                                 The Attorney                    General of Texas
                                                          March 10,      1983

JIM   MATTOX
Attorney   General


                               Mr. Edward 0. Coultas                                    Opinion     No.   JM-7
Supreme Court Building         Executive   Director
P. 0. BOX 12546                State Bar of Texas                                        Be:       Whether     District       of
Austin. TX. 76711. 2546
                               P. 0. Box 12487. Capitol            Station               Columbia professional        corpora-
512/475-2501
Telex 910/674-1367
                               Austin,   Texas      78711                                tion    needs    a certificate       of
Telecopier 5121475.0266                                                                  authority     to transact    business
                                                                                         in Texas

1607 Mam St.. Suite 14W        Dear Mr. Coultas:
Dallas. TX. 752014703
2141742.6944
                                      You ask whether an Individual          who practices     law in the District
                               of Columbia and Is not licensed          to practice    in the state of Texas, yet
4624 Alberta Ave.. Suite 164   who is a partner       in a general    partnership    organized    under the laws of
El Paso. TX. 79905.2793
                               the state    of Texas, may Incorporate         a professional      corporation      under
9)433-3464
                               the laws of the District        of Columbia and substitute         it for himself       as
                               a partner    In the Texas partnership.          If so. you then ask whether the
1220 cum be.. we     202       foreign   professional     corporation     is deemed to be transacting          business
HOUS~O”.TX. 77002.6966         in the state of Texas and is thus required             to obtain     a certificate      of
7 131650-0666
                               authority   from the secretary       of state.

606 Broadway. Suite 312               In our opinion,          any corporation          acting    as a general      partner     of a
Lubbock. TX. 79401.3479        Texas partnership          transacting        business      in Texas is itself         transacting
0061747-5236                   business      in Texas.         See Attorney         General      Opinion    WW-191 (1958).          A
                               partnership       under theTexas            Uniform Partnership         Act is defined        as “an
4309 N. Tenth. Suite e
                               association       of two or more persons             to carry on as co-owners           a business
McAllen. TX. 76501-1665        for profit.”         V.T.C.S.        art.    6132b.     16.     The term “persons”         includes
5121662-4547                   corporations.          V.T.C.S.         art.     6132b,      56-A.      This   definition        also
                               pertains       to professional            corporations        by virtue      of article       1528e.
                               section     5. V.T.C.S..         which provides           that “professional         corporations
200 MaIn Plaza. SUlW 4w
San Ank,“,o. TX~ 76205.2797
                               shall    enjoy     the powers and privileges                 and be subject       to the duties,
512,2254191                    restrictions        and liabilities            of other       business     corporations       except
                               insofar     as the same may be limited                 or enlarged      by this Act.”         If the
                               partnership        business      is carried         on in Texas,        each   partner      is also
                               transacting       business      in this state.         because     every partner      is an agent
                               of the partnership           for the purpose of partnership                business,      and every
                               partner      has an equal           right     in the management and conduct                  of the
                               business.         V.T.C.S.       art.      6132b.     $09.     18.     See Scott       Company of
                               California       v. Enco Construction             Company, 264 So.2d 409 (Hiss.               1972);
                               17 W. Fletcher,          Cyclopedia        of the Law of Private            Corporations,       P8464
                               (1977).       Cf. Williams        v. Freeport        Sulphur Company, 40 S.W.Zd 817. 824
                               (Tex. Civ.pp.           - Galveston         1931, writ ref’d).




                                                                    p.   27
Mr.   Edward      0.   Coultns       -   Page    2       (JM-7)




       Thus,       in     order        for     the     professional           corporation/partner                   to
transact      business          in this          state,       it    would      be necessary                for     the
corporation         to be authorized                to do business               in Texas.              The Texas
Professional           Corporation           Act,      article         15281~. V.T.C.S.,                 does      not
provide     for the registration                  of foreign          professional           corporations           In
Texas.       Such authority               may not be obtained                   by registration                  as a
foreign     corporation          under the Texas Business                  Corporation          Act.         Section
5 of the Texas Professional                      Corporation          Act provides            that the Texas
Business        Corporation             Act      shall       be      applicable           to      professional
corporations          except       to the extent            that the provisions                  of the Texas
Business      Corporation            Act conflict          with the provisions                   of the Texas
Professional         Corporation           Act.     The failure           of the Texas Professional
Corporation           Act      to       provide        for       the      registration              of       foreign
professional         corporations           indicates       the legislature’s              intent        that such
corporations         not be authorized              to do business             in the state              of Texas.
Use of the provisions                 of the Texas Business                Corporation          Act to supply
such authority          would constitute             a conflict         with the Texas Professional
Corporation        Act.       Although        the Texas Professional                  Corporation            Act has
not been construed                by a court           in this         regard,       at least           one other
jurisdiction           has       found        that      the       failure        of      its       professional
corporation          act      to     provide        for      the      registration            of       s     foreign
nrofessional         cornoration           orohibits       a foreien         nrofessional            cornoration
from doing business                 in the state.              Dalton,       Dalton,       Little,         ‘Inc.    v.    A
Mirandi.      41’2 F. Supp. 1001 (D. N.J.                        1976).      Accord,        Ariz.        Op. Att’y
Gen. 71-38 (Oct.            27, 1971); N.C. Op. Att’y                    Gen. (Aug. 26, 1970);                  Minn.
Op. Att’y       Gen. 92b-18            (Apr. 6, 1965).               in our opinion,              in order         for
the professional             corporation         which Is the subject                  of your request               to
be able       to transact              business       in this          state      as a partner                in the
practice       of     law.      that       corporation          will      have      to comply             with     the
provisions        of the Texas Professional                        Corporation         Act.        That is.          it
will    have to become a domestic                    professional           corporation           in the state
of Texas.

                                                 SUMMARY

                     A foreign         corporation      that is a partner          in a
                 general      partnership        organized     under     the laws of
                 the state       of Texas is deemed to be transacting
                 business      In the state         and, thus,       is required       to
                 obtain      a     certificate        of    authority        from    the
                 secretary      of state.        The same rule would apply to
                 a foreign        professional        corporation,        except    that
                 the     secretary        has no authority            to    grant    the
                 certificate        to a foreign      professional,        rather than
                 business,         corporation.          The     absence       of    any
                 licensing      provision       for a foreign         corporation      to
                 do business         in the state       of Texas Indicates          that
                 the legislature           did not wish to allow             a foreign
                 professional            corporation        to     carry       on    any




                                                           p.   28
Mr. Edward 0.     Coultas     - Page 3      (JM-7)




             activities   that amount to transacting          business      in
             this state.     Thus, because      being     a partner    would
             amount to transacting       business     In this state,      and
             the foreign    professional     corporation     could not be
             licensed    under    the usual      corporation      licensing
             provisions,    the foreign      professional      corporation
             may not participate       ss a partner     in a partnership
             organized   under the laws of the state of Texas.




                                                  J Ai&
                                                      Very truly   you


                                                           LA
                                                      JIM      MATTOX
                                                      Attorney  General   of   Texas

TOM GREEN
First Assistant     Attorney      General

DAVID R. RICHARDS
Executive Assistant         Attorney   General

Prepared    by Catherine   B. Fryer
Assistant    Attorney   General

APPROVED:
OPINION COMMITTEE

Susan L. Garrison,      Chairman
Catherine   B. Fryer
Rick Gilpin
Jim Moellinger




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