Case Information

*1 i

r Opinion No. m-734

Chairman Re: Whether an insurance carrier

State Board of Insurance 1110 San Jacinto Boulevard m=Y consider completion a defensive driving course under Austin, Texas 6701d, 143A.

V.T.C.S.

Dear Mr. Olson:

You ask several questions about the practice engaged in by some completion of a defensive insurance companies driving course as the equivalent of a conviction certain mis- demeanor offenses under article 6701d, V.T.C.S., the Uniform Act Regulating Traffic on Highways. Your questions are:

1. Does article 6701d, 143A, prohibit completion course for underwriting purposes or does merely prohibit the charge from being considered by a court in assessing punishment subsequent traffic citations?

2. If the statute prohibits the consideration course underwriting purposes, would an insurer's con- sideration of such completion violate the Deceptive Trade Practices Act, Business and Commerce Code section 17.46 and thereby allow enforcement by the State Board of Insurance under 21.21, 7 of the Insurance Code? If not, would such an act violate Insurance Code provisions?

You advise that various companies charge increased prices when an insured or a person seeking takes a defensive in exchange for dismissal of a traffic citation under 143A of article 6701d.

Section 143A of article 6701d, V.T.C.S., provides: i

i (a) When a person is cherged with e mis- demeanor offense under this Act, then a violation of Section 51. committed while operating a motor vehicle, the court:

(1) in its discretion may defer proceedings end allow the person 90 days to present evidence subsequent to the alleged act, the person that, has successfully completed e defensive driver’s course approved by the Texas Department of Public Safety or other driving safety course approved by the court; shall defer proceedings end allow (2)

person 90 days to present written evidence that, subsequent to the alleged act, the person has successfully completed a defensive driver’s course approved by the Texas Department of Public Safety or another driving safety course approved by the court, if:

(A) the person presents to court en oral request or written motion to take a course ;

(B) the person has a valid Texas driver’s license or permit; end

(C) the person’s record es main- tained by the Texas Department of Public Safety does not indicate successful completipn of a safety course under this subdivision within the two years immediately preceding date of the alleged offense.

(b) When the person complies with the pro- visions of Subsection (a) of this and the evidence presented is eccepted by the court,

court shall dismiss the charge.

When a charge is dismissed under this section, the charge may not be pert of the person’s driving or used for any purpose, but the court shall report fact that a person has success- fully completed a driving safety and the date to the Texas Department

Public Safety inclusion in the person’s record. shall note in The court its report whether course was taken under

procedure provided by Subdivision (2) of Sub- -, (a) of this the purpose providing information necessary to determine eligibility to take a subsequent course under that subdivision. (Emphasis added).

Resolution your first question depends on whether the underscored language in section 143A applies to companies.

It has been suggested that the directive that “the charge may not be pert of the person’s driving or used for any purpose” applies only to the courts. This language, however, is broad end is not, by its terms, limited to the courts. Because the prohibition is somewhat emb iguous, its scope depends on the legislative intent behind the phrase in question end behind the whole of section 143A.

Legislative intent is derived from a general review of en entire enactment es well es from an examination of the circumstances existing at the time of enactment, any “evil” to be corrected by the statute, end the purpose to be accomplished by the statute. The legislature added section 143A to article 6701d in 1975. Acts 1975, 64th Leg., ch. 738, et 2406. As originally enacted, the provision applied only when the courts exercised their discretion to apply it. In 1979, the legislature emended section 143A to require the courts to apply the to defendants who comply with the three requirements set forth in subsections (a)(2)(A), (B), and (C) of section 143A. Acts 1979, 66th Leg., ch. 610, et 1359; see Attorney General Opinion NW-428

[1] ?

You also ask whether, if section 143A prohibits the consideration of the completion of a defensive course under section 143A for purposes, such consideration violates the Texas Deceptive Trade Practices - Consumer Protection Act, Business end Commerce Code 17.46, thereby allowing the board to prohibit the conduct under article 21.21, 7, of the Insurance Code. Secrion 7 authorizes the board to issue a cease end desist order against: persons found , after hearing, to have a board violeted the unfair competition/deceptive acts provisions of the Insurance Code or the Deceptive Trade Practices - Consumer Protection Act. It should be noted that the board does not hold the exclusive means to regulate legality practices. See Attorney General of Texas v.

Allstate Insurance Company, 687 S.Wx 803 (Tex. App. - Dallas 1985, ref’d n.r.e.). Additionally, 16 of article 21.21 of the writ Insurance Code creates a private cause of action treble damages injury from unfair or deceptive insurance practices (1) prohibited in section 4 of article 21.21, or (2) rules lawfully adopted by the Insurance Board under article 21.21, or (3) described in the Deceptive Trade Practices - Consumer Protection Act as unlawful. See Royal Globe Insurance Company v. Bar Consultants, Inc., 577 S.W.2d688, (Tex. 1979).

Subsection (b) (12) of section 17.46 of the Business end Commerce Code, the Deceptive Trade Practices Act, provides term “f else, misleading, or deceptive acts or practices includes . . . representing that en agreement confers or involves rights, remedies, or obligations which it does not have or involve, or which are prohibited by law.” As indicated, 143A of 6701d, V.T.C.S.. prohibits from course under section 143A as pert of a person’s driving record or for any other purpose.

practice could fell within et least one express prohibition Deceptive Trade Practices - Consumer Protection Act. A violation the act necessarily depends on the facts in each case. See Royal Globe Insurance Co. v. Bar Consultants, Inc., supra; Attorney General Opinion JK-218 (1984).

Your final question is whether, if the practice in question does not violate the Deceptive Trade Practices - Consumer Protection Act, the practice violates Insurance Code provisions. Because your question is premised on a negative response to your inquiry about Deceptive Trade Practices Act, it is not necessary to address in full in this opinion. You should be aware, however, that a number of Insurance Code provisions are implicated.

For example, 5.09 code prohibits distinctions discrimination between insureds having like hazards. See also Ins.

Code art. 21.21, §4(7). Considering as the equivalent of a conviction

purposes raises discrimination questions.

Moreover, 5.01-l of the Insurance Code provides:

A rating plan promulgated by the State Board of Insurance respecting the writing of motor vehicle insurance, other than insurance written pursuant to Section 35 [assigned risk plans] of the Texas Motor Vehicle Safety-Responsibility Act (Article 6701h. Vernon's Texas Civil Statutes), may not assign any rate consequence to a charge or convic- tion, or otherwise cause premiums for motor vehicle to be increased because of a charge or conviction a violation of

Uniform Act Regulating Traffic on Highways, as amended (article 6701d. Vernon's Texas Civil Statutes) . .

A full discussion these provisions is beyond the scope of your opinion request.

SUMMARY Section 143A of article 6701d. V.T.C.S.. Uniform Act Regulating Traffic on Highways, pro- hibits the completion

a defensive driving course under section 143A for the dismissal of a traffic citation as part of a person's purposes.

Subsection (b)(12) of section 17.46 of the Texas Business and Commerce Code (the Deceptive Trade Practices Act) defines as unlawful an agreement "confers involves rights, remedies, or obligations which it does not have or involve, or which are prohibited by law." because consideration is prohibited by section 143A of 6701d, V.T.C.S., Is prohibited by subsection (b)(12) 17.46

Business and Commerce Code. Additionally,

course under section 143A as the equivalent of a conviction purposes raises dis- which implicate crimination questions

orovisions of the Insurance Code.

JIM MATTOX Attorney General of Texas --Y NARY KELLER

Executive Assistant Attorney General

JUDGE ZOLLIE STJUKLEY

Special Assistant Attorney General

RICK GILPIN

Chairman, Opinion Cormnittee

Prepared by Jennifer Riggs

Assistant Attorney General

.- (1982) . The bill analysis to thisamendment notes that [e]ven though [section 143A] is advantageous to people in that it gives them en alternative to traffic fines and raised retes. the law is only applicable to those persons whom the court chooses to allow the benefit. This language indicates that one of the primary purposes alternative provided by section 143A is to prevent en increase insurance premiums. It is significant that the bill also emended subsection (f) 21 of article 6687b, V.T.C.S., the statute governing department’s jurisdiction over Texas drivers’ licenses, to provide that the department may not release the reasons a driving safety course. The department may only release this information to the courts the purpose of determining eligibility to take a subsequent course uuder section 143A. The fact that legislature restricted the access of all persons except. the courts to information indicates chat legislature intended prohibition to apply broadly. 143A prohibits a charge is dismissed pursuant to 143A as pert of a person’s driving record and from using dismissal of the charge for “any purpose.”