HAYS v. WOOD

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Court of Appeal, First District, Division 3, California.

Randall A. HAYS, Ukiah City Attorney, et al., Plaintiffs, Cross-Defendants and Respondents, v. Barry WOOD, Ukiah City Councilman, Defendant, Cross-Complainant and Appellant.

Civ. 40623.

Decided: March 08, 1978

Barry Wood, Atty. at Law, Ukiah, for defendant, cross-complainant and appellant. Daniel H. Lowenstein, Robert M. Stern, Michael J. Baker, Lee C. Rosenthal, Fair Political Practices Commission, Sacramento, Evelle J. Younger, Atty. Gen., Iver E. Skjeie, Asst. Atty. Gen., John A. Gordnier, Floyd D. Shimomura, Deputy Attys. Gen., Sacramento, for plaintiffs, cross-defendants and respondents. Herbert M. Rosenthal, San Francisco, Robert M. Sweet, Los Angeles, for amicus State Bar of Cal. Robert P. Will, Gen. Counsel, Carl Boronkay, Asst. Gen. Counsel, Richard P. Gerber, Deputy Gen. Counsel, Los Angeles, for amicus Metropolitan Water District.

We are asked to determine the constitutionality of that portion of the Political Reform Act of 1974 which requires certain public officials who are also attorneys to disclose the names of their clients who pay them a fee of over $1,000. The statutory provision setting forth the form of disclosure is Government Code,1 section 87207,2 which provides in part:

(b) When income of a business entity, including income of a sole proprietorship, is required to be reported under this article, the statement shall contain:

(1) The name, address, and a general description of the business activity of the business entity;

(2) In the case of a business entity which provides legal or brokerage services, the name of every person who paid fees to the business entity if the filer's pro rata share of fees from such person was equal to or greater than one thousand dollars ($1,000);

All other occupational groups are required to make disclosure of income as set forth in section 87207, subdivision (b)(3), which provides:

In the case of a business entity not covered by paragraph (2), the name of every person from whom the business entity received payments if the filer's pro rata share of gross receipts from such person was equal to or greater than ten thousand dollars ($10,000) during a calendar year.

We have concluded that there is no constitutional infirmity in a statute requiring an attorney-public official to disclose the names of clients who have paid a certain fee for legal services, but that the attorney-public official need disclose only the identity of clients doing business within, or clients having other limited contact within the public official's jurisdiction. We also conclude that an attorney-public official need not disclose the name of a client if such disclosure would violate a legally recognized privilege, and further, the attorney-public official is entitled to seek judicial review of a decision of the Fair Political Practices Commission denying the existence of a privilege not to disclose a client's name.

However, the statute here does contain an impermissible distinction between public officials who are attorneys or brokers and public officials engaged in other business activities or professions. To that extent the statute denies attorneys the equal protection of the laws and is therefore unconstitutional. To preserve the legitimate ends of the disclosure statute, we determine that attorneys are includable within section 87207, subdivision (b)(3).3

The statute in question is a part of the Political Reform Act of 1974 (Act). (Gov.Code, title 9, ss 81000-91014.) The Act was adopted as an initiative measure (commonly known as Proposition 9) by the electors June 4, 1974, effective January 7, 1975. The Act established a Fair Political Practices Commission (Commission) (s 83100 et seq.) generally charged with the “primary responsibility for the impartial, effective administration and implementation” of the Act (s 83111). The Act covers a wide range of activities by public officials. We are concerned, however, with Chapter 7 of the Act, entitled “Conflicts of Interest” (ss 87100-87312). Section 87100 recites the public policy concerning conflicts of interest by public officials and provides:

No public official at any level of state or local government shall make, participate in making or in any way attempt to use his official position to influence a governmental decision in which he knows or has reason to know he has a financial interest.

In furtherance of this policy, certain public officials (s 87200)4 are required to make a disclosure annually (s 87203) of sources of income, as set forth in section 87207, supra.

This action was commenced by Randall A. Hays, City Attorney of the City of Ukiah, to compel appellant Barry Wood to file a disclosure of income statement, as required by section 87207, subdivision (b)(2). Wood is a city councilman and one of the public officials listed in section 87200. Appellant alleged that the information sought was privileged. By way of a cross-complaint for declaratory relief, appellant sought to establish the unconstitutionality of the statute.5 The trial court declared the disclosure provisions valid and ordered appellant to comply with the provisions of the Act.

Appellant is an attorney duly licensed and admitted to practice before all courts of the State of California. Since September 1, 1971, he has been a sole practitioner engaged in the general practice of law in the City of Ukiah, California. On March 12, 1974, he assumed the office of City Councilman of the City of Ukiah, having been elected on March 5, 1974.

On April 9, 1975, within thirty days of the first anniversary of his assuming office, appellant filed a financial disclosure statement, as required by section 87203, covering the period January 7, 1975 through March 12, 1975. On April 1, 1976 he filed a second anniversary statement for the period March 12, 1975 through March 9, 1976. Each statement contained all the information required by, and in all respects fully complied with, the Act except that appellant refused to “List the names of each person who paid fees to the business entity if your pro rata share of the fees was $1,000 or more.” Appellant claimed the information was privileged.

Appellant had three clients who, during the first reporting period (January 7, 1975 through March 12, 1975), paid fees to his law practice in amounts equal to or greater than $1,000. He had five clients who, during the period covered by his second filing (March 12, 1975 through March 9, 1976), paid fees to his law practice in amounts equal to or greater than $1,000.

I. Initially, we examine two recent Supreme Court cases which address themselves to previous public official disclosure acts, i. e., City of Carmel-By-The-Sea v. Young (1970) 2 Cal.3d 259, 85 Cal.Rptr. 1, 466 P.2d 225, and County of Nevada v. MacMillen (1974) 11 Cal.3d 662, 114 Cal.Rptr. 345, 522 P.2d 1345. In Carmel, the court struck down the 1969 financial disclosure law (former Gov.Code, ss 3600-3704, added by Stats.1969, ch. 1512, p. 3093, s 1.) The law required “every public officer” (s 3700) and “each candidate” (s 3702) for state or public office to “file, as a public record, a statement describing the nature and extent of his investments” if in excess of $10,000 at the time of the filing of the statement (s 3700). The law also included holdings of a spouse or minor child; it exempted real property used primarily for residential or recreational purposes (s 3603).

The court acknowledged that the public's right to know of matters that might create a conflict of interest between public service and private financial interests was both a “laudable and proper legislative concern and purpose.” (City of Carmel-By-The-Sea v. Young, supra, 2 Cal.3d at p. 262, 85 Cal.Rptr. at p. 3, 466 P.2d at p. 227.) However, the court pointed out that governmental regulation of activities properly subject to control could not be accomplished in such a way as to unnecessarily infringe upon constitutionally protected freedoms (at p. 263, 85 Cal.Rptr. 1, 466 P.2d 225). The record in Carmel showed that the city faced a situation in which numerous public officials would resign rather than make the required financial disclosures; against this factual background the court referred to the “fundamental right” of citizens to hold office. The court also mentioned several cases recognizing the right of public employees to engage in political activities. In its discussion of these cases, it emphasized the importance that any statute restricting a public employee's involvement in political activities be no broader than necessary to preserve the integrity and efficiency of public service (at p. 265, 85 Cal.Rptr. 1, 466 P.2d 225).

The Carmel court recognized a constitutional right of privacy which included an individual's financial affairs and those of a spouse and child, and characterized it as “fundamental” (at p. 268, 85 Cal.Rptr. 1, 466 P.2d 225). The justification for any significant encroachment upon such right by the state requires the presence of a compelling state interest; this interest must be such that it cannot be achieved by a less restrictive alternative (at p. 268, 85 Cal.Rptr. 1, 466 P.2d 225).

In concluding that the law was invalid, the Carmel court stated “there must be a balancing of interests between the government's need to expose or minimize possible conflicts of interest on the one hand and the right to maintain privacy in one's personal affairs while seeking or holding public office on the other.” (2 Cal.3d at p. 269, 85 Cal.Rptr. at p. 8, 466 P.2d at p. 232.) The court characterized the disclosure requirements of the 1969 act as “encompass(ing) indiscriminately persons holding office in a statewide agency regardless of the nature or scope of activity of the agency, as well as those whose offices are local in nature.” It further commented (at p. 269, 85 Cal.Rptr. at p. 8, 466 P.2d at p. 232):

“No effort is made to relate the disclosure to financial dealings of assets which might be expected to give rise to a conflict of interest; that is, to those having some rational connection with or bearing upon, or which might be affected by, the functions or jurisdiction of any particular agency, whether statewide or local, or on the functions or jurisdiction of any particular public officer or employee. Instead, the statute directs that every public officer and each candidate shall file as a public record, ”a statement describing the nature and extent of his investments“ and those ”owned by either spouse or by a minor child thereof,“ if ”such investment is in excess of “ $10,000, excepting only a home and real property used primarily for personal or recreational purposes. (ss 3700, 3702, 3603, 3604.)”

The court also expressed concern (at p. 270, 85 Cal.Rptr. at p. 8, 466 P.2d at p. 232) that

“the newspaper publication of a public officer's assets, or those of the spouse or children, can be expected to bring unwanted solicitation from a variety of salesmen and others, could well encourage harassment lawsuits or demands of like nature, and could expose the public officer and family to various criminal elements in our society. Other public officials whose worth or investments do not require disclosure may find that fact understandably embarrassing. The invasion of privacy rights and the chilling or discouraging effect upon the seeking or holding of public office, great or small, or high or low, appears too clear for dispute.”

Thus, in addition to the unwarranted invasion of the privacy rights of those holding and seeking public office, the court was also sensitive to the secondary effect of the disclosure requirements in deterring individuals from exercising the fundamental right to seek public office. Finally, the court made clear (at p. 272, 85 Cal.Rptr. at p. 10, 466 P.2d at p. 234) that

“Nothing we say here should be deemed to preclude the Legislature in a properly drawn statute from providing for a broad disclosure of assets, income or receipts relevant to the duties and functions of a public officer or employee.”

In Nevada, the court examined the 1973 conflict of interest act (Gov.Code, s 3600 et seq.) in light of a constitutional challenge similar to that in Carmel. The 1973 act contained both prohibitions and disclosure requirements; the disclosure requirements applied only to designated high level officials (s 3700), including city councilmen. The act required the disclosure of investments or real property worth more than $1,000 and whether the value exceeded $10,000. It further required the disclosure of each source of income, loans or gifts amounting to $250; the name, address, and general description of the business activity of each source; a statement of the consideration for which the income was received; and whether the total income, loans or gifts received was worth more than $1,000. Subdivision (c) of section 3700 of the 1973 act provided that “no interest need be disclosed”

“which could not be affected materially by any action, failure to act or decision taken by the public official acting within the scope of his official duties.” However, under subdivision (d), “an interest in real property located within the jurisdiction of the official's agency or an investment in a business entity, a source of income or a position of employment, office or management in any business entity located within the jurisdiction . . . shall be regarded as an interest which could be (a)ffected materially by the official in the scope of his official duties.”

(County of Nevada v. MacMillen, supra, 11 Cal.3d at p. 669, 114 Cal.Rptr. at p. 348, 522 P.2d at p. 1348.)

The court in Nevada stated that the 1973 act “seems specially tailored to meet and satisfy the primary concerns” of Carmel (pp. 670-671, 114 Cal.Rptr. p. 349, 522 P.2d p. 1349). It noted that the disclosure provisions of the 1973 act did not apply to every public official and that they related only to financial dealings which might give rise to a conflict of interest. “(U)nlike the 1969 act, the 1973 act does not require disclosure of the actual extent of the official's assets and interests, but only whether the value of his investment or real property interest exceeds $10,000” (pp. 671-672, 114 Cal.Rptr. p. 350, 522 P.2d p. 1350). The court concluded that the 1973 act, on its face, “contains sufficient assurances that unnecessary intrusions into personal privacy will not occur” (p. 672, 114 Cal.Rptr. p. 350, 522 P.2d p. 1350).

The court in Nevada construed the 1973 act in light of a then recent amendment so that the phrase “source of income, loans or gifts” did not refer to individual customers or clients but only the general business in which the official earned the income. The court thereby avoided any real discussion of the constitutional implication of more specific disclosure provisions. (See 11 Cal.3d at pp. 674-675, 114 Cal.Rptr. at p. 352, 522 P.2d at p. 1352.)

II. As originally enacted, section 82030, subdivision (a) defined “income” to include any fees paid by a client to an attorney's law firm if the attorney's pro rata share of the fee amounted to $1,000 or more. Effective January 1, 1977, this section was amended to exclude

income received from any source outside the jurisdiction and not doing business within the jurisdiction, not planning to do business within the jurisdiction, or not having done business within the jurisdiction during the two years prior to the time any statement or other action is required under this title.

(Stats.1976, ch. 1161, s 2.) This amendment limits the client disclosure requirements to those clients doing business within the official's jurisdiction or having the other specified contacts within the jurisdiction.

We deem this amendment to be directly aimed at curing the original overbroad disclosure requirements of the Act. In Carmel, the court stated: “It may be assumed that a requirement of relevant disclosures of investments or assets would bear a rational relationship to the valid state purpose of preventing conflicts of interest on the part of public officials and employees.” (2 Cal.3d at p. 270, 85 Cal.Rptr. at p. 9, 466 P.2d at p. 233.) Thus, it is clear that disclosure requirements must be relevant in applying only to sources of income or assets which could potentially create a conflict between the official's public duties and private financial interests. The stated purposes of the Act, as they concern this conflict of interest issue, are found in section 81001, subdivision (b), and provide as follows: “Public officials, whether elected or appointed, should perform their duties in an impartial manner, free from bias caused by their own financial interests or the financial interests of persons who have supported them.” Obviously, fees generated from sources unconnected with the official's jurisdiction have no bearing upon or relationship to the stated purposes of the Act.6

Furthermore, in enacting this amendment the Legislature may have done no more than correct an oversight in the drafting of the original Act. Certain references in the original Act to the disclosure provisions indicate that disclosure is required as to financial matters that could potentially affect the official's performance in office. Section 81002, which enumerates the purposes of the Act, states in part that

(d) Assets and income of public officials which may be materially affected by their official actions should be disclosed and in appropriate circumstances the officials should be disqualified from acting in order that conflicts of interest may be avoided; (Emphasis added.)

Section 82034 defines “investment”; it provides in part:

“Investment” means any financial interest in or security issued by a business entity, including but not limited to common stock, preferred stock, rights, warrants, options, debt instruments and any partnership or other ownership interest, if the business entity or any parent, subsidiary or otherwise related business entity has an interest in real property in the jurisdiction, or does business or plans to do business in the jurisdiction, or has done business within the jurisdiction at any time during the two years prior to the time any statement or other action is required under this title. (Emphasis added.)

The underscored language of this provision of the original Act is virtually identical to the language found in the amendment relating to income. There is no reason to believe that the Act initially intended the relevance requirement to apply only to investments and not to income. These two sections evidence a concern with the disclosure of financial affairs which could be affected by actions taken in public office or which in turn could influence these actions. In light of this purpose, application of the amendment to the present case would be consistent with the intent of the Legislature in enacting it, as well as the desire of the electorate in enacting the Act.

We conclude that the amendment is necessary to preserve the validity of the statute. Appellant's disclosure requirements as to the periods here in question are governed by the amendment. To hold otherwise would eliminate any pre-January 1977 disclosure requirement, a result we deem unnecessary.

III. The amended Act meets the requirement of Carmel in that it “relate(s) the disclosure to financial dealings or assets which might be expected to give rise to a conflict of interest; that is, to those having some rational connection with or bearing upon, or which might be affected by, the functions or jurisdiction of any particular agency . . . or . . . of any particular public officer.” (2 Cal.3d at p. 269, 85 Cal.Rptr. at p. 8, 466 P.2d at p. 232.) Here, the Legislature and the electorate have drafted a statute which avoids the major flaw of the 1969 act examined in Carmel ; an overly broad disclosure provision irrelevant to the state's legitimate interest in avoiding and exposing conflicts between the personal financial interests of its officials and the performance of their official duties. In addition, appellant as a city councilman holds a sufficiently high level office that the application of this particular disclosure scheme is reasonable, given the state's recognized legitimate interest in avoiding conflicts of interest by public officials.

The present disclosure provisions resemble those examined in Nevada in several respects. As indicated, the present scheme applies only to designated officials of such rank that disclosure is reasonable; in this way it resembles the 1973 act. Neither act requires the disclosure of the actual extent of the official's income. The present Act (as amended) and the 1973 act have very similar income disclosure provisions which are triggered only by income whose source could potentially affect an official's performance in public office.

The present Act is less intrusive and more carefully drawn than the 1973 act in that the disclosure requirement arises only after the official has been in office for one year (ss 87201-87203), while the 1973 act demanded disclosure on an annual basis each April even if the official had not been in office for a year. Thus, under the 1973 act an official was, in some cases, obliged to report income received prior to office. (See former s 3700.) In addition, the Act's disclosure provisions are more precisely drawn than those of the 1973 act in that section 82030, subdivision (b) lists eight items which are specifically designated as not being “income”; they represent sources of funds which either lack potential as the basis for abuse of public office or are regulated under another scheme.

IV. Section 87207, subdivision (b)(2) of the present Act differs from the 1973 act (as construed in Nevada ) in requiring disclosure by attorneys and brokers of “the name of every person who paid fees to the business entity” (emphasis added) from which the filer's pro rata share is $1,000 or more. To some extent this requirement constitutes a further intrusion into the filer's private financial affairs and has a greater chilling effect upon the exercise of a broker's or attorney's right to run for public office.

Because of the application of the recent amendment to the present case, the only client names required to be disclosed under the Act are those having a significant relationship to the jurisdiction in which the official holds office. This information is somewhat more revealing as to the private financial affairs of the attorney than simply designating his law practice as the source of income; however, simply disclosing a law practice, without identification of the clients who paid substantial fees, does little to reveal a potential or actual conflict of interest. To prohibit the required disclosure of the names of clients having substantial ties to the jurisdiction in which the official holds office and paying significant fees to the official's law firm (and the official) would be to prohibit any effective disclosure provisions as to public officials who maintain an active law practice; the most serious abuses of public office could be hidden because of disclosure provisions which merely revealed a law practice, but not the fact that the attorney-public official received large fees from individuals who dealt regularly with him or appeared before him in his capacity as a public official. The court indicated in Carmel that nothing prevents the Legislature from providing for a “broad disclosure of assets, income or receipts relevant to the duties and functions of a public officer or employee.” (2 Cal.3d at p. 272, 85 Cal.Rptr. at p. 10, 466 P.2d at p. 234.)

In light of the relevance requirement which the 1976 amendment imposes on the disclosure scheme, the limited invasion of appellant's and his clients' privacy rights and any incidental chilling effect on appellant's right to run for public office is constitutionally permissible under the holdings of Carmel and Nevada.7

V. We conclude that the Act did not intend to affect or dilute the attorney-client privilege (Evid.Code, ss 950-962) or affect the attorney's duty under Business and Professions Code, section 6068, subdivision (e). A procedure is necessary to harmonize the Act with these other statutes. To this end, the Commission has adopted regulations to carry out the purposes of the Act under authority of section 83112. California Administrative Code, division 6, chapter 7, title 2, section 18740 provides a procedure for not divulging the name of a client otherwise required to be disclosed, if doing so would violate a legally recognized privilege under California law. The purpose of the regulation is to avoid interference with the legitimate rights of clients as otherwise protected, in recognition of the attorney-client privilege (Evid.Code, ss 950-962) and rules of professional conduct (Bus. & Prof.Code, s 6068, subd. (e)).

The Commission's procedure requires the attorney claiming the privilege to explain “the legal basis for assertion of the privilege and, as specifically as possible without defeating the privilege, facts which demonstrate why the privilege is applicable.” (2 Cal.Adm.Code, s 18740, subd. (a).) This is an appropriate manner of commencing the claim of privilege. Under subdivision (c), if the Executive Director of the Fair Political Practices Commission doesn't agree that the privilege exists, he may order disclosure. The attorney-official may appeal to the Commission and the decision of the Commission is final (subd. (e)). In the event that the Commission refuses to recognize a claimed privilege, such “action” is subject to judicial review under section 83120.

VI. We turn now to our determination that section 87207, subdivision (b) denies attorneys as a class the equal protection of the laws. The Act requires an attorney-public official (or broker-public official) to report the names of certain clients from whom he received pro rata fees of $1,000, while an official involved in another business or profession need not disclose the names of clients or customers until he has received from them gross receipts of $10,000.

In cases involving claimed violations of equal protection, both the California Supreme Court and the United States Supreme Court have adopted a two-tier approach. Where the questioned classification involves either a “suspect class” or a “fundamental right,” a classification or discrimination must be justified by a compelling governmental interest, while in cases not involving such a right or classification the presumptive validity of the law will prevail if there appears to be a rational relationship between the scheme and a valid state interest. (See Johnson v. Hamilton (1975) 15 Cal.3d 461, 466, 125 Cal.Rptr. 129, 544 P.2d 881; Weber v. City Council (1973) 9 Cal.3d 950, 958-959, 109 Cal.Rptr. 553, 513 P.2d 601; Shapiro v. Thompson (1969) 394 U.S. 618, 634, 89 S.Ct. 1322, 22 L.Ed.2d 600; San Antonio School Dist. v. Rodriguez (1973) 411 U.S. 1, 17, 28, 93 S.Ct. 1278, 36 L.Ed.2d 16.) Attorneys and brokers are not a “suspect class.” (See San Antonio School Dist. v. Rodriguez, supra, at p. 28, 93 S.Ct. 1278.) The disclosure provisions substantially affect the fundamental rights of privacy and the right to seek office. (See Carmel, 2 Cal.3d at pp. 268, 270, 85 Cal.Rptr. 1, 466 P.2d 225; Nevada, 11 Cal.3d at p. 676, 114 Cal.Rptr. 345, 522 P.2d 1345.) Where a fundamental right is involved, there is no presumption of validity and the state must show, in addition to the compelling state interest to justify the law, that the particular classification adopted is necessary to further this interest. (Johnson v. Hamilton, supra, 15 Cal.3d at p. 466, 125 Cal.Rptr. 129, 544 P.2d 881.) Thus, here, where “strict scrutiny” is required, the court must carefully examine the interest advanced to justify the provisions in question and the necessity for that particular classification to achieve the interest.

In response to equal protection arguments advanced against the 1973 act, the court in Nevada stated that

“it seems evident that the Legislature had the authority to specify those ” high-level“ officials to which the disclosure provisions should apply in our Carmel case, we pointed out that one of the failings of the 1969 act was that its provisions applied to all public officials regardless of the nature of their responsibilities.”

(11 Cal.3d at pp. 676-677, 114 Cal.Rptr. at p. 354, 522 P.2d at p. 1354.)

It is clear that the Legislature has discretion to decide which public officials are subject to valid disclosure requirements and which are not; however, once it makes such a determination, it cannot, absent a manifest need, required different disclosures by officials, depending upon their private occupations.

In support of this stricter reporting standard for attorneys, the trial court was persuaded by a contention of the Commission that attorneys have a much greater opportunity to misuse their office under the guise of legitimate client relationship than do public officials in other professional occupations. We find nothing in support of this contention. This contention and others made by the Commission cannot serve as a ‘rational basis,’ the standard used by the trial court, to support discriminatory legislation, nor do they provide the basis of a compelling state interest to justify the disparity.

Respondents make an unpersuasive argument that the $1,000/$10,000 distinction does no more than take account of the different profit margins of different professions and thus trigger the disclosure requirements at a uniform level in terms of net income. They argue that attorneys have an average net profit of from 45%-60% Of their gross fees, while businessmen have average net profits of 1%-10% Of gross income. Respondents concede, however, that there may be other professionals or businessmen also having 45%-60% Profit margins who do not come within the stricter disclosure requirements of section 87207, subdivision (b) (2).

Respondents also point to the retainer fee as having great potential for abuse as a disguised payment for favorable treatment from a public official. This argument is unpersuasive. Disclosable “income” as defined by section 82030 includes any manner of receipt of money or something of value, i. e., gifts or otherwise. Any public official could fall within the rationale of the respondents, not just attorneys. There is no greater potential for the misuse of the retainer fee to corrupt an attorney than the giving of “income” in any manner to any public official. It appears that the drafters of the initiative measure, for no justifiable reason, simply set attorneys and brokers apart from other citizens who hold public office.

We conclude, therefore, that the distinction between the treatment of the business of an attorney-public official and the businesses of other public officials is impermissible. However, it is not necessary to strike down all of the disclosure provisions of section 87207. By finding section 87207, subdivision (b)(2) unconstitutional, we leave the rest of the section intact.8 Attorney-public officials fall within subdivision (b)(3) in the same way and to the same extent as other business entities. The disclosure as to personal sources of income will continue as provided by subdivision (a).

Judgment is reversed with directions to enter judgment in conformity with the views herein expressed.

FOOTNOTES

FN1. Unless otherwise stated, all statutory references are to the Government Code..  FN1. Unless otherwise stated, all statutory references are to the Government Code.

2.  All officials are required to report income as described in section 87207, subdivision (a), as follows:When income is required to be reported under this article, the statement shall contain, except as provided in subsection (b):(1) The name and address of each source of income aggregating two hundred fifty dollars ($250) or more in value, or twenty-five dollars ($25) or more in value if the income was a gift, and a general description of the business activity, if any, of each source;(2) A statement whether the aggregate value of income from each source was greater than one thousand dollars ($1,000), and whether it was greater than ten thousand dollars ($10,000);(3) A description of the consideration, if any, for which the income was received;(4) In the case of a gift, the amount and the date on which the gift was received.Appellant does not contend, nor do we find, any constitutional infirmity in these reporting requirements. (See City of Carmel-By-The-Sea v. Young (1970) 2 Cal.3d 259, 85 Cal.Rptr. 1, 466 P.2d 225; County of Nevada v. MacMillen (1974) 11 Cal.3d 662, 114 Cal.Rptr. 345, 522 P.2d 1345.)

3.  Business entities which provide brokerage services, i. e., brokers, though not before us here, are also denied equal protection by the impermissible distinction.

4.  Section 87200 provides:This article is applicable to elected state officers, judges of courts of record, members of the Public Utilities Commission, members of the State Energy Resources Conservation and Development Commission, members of the Fair Political Practices Commission, members of the California Coastal Zone Conservation Commission, members of the board of supervisors, district attorneys and chief administrative officers of counties, mayors, city managers, chief administrative officers and members of city councils of cities, members of each of the six regional coastal zone conservation commissions, and to candidates for any of these offices at any election.

5.  The State Bar of California, as amicus, filed a brief in support of appellant's contention that the statute is unconstitutional.

6.  We do not attempt here to define who is “doing business” (s 82030, subd. (a)) within an official's jurisdiction so as to bring the official within the disclosure requirements. We do, however, perceive that the client's contact within the official's jurisdiction must be substantial and not just the casual use of business services within the jurisdiction. It is also evident that a public official must in fact have knowledge that an income source is “planning to do business within the jurisdiction” before he is obligated to disclose such source.

7.  We do not perceive that the disclosure requirement can be challenged on the basis of the clients' right of privacy. (See Cal.Const., art. I, s 1.) If such a right of privacy exists, it would be equally applicable to clients and customers of all business entities. Clients and customers of public officials simply have the option of not patronizing the public official if they do not want this aspect of their financial affairs disclosed. This result may have some limited chilling effect upon the desire to hold public office. It is manifestly necessary, however, to an effective financial disclosure requirement that the names of clients or customers of public officials making substantial payments to those public officials be made public.

8.  Section 81015 specifies that the provisions of the Act are severable; if a provision is held to be invalid, other provisions shall not be affected thereby.

SCOTT, Acting Presiding Justice.

KING and SMITH (Assigned by the Chairperson of the Judicial Council), JJ., concur.