Letter Opinion 1970 No. 020

- - - - - - - - - - - - - February 20, 1970 Honorable Ludwig Lobe Chairman Washington State Board of Accountancy 3000 First Avenue Seattle, Washington 98121 Cite as:  AGLO 1970 No. 20 Re:  Professional Corporations Dear Mr. Lobe: This is in response to your oral inquiry as to the legality of accountants utilizing the 1969 professional service corporation act in light of specific provisions found in the accountancy law. ANALYSIS The Washington supreme court in State ex rel. Standard Optical Co. v. Supr. Ct., 17 Wn.2d 323, 135 P.2d 839 (1943), declared that neither a corporation nor an unlicensed person or entity could engage, even through licensed employees, in the practice of the learned professions unless specifically permitted to do so by statute.  The accountancy act by virtue of a "grandfather clause" permits some corporations to engage in the practice of accountancy (see, RCW 18.04.350).  With the exception of that "grandfather clause" the corporate practice of accountancy has not been permitted in the state of Washington.  RCW 18.04.340 (10) prohibits the use of a corporate name or even any wording that would indicate that the corporation is performing accounting services.  It is probably that provision in conjunction with RCW 18.04.300 (3) which declares the preceding to be a ground for the suspension or revocation of a license that has probably given rise to your inquiry. The 1969 professional service corporations act (chapter 122, Laws of 1969, now codified as chapter 18.100 RCW) clearly permits the formation of a professional service corporation to practice accountancy.   [[Orig. Op. Page 2]] See, RCW 18.100.030.  In light of the purposes of the professional service corporations act, it must be construed as affirmatively granting the professional corporation the ability to function in this state notwithstanding specific provisions in the various professional licensing acts.  Therefore, I would conclude that a corporation formed under the professional service corporations act can practice accountancy while at the same time the prohibitions remain in full force and effect against any other corporate form attempting to engage in the practice of accountancy or other professions. We trust that the foregoing clarifies our oral conversation and will be of assistance to you. Very truly yours, FOR THE ATTORNEY GENERAL Edward B. Mackie Deputy Attorney General