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The Vermont Statutes Online

 

Title 11: Corporations, Partnerships and Associations

Chapter 003: INCORPORATION OF PROFESSIONAL PERSONS

  • § 801. Definitions

    As used herein, unless the context clearly indicates that a different meaning is intended:

    (1) "Professional corporation" means a corporation organized under this chapter.

    (2) "Professional service" means any type of personal service rendered to the public which requires as a condition precedent to the rendering of such service the obtaining of a license or other legal authorization, and which, prior to the passage of this chapter, could not, by reason of law, be performed by a corporation. (1963, No. 218, § 2, eff. July 3, 1963.)

  • § 802. Articles of association

    One or more individuals, each of whom is licensed to render a professional service, may incorporate a professional corporation by filing articles of association with the Secretary of State. The articles of association shall meet the requirements of the general corporation law under chapter 17 of this title, except that the number of incorporators or directors may be the same as the number of individuals incorporating. In addition thereto, it shall contain the following:

    (1) the profession to be practiced through the professional corporation;

    (2) the names and residence addresses of all of the original shareholders, directors and officers of the professional corporation; and

    (3) a certificate by the regulating board of the profession involved that each of the incorporators, directors, and shareholders is duly licensed to practice such profession. (1963, No. 218, § 3, eff. July 3, 1963; amended 1981, No. 64; 1983, No. 127 (Adj. Sess.), § 1.)

  • § 803. Applicability of general corporation law

    The general corporation law under chapters 1 and 17 of this title shall be applicable to professional corporations and they shall enjoy the powers and privileges and be subject to the duties, restrictions, and liabilities of other corporations, except where inconsistent with the letter and purpose of this chapter. This chapter shall take precedence in the event of any conflict with provisions of the general corporation law or other laws. (1963, No. 218, § 4, eff. July 3, 1963.)

  • § 804. Purpose for which incorporated

    A professional corporation may be organized pursuant to the provisions of this chapter only for the purpose of rendering one specific type of professional service and services ancillary thereto and shall not engage in any other business than rendering the professional service which it was organized to render and services ancillary thereto; provided, however, that a professional corporation may own real and personal property necessary or appropriate for rendering the type of professional services which it was organized to render and may make such investment of its funds as is applicable for other corporations. (1963, No. 218, § 5, eff. July 3, 1963.)

  • § 805. Issuance and transfer of shares

    A professional corporation may issue the shares of its capital stock only to persons who are duly licensed to render the same specific professional service as those for which the corporation was organized. A shareholder may voluntarily transfer his or her shares in a professional corporation only to a person who is duly licensed to render the same specific professional services as those for which the corporation was organized. Any shares issued in violation of this section shall be null and void. The voluntary transfer of any shares in violation of this section shall be null and void. No shares may be transferred upon the books of the professional corporation or issued by it until there is presented to and filed with the corporation a certificate by the regulating board stating that the person to whom the transfer is to be made or the shares issued is duly licensed to render the same specific professional services as those for which the corporation was organized. (1963, No. 218, § 6, eff. July 3, 1963.)

  • § 806. Officers, directors and shareholders

    No person may be an officer, director, or shareholder of a professional corporation who is not duly licensed to render the same specific professional services as those for which the corporation was organized. No person may be simultaneously an officer, director, or shareholder of more than one professional corporation. (1963, No. 218, § 7, eff. July 3, 1963.)

  • § 807. Professional services through officers, employees, agents

    A professional corporation may render professional services only through its officers, employees, and agents, who are duly licensed to render such professional services. However, this provision shall not be interpreted to prohibit the employment by a professional corporation of clerks, secretaries, bookkeepers, technicians, and other assistants who are not usually and ordinarily considered by custom and practice to be rendering professional services to the public for which the license is required. (1963, No. 218, § 8, eff. July 3, 1963.)

  • § 808. Professional relationship and liability

    This chapter does not alter the law involving liability of any person employed by the corporation arising out of professional services, and including the confidential relationship between the person rendering the professional service and the person receiving such professional service, if any, and all confidential relationship previously enjoyed under the laws of this state shall remain inviolate. (1963, No. 218, § 9, eff. July 3, 1963.)

  • § 809. Professional regulation

    Nothing in this chapter shall restrict or limit in any manner the authority and duty of the regulating boards for the licensing of individual persons rendering professional services or the practice of the profession which is within the jurisdiction of such regulating board, notwithstanding the fact that such a person is an officer, director, shareholder, or employee of a professional corporation and rendering such professional services or engaging in the practice of such profession through such professional corporation. (1963, No. 218, § 10, eff. July 3, 1963.)

  • § 810. Prohibited acts

    No professional corporation may do any act which is prohibited to be done by individual persons licensed to practice the profession which the professional corporation is organized to render. (1963, No. 218, § 11, eff. July 3, 1963.)

  • § 811. Death or disqualification of shareholders

    The articles of association may provide for the purchase or redemption of the shares of any shareholder upon the death or disqualification of such shareholder, or the same may be provided in the bylaws or by private agreement. In the absence of a provision for the same in the articles of association or the bylaws or by private agreement, the professional corporation shall purchase the shares of a deceased shareholder or a shareholder no longer qualified to own shares in such corporation within 90 days after the death or disqualification of the shareholder, as the case may be. The price for such shares shall be the book value as of the end of the month immediately preceding the death or disqualification of the shareholder. Book value shall be determined from the books and records of the professional corporation in accordance with the regular method of accounting used by such corporation. If the corporation shall fail to purchase such shares by the end of said 90 days, then the executor or administrator or other person representative of a deceased shareholder or a disqualified shareholder may bring an action in the Superior Court for the county in which the principal office of the professional corporation is located for the enforcement of this provision. If the plaintiff obtains judgment in such action he shall be entitled to recover the book value of the shares involved and his costs. The professional corporation shall repurchase such shares without regard to restrictions upon the repurchase of shares provided by the general corporation law. (1963, No. 218, § 12, eff. July 3, 1963; amended 1973, No. 193 (Adj. Sess.), § 3.)

  • § 812. Certificates

    The regulating boards of the respective professions described herein are hereby authorized and directed to issue the certificates required by subdivision 802(3) of this title. Such certificates shall be on forms prescribed and furnished by the Secretary of State. (1963, No. 218, § 13, eff. July 3, 1963.)

  • § 813. Statutory policy

    This chapter shall be so construed as to effectuate its general purpose of making available to professional persons the benefits of the corporate form for the business aspects of their practices, while preserving the established professional aspects of the personal relationship between the professional person and those he or she serves. (1963, No. 218, § 14, eff. July 3, 1963.)