Texas Professional Corporation for Dentists Law

Texas Professional Corporation for Dentists Law

Corporations – Professional Corporation – Texas

Occupations Code, Title 3, Chapters 251-261
Texas Professional Corporation Act (Vernon’s Texas Civil Statutes, Article 1528e)

Texas Business Corporation Act, Article 1.01 et seq.

The practice of dentistry in the State of Texas is controlled by Title 3, Chapters 251-261 of the Occupations Code as well as by the rules and regulations established by the Texas State Board of Dental Examiners. A professional corporation formed to engage in the practice of dentistry is also subject to the provisions of both the Texas Professional Corporation Act and the Texas Business Corporation Act.

The primary distinctions between a “regular” corporation and a professional corporation are:

1. When the provisions of the Texas Professional Corporation Act and the Texas Business Corporation Act are in conflict, the provisions of the Texas Professional Corporation Act control.

2. A professional corporation may use the initials “P.C.” in its corporate name in lieu of the word, or in lieu of the abbreviation of the word, “corporation,” “company,” or incorporated.”

3. All shareholders, officers, and directors of a professional corporation organized to render the professional services of dentists must be licensed or otherwise authorized to engage in the practice of dentistry in the State of Texas.

4. A professional corporation organized to render the professional services of dentists may be organized under the Texas Professional Corporation Act only for the purpose of rendering professional dentistry services and for services ancillary to the rendering of dentistry services.

5. If a shareholder, officer, or director of a professional corporation organized to render the professional services of dentists becomes legally disqualified to render those services, that person MUST IMMEDIATELY sever all employment ties with the corporation and terminate all financial interest in the corporation.

6. If any successor in interest of any shareholder is not licensed to engage in the practice of dentistry in the State of Texas, the person holding that interest MUST IMMEDIATELY terminate all financial interest in the corporation.

7. A professional corporation organized to render the professional services of dentists may render professional service in Texas only through its officers, employees and individual agents who are duly licensed to render such professional service in Texas. (This does not include “employees such as clerks, secretaries, bookkeepers, technicians, nurses, assistants and other individuals who are not usually and ordinarily considered by custom and practice to be rendering professional service for which a license or other legal authorization is required”)

8. The dentist-patient relationship is not affected because the professional services are being rendered by the corporation.

9. The professional corporation (but not the individual shareholders, officers or directors) is jointly and severally liable with the officer, employee or agent rendering professional service for any professional errors, omissions, negligence, incompetence or malfeasance on the part of any officer, employee or agent when that officer, employee or agent is acting in the course of his employment for the professional corporation.

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Inside Texas Professional Corporation for Dentists Law