Court Opinion

ID: 2690195
Source: CourtListenerOpinion
Date Created: 2014-08-01 20:39:21.882688+00
Date Added: 2024-06-11T12:51:21.871785
License: Public Domain

[Cite as Cincinnati Bar Assn. v. Jansen, 138 Ohio St. 3d 212, 2014-Ohio-512.]

                 CINCINNATI BAR ASSOCIATION v. JANSEN ET AL.
 [Cite as Cincinnati Bar Assn. v. Jansen, 138 Ohio St. 3d 212, 2014-Ohio-512.]
Unauthorized practice of law—Violation of prior consent decree by continuing to
        solicit debtors as clients and to negotiate the resolution of their debts—
        New consent decree approved.
     (No. 2009-1663—Submitted June 5, 2013—Decided February 18, 2014.)
   ON FINAL REPORT by the Board on the Unauthorized Practice of Law of the
                            Supreme Court, No. UPL 06-07.
                                ____________________
        Per Curiam.
        {¶ 1} This matter is before the court on relator Cincinnati Bar
Association’s September 13, 2011 motion for an order to show cause why
respondents Stuart Jansen and American Mediation & Alternative Resolutions
(“AMAR”) should not be found in contempt for their failure to abide by the terms
of this court’s January 26, 2010 order. That order approved the parties’ proposed
consent decree and enjoined Jansen and AMAR, neither of whom is licensed to
practice law in the state of Ohio, from engaging in the unauthorized practice of
law. Cincinnati Bar Assn. v. Jansen, 124 Ohio St. 3d 272, 2010-Ohio-133, 921
N.E.2d 639 (“Jansen I”).
        {¶ 2} The parties submitted a waiver of hearing, proposed findings of
fact, and a proposed consent decree and moved for their adoption and approval.
The panel of the Board on the Unauthorized Practice of Law assigned to hear the
matter adopted the parties’ proposed findings of fact and found that Jansen and
AMAR had violated the terms of the 2010 consent decree by continuing to solicit
debtors as clients and negotiate the resolution of their debts. Stating, however,
that the board did not have authority under the Rules for the Government of the
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Bar to recommend the approval of the parties’ proposed consent decree, the panel
simply stated that it did not object to its terms. The board adopted the panel’s
findings of fact and conclusions of law and recommends that we issue an order
finding that respondents violated the terms of the 2010 consent decree.
       {¶ 3} For the reasons that follow, we find that Jansen and AMAR
engaged in the unauthorized practice of law in violation of the January 26, 2010
consent decree and approve the proposed consent decree submitted to the board
on September 10, 2012.
                            The 2010 Consent Decree
       {¶ 4} In August 2006, relator filed a complaint against Jansen and
AMAR alleging that they had engaged in the unauthorized practice of law by
agreeing to represent a debtor by effecting a settlement with her creditor.
       {¶ 5} On January 26, 2010, this court accepted the board’s
recommendation and approved a consent decree proposed by the parties to resolve
the pending unauthorized-practice-of-law claim.       In that consent decree, the
parties acknowledged that Jansen and AMAR had attempted to effectuate
settlements between their clients and their clients’ creditors. Jansen I, 124 Ohio
St.3d 272, 2010-Ohio-133, 921 N.E.2d 639, at ¶ 9-10. The parties stipulated that
this conduct constituted the unauthorized practice of law, id. at ¶ 11, and agreed:

               “1. The Respondents permanently shall cease and desist
       from sending on behalf of any client of the Respondents located in
       the   State   of   Ohio   any correspondence,       email   message,
       memorandum or any other written or oral communication to any
       creditor of such client which communication disputes or otherwise
       calls into question the validity or amount of the creditor’s claim
       against such client (except only to the extent any such creditor has

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       or may have incorrectly computed the amount of its claim then
       due).
               “2. The Respondents shall not otherwise ‘represent debtors
       in Ohio by advising, counseling or negotiating resolution of their
       debts with creditors or creditors’ counsel’ (per Ohio State Bar
       Assn. v. Kolodner (2004), 103 Ohio St. 3d 504, 2004-Ohio-5581,
       [817 N.E.2d 25]) and shall not otherwise engage in the
       unauthorized practice of law.”

Id. at ¶ 15 and 16, quoting the consent decree approved by the court in 2010.
                        Consent Decree Proposed to Resolve
                Relator’s Motion for an Order to Show Cause
       {¶ 6} After relator moved for an order to show cause why Jansen and
AMAR should not be held in contempt of court for violating the 2010 consent
decree as adopted by this court in Jansen I, the parties submitted stipulations of
fact, and eventually entered into a proposed consent agreement, which provides:

               THIS CONSENT DECREE AND JUDGMENT ENTRY
       AND WAIVER OF HEARING (this “Consent Decree”)
       concerning the Cincinnati Bar Association (“Relator”), and Stuart
       Jansen (“Jansen”) and American Mediation & Alternative
       Resolutions (“AMAR” and, together with Jansen, “Respondents”)
       is as follows:
               A. WHEREAS, on January 26, 2010, the Ohio Supreme
       Court accepted the recommendations of the Board on the
       Unauthorized Practice of Law in this case and approved and
       entered the Consent Decree submitted by Relator and Respondents
       (the “2010 Consent Decree”).         Cincinnati Bar Association v.

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Jansen, et al., 124 Ohio St. 3d 272, 2010-Ohio-133[, 921 N.E.2d
639]; and
         B. WHEREAS, following the Supreme Court’s approval
and entry of the Consent Decree, Respondents continued in
business using, in general, the following practices:
         (a) Respondents sent solicitation letters to prospective
clients, typically identified by Respondents searching the court
index and/or docket in Ohio for named defendants in recently-filed
collection cases, * * *.
         (b) As to those defendants who responded positively to the
Solicitation Letters, Respondents asked them to sign and return a
Limited Power of Attorney Appointment, * * *.
         (c) As to each defendant who signed and returned the
Limited Power of Attorney Appointment, Respondents then sent a
letter to the creditor which had filled the collection case against the
defendant, and which letter contained a “proposed resolution,”
* * *.
         (d) As to those creditors which responded positively to the
Proposed Resolution Letters, Respondents then attempted to
facilitate a resolution of the collection case by transmitting
settlement proposals between the defendant and the creditor.
Those efforts were mostly successful; sometimes they were not;
and
         C. WHEREAS, with respect to those collection cases as to
which Respondents were able to facilitate a settlement, the creditor
prepared a settlement agreement or an agreed judgment entry. The
creditor typically sent the agreement or judgment entry directly to
the debtor. Occasionally, Respondents acted as an intermediary

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                        January Term, 2014

and mailed or emailed the agreement to the debtor on behalf of the
creditor. The debtor was responsible for sending money to the
creditor or returning the signed judgment entry to the creditor.
Respondents were not involved in dismissal of the collection case;
and
       D. WHEREAS, Relator contends the foregoing business
practices constituted the continued unauthorized practice of law by
Respondents in violation of, inter alia, the 2010 Consent Decree.
Respondents contend the foregoing business practices did not
constitute the continued unauthorized practice of law but, instead,
constituted the conduct of a bona-fide mediation service; and
       E. WHEREAS, on September 13, 2011 Relator filed in this
case a Motion for an Order to Show Cause in connection with
Respondents’ foregoing business practices; and
       F. WHEREAS, in February, 2012, in response to Relator’s
Motion for an Order to Show Cause, Respondents: (a) started
using a modified Solicitation Letter * * *; (b) stopped using the
Limited Power of Attorney Appointment form; and (c) started
using a Mediation Agreement * * *; and
       G. WHEREAS, between January 26, 2010 and the date
hereof, Respondents have:        (a) sent approximately 35,000
Solicitation Letters to defendants; (b) received approximately 467
signed Limited Power of Attorney Appointments from defendants;
(c) sent approximately 459 Proposed Resolutions Letters to
creditors; and (d) facilitated the settlement of approximately 434
collection cases; and
       H. WHEREAS,        throughout     this    period   of    time,
Respondents typically have charged those debtors which agreed to

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engage Respondents a fee of $250 per case. In the more complex
cases, Respondents sometimes have charged a slightly higher fee,
but rarely any more than $295 per case; and
       I. WHEREAS, in order to eliminate the need for
contentious, costly and time-consuming litigation of their dispute,
the outcome of which is uncertain, and to amicably settle their
disagreements and differences, Relator and Respondents have
agreed to enter into this Consent Decree; and
       J. WHEREAS, Relator and Respondents hereby waive a
hearing before the Board on the Unauthorized Practice of Law of
the Supreme Court of Ohio (the “Board”).
       NOW, THEREFORE, it hereby is agreed, decreed, and
ordered that:
       1. Upon     their   execution       of   this   Consent   Decree
Respondents shall entirely and permanently cease and desist,
whether as an owner, principal, officer, employee, consultant,
independent contractor, agent, representative or otherwise, from
directly   or    indirectly      soliciting,    procuring,   conducting,
participating in, supervising or otherwise engaging in any
arbitration, mediation or alternative dispute resolution of any kind
for profit. Nothing in this paragraph shall prohibit Respondent
Jansen from engaging in any activity in which he is permitted to
engage by reason of obtaining a securities license or license to
practice law. Nothing in this paragraph shall prohibit Respondent
Jansen from participating in a mediation, arbitration, or other
dispute resolution as a party.
       2. If Respondents are determined by the Board to be in
violation of this Consent Decree, then there shall be imposed

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                                    January Term, 2014

        against them, jointly and severally, a monetary sanction in the
        minimum amount of $50,000 plus any other sanctions (monetary
        or otherwise) which may be imposed on them by the Board or the
        Supreme Court of Ohio.
                 3. Nothing in this Consent Decree shall be deemed to
        amend or modify in any respect any prior stipulations, decrees,
        order or judgments in this case.

(Capitalization sic.)
                          The Board’s Recommendation
        {¶ 7} Pursuant to Gov.Bar R. VII(5b)(E)(3), the board issued a report in
which it adopted the facts as set forth by the parties in the consent decree and
determined that respondents had violated the 2010 consent decree by continuing
to solicit debtors as clients and to negotiate the resolution of their debts. The
board noted that respondents had relied on counsel to assist them in modifying
their business practices to comply with the 2010 consent decree but that the
modifications were nevertheless insufficient to bring them into full compliance
with the decree. Therefore, the board concluded that the violation of the 2010
consent decree was unintentional.           Interpreting Gov.Bar R. VII(5b)(E)(3)1 as
limiting the board’s jurisdiction to making a determination whether the consent

1. Gov.Bar R. VII(5b)(E)(3) provides:

                 A motion to show cause alleging a violation of a consent decree and
        any memorandum in opposition shall be filed with both the Supreme Court and
        the Board. The Board, upon receipt of the motion and memorandum in
        opposition, by panel assignment shall conduct either an evidentiary hearing or
        oral argument hearing on the motion, and by a majority vote of the Board submit
        a final report to the Court with findings of fact, conclusions of law, and
        recommendations on the issue of whether the consent decree was violated.
        Neither party shall be permitted to file objections to the Board’s report without
        leave of Court.

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decree was violated, however, the board did not address the remedial aspects of
the consent decree, other than to state that it did not object to its terms.
                       Jansen and AMAR Have Continued
                 to Engage in the Unauthorized Practice of Law
                     in Violation of the 2010 Consent Decree
        {¶ 8} Article IV, Section 2(B)(1)(g) of the Ohio Constitution grants this
court original jurisdiction over all matters relating to the practice of law. The
unauthorized practice of law consists of the rendering of legal services for another
by any person not admitted to practice law in Ohio. Gov.Bar R. VII(2)(A). We
have held that the practice of law includes “making representations to creditors on
behalf of third parties, and advising persons of their rights, and the terms and
conditions of settlement.” Cincinnati Bar Assn. v. Cromwell, 82 Ohio St. 3d 255,
256, 695 N.E.2d 243 (1998); see also Ohio State Bar Assn. v. Kolodner, 103 Ohio
St.3d 504, 2004-Ohio-5581, 817 N.E.2d 25, ¶ 15; Cincinnati Bar Assn. v. Telford,
85 Ohio St. 3d 111, 707 N.E.2d 462 (1999). It is no defense that respondents
disclosed to their customers that they were not attorneys and could not give legal
advice, or that they obtained powers of attorney executed by their customers. See,
e.g., Columbus Bar Assn. v. Am. Family Prepaid Legal Corp., 123 Ohio St. 3d
353, 2009-Ohio-5336, 916 N.E.2d 784, ¶ 76; Telford at 113.
        {¶ 9} Respondents’ efforts to characterize their services as those of a
mediator or arbitrator of client debts are likewise unavailing. A mediator is “[a]
neutral person who tries to help disputing parties reach an agreement,” and an
arbitrator is “[a] neutral person who resolves disputes between parties * * *.”
Black’s Law Dictionary 1071, 120 (9th Ed.2009). Respondents initially provided
services only to debtors pursuant to “Limited Power of Attorney Appointments”
authorizing them to “effect a resolution” with the creditor. Later, they used
“Mediation Agreements” that purported to appoint Jansen and AMAR as neutral
mediators of debtor-creditor relationships.        While the mediation agreement

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requires the debtor to sign it in order to accept the terms of the agreement and to
authorize the creditor to communicate with Jansen and AMAR, it deems any
communication from the creditor for purposes of discussing the debtor’s
obligation to constitute acceptance of the terms of the agreement by the creditor.
The one-sided nature of this agreement, which also requires the debtor to pay
respondents’ fees in full, reveals that while respondents’ forms may have
changed, their underlying business practices—which constitute the unauthorized
practice of law—have not.
              Approval of the Parties’ Proposed Consent Decree
       {¶ 10} We adopt the factual findings as set forth in the parties’ proposed
consent decree and adopt the board’s finding that Jansen and AMAR violated the
2010 consent decree. We also find that the proposed consent decree (1) protects
the public from future harm, (2) resolves the material allegations of the
unauthorized practice of law, (3) contains an agreement by Jansen and AMAR to
cease and desist the alleged activities that we have found to constitute the
unauthorized practice of law, and (4) provides that in the event Jansen and AMAR
violate the terms of the consent decree, they will be subject to a minimum
monetary sanction of $50,000—in addition to any other sanctions that may be
warranted. See Gov.Bar R. VII(5b)(C).
       {¶ 11} Accordingly, we approve the consent decree in its entirety.
Respondents shall entirely and permanently cease and desist, whether as an
owner, principal, officer, employee, consultant, independent contractor, agent,
representative, or otherwise, from directly or indirectly soliciting, procuring,
conducting, participating in, supervising, or otherwise engaging in any arbitration,
mediation, or alternative dispute resolution of any kind for profit.
       {¶ 12} If Jansen or AMAR are determined by this court to be in violation
of this consent decree, then there shall be imposed against them, jointly and
severally, a monetary sanction in the minimum amount of $50,000, plus any other

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sanctions that may be imposed on them by this court. Costs are taxed, jointly and
severally, to Jansen and AMAR.
                                                          Judgment accordingly.
       O’CONNOR, C.J., and PFEIFER, O’DONNELL, LANZINGER, KENNEDY,
FRENCH, and O’NEILL, JJ., concur.
                            ____________________
       Louis F. Solimine; and Maria C. Palermo, for relator.
       Montgomery, Rennie & Jonson, George D. Jonson, and Lisa M. Zaring,
for respondents.
                        __________________________

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