Opinion ID: 1250676
Heading Depth: 1
Heading Rank: 1

Heading: Aiding in the Unauthorized Practice of Law.

Text: We first turn our attention to the commission's finding that Baker aided Voegtlin in the unauthorized practice of law. Whether we agree with this finding requires a two step analysis. First, did Voegtlin's actions constitute the unauthorized practice of law? If so, did Baker aid those actions? A. Voegtlin's actions. This court has refrained from attempting an all-inclusive definition of the practice of law. Rather it decides each case in this area largely on its own particular facts. Bump v. Barnett, 235 Iowa 308, 315, 16 N.W.2d 579, 583 (1944). EC 3-5 of the Iowa Code of Professional Responsibility for Lawyers takes the same tack: It is neither necessary nor desirable to attempt the formulation of a single, specific definition of what constitutes the practice of law. EC 3-5. However, EC 3-5 goes on to tell us what the practice of law includes: However, the practice of law includes, but is not limited to, representing another before the courts; giving of legal advice and counsel to others relating to their rights and obligations under the law; and preparation or approval of the use of legal instruments by which legal rights of others are either obtained, secured or transferred even if such matters never become the subject of a court proceeding. Functionally, the practice of law relates to the rendition of services for others that call for the professional judgment of a lawyer. The essence of the professional judgment of the lawyer is his educated ability to relate the general body and philosophy of law to a specific legal problem of a client; and thus, the public interest will be better served if only lawyers are permitted to act in matters involving professional judgment. Where this professional judgment is not involved, nonlawyers, such as court clerks, police officers, abstracters, and many governmental employees, may engage in occupations that require a special knowledge of law in certain areas. But the services of a lawyer are essential in the public interest whenever the exercise of professional legal judgment is required. (Emphasis added.) In short, the practice of law includes the obvious: representing another before the court. But the practice of law includes out-of-court services as well. For example, one who gives legal advice about a person's rights and obligations under the law is practicing law. Or one who prepares legal instruments affecting the rights of others is practicing law. Or one who approves the use of legal instruments affecting the rights of others is practicing law. Practically speaking, professional judgment lies at the core of the practice of law. When lawyers use their educated ability to apply an area of the law to solve a specific problem of a client, they are exercising professional judgment. The phrase educated ability in EC 3-5 refers to the system of analysis lawyers learn in law school. They learn to recognize issues first and then how to solve those issues in an ethical manner, using their knowledge of the law. See EC 3-2 (Competent professional judgment is the product of a trained familiarity with law and legal processes, a disciplined, analytical approach to legal problems, and a firm ethical commitment.). The practice of law is no different: lawyers determine what the issues are and use their knowledge of the law to solve them in an ethical way. This is the art of exercising professional judgment. In contrast, nonlawyers who use their knowledge of the law for informational purposes alone are not exercising a lawyer's professional judgment. For example, an abstracter must have knowledge of what constitutes a lien on real estate. An abstracter uses this knowledge, which is legal in nature, when the abstracter shows the lien in the abstract of title. In doing so, the abstracter is simply furnishing the title examinera lawyerinformation that the lawyer needs in advising the client on the marketability of title. In this scenario, the abstracter is simply furnishing information; the title examiner is exercising professional judgment on a legal question. The abstracter is not practicing law; the title examiner is. From the evidence in this case, it is clear that Voegtlin's actions met one of the practicing law tests articulated in EC 3-5: approval of the use of legal instruments by which legal rights of others are either obtained, secured or transferred. Voegtlin met with the clients. He advised them about what they needed in the way of estate planning. He advised them in particular about what documents they would need and how those documents would need to be tailored to meet their particular situation. In the words of one UPC investigator, by the time the clients got to Baker it was a done deal. Baker was merely a scrivener. Voegtlin had already made the major decisions; he, rather than Baker, was exercising professional judgment. The smoking gun on this point is found in the supplemental financial planning letter. This document acknowledges that the financial planning letter and related instruments were recommended by Voegtlin. Voegtlin's actions fit neatly into what one court considered to be the unauthorized practice of law: Giving legal advice, directly or indirectly to individuals or groups concerning the application, preparation, advisability or quality of any legal instrument or document or forms thereof in connection with the disposition of property inter vivos or upon death, including inter vivos trusts and wills. In re the Florida Bar, 215 So.2d 613, 613-14 (Fla.1968) (per curiam) (petition by state bar and securities broker to determine whether certain activities of securities broker constituted the unauthorized practice of law). We adopt this test as a supplement to EC 3-5 and as an expanded definition of the practice of law. For all of these reasons, we agree with the commission that Voegtlin was engaged in the unauthorized practice of law. B. Baker's actions. DR 3-101(A) prohibits a lawyer from aiding a nonlawyer in the unauthorized practice of law. EC 3-1 exhorts the legal profession to actively discourage the unauthorized practice of law. EC 3-3 reminds lawyers that the disciplinary rules prohibit a lawyer from submitting to the control of others in the exercise of the lawyer's judgment. EC 3-4 also reminds lawyers that [p]roper protection of members of the public demands that no person be permitted to act in the confidential and demanding capacity of a lawyer unless he is subject to the regulations of the legal profession. We agree with the commission that in one way or another Baker violated DR 3-101(A), EC 3-1, EC 3-3, and EC 3-4. From our review of the record, we see Voegtlin's seminars, his newsletters, and his referrals to Baker as nothing more than a scheme on Voegtlin's part to reap substantial fees. Indeed, he targeted clients having estates in excess of $600,000. The scheme worked because Voegtlin preached through his seminars and newsletters that clients should use a living trust because our probate system takes too long and is too expensive. Voegtlin controlled the whole process from the initial interview to the final meeting when the clients executed the documents in his office. He did so by recommending the living trust, the necessary tailored documents to effectuate it, and a lawyer who he believed would not counsel against his advice. In fact, when Voegtlin sold clients on a living trust, Baker never once counseled against using it. Instead of discouraging Voegtlin from these actions, Baker actually encouraged them in a number of ways. First, Baker allowed Voegtlin to exercise the professional judgment Baker should have exercised. Second, Baker allowed Voegtlin to act in a confidential capacity with the clients who were referred to Baker. Third, Baker furnished Voegtlin with forms to be used at his seminar. Fourth, Baker accepted approximately 100 referrals from Voegtlin. Last, Baker gave Voegtlin advice on his newsletters. Our experience with living trusts teaches us that they may be a very poor substitute for probate. Unlike probate fees, the fees charged by nonlawyers like Voegtlin who tout living trusts are not subject to court scrutiny. Lack of court scrutiny can easily lead to unnecessary and excessive fees. [1] The point is whether a living trust is appropriate in a given case calls for the exercise of independent professional judgment by a lawyer.