                  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 individuals at
                                        administrativehearings
                                        of state boaxds aud
                                        agencies.             :.
                                               '.
Dear Mr. Gayle:
     You have requestedour opinion as to whether representation
of corporationsand individualsby non-lawyers before the
Industrial Accident Board aa the State Board of Insurance
constitutes the unauthorizedpractice of law.
      It is well establishedthat the purpose of laws land
decisions prohibitingthe performance of legal services by
non-lawvexs is to protect the public from unqualifiedpersons.
Hexter Title 6 Abstract Co. 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430a of the Penal Code, repealed in 1949, defined various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 judiciary may have the final authority
to define -thepractice of law, but failed .torule od the
question and based their decisions,upon the 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 included within 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'tdid 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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                  Y     i   .   --   i   li’   .I ”   - -   I.   ,..   *

    The Honorable Gibson Gayle, Jr..- page 2 (R-974)


         Following the repeal of article 430a in 1949, the res-
    ponsibilityfor 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 activities under agreementswith shippers
    which gave the Bureau discretion to settle claims and accept
    settlementoffers constituted the 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 investigationalprocedures did not involve the
    practice of law and stated:
              The rule limiting the practice of law . . ;
              should not be extended beyond the
              requirementsof the comaongood. Southern
              haffic Bureau 5 Thompson, supra at 749.
    Thus, any decision concerning the definitionof the practice
    of law should be based upon an analysis of the dangers apd
    benefits to the public. Of course, these factors will differ
    depending upon the substance and nature of particular admin-
    istrative proceedings. In some instances,federal law is
    relevant. See ;.&20 C.F.R. 404.971 (1976). For these
    reasons, it wou      impossible to answer-ageneral question
    conceru5xqthe representationof persons aud corporations
    before all state agencies. Accordingly,we will address
    only ~+hethe specific.agenciesmentioned in your request,
    the IndustrialAccident board and the State board of Insurance.
         The IndustrialAccident Board was created by the
    Legislatureto admgnister the State's Workmen's Compensation
          V.T.C.S. arts. 8306-8309h. In Sooth v. Texas
    Em i0 ers* InsuranceAssociation, 123-2r3ZZex.
    "::B&liZ court explained:
              [Ilt is apparent that the Industrial
              Accident Board is not a court but an
              adminietrativebody, that claims filed
              before.it are not pleadings, and that the
              presentationor hearing of claims is not
              intended to be attended or governed by
              rules or formalities appropriateto
              trials in court.


                                               p. 4055
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            The Sonorable Gibson Gayle, Jr. page 3 m-974)


    .                       . . . .

                           It is important to the successful
                        perfonaanceof the duties of such admin-
                        istrativeagency and to the attainment of
                        the general purpose of the Workmen's
                        CompensationLaw that the board be per-
                        mittea to entertain and promptly decide
                        claims submitted to it, unhampered by
                        unnecessaryformality zna unrestrained by
                        the rules of pleading and evidence that
                        prevail in the courts. It is often desirable
                        that the~~injuriaemployee be able to file his
                        claim for compensationand 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 inconsistentwith law.
                 Prior to 1975, article 8307, section 10(b) expressly
            rewgnized that nonlawyersmight represent parties before
            the IndustrialAccident Board, In the enactment of,Senate
            Bill 1010 by the 64th Legislature,the language 'their-
            attorneys or the duly authorized agents of the parties,' was
            deleted from section 10(b). This could have been an inadvertant
            omission which was beyond the scope of the conference committee's
            authority, since the language was in the bill as presented
            to the committee and 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 accomplished in accordance
            with the rules pertainingto amendment of existing statutes;
            that is, the phrase was 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 indicationof an intent on the part of the
            Legislature to prohibit nonlawyers from practicing before
            the Board.
                     The IndustrialAccident Board has informed us that non-
                lawyers are permitted to represent parties at prehearing
                conferences and at hearings before the Board. -See Board




                                         P- 4056
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The Honorable Gibson Gayle, Jr. - page 4   (H-974)


Rule 5.080(b) [TexasCompensationMdnUal).    They may likewise
do so before the State Board of Insurance. Rule 059.01.04.008.
(Rules of Practice and Procedure before the State Board of
Insurance and the Commissionerof Insurance,.Dec.31, 1975).
This is not to say, of course, that a non-lawyer is required
or entitled to representan individual in the same manner as
an attorney is or that he may charge a fee for such represen-
tation. This has long been the practice in this state and neither
the judiciary nor the Legislaturehas seen fit to alter it.
As previously stated, any prohibition of such representation
by non-lawyersmust result from an assessment of the public
welfare. In our view, the Legislature and the agency involved
are in the best positionto make such an assessment.
     The settlementof claims by an insurance adjuster was
authorized by the Statementof Principles approved by the
State Bar in 1946. 22 Texas Bar Journal 69 (1959). Similarly,
in a meeting of members of the Unauthorized'Practiceof Law
Subcommitteeand insurancerepresentativeson November 5,
1976, a consensuswas reached that *activitiesof insurance
adjusters and persons representingclaimants at prehearing
wnfe,rencesdo not present any great problem or danger to
the . . . public at the present time" and that the appearance
of non-lawyersbefore the Industrial Accident Board and the
Insurance Commission *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 Industrial Accident Board
hekings:
     In the many briefs filed with this office in this
matter, there is no referenceto any detriment to the public
resulting from representationby 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 Insurance and the Industrial
Accident.Boarddoes not constitute the unauthorizedpractice
of law so long as such representationis permitted by 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 representationbefore
agencies by non-lawyers. See Annot. 2 A.L.R.3d-724. However,
the decisions are not consxent; they.vary with the terms
of the various statutesand the differing views of the




                         p. 4057
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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 Utilities Commission,(~ :9:2)467
        TZlvoFFmeister            v. ma, 349 s.w.za 5    .      ;
        Goodman -
                v. Beall, 200 N.E.T7mOhio    1936).
                               SUMMARY

                 Representationof parties before the
                 State Board of Insurance and the Industrial
                 Accident Board does not constitute the
                 unauthorizedpractice of law so long as
                 such representationis permitted by the
                 agencies and is not prohibited by any act
                 or decision of the Legislature or the wurts.
                                     Very truly yours,



                                     Attorney General of Texas




        Opinion Committee
        klU1




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