This is an extremely difficult area of law. Since day 1 of its foundation, the American bar association has been trying to define what is a practice of law. Every jurisdiction in this country has rules to outlaw an unauthorized practice of law. The purpose of such a rule is simple: for consumer protection. If you have a toothache you would choose to see a dentist. What makes a layperson think that he or she could practice law? Practice law is also a highly specialized profession. That is why people spend years in law school to learn how to do it. Yet, every jurisdiction allows pro se litigants. Technically, a high school history teacher practices law when he or she teaches the principles of the Constitution in the classroom since legal knowledge is conveyed. Are these unauthorized practices of law (UPL) such that we need hold them criminally liable? Not only UPL is hard to define, but also any definition would inevitably touch upon the First Amendment Free Speech right. This is increasingly important nowadays with social media networks, chat rooms, online forums around.
In Los Angeles, there are many reports of fraud each year, mainly in the area of immigration. Many individuals are not attorneys yet defrauded new immigrants into paying thousands of dollars to change their legal status.
I am not an expert in this area. The discussion hereafter is based on my understanding of the law, which of course, may or may not be true in the eyes of a court.
To understand UPL, we have to define it. There is no way around. An ABA task force formed an opinion how to define UPL: The practice of law is the application of legal principles and judgment with regard to the circumstances or objectives of a person that requires the knowledge and skills that trained in the law. A person is presumed to practice of law if engaging in any conduct of the following: (1) Giving advices or counsel to persons regarding their legal rights and responsibilities or to those of others. (2) Selecting, drafting, completing legal documents that would affect legal rights of others. (3) Representing another in court, including preparing a filing or conducting a discovery. (4) Negotiating legal rights or responsibilities on behalf of another.
Bear in mind that ABA rules, until they are adopted by a jurisdiction, are not laws. So far only a handful of jurisdictions adopted this rule. Quite frankly, if I were a layperson I would be more confused after reading this rule, in terms of what I shall do and shall not do.
In California, Business and Professions Code, sections 6125 and 6126 only prohibit a layperson to practice law and make such a practice a crime with a penalty of no less than 90 days in jail and/or $1000 in fine. The Code, however, does not define what is UPL. The definition, however, can be traced to a couple of cases, which I quote directly below:
People v. Merchants Protective Corp., 209 P.363, 365 (1922) 'As the term is generally understood, the practice of the law is the doing or performing services in a court of justice, in any matter depending therein, throughout its various stages, and in conformity to the adopted rules of procedure. But in a larger sense it includes legal advice and counsel, and the preparation of legal instruments and contracts by which legal rights are secured although such matter may or may not be depending in a court.' Quoting In the case of Eley v. Miller, 7 Ind. App. 529, 34 N. E. 836.
Baron v. Los Angeles, 2 C.3d 535, 86 C.R. 673, 469 P.2d 353 (1970). (T)he Legislature adopted the state bar act in 1927 and used the term 'practice law' without defining it. [FN7] The conclusion is obvious and inescapable that in so doing it accepted both the definition already judicially supplied for the term and the declaration of the Supreme Court (in Merchants') that it had a sufficiently definite meaning to need no further definition. The definition above quoted from People v. Merchants' Protective Corp. has been approved and accepted in the subsequent California decisions (citations), and must be regarded as definitely establishing, for the jurisprudence of this state, the meaning of the term 'practice law." (People v. Ring (1937) supra. 26 Cal.App.2d Supp. 768, 772, 70 P.2d 281, 283.)
It can be seen that these two cases are old. It must be further defined in terms of today’s world. To do that, it is generally accepted that four cases are the precedents in this area.
First, Jason et al v. Legalzoom. 271 F.R.D. 506, 506 (W.D. Mo. 2010). This was a direct result of opinions of several state bar regulators, such as OH, NC, PA, and CT. Ohio Supreme Court’s Board issued an advisory opinion after investigating Legalzoom, that “An online service, in contrast, utilizes user responses to a question set in order to select the proper clauses, provisions, terms and forms that are required to accomplish the desired result. This process intrinsically requires the practice of law through the automated decision-making system." CT bar in its opinion, denounced Legalzoom as the conduct goes beyond stenographic completion of a document provided by a consumer. PA bar association stated in its opinion that in preparing legal documents which involve selecting terms and clauses and applying facts to unique circumstances of a client, Legalzoom’s conduct constituted UPL.
Second, the US Appeals Court in Ninth Circuit in In re Reynoso, 477 F.3d 1117 (9th Cir. 2007), held “Websites don’t just grow out of thin air and aren’t maintained out of thin air. They’re put together by people; they’re put on the Internet; and it’s not the web site that provides the assistance. It’s the people who develop the web site that provide the assistance."
Third, Dacey. New York County Lawyers Association v. Dacey, 287 N.Y.S. 2d 422 (N.Y. 1967); 283 N.Y.S.2d 984 (N.Y. App. 1967). Norman Dacey, an estate planner, published a book to teach others how to avoid probate. It was found that Dacey conducted UPL.
Finally, Parsons. 179 F.3d 956 (1999). Texas unauthorized practice of law committee sued Parsons Technologies. The defendant invented a software package, “Quicken family lawyer", which interviews a client, applies legal principles, and generates divorce papers. The court held software products that actively assist users in filling out simple legal forms may constitute an unauthorized practice of law.
The bottom line is, with the internet technology these days, everyone can do legal research, prepare legal documents, and represent him or herself in court, as long as such conducts are confined for his or her own goods. If the person starts to give legal advice to others, prepare legal documents for others, represent others in courts or otherwise negotiate rights such as a contract for others, he or she is risking crossing the line of unauthorized practice of law. This is particularly true in an online setting. One can air his or her own opinion, tell a story, etc. Once the person is applying legal principle to a specific set of facts of others, analyzing it, telling others what to do in a court in terms of law or procedures, that person is giving legal advice, thus risking UPL, which, of course, is a crime if that person is not licensed to practice in that particular jurisdiction.
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