmlshlng report% and ool-
         leotfng, eeourlng, settling, adjustine or aom-
         .promlslng, out 0r oourt, defaulted, controverted
          or disputed aooounts or olalxw growing out ot
          oontraotual    relations, provlded,that said lndl-
          iiaual, aompany, aorporatlon, or aseooletlon, oom-
          @lies with the above etatute; and provided fur-.
          ther that nothing in this Aot shall be ooestrued
          as prohibiting real estate agents from aolleat-
          lng rent% for their employer%;     provided that
          nothing herein shall prevent ,Notariea Publio
          ;~yorawIng      oonveyanaea ror or without aompef-
                   .

               "SEC. 3. It shall be unlawful for any oor-
          poratlon to practloe law as derlned by thla Aot
          or to appear as an attorney ror a@ person other
          than ltselr in any oourt, in thie State, or before
          any judicial body or any board or oomiaisslon of
          the state oP..Texa%; or hold ltselr out to the
          pub331 or advertise a% being  entitled to praotlas
          law; and no oorporatlon shall prepare oorporate
          oharters or amendment% thereto, or other legal
          doouments no$ relating to Its authorized busl-
          nes%, or draw wills;  or-hold kt%elf out ln any-
          manner dlreotly or lndlreatly as bekg %ntItled
          tp do eny or the foregolns aota; provided,
          that the foregoing shall not prevent a oorpora-
          tion, person or assoolatlon of person% rrom
Honorable   Tom L. Beauohamp, Page 6

            8mpLoyfng an attorney or other ag%nt or repre-
            sentative In regard to its o%,n affair% In any
            hearing or Investlgatlon berore any admlnl%-
            tratlve orrlolal or body.

                    "Provided, further, that the above prwl-
            slons of tbls Aot shall not be oonstrued to
            prohibit a person or corporation aotlng in a
            tlduclarf capaolty from transacting the neoe%-
            aary olerloal busineea Inoldental to the
            routine or usual administration of estate%,.
            trust%, guardianships, or Other slmllar ildu-
            clary capaoltles, or riling aooount9, prepar-
            ing and tlllng tax returns of every nature,
            and other such admlnletrative'acta, nor from
            partlolpatlng through his or Its own agent
            or attorney, in oooperatlon with testator's
            attorne-7,   In the preparation ot teatator's
            will, where no oompeneatlon 1s oharged for
            suoh servlae and no aompensatlcn whatever is
            charged or reoelved, other than the ueual
            commission allowed by the aourt ror admIni%-
            terlng the estate or trust, or provided for
            by the lnetrument oreatlng the trust or other
            rldualary relationship.

                 WAnd provided, further, that nothing here-
            In shall prohibit any Insurance company from
            causing to be defended, or proseauted, or from
            offering to aause to be defended, through law-
            yers of Its own seleotlon, ths lnsureds or
            assureds in polloiea issued or to be issued by
            It, lo aooordanoe with the terms of suoh poll-
            cIes;l and:shall not prohibit one suoh lloensed
            attorney at law rrom aotlng ror several como5
            c;:rrlers or,other oorporatlone and a%%oalatlone
            or any of It% subsidiaries pursuant to arsange-
            ment between eald oorporatlons or assoolations.

                 "SEC. 4. It ahall be unlawful for any at-
            torney at law io share any fee or ie%a earned
            or received by him for legal servloea with any
            person or firm, not a licensed attorney or at-
            torneys, or with any asaooIatIon or oorporatlon.
Honorable Tom L. Beauchamp, Page 7

               "SEC. 5. The oounty attorney and/or Dle-
          trlot Attorney and/or Crlmlnal Dlstrlat At-.
          torney of any oount? In Texas shall on his ow5
          Initlatlve or upon the applloation of a5y Bar
          Assoalation In~the State of Texas bring mob
          aotlon in the name of the State of Texas in the
          proper aourt to enjoin a5y suah person, oorpora-
          tlon, or assooIatlon or persons rrom vlolatlng
          any of the provisions of this Aot, and It %hell
          b% the duty of the aountg attorney% and/or
          Dlstrlot Attorney and/or Criminal Dlstrlat At-
          torney of this State to rile aomplainte In the
          proper court agalnrrt any person, oorporatlon,
          or assoclatlon of person% upon the reoelpt oi
          Intormatlon or the violation or any or the
          provisions or this Aat.

               wse. (1. Any person, rirm, aorporatlon, or
          association of persons vlolatlng anyof the pro-
          visions of this Act shall be guilty or a tie-
          demeanor.  Ir any provision or this Aot Is via-
          latad by any person lndlvldually or by any person
          or persons representing a aorporatlon, or a9so-
          elation, or by a'aorporatlon, the defendant or
          defendants upon oonvlation shall be pirnishod by
          a rlne of not more than Firs Hundred ($500.00)
          Dollars nor lees than One Hundred ($lO(!.OO)
          Dollars.

               "SEC. 7. by agreement by any person, oor-
          poratlon, or assoolatlon In violation of this
          Act shall be illegal and such person, aorporatlon,
          or essoolatlon shall not be able to reoover for
          any services rendered in violation of this Aot,
          either on the contraat or a quasi-aontraatual
          obllgatlon.   Ii any person, oorporatlon, or eei-
          soaiatlon of persons shall, by any eot or 01&s-
          ~105 in violation of this Aot, aause any loa%,
          damage, or Injury to any person, oorporatlon or
          assoolatlun of persons, suoh person, oorporation,
          or aesoaloU.on of perf.ona, shall be liable in
          actual damages therefor to any person, oorpora-
          tion, or assooiatlon of persons who sustained
          any suoh loss, damage or injury; and suoh lla-
          blllty ahall be absolute and not dependent upon
          any queetlon or showing of want of &kill, oare
          or UIlIgeno%.
Honorable Tom L. Deauohamp, Pag% 8

               “SEC. 2. All laws and parts or laws In-
          aonslstent herewith are hereby repealed, and
          in oass sny seation, subdlvlslon, paragraph,
          or sentence of this Aot 1s deolared umonsti-
          tutionr:J the validity of the,,rest of this Aat
          shall not be affeoted thereby."

           SeotIons'48, 49, and 50 of r.rtlole 1302, Revised
Cloll.Statutes; read as follows:

               "48. To aaoumulate and lend moneywlth-
          out bankinG or dlscountlng privilege%.

               "49. For any one or more of the rollorr-
          Ing purposes: To aooumulate and lsnd PIoney,
          purahaae, sell and deal 15 note!, bonds and
          seourltles, but without banking and dlsoount-
          lng privileges;  to aot a8 ttistee under a5y
          lawful express trust oolnmitted to them by
          oontraot end as agent for the performsnoe of
          any lawful eat.

               "50.   To subscribe for, purohass, invest
          15, hold, own, assign. pledge end otheralso
          deal in and dispose of sharss or~aapital
          stook, bond%, mortgages, debentures, notes and
          other seourltles, obligations, oontraots end
          evldenoee of indebtedness or foreign or domea-
          tic corporations not oompetlng ,tith eeoh other
          in the same line or business;  provided tho
          powers and authority herein Oonfsrretd ehall
          In no way arrect snp provlalon'of the ant&
          trust laws or th:s State."

          Article 1524a, Revised Civil Statutes, embreaes ocrpo-
rations heretofore oreated and hereafter oreated having for the**
purpose or purposes any or all the powers LJOW euthorlzed 15 sub-
dIvislon% of 48, 49, or SO of Artlole 1302, Revised alvil Stet-
utes of Texas, 1925, and hexetofore or hereafter qr.Qreated
having in whole or Ln part any purpose or purposes :5ow euthor-
lsed In Chapter 275, Senate Bill No. 232 of the General and
Speolal Laws of the Regular Session of the 40th Legislature.

          In the case of In re BraI5ard, 26 Paa. Rsp. (2) 769,
Honoriblo Tom L. SeauohamPp, Page 9

where a former probate judge who, for oo~~etensation,without
being edqltted to practloe law end without paying llaenae
fees, advlsed persons in probate matter6 nnd prepared and
filed paper% In oonneotlon therewfth, and who prepared a&l-
010s of lriaorporatlon for corporate organizers, whloh work
wa% neoessax   to olear titles in loon transections, the Su-
preme Court of Idaho held that the for%er judge wasengaged
In the praotloe of law rendering him guilty of ooctampt of
the Supreme Court of Idaho althougb he did not sign the pa-
pers e5d pleadings as attorney, and he did not acoept legal
employment sxeept rrom persons who had already enllated hi%
servloes In buslners matters oocneoted with loans.
           The Supreme Court of the State of New York in the
case of In re Paoe, 156 14. Y. Sup. 641, held in erieot that
where A aorpora,tioa, known aa the Corporation Coupany of Dols-
ware malntalned~ en offloe In New York City and dlst*rIbuted
alroulars to attorneys at law, Offering either to inoorporete
oompanles under the laws of Delaware or to furnish all ths
neoessary r0m,    eta., for the attorneys to do so themeelves,
end thereafter through %uoh oorporatlon Hew York attorneys,
who aated as roswardersto the home ortloe   In Delawars, In-
aorporated three oo>panIes. The aorporatlon wus guilty or
e vlolatlon of the Penal Law prohlblting the praotloo or law
by aorporatlons  ainoe the praotIoe of law is not lI&tsd to
appearlag In oourt, or advlsI5g and aa%IstI5g In the aonduot
or lItigatIona, but embraaes the preparation of pl%adlngs and
all other papers Inoldent to lotlo5s and. speolal ~~I!OOe%ding%,
oonveyances, the preparation of legal Instruments of all klads,
and the glvlne, or all legal adVIOe to allents, and Potions
taken for them in matters oonneated with the law, lwluding
the preparation of papers requisite for the Incorporation of
the oompany and the Inoldental advise necessarily given In eon'
neotlon therewith.

           7% do not rind any Texas Ceoislons construing Section
3 or Article 43Ga quoted ebove. Xe quote from.opInItn ho.
O-647 written hay 5, 1939, by Honorable dames ?. Hart, Assis-
tant Attorney General, wklob oon%truee Seotion 3 of Artlole
43Ga ri9 roiiowt3:

               *The ",ue!itIouremains as to Wiet was the
          Intention cr the Legislature In providing in
          SeatAm 3 that *It shall be unlnwt'ul ror any
          corporstion to practloe law cf% defined by this
Honorable Tom L..Beauohakp,Page 10

          Adt  or to appear as an attorney r0r say par-
          son other than itself. . .* It Is our opIn-
          ion that the words *other than Itself' were
          used 80 a8 to make it plain that a aorporetlon
          is not prevented trOm hIring a regular stati
          or lawyers to appear and represent it in court.
          In a sense, such action by the corporation tight
          be construed to+oonstltute the Indireot praatioe
          of the law by the oorporation for iteelf, but
          suoh action Is not illegal because the oorpora-
          tlon by so doing is seaurlng legal representa-
          tion for Itself and not for other persons. We
          believe that the LsgIslature had in tind certain
          cases wherein it has been held thot a oorpora-
          tion Is indlreotly prdotiolng law where It, In
          eifect, hires E staff of lawyers and furnishes
          legel repreeentetlon to other peraonm.- See In
          re Uaolub of America, (Mass.) 3 N. EG (2).272,
          ,105 A. L. R. 1300; Peopla 0. Motorists Asso-
          olatlon of Illinois, 354 Ill. 595, 188 N. IC.
          827; United 8tates Title Cunranty Oonipany v.
          Brown, 217 N.Y. 628, &ll N. E. 826. We think
          thet the Legislature intended, by using the
          words 'other then itself,' to make it plain
          that a corporation can hire a regular legal
          atafi to represent It, but that the Legfslatum
          did not intend tp confer On oorpOratiOAt3 the
          right to be represented e:oept by agent8 or
          attorneys who have been duly lioenaed to praa-
          tloe law."

           We do not .belleve that the C~ T Corporation System or
the proposed corporetlon mentioned in your    in@ry   under their
ITvzse   clauses are authoiized to render the servIoes outlined
     .
          In view of' the foregoing authorities you ere reepeot-
iully advised that It is the oplnlon of thI8 Department that
your questions should be answered as follows:

           (1)   No.
           (2)   Yee.

           (3)   Yes.
Hanorabie Tom L, Beauahamp, Page 11

            (4)   No.
          Aa we have answerad your fourth question In the nega-
tIve it 18 not neoes8ciry to amwar queetfone NOe. 5 and 6.

            Trmting     that the   foregoing     answers   your   inquiry,
we remain
                                                    Your8 very truly

                                               ATTORNXY GEh:ERi'iL
                                                                OF TEXAS

                                                 -.4S.LiL-
                                               BY      A+11        yiIlliams3
                                                                  A&sletant