Court Opinion

ID: 4133363
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:37:04.016205+00
Date Added: 2024-06-11T14:34:14.460507
License: Public Domain

THE     ATTORNEY    GENERAL
                        OF 9?ExKAs
                      AUWIXN.   TRXAH      W37'11

                           March    1, 1973

Honorable David Finney                        Opinion No. II-15
Chairman, State Affairs Committee
House of Representatives                      Rc:   Questions concerning
Austin, Texas   78711                               constitutionality of
                                                    portions of H. B. No. 1,
                                                    a Bill regulating the
                                                    activities of certain
                                                    State officers and State
                                                    employees, etc.
Dear Representative Finney:
     At the direction of the State Affairs Committee of the House
of Representatives you have furnished us with a copy of Committee
Amendment No. 1 to II.B. 1, often referred to as "The Ethics Bill",
with the request that we examine its provisions, generally, for
constitutional questions and, particularly, with reference to
several specific questions you have asked.
     The Bill declares it to be the policy of this State that no
legislator, elected or appointed state officer, or state employee
"shall have any interest, financial or otherwise! direct or indirect,
or engage in any business transaction or professional activity or
incur any obligation of any nature, which is in substantial conflict
with the proper discharge of his duties to the public interest," and
is designed to implement that policy. Its purpose is "to strengthen
the faith and confidence of the people of Texas in their state gov-
ernment" by assuring that public business is being honestly and
ethically conducted, a legitimate reason for the exercise of the
police power.
     Legislative .efforts in that direction, however, must comport
with the State and Federal Constitutions. To be valid, a law such
as this must not violate the separation of powers principle; it
must be reasonable and fair in its application in order to satisfy
due process, privacy and equal protection righte; its penal provi-
sions must not be vague; and it must not otherwise conflict with

                                   p. 63
                                                           .      I

Honorable David Finney, page 2 (H-15)

constitutional provisions.
     A separate right of privacy has recently been given formal
recognition in Texas, described as the richt to be free from (1)

                                                                      s
suffering, shame or humiliation to a oerson of ordinarv sensibili-
ties. Billings v. Atkinson, 1G Tex.Sup.Ct.Jourl81, J'an.27, 1973.
Also see-~~-v7i------~.S.             93 S. Ct. 705 (1973), the Abor-
tion deci&~~%~----'
                  A Cali%rnia eth&    law requiring financial dis-
closure was invalidated by the Supreme Court of that State because
it infringed too greatly upon such rights. ---City-.-----------
                                                   of Carmel-by-the-
                                                               -----.
Sea
-.
 -.
  -._v.
   -. _.
       _.Young,
          __ _  466 P.2d 225 (Cal., 1970).
     It is our opinion that the public does have a legitimate
interest in the current financial condiET?&'and recent financial
history of those of its servants who are in positions of authority
where the temptation to improperly exercise public discretion for
private gain may coincide with the opportunity to do so, and that
public inquiries may be searching in their scope so long as they
are reasonably related to a purpose such as this bill implements.
See Stein v. Hewlett, 289 D.D.2d 409 (Ill., 1972); Cf. New York
Tirne??z,-'ii-;-%lEi%,
tla-71~~aT,-------.    376 U.S. 254, 11 L.Ed.Zd 686, 84--------.
                                                           s.Ct.

      On January 6, 1972, this office issued Opinion M-1039 declar-
ing House Bill 203 (Acts 1971, 62nd Leg., ch. 962, pp. 2906-12),
amending Article 6252-9, V.T.C.S., (and similar in some respects
to the bill considered here) to be unconstitutional. At that time,
the -dpiIi'ion
    Stein case
             reiiz~,!   had not been decided. Gn.the privacy issue,
                    principally on the 1970 decision of the Califor-
nia Supreme Court in City-of Carmel-by-the-Sea v.-----
                                                   Young,
In the light of the v--v.
                     .SEzxn?%ss-------
                               , we nowTGll~V&~f~e Cannel
                                                    -----T-
Sea opinion overbalanced the scales in favor of nrivate
aii?i
    that a different shift in the balance will bk found by-the.
Texas Supreme Court and the United States Supreme Court when such
questions reach them. If certain corrections are made, it is our
opinion that the Bill could meet all the constitutional tests and,
if enacted, be held valid.
I.   zsaration  of Powers Generally.
        ------------------.------
      The separation of governmental powers found in Article 2,

                                p. 64
.    .

Honorable David Finney, page 3 (H-15)
Sec. 1 of the Constitution of Texas is designed to protect freedom
and to prevent excesses. It was not intended to make effective
action impossible, and a constitutional problem arises only when
one branch of the government interferes with the functioning of
another branch in a field constitutionally committed to it. -m-e-.
                                                             State
Board of Insurance
--.--.--.-
       --..        v.
          ----------  Bet:?., 308 S.W.Zd 846 (Tex. 1958).
     In determining whether an exercise of power by one branch is
an unauthorized invasion of the jurisdiction of another, the con-
stitutional relationship of the various departments must be con-
sidered. The authority of the State Legislature is plenary, limi-
ted only by express or implied restrictions contained in or neces-
sarily arising from the Constitution itself. Government
                                                 --w-m    Services
                                                            -----.
Insurance
-----     Underwriters
           ------      v. Jones, 368 S.W.Zd 5667Tex.   I%Jl.   The
exercise%! sovernmen~>ii~~~itv     over the svstem established for
the administration of oublic affairs throuahoirtthe state is a
legislative matter [Perkins v,>ate,   367 S.W.2d 140 (Tex. 1463)1,
as is the declaratioii?Z-EiZlic policy.
     The proposed act would apply alike to employees and officers
of the state, with certain exceptions mentioned hereafter. It has
three separate spheres of operation: (1)it requires financial dis-
closures; (2)it establishes directory standards of conduct and
creates The State Ethics Commission to investigate reported devia-
tions from those standards: and (3)it defines certain types of
conduct as crimes subject to criminal penalties. We do not think
the proposed act would unconstitutionally burden the executive or
judicial departments in its general application.
     In setting standards with which all persons entrusted with
public responsibility must comply, the Legislature does not en-
croach upon the constitutional prerogatives of the other branches
of the government; it acts in their aid, as well as its own, to
promote public confidence in the integrity of all branches of the
government.
     So long as the Legislature does not interfere with the dis-
charge by the other branches of their constitutional duties, no
constitutional problem results. State Board of Insurance v.
Betts, supra. Requiring ethical             iiiii?~~e~~~~ed    of
~~l-&ther public servants can be no-unwarranted burd&. -Nor can
requiring disclosure of relevant financial matters be condemned
out of hand. And, it has always been a legislative function to
define crimes and set punishments.

                               p. 65
                                                              .

Bonorable David'Finney, page 4 (H-15)

     The Bill does not purport to vary the constitutional quali-
fication for any office or position or to provide for the removal
of officers or employees who fail to meet its standards, though
a failure to comply may have other serious consequences. In the
abstract, it creates no impediment to the proper functioning of
any department of government; it does not on its face and, so far
as we can see, will not in its operation, violate the separation
of powers clause.
II.   Application
      -           to Judges
         _-_-----___---_ _-.
     The Bill does not, in our opinion, conflict with Article 5,
Section l-a of the Constitution which creates the Judicial Quali-
fications Commission. Primarily, that Section establishes a re-
tirement system for judges, and provides for censure, involuntary
retirement or removal from office for certain types of wilful or
persistent conduct, or for disability. It does not define any
conduct as criminal. Nor does it provide any punishment.
     The Constitutional Section contains no provision for disclo-
sure of relevant information to the public. To the contrary, papers
filed with the Judicial Qualifications Commission and its proceed-
ings are required to be held in confidence. Section l-a of Article
5 of the Constitution cannot be understood as withdrawing from the
Legislature all power to regulate the conduct of judges. If that
were the case, penal laws applying to the conduct of judicial offi-
cers would be void as to them (for example, see Articles 159, 160,
184, 185, 196, and 197, Vernon's Texas Penal Code); and the Section
would violate the Equal Protection provision of the Federal Con-
stitution, inasmuch as it would insulate judges from the criminal
sanctions to which other similarly situated persons are subject,
and would seriously impair the system of checks and balances as
applied to the limitation of judicial power. Cf. Ku_echlerv. Wright,
40 Tex. 600 (1874); --
                    Ferguson v. Maddox, 263 S.W. 88% -(r&%?~~~~~ --
                        m-m-v.
     Subsection (13) of Section l-a of Article 5 expressly provides
that the Section shall not be exclusive in its operation. ExaG.
v. State
_-___.-v.' 457 S.W.Zd 72 (Tex.Civ.App., Eastland, 1970, writ reE
n.r.e.7.
     Parenthetically, we note that Section 2(2) (B) of the Bill,
if read literally, would make its provisions applicable to elected
judges but not to judges appointed to elective positions, as, for
example, to fill an unexpired term. This might pose a "classifica-
tion" problem if left unaltered.

                                p. 66
Honorable David Finney, page 5 (H-15)

     It is our opinion that no conflict exists and that the Legis-
lature may make the provisions of the Bill applicable to Judges.
III.   The Disclosure Provisions
       --_-------       -------.
     The disclosure provisions of Section 4 of the Bill have "clas-
sification" problems which, if left uncorrected, would also affect
its constitutionality, we believe.
     The Texas Supreme Court has reiterated the strong presumption
that the Legislature understands and correctly appreciates the
needs of its own people, that its laws are directed to problems
made manifest by experience, and that its discriminations are
based on adequate grounds. It is not the function of the Courts
to judge the wisdom of a legislative enactment. The necessity or
reasonableness of particular regulations imposed under the police
power is a matter addressed to the legislative department whose
determination in the exercise of a sound discretion is conclusive
upon the Courts. Legislative enactments will not be held uncon-
stitutional and invalid unless it is absolutely necessary to so
hold. -----_-
       Texas State Board
                    --   of Barber Examiners v: Beaumont-Barber
               454-S.W.Zd-7987~~~~~~--However;-l~~~l;iiive
                sometimes constitute improper exercises of police
power and, when they do, they will be declared unconstitutional.
Lone Star Gas Co. v. Kelly, 165 S.W.Zd 446 (Tex., 1942).
-----_.---.------------
     To be valid, a classification should be reasonable for the
purpose of the legislation,.should be based upon proper and justi-
fiable distinctions (considering the purpose of the law), should
not be clearly arbitrary, should not be a subterfuge to shield
one class and unduly burden another, and should not be a cover to
oppress a class unlawfully in its administration. ergo    v. B orgo,
                                                               Tex;.
402 S.W.Zd 143 (Tex. 1966); Buchanan v. State, 480 S.W:ZssaT -+-
Crim. 1972) ; McDonald v. Boa~-~~'-iion-~~~issioners     of Chicagg.,
394 U.S. 802,-~~E~-~~a~,-T~~~~~~~-7m-7T~~~~;------------
     Faced with a "classification" problem in Reed v. Reed, 404 U.S.
71, 92 S. Ct. 251, 30 L.Ed.Zd 225 (1971), The S~p~~-~~ii%   of the
United States, in a unanimous opinion by Chief Justice Burger, said:
          "In applying that clause [the Equal Protection
          Clause], this Court has consistently recognized
          that the Fourteenth Amendment does not deny to
          States the power to treat different classes of
          persons in different ways . . . . The Equal

                                   p. 67
                                                              .

Ronorable David Finney, page 6 (H-15)

          Protection Clause of that amendment does
          however, deny to States the power to legjs-
          late that different treatment be accorded to
          persons placed by a statute into different
          classes on the basis of criteria wholly un-
          related to the objective of that statute. A
          classification must be reasonable not arbitrary,
          and must rest upon some ground of difference
          having a fair and substantial relation to the
          object of the legislation, so that all persons
          similarly circumstanced shall be treated alike.'
          Royster Guano Co.
                    -.----
          ~~5~~~-%:Ld.  989, 990,
          . . . (404 U.S. at 75-6).
     Aside from State officers, the classes recognized by the pro-
posed Bill in its disclosure provisions are (1) employees earning
state salaries of $15,000.00 or more, and (2) those earning less
than that amount. The former must disclose; the latter need not.
The declared purpose of the legislation is to further a policy
that no state officer or employee engage in any transaction or
incur any obligation in substantial conflict with the proper dis-
charge of his duties in the public interest. Certainly there is
reason f?3?aZ?iGi%i~-thatstate employees commanding salaries above
some certain high level will be engaged in the discharge of im-
portant duties in the public interest and ought to be subject
to public examination, but it cannot be said with the same certainty
that those receiving a salary below that figure have a lesser degree
of public responsibility which does not require surveillance. When
the State commands disclosure by some, but not all, and makes a
crime of the failure to disclose, its lines of demarcation must
meet Fourteenth Amendment tests. Further, its invasions of pri-
vacy must not go so far as to leave unbalanced the individual and
public rights.
     A classification of those required to disclose, based solely
on salary level, is unreasonable for the purpose of the legislation
proposed. We believe the Supreme Court of Texas would overturn
invasions of the right to privacy if the selection of those whose
privacy is to be invaded is not based upon the relation of their
function and authority vis a vis the proper discharge of public
business and the exercise-d-196 S.W.2d 324 (Tex. 1946)], but
Article 4, Se~~~?i-~-~?-~&' Constitution of Texas provides that
vacancies in State offices, except legislative offices, will be
filled by the Governor -i----r---
                       unless otherwise
                                  ---- provided bx---.
                                                     law. Clearly,
the Legislature is constitutionally autho?lza-%z- otherwise"
properly attach such power and, if it does, no unconstitutional
encroachment results. A judicial office is not involved, (see
Article 5, Section 2, Constitution of Texas) nor is the discharge
of any constitutional duty impaired thereby. Cf. State ex rel
Peden v. Valentine, 198 S.W. 1006 (Tex.Civ.App., Fc-&rth,-I?f17,
~~rii-~~~,r7-~nrouse    Bill No. 537, 256 S.W. 573 (Tex. 1923).
           '---~~~-~~~ssT~~-~~nternplated
In our opinion,                                is a "Board" within
the meaning of Article 16, Section 30a of the Texas Constitution
permitting staggered six years term.
     Some of the powers given the Commission call for close exami-
nation, The power to issue advisory opinions [Section 10(c)] may
conflict with the power invested in the Attorney General by Article
4, Section 22 of the Constitution. A similar provision was ruled
invalid in ---------
           Stein v. -----.'
                    Howlett 289 N.E.2d 409 (Ill. 1972).
     Section 11 of the Bill gives the Commission the power to sub-
poena witnesses and the production of pertinent books, accounts,

                                    p. 70
           .

.

    Honorable David Finney, page 9 (H-15)
    records and documents. Subsection (d) of Section 11 commands
    district courts, at the application of the Commission and with-
    out notice or hearing, to issue a judicial summons to a recalci-
    trant witness to appear and give whatever evidence is required
    by the Commission.
    ae~~~~~a;--.-----   If the witness still fails to give the evidence
              the Court is required to examine him and punish him for
    contempt if the Court finds that he did refuse ijixhoutreasonable
    cause or legal excuse to be examined;--'
                                          or answer relevant questions,
    or produce pertinent records or documents. The procedure could
    violate the due process clauses of the Texas and Federal Consti-
    tutions by making the reluctant witness hazard the deprivation of
    his liberty without an opportunity to first obtain a judicial dec-
    laration of his rights.
         In the same vein, the absence of provision for judicial review
    has constitutional connotations. While the Commission has no power
    to exact civil or criminal penalties , or even to prefer charges, its
    fact-finding and reporting functions enable it to destroy reputa-
    tions. Article 1 Section 13 of the Texas Constitution guarantees
    that ". . . every person, for an injury done him in his . . .
    reputation, shall have remedy by due course of law." The Supreme
    Court of Texas recognizes an inherent right of appeal from admini-
    strative action where constitutional or property riahts are affec-
    ted. Houston v. Blackbird, 394 S.W.2d 159 -(Tex:1965); --------,
                                                             Board of
    Fireme~~s-~~~~~~~-~~~e~nt
         -.---- ---    -            Fund Trustees of Texa&s     v:,
    &xlton., 3% S.W.ld ~~~~~~-~~~~~F;r,--~~~~~~-~y-very well be
    ai&il%le anyway, but the Bill does not assure it.
    VII.       Penalties
               -----.---
         Section 18 apparently relates to the "confidential' part of
    Section 6(a) as well as Section 17. As a result, Section 18 and
    Section 19(b) assess different punishments for the same indiscretion,
    though Section 18 has a wider application. Convictions under nei-
    ther Section 18 nor Section 20 require a criminal intent. Under
    Section 18 disclosures to persons honestly believed authorized to
    receive the information will still earn the penalty. Under Section
    20(a) the falsity of an allegation is reason enough for punishment,
    under its terms, no matter what be the bona fides of the public
    concern which prompted it. To that extent, Section 20(a) consti-
    tutes a forbidden abridgment of the First Amendment to the Consti-
    tution of the United States, and cannot stand. New York Times Co.
    v. Sullivan, 376 U.S. 254, 11 L.Hd.Zd 686, 84 S.i%:-~~~-7~g~~:---'
    ---.--------
         Moreover, the remainder of Subsection (a) of Section 20 conflicts
    in its punishment provision with the Penal Ccode. See Articles 1269,

                                     p. 71
.   .

        Honorable David Finney, page 10      (H-15)

        1270, and 1275, subdivision 5, V.T.P.C.
             Subsection (b) of Section 20 subjects complainants to civil
        penalties even when their allegations are true, if they are shown
        to have acted with mala fides. Short of a security danger or the
        impairment of the discharge of constitutional duties, we do not
        believe the First Amendment will permit any governmental repres-
        sion, direct or indirect, of ----.--.
                                     truthful political information of-
        fered by private citizens, no matter what motivates its rcvela-
        tion. Also see Article 1 Section 8, Texas Constitution.
        VIII.   _I_njunction
                   _---_-.
             The provisions of Section 21 permitting private citizens to
        initiate injunction or mandamus proceedings to enforce the pro-
        posed Act do not purport to deprive elected officers of any con-
        stitutional authority, and interpreted in that light, we believe
        the provision to be valid. s_ence v.._F_enchler,
                                                ----I. 180 S.W. 597
        (Tex. 1915); _-_-_---~-~~~~_-----
                     Scott v. Board of Adjustment,
                                          -----__ 405 S.W.Zd 55 (Tex.
        1966).
        IX.   Severability
              __._._.__-
                     ----
             We think the three spheres of the Bill's operation (disclosure;
        standards and Ethics Commission; crimes and punishments) while
        concerning only one subject, are so distinct and independent in
        nature that any invalidity in one of them need not affect the
        validity of the others, except insofar as the Ethics Commission
        is designated the safekeeper of disclosure statements.
        X.    Specific
              _ _,__.__Questions Answered
                      -_----_----.-------.
             We believe that the foregoing discussion answers each of your
        questions. However, for ease of reference, we restate the ques-
        tions and our opinion as follows:
        Question: “Does the public disclosure of financial activity and
        sZi-iii'?gquirred
                        by Sections 4 and 5 of H. B. No. 1, violate a
        constitutionally protected right of privacy or any other consti-
        tutionally protected right as to either:
                  (1) any one or   more   classes of persons required to file
        the statement; or
                  (2) any one or more items or categories of financial in-
        terest or activity required to be disclosed and specifically as to

                                             p. 72
Honorable David Finney, page 11 (H-15)

the provisions in Section 5(a)(2), (3) and (5) in that these sec-
tions require the disclosure of certain interests that are held,
acquired or sold during the reporting period?"
Answer:
_.-.-.   We answer "yes" as respects the classification of persons,
   -ii-.-.
and no" as respects disclosable interests and activities.
Question: "Does Section 2(2)(d) of II.B. No. 1 conflict with
Ar%~cl~-5 Section l-a(6) of the Texas Constitution by the omission
of certain judges?"
Answer: NO. Section 2 of the Bill, in defining "State officer"
iii%i&s elected officers which, in turn, includes, under Section
2(2) (D) judges of certain enumerated state courts, but does not
include county and municipal judges, or judges appointed to office,
all of whom are listed in subsection (6)A of Section l-a of Arti-
cle 5, of the Constitution as being subject to removal for mis-
conduct. There is no conflict because the Bill does not effect
removal, but there is a classification problem in impliedly ex-
empting aEp_ointeesto elective offices from provisions applicable
to persok elected to such positions.
Question:   "Do Sections 6 and 7 of the H. B. No. 1 conflict with
E~~~l~T, Section l-a(6) of the Texas Constitution wherein the
Constitution states that standards of ethics are to   be   measured
by a 'wilful and persistent conduct' standard?"
Answer:
--.--.-. No.
Question:-. "DO the provisions for prohibited acts and the statement
  --.-.-.--
O? standards in Section 6 and 7 of H. B. No. 1 and the standards
stated in Article 5, Sec. 1-a(6)A  of the Texas Constitution impose
upon judges greater standards and punishments than those applicable
to other  state officials?"
Answer:  No.
----.--.-.
Question: "Wae the constitutional grant of powers to the Judicial
~iiiillIiE5kions
               [Commission] concerning the ethics of judges [a] grant
which can be added to or changed by the Legislature?"
Answer:
-_.-._.---No. But it concerns only retirement removal and official
censure. The Legislature could not add to the constitutional grounds
for removal  of a judge.

                                  p. 73
Honorable David Finney, page 12 (H-15)

Question:
--.-.      "With respect to the judges, does the establishment of
   --.-.-.--.
a State Ethics Commission and the provisions concerning its powers
and procedures conflict with the provisions of Article 5, l-a,
Sets. (2) through (9) and Sec. (11) of the Texas Constitution
which creates the Judicial Qualifications Commission and states
its powers and procedures?"
Answer:
-------..NO.
Question: "Does the subjection of judges to the jurisdiction of
both-x%-State Ethics Commission and the Judicial Qualifications
Commission, without subjecting other officials to both powers,
violate the equal protection provisions of the U. S. Constitution?"
Answer : No.
-----.-.
Question:
      ---. "Does Section 19-b of H. B. No. 1 which imposes felony
p-GGhment, when considered with Article 5, Section l-a(5), (6)
and (9) of the Texas Constitution which imposes on judges sanctions
and punishment of enforced retirement, censure or removal from
office, violate the equal protection provision of the U. S.
Constitution?"
Answer:
    --.-.No.
_.-_-
Question:
~-- I-.   -,. "Does H. B. No. 1 conflict with the grant of powers over
      -- -.
3udges to the Judicial Qualifications Commission?"
Answer:
--.-----.No.

                          6 UMMARY
          So long as the classification of person and subjects
     covered is not unreasonable, the Legislature has the power
     to (1)require by ethics legislation that classes of state
     officers and employees in places of authority disclose in-
     formation concerning relevant aspects of their financial
     life; (2)to provide criminal sanctions for specific un-
     ethical conduct (so long as the prohibited conduct is
     described with sufficient definition) ; and (3)to establish
     an Ethics Commission for investigating complaints of un-
     ethical conduct on the part of such state officers or
     employees, for making findings on those complaints, and
     for supervising the disclosure provisions.

                                 p. 74
                   7   .
       .-
,.‘.        ,,,.

                   ilonorableDavid Finney,   page   13   (H-15)

                                The fact that persons subject to the Ethics
                           legislation may also be subject to other rules of
                           law governing their ethical conduct, does not alone
                           render the proposed legislation unconstitutional.
                                                         Very truly yours,

                                                         JOHN L. HILL
                                                    c    Attorney General of Texas

                                                         p. 75