It is the first major controversy of her first four weeks in the Virginia attorney general's office, and Mary Sue Terry has been nowhere to be seen.

And it was, after all, an opinion from her own staff counsel that set off the legislative fireworks last week over the state's conflicts-of-interest law.

New interpretations of the law delivered by attorney general counsel Francis C. Lee sent lawmakers into turmoil.

The noticeable absence of Lee's boss in the midst of all the confusion angered and annoyed some legislators.

"As the furor continued, she had it in her power to pour oil on the troubled waters," said Sen. Joseph V. Gartlan Jr., the Fairfax Democrat who heads a Senate committee entangled in the controversy. "Why she didn't, I don't know . . . . As long as she leans on these semiofficial memoranda, uncertainties will persist."

Gartlan was referring to the only official communication the legislature received, a "clarifying" memo delivered to lawmakers from Lee on Attorney General Terry's letterhead stationery three days after Lee dropped his bombshell at a House committee hearing.

Appearing at the request of a committee working on modifications to the conflict statute, Lee jolted committee members with an unexpected interpretation of a 14-month-old state Supreme Court ruling. Lee, considered an expert on conflict-of-interest issues, said the ruling suggested that lawmakers could not vote on any matter in which they had any personal interest.

He told the committee that, for example, a delegate who owned one share of bank stock is barred from participating in debate and from voting on any matter affecting banks.

A Senate committee quickly demanded that Lee appear before it and explain what he meant by the sudden, new interpretation of an old court ruling.

Lee, who admitted that Terry had "discussed" his initial comments with him, stood before the Senate Rules Committee two days later and backed down from the first statements, saying he may have been "misunderstood."

What the court ruling means, he told senators, is that the legislator with the one share of bank stock would be prohibited from voting on banking issues only if the one share brought him or her more than $10,000 in annual income or represented at least 3 percent of the bank's holdings. State law sets those figures as guidelines for determining when income or ownership in an enterprise constitutes "personal interest."

But even Lee's revised interpretation carried the impact much further than some legislators said they ever intended in the original law.

A spokesman for Terry's office explained her lack of public actions on the matter by saying that legislators never invited her to appear before a committee. They invited Lee, the spokesman said.

But Terry was not the only state official getting criticism from legislators. As the debate wore on, dozens of lawmakers began asking why Gov. Gerald L. Baliles, who was attorney general at the time the opinion was written by the court, did not alert legislators to the ramifications of the ruling in last year's legislative session.

"Why weren't we alerted last January?" questioned Del. Vincent F. Callahan Jr. (R-Fairfax). "Baliles should be embarrassed -- he was attorney general."

"I interpreted that decision to involve school personnel ," said Baliles, who played a key role in writing the version of the conflicts law that was approved in 1983. "And I did not extrapolate it to apply to other facets of the law."

The court ruling stated that the mayor of Richmond, who sat on the City Council and was a high school principal, could not vote on the appointment of the school superintendent, who ultimately would be his boss.

"I obviously looked at the law very carefully," said Baliles. "I am not going to second-guess or evaluate the attorney general's ruling."