OFFICES AND OFFICERS ‑- STATE ‑- LEGISLATORS ‑- LAWYERS ‑- CODE OF ETHICS ‑- REPORTING PERIOD ‑- INCOME.
(1) Under § 6, subsection (3), chapter 150, Laws of 1965, Ex. Sess. (Substitute Senate Bill No. 1) which requires a public official or candidate to report the names of persons, corporations, firms, partnerships or other business associations from whom he receives compensation exceeding a certain specified amount, a legislator who is an attorney engaged in the private practice of law is required to report the name of his firm but is not required to report the names of his individual clients since a lawyer is not an "employee" of a client in the ordinary attorney-client relationship.
(2) The first report which must be filed by incumbent public officials subject to the provisions of § 6, chapter 150, Laws of 1965, Ex. Sess. (Substitute Senate Bill No. 1) will cover the period August 6, 1965, through December 31, 1965, since the new act must be construed prospectively.
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October 5, 1965
Honorable Martin J. Durkan
State Senator, 47th District
4049 W. Lake Sammamish S.
Cite as: AGO 65-66 No. 44
By letter previously acknowledged you have requested the opinion of this office on two questions which we paraphrase as follows:
(1) Under § 6, subsection (3), chapter 150, Laws of 1965, Ex. Sess. (Substitute Senate Bill No. 1), which requires a public official and candidate to report the names of persons, corporations, firms, partnerships, or other business associations from whom he receives compensation exceeding a certain specified amount, must a legislator who is an attorney engaged in the private practice of law report the names of his individual clients in addition to reporting the name of his law firm?
(2) Does § 6, chapter 150, Laws of 1965, Ex. Sess. (Substitute Senate Bill No. 1) operate only prospectively, i.e., from its effective date, August 6, 1965, in regard to the report required to be filed on January 31, 1966, and the period of time to be covered by the initial report?
[[Orig. Op. Page 2]]
We answer the first question in the negative; the second in the affirmative.
Section 6, chapter 150, Laws of 1965, Ex. Sess., reads in pertinent part as follows:
"Every public official shall on or before January 31st of each year, and every candidate shall within thirty days after filing a declaration of candidacy, file with the secretary of state, a written statement of:
". . .
"(3) The name of any person, corporation, firm, partnership, or other business association from which he receives compensation in excess of one thousand five hundred dollars during the preceding twelve month period by virtue of his being an officer, director, employee, partner or member of any such person, corporation, firm, partnership or other business association.
"(4)As to attorneys or others practicing before regulatory agencies during the preceding twelve month period, the name of the agency or agencies and the name of the firm, partnership or association of which he is a member, partner or employee." (Emphasis supplied.)
The primary, if not the sole purpose of construing legislative enactments is to ascertain and give effect to the intent of the legislature. Cory v. Nethery, 19 Wn.2d 326, 142 P.2d 488 (1943). In the process of arriving at legislative intent, the first resort of the courts or this office should be to the context and subject matter of the legislation, since the intention of the legislative body is to be deduced, if possible, from what it said. Graffell v. Honeysuckle, 30 Wn.2d 390, 191 P.2d 858 (1948). Legislative intent is to be determined according to the ordinary meaning of the words used in a statute. Cory v. Nethery, supra; Cochran v. Nelson, 26 Wn.2d 82, 173 P.2d 769 (1946).
Under subsection (3),supra, an attorney member of the legislature is clearly required to report the name of any law firm, [[Orig. Op. Page 3]] partnership, person, or other business association of which he may be a member, partner or employee, and from whom or from which he derives compensation exceeding the specified amount. However, it is our opinion that he is not required to report the names of his individual clients because he is not, in the ordinary sense, an "employee" of such persons. The attorney-client relationship is ordinarily more like that of an independent contractor than that of employer-employee, in the usual sense of the term. See, Buehman v. Smelker, 50 Ariz. 18, 68 P.2d 946 (1937);1/ also, 5 Am.Jur., Attorneys at Law, § 6.
This distinction was obviously recognized by the legislature itself in requiring a special report to be submitted by attorneys under subsection (4),supra.2/ We should point out for clarity that the actual meaning of that subsection is not involved in any way in this opinion.
In answer to your second question, the period to be covered for thefirst report to be filed by public officials subject to the provisions of chapter 150, Laws of 1965, Ex. Sess., supra, in our opinion, commences on the effective date of the law‑-August 6, 1965.
We have reached this conclusion by reasoning as follows: It is a general rule that statutes speak prospectively and not retrospectively; i.e., they speak only from the time of their taking effect. The court inState v. Ladiges, 63 Wn.2d 230, 386 P.2d 416 (1963), stated the rule as follows:
"As a general rule, newly enacted statutes and newly adopted court rules operate prospectively only. McDowell v. Burke, 57 Wn. (2d) 794, 359 P. (2d) 1037 (1961). See, also, 14 Am.Jur., Courts § 156, p. 361.
". . .
"An exception to the general rule that laws are to be given prospective effect [[Orig. Op. Page 4]] only is recognized in instances where the enacting authority clearly indicates that a retroactive effect was intended. Ashenbrenner v. Department of Labor & Industries, 62 Wn. (2d) 22, 380 P. (2d) 730 (1963); Sorensen v. Western Hotels, 55 Wn. (2d) 625, 349 P. (2d) 232 (1960)." (Emphasis supplied.) (p. 234)
See, also,Tellier v. Edwards, 56 Wn.2d 652, 354 P.2d 925 (1960), and cases cited therein.
If the present act, § 6, chapter 150, Laws of 1965, Ex. Sess.,supra, were construed to require an initial report covering transactions that took place before its effective date, it would be operating retrospectively. InHammack v. Monroe St. Lbr. Co., 54 Wn.2d 224, 339 P.2d 684 (1959), our court said:
"In 1814, Mr. Justice Story, in the Society for the Propagation of the Gospel v. Wheeler, No. 13, 156, 22 Fed. Cas. 756, defined a retrospective law as follows:
"'. . . Upon principle, every statute, which takes away or impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability,in respect to transactions or considerations already past, must be deemed retrospective; . . .'" (Emphasis supplied.) (p. 229)
The basic reporting requirement of the act is that every public official (as therein defined) "on or before January 31st of each year" file a report of relationships from which he has derived compensation exceeding a certain amount during the preceding "twelve month period." See subsection (3) of § 6,supra. However, there is nospecific reference as to the period to be covered by thefirst report.
In the absence of a clear indication "that a retroactive effect was intended" we believe the statute should be construed as prospective only‑-and thus applicable only to transactions occurring after its effective date.
Additionally it should be noted that this conclusion avoids any constitutional objection which might otherwise arise. Section 8 of the act imposes a criminal sanction for violation of the provisions of the act. It reads as follows:
"Any person wilfully, knowingly and intentionally violating any provision of this chapter shall be guilty of a gross misdemeanor." (§ 8, chapter 150, Laws of 1965, Ex. Sess.)
[[Orig. Op. Page 5]]
Thus, if the act were to be given a retrospective effect it would "create a new obligation" or "impose a new duty" of reporting business associations which were not subject to any reporting procedure at the time they were consummated. Failure to report retrospectively would, under § 8, supra, make a public official subject to criminal sanctions.
InHuntamer v. Coe, 40 Wn.2d 767, 246 P.2d 489 (1952), the court adopted a prospective interpretation of the section of the subversive activity act requiring an affidavit of nonsubversive activity. The court said:
"We are in agreement with these views as stated by the attorney general of the state of Washington; furthermore, it is our opinion that chapter 254, Laws of 1951, § 16, and subsection (e) of § 1, can and should be interpreted to require an oath of allegiance relating to the present and the future; and that in this sense, the legislation should not be characterized as ex post facto, or in effect a bill of attainder. If chapter 254 is susceptible of an interpretation requiring an oath covering and relating to past conduct‑- political or otherwise‑-it would in our opinion and under existing authorities be unconstitutional. We believe such an interpretation of the pertinent provisions of chapter 254 is not mandatory or the only one possible.
"InCasco Co. v. Public Utility Dist. No. 1, 37 Wn. (2d) 777, 788, 226 P. (2d) 235, we said:
"'Where a statute is open to two constructions, one of which will render it constitutional and the other, unconstitutional, the former construction, and not the latter, will be adopted. State ex rel. Northern Pac. R. Co. v. Henneford, 3 Wn. (2d) 48, 99 P. (2d) 616.'
"In other words, we think the statute in question can and should be interpreted in a present and prospective sense in so far as the requirement of an oath or affidavit is concerned; and as so interpreted, that it is not unconstitutional, that is,ex post facto, or in effect a bill of attainder." (p. 776)
[[Orig. Op. Page 6]]
As stated above, the manner in which we construe § 6, chapter 150, Laws of 1965, Ex. Sess.,supra, avoids any constitutional objection which could arise if an attempt were made to apply the act retrospectively. This approach to the matter is clearly in accord with the proposal announced by our court inSoundview Pulp Co. v. Taylor, 21 Wn.2d 261, 150 P.2d 839 (1944), as follows:
"There are statutes, however, in which their wording may be plain, but it may appear from such wording that a given statute may be applied in different ways, or some of the words may be susceptible of different meanings, and if applied, or the words are used in a certain way, the statute would be unconstitutional, or a grave doubt as to its validity would be raised. In such cases the rule is that, where a statute is open to two constructions, one of which will render it constitutional and the other unconstitutional or open to grave doubt in this respect, the former construction and not the latter is to be adopted. . . ." (p. 268)
We trust the foregoing will be of assistance to you.
Very truly yours,
JOHN J. O'CONNELL
ROBERT F. HAUTH
Assistant Attorney General
*** FOOTNOTES ***
1/However, a different result would prevail if the attorney were actually employed as an employee by the corporation, either in a nonlegal capacity or as "house counsel," e.g., where the attorney is hired on a monthly salary.
2/The legislative history of Substitute Senate Bill No. 1 provides additional support for our conclusion, particularly if one compares the language of § 4 of the original bill (Senate Bill No. 1) with what are now §§ 3 and 4 of Substitute Senate Bill No. 1.