Wilkey v. State ex rel. Smith

• Citation: 14 So.2d 536,244 Ala. 568
• Decision Date: 13 May 1943
• Docket Number: 6 Div. 970.
• Parties: WILKEY et al. v. STATE ex rel. SMITH.
• Court: Supreme Court of Alabama

14 So.2d 536

244 Ala. 568

WILKEY et al. v. STATE ex rel. SMITH.

6 Div. 970.

Supreme Court of Alabama

May 13, 1943

Rehearing denied June 30, 1943. [Copyrighted Material Omitted]

James A. Simpson and Lange, Simpson, Brantley &amp Robinson, all of Birmingham, and Pennington & Tweedy, of Jasper, for appellants.

Marvin Woodall and Francis Hare, both of Birmingham, for appellees.

J. S. Mead, Benners, Burr, McKamy & Forman Frontis H. Moore, and Maurice F. Bishop, all of Birmingham, Dortch, Allen & Swann, of Gadsden, Huey, Welch & Stone, of Bessemer, McCorvey, McLeod, Turner & Rogers, of Mobile, and Powell, Goldstein, Frazer & Murphy, of Atlanta, Ga., amici curiae.

LAWSON Justice.

This is an appeal from a judgment rendered in the court below wherein the appellants were adjudged guilty of practicing law without a license, as required by law, and wherein appellants were prohibited from continuing the practice of law until regularly licensed to so practice in accordance with the laws of this state.

The original petition in this cause was filed on August 21, 1937, in the name of the State of Alabama on the relation of Jim C. Smith and Jim C. Smith against J. L. Wilkey and J. L. Wilkey, Adjuster, Inc., charging that the respondents were engaged in the practice of law without a license. To the original petition, as amended, the respondents filed numerous pleas, among them the general issue and a special plea wherein was set out the practice and procedure usually followed by the respondents in conducting the business of an insurance adjuster. The trial court sustained a demurrer to the plea of the general issue and also to the said special plea. This court in the case of Wilkey v. State, 238 Ala. 121, 189 So. 198, reversed the trial court, holding that it erred in sustaining the demurrer to the plea of the general issue, but concluding that the demurrer to the special plea was correctly sustained. On the second trial in the court below, the trial court gave the general affirmative charge for the complainant after the opening statement of the respondents' counsel. This court again reversed and remanded the cause on the ground that where the respondents plead the general issue and do not waive jury trial, and the opening statement of their counsel raises no issue which is immaterial or against public policy, a directed verdict based on such opening statement is improper as denying the right to trial by jury. Wilkey v. State, 238 Ala. 595, 192 So. 588, 129 A.L.R. 549. The present appeal, therefore, is the third in this case.

The relator alleged in the petition that he was a duly licensed practicing attorney, residing and practicing law in Birmingham, Jefferson County, Alabama, and that at the time of the filing of the petition was president of the Birmingham Bar Association.

The petition charges that J. L. Wilkey, Adjuster, Inc., a corporation, was organized on the 2nd day of January, 1932, in Jefferson County, Alabama, and has its principal office or place of business in said city of Birmingham, Jefferson County, Alabama, and that said corporation was still in existence and in operation at the time of the filing of the petition; that the respondent J. L. Wilkey, Adjuster, Inc., a corporation, from the time of its creation has been managed, controlled and practically owned by the individual respondent J. L. Wilkey; that J. L. Wilkey and J. L. Wilkey, Adjuster, Inc., a corporation, are intruding into the profession of the practice of the law in Jefferson County, Alabama, and elsewhere in this state in that they are and have been since 1932 unlawfully practicing law without having obtained the license as required by the laws of this state.

The relief sought in the petition is: (1) That the respondents be commanded to show by what warrant or authority they, separately and severally, are and have been intruding into the profession and practicing said profession of law in Birmingham, Jefferson County, Alabama, and elsewhere in the state; (2) that upon final hearing the respondents separately and severally be excluded or be prohibited from practicing law in this state until such time when they or either of them may become legally licensed to practice law in the State of Alabama.

The respondents by pleas 1 and 2 set up the general issue or denial of the allegations of the petition.

After the completion of the testimony, the trial court gave the general affirmative charge with hypothesis for the complainant, which charge was duly requested in writing. The jury returned a verdict in accordance with said charge, in favor of the complainant and against the respondents.

The judgment rendered by the court below is in substance as follows:

"* * * And it further appearing to the Court that plaintiffs are entitled to such appropriate relief as is germane to the general nature and purposes of this proceeding in the proper administration of justice and for the general welfare of this State:

"Now, therefore, it is ordered, adjudged and decreed by the court that the said defendants, J. L. Wilkey and J. L. Wilkey, Adjuster, Inc., a corporation, are now and have been continuously since, to wit: in January, 1932, unlawfully intruding into the profession of the practice of law in Jefferson County, Alabama, and elsewhere in this State, and unlawfully practice law in Jefferson County, Alabama, and elsewhere in this State, including the settling, adjusting or compromising of controverted or disputed claims or demands between persons with neither of whom they are in privity or in the relation of employer and employee in the ordinary sense, which is a profession requiring a license or certificate, or other legal authorization within this State, without having obtained such license or certificate or other legal authorization within this State.

"It is further ordered and adjudged by the Court that the defendants, J. L. Wilkey, Inc., a corporation, their officers, agents, servants or employees, be and they are each, separately and severally, hereby excluded from and prohibited from practicing law in the State of Alabama, including the settling, adjusting or compromising of controverted or disputed claims or demands between persons with neither of whom they are in privity or in the relation of employer and employee in the ordinary sense, until such time when they or either of them, respectively may become licensed to practice law in the State of Alabama."

The primary purpose of this litigation as we view it is to have this court determine whether or not there is a field of operation under the laws of this state for the independent insurance adjuster and, if so, to draw a line of demarcation between those acts which constitute the practice of law and those acts connected with the usual course of conduct of such a business which do not amount to the practice of law.

The petition or information in this case does not include any averments of specific acts on the part of respondents which it is contended constitute the practice of law. We have held that such is not necessary, but that allegations, such as are in this case, which charge in general terms that a respondent has intruded into the practice of the profession without a license as required by law, are sufficient. Donovan v. State ex rel. Biggs, 215 Ala. 53, 55, 109 So. 290. The testimony tends to show the practice and procedure customarily followed by respondents in the conduct of business of an independent insurance adjuster. It includes many phases and several different activities which appellee contends constitute the practice of law. If it appears by direct, positive and undisputed evidence that respondents have engaged in any activities in the conduct of the business of an insurance adjuster which constitutes the practice of law, then the trial court correctly gave the general affirmative charge with hypothesis, as requested by complainant, even though there may be a conflict in the evidence as to some phases of respondents' activities or if certain of the other activities of respondents do not constitute the practice of law.

However, in the interest of clarity and because of the importance of the questions presented to all parties concerned, including the public, we deem it wise to discuss the various activities of respondents as disclosed by the record and to express our opinion as to whether or not they constitute the practice of law.

The facts as are necessary to an understanding of this controversy may be summarized as follows:

J. L Wilkey is a resident of the City of Birmingham. His business or vocation is that of an independent insurance adjuster of claims for various companies. He has been so engaged in such vocation since 1928. This type of work was carried on by him as an individual until 1932, when J. L. Wilkey, Adjuster, Inc., a corporation, was organized. Wilkey is the owner of twenty-three of the twenty-five shares of stock, is president and treasurer of the corporation and has exercised complete control and supervision over its activities and policies. The objects for which the corporation was formed as here pertinent are stated in the incorporation declaration to be: (a) To engage in the business of enforcing, securing, settling, adjusting and compromising defaulted, controverted, disputed and denied accounts, claims or demands of every kind, acting solely for persons, firms and corporations with whom said J. L. Wilkey, Adjuster, Inc., is in privity, one or both or more, or with whom one or both or more said J. L. Wilkey, Adjuster, Inc., sustains the legal relation of employer and employee in the ordinary sense; (b) the corporation shall have no power to practice law nor act as an attorney. Offices are maintained in the cities of Birmingham, Anniston and...