Texas State Bd. of Public Accountancy v. Fulcher

• Decision Date: 19 September 1974
• Docket Number: No. 889,889
• Citation: 515 S.W.2d 950
• Parties: TEXAS STATE BOARD OF PUBLIC ACCOUNTANCY, Appellant, v. W. L. FULCHER, d/b/a Fulcher and Company, Appellee.
• Court: Texas Court of Appeals

Page 950

515 S.W.2d 950

TEXAS STATE BOARD OF PUBLIC ACCOUNTANCY, Appellant, v. W. L. FULCHER, d/b/a Fulcher and Company, Appellee.

No. 889.

Court of Civil Appeals of Texas Corpus Christi.

Sept. 19, 1974.

Rehearing Denied Oct. 31, 1974.

Second Rehearing Denied Nov. 21, 1974.

Bill Campbell, Austin, Sloan B. Blair, Cantey, Hanger, Gooch, Gravens & Munn, Fort Worth, for appellant.

Randall P. Crane, Harlingen, for appellee.

OPINION

BISSETT, Justice.

This suit was instituted by the Texas State Board of Public Accountancy against W. L. Fulcher to enjoin him from holding himself out to the public as an 'accountant' on the ground that he was violating certain provisions of the Public Accountancy Act of 1945 (Art. 41a, Vernon's Ann.Civ.St.). The Texas Society of Certified Public Accountants intervened as a party plaintiff. The trial court, after a trial before the court without a jury, denied the application for injunction on grounds that the Act was unconstitutional, and dismissed the action. Plaintiff and intervenor, hereinafter sometimes called 'appellants', have appealed .

The Board alleged that appellee is not registered with the Texas State Board of Public Accountancy either as a public accountant or certified public accountant, that he does not now hold and has never held a live permit for the practice of public accounting issued under any section of the Act, and that he has violated certain provisions of the Act by unlawfully holding himself out as an 'accountant'. The prayer was that appellee 'be enjoined from holding himself out as a public accountant and engaging in the business of public accountancy' until he has complied with the provisions of the Act.

Appellee denied generally the allegations contained in the petition. He further pled that the Act violates rights guaranteed him and others by both the Federal and State Constitutions because it is 'ambiguous, contradictory, and prohibitory, rather than regulatory'.

The issue here presented is whether the Act, as it is applied to appellee, violates any right or rights guaranteed to appellee by the Constitution of Texas and of the United States. Findings of fact and conclusions of law were made and filed. Since the conclusions of law deal only with constitutional issues, the trial court held that appellee was in violation of the Act, but excused his violation solely on the ground that the Act, as applied to appellee, was unconstitutional. Any other holding would contravene the cardinal principle that a court will not consider a constitutional issue if the case can be decided on other grounds. See 12 Tex.Jur.2d, Constitutional Law, § 32.

Appellee is not a certified public accountant nor is he a licensed or registered public accountant under any of the provisions of the Act. He does not hold a permit for the practice of public accounting under the Act. Appellee admits that he performs accounting services for the general public and uses the designation 'accountants' in his business. He further admits that he has held himself out to the public as an 'accountant'. In addition to preparing income tax returns and furnishing bookkeeping services to his clients, appellee renders general accounting services to the public, which include preparation of financial statements and reports, and designing and implementing accounting and bookkeeping systems. He does not make and prepare certified audits nor does he affix his signature to financial reports or statements in such a manner as to indicate that they are based upon a certified audit. He does, however, sign his name to financial reports and statements. The words 'Fulcher & Fulcher, Accountants' appear on both the building directory in the office building where appellee maintains his place of business and on the entrance door to his office. The words 'Fulcher & Company, Accountants' appear as the return address on his business envelopes. Appellee agreed that if a member of the public was seeking an accountant, his business envelope and the sign would be sufficient notice that he was holding himself out to the public as an accountant.

Among other fact findings, the trial court found: appellee held himself out to the public as an accountant; he is well qualified to render accounting services to the general public; there is a need for the services of unlicensed accountants in Texas; and to permit an unlicensed person to practice public accounting would not 'confuse the general public into thinking he is licensed by the State as a certified public accountant or public accountant'.

In conclusions of law 1, 2 and 3, the court concluded that the current Article 41a is an overextension of the State's police power in that it works a hardship on individuals without offering any commensurate protection benefitting the general public; tends to create a monopoly in a single class when unlicensed practitioners are prohibited from using the word 'accountant' to describe their services; and, prohibiting unlicensed accountants from using the word 'accountant' to describe their work violates the guarantees of the Bill of Rights and is in conflict with the spirit and express provisions of the Constitution and hence void. The remaining conclusions read, as follows:

'4. Article 41a, current Texas Civil Statutes, is prohibitory rather than regulatory in that it tends to advance the interests of a single class, licensed accountants, at the expense of unlicensed accountants and the public as a whole.

5. Article 41a, current Texas Civil Statutes, denies unlicensed accountants equal protection of the law and is therefore in conflict with both the State and Federal Constitutions.

6. Article 41a, current Texas Statutes, does not accomplish its purpose in a reasonable manner in that unlicensed accountants are not prohibited from practicing accounting but are prohibited from holding themselves out to the public as accountants and the same is therefore void.

7. Ambiguity exists in the statute (Art. 41a) in that unlicensed accountants are not prohibited from practicing accounting yet are restricted from calling themselves accountants. This ambiguity must be resolved in favor of unlicensed practitioners in order to make the statute intelligible by reading into the law the legislative intent which is to prohibit the use of the word 'accountant' only when the word is used in a misleading manner by unlicensed practitioners.'

A statute is presumptively valid and will not be declared unconstitutional unless it is expressly or by necessary implication in conflict with some constitutional provision, and one claiming that the same is unconstitutional must point out to the court the constitutional principle violated. 12 Tex.Jur.2d Constitutional Law, § 34. 'The courts should be reluctant to strike down a statute as unconstitutional unless and only when it is absolutely necessary on the facts or circumstances presented by the particular case'. Vernon v. State, 406 S.W.2d 236, 242 (Tex.Civ.App. --corpUs chriSti 1966, writ ref'd n.r.e.). If a statute is capable of two constructions, one of which sustains its validity, and the other renders it unconstitutional, the courts will give it that interpretation which sustains its validity. McCarty v. James, 453 S.W.2d 220 (Tex.Civ.App.--Austin 1970, writ ref'd n.r.e.).

We adhere to the time honored rule that an act will not be declared unconstitutional on the grounds that it is harsh, unwise, inexpedient, or impolitic. 12 Tex.Jur.2d, Constitutional Law, § 40. Whether a statute is wise or not is not for us to say. The answer to that inquiry must come from the legislature, not the courts. Our concern in this case is with the power of the legislature, not with its wisdom. Helvering v. Davis, 301 U.S. 619, 57 S.Ct. 904, 81 L.Ed . 1307 (1937).

In Railroad Commission of Texas v. Miller, 434 S.W.2d 670, 673 (Tex.Sup.1968), it was held:

'. . . A state may classify its citizens into reasonable classes and apply different laws, or its laws differently, to the classes without violating the equal protection clause of the Fourteenth Amendment . . . The test is whether there is any basis for the classification which could have seemed reasonable to the Legislature . . . A classification is reasonable if it is based on a real and substantial difference having relationship to the subject of the particular enactment and operates equally on all within the same class. . . .'

Where the state may validly require a license, it may make such classifications, restrictions, prohibitions or exemptions as deemed necessary, so long as they do not violate constitutional guarantees and prohibitions. Hurt v. Cooper, 130 Tex. 433, 110 S.W.2d 896 (1937). 'The mere fact that discrimination is made does not necessarily vitiate the classification, and unless there is no substantial basis for the discrimination, there is no warrant for judicial interference . . . All that is required is that the enactment shall be applicable to all persons alike under the same circumstances'. Dodgen v. Depuglio, 146 Tex. 538, 209 S.W.2d 588, 594 (1948). If there could exist a state of facts justifying the classification, restriction or prohibition complained of, the courts will assume that it existed. Reed v. City of Waco, 223 S.W.2d 247 (Tex.Civ.App.--Waco 1949, writ ref'd).

It is well settled that accounting is a highly skilled and technical profession that affects the public welfare, and which the state, in the exercise of its police power, may regulate. Henry v. State, 97 Tex.Crim. 67, 260 S.W. 190 (1924); 70 A.L.R.2d 435--437; 1 Am.Jur.2d, Accountants, § 2. Statutes which prohibit anyone from holding himself out as a 'public accountant' or a 'certified accountant' without having actually received a certificate or permit to practice public accountancy have generally been upheld. See Tom Welch Accounting Service v. Walby, 29 Wis.2d 123, 138 N.W.2d 139 (1965); Davis v. Allen, 43 Tenn.App. 278, 307 S.W.2d 800 (1957); 70 A.L.R.2d pp. 435--437. For the...