Arkansas Bar Ass'n v. Block, 5-1696

• Decision Date: 27 April 1959
• Docket Number: No. 5-1696,5-1696
• Parties: ARKANSAS BAR ASSOCIATION et al., Appellants, v. Sam BLOCK et al., Appellees.
• Court: Arkansas Supreme Court

Page 912

323 S.W.2d 912

230 Ark. 430

ARKANSAS BAR ASSOCIATION et al., Appellants, v. Sam BLOCK et al., Appellees.

No. 5-1696.

Supreme Court of Arkansas.

April 27, 1959.

Rehearing Denied June 1, 1959.

Gentry & Gentry, Little Rock, for appellants.

Warren & Bullion, Little Rock, for appellees.

HOLT, Justice.

This case involves the alleged unlawful practice of law by appellees, and others similarly situated, and comes to this court on the following agreed statement of facts:

'It is stipulated by and between the plaintiffs and the defendants in the above styled cause of action that the following facts shall be considered by the Court in determining the issues involved in this cause.

'I

'The Bar Association of Arkansas is a voluntary, unincorporated association composed of lawyers comprising most of the practicing lawyers of the State of Arkansas. The plaintiffs have filed this action as officers of the Bar Association of Arkansas and individually as licensed attorneys of Arkansas. This is a class action on behalf of all the members of the Bar of the State of Arkansas.

'II

'This action was brought against the defendants as members of a class of real estate brokers and salesmen licensed under the laws of the State of Arkansas, and is intended to apply equally to all members of said class and is not an individual action directed solely toward the defendants.

'III

'The Arkansas Real Estate Association is a voluntary unincorporated association composed of persons engaged in the real estate business in the State of Arkansas and has intervened in this action as representatives of the class which it represents. The Pulaski County Bar Association is a voluntary unincorporated association composed of practicing lawyers in Pulaski County, Arkansas, and has intervened in this action as a class intervention in behalf of the class which it represents.

'IV

'The Statutes of the State of Arkansas do not define the term 'practice of law'; however, they do provide that no person may practice law in the State of Arkansas without first having obtained a license to do so [Ark.Stats. § 25-106].

'V

'The Statutes of the State of Arkansas provide that no person may engage in the real estate business in the State of Arkansas without having first obtained a license to do so under the Real Estate License Law [Ark.Stats. § 71-1301 et seq.].

'VI

'The practice of completing printed forms of instruments incidental to the completion of real estate transactions in which a real estate broker has an interest as broker has been widespread and prevalent in the State of Arkansas for a number of years and is in practice now and the said real estate brokers intend to continue said practice in the future.

'VII

'The real estate brokers, in transactions in which they act as broker, use standardized and approved prepared forms of instruments hereinafter listed, and complete them by filling in the blank spaces to show the real estate transaction.

'The said instruments are:

1. Warranty Deeds;

2. Disclaimer Deeds;

3. Quitclaim Deeds;

4. Joint Tenancy Deeds;

5. Options;

6. Easements;

7. Loan Applications;

8. Promissory Notes;

9. Real Estate Mortgages;

10. Deeds of Trust;

11. Assignments of leases or rentals;

12. Contracts of Sale of Real Estate;

13. Releases and Satisfactions of Real Estate Mortgages;

14. Offers and Acceptances;

15. Agreements for the sale of real estate;

16. Bills of Sale;

17. Contracts of Sale;

18. Mortgages;

19. Pledges of personal property;

20. Notices and Declarations of Forfeiture;

21. Notices requiring strict compliance;

22. Releases and discharges of mechanic's and materialmen's liens 23. Printed forms approved by attorneys, including the various forms furnished by title insurance companies to defendants for use by defendants as agents of title insurance companies; and

24. Acting as closing agent for mortgage loans and completing by filling in the blanks therein with factual data such instruments as are furnished to them and are necessary and incidental and ancillary to the closing of the transaction between the mortgagee for whom they act as agent and the mortgagor.

25. Leases.

'VIII

'The real estate broker receives a commission for his participation in the real estate transaction as real estate broker, but no separate charge is made by the real estate broker for the completion of the blank forms of instruments which he prepares in the closing of a real estate transaction in which he is participating as broker.

'IX

'The forms used by the defendants have been previously approved by attorneys and have been previously prepared, save for the blank spaces remaining thereon, which the defendants complete as above set out. The selection of the type of instrument form to be used in the closing of the transaction is made by the broker from information elicited from the other parties to the transaction and in accordance with their desires.

'In selecting the type of form to be used in any transaction, the real estate broker consults with the other parties to the transaction and follows their expressed desire as to the kind of transfer, terms, duration of payment, interest, etc.

'X

'The defendants prepare no instruments in transactions in which they are not interested parties as brokers and do not claim the right to prepare instruments or complete printed forms of instruments for other parties where they are strangers to the transaction.

'XI

'The defendants do not render opinions as to titles, nor the condition of titles of the properties which are involved in the transaction, but refer the other parties to the transaction to their respective attorneys in the event a question of title is raised'.

On a hearing, the trial court held that the activities of appellees in preparing the various instruments above listed 'as an incident to real estate transactions which they are handling' did not constitute the practice of law in Arkansas. We have concluded that in so holding the court erred. Simplified, the question presented is whether the admitted activities of appellees constitute the practice of law. We hold that such activities do constitute the practice of law as to every one of the instruments itemized above except as to No. 14, that of 'Offers and Acceptances'. It is undisputed that the appellees here are either persons who are not licensed to practice law, or corporations which cannot be licensed in Arkansas to practice law directly or through employees who are lawyers. Research of authorities by able counsel and by this court has failed to turn up any clear, comprehensible definition of what really constitutes the practice of law. Courts are not in agreement. We believe it is impossible to frame any comprehensive definition of what constitutes the practice of law. Each case must be decided upon its own particular facts.--The practice of law is difficult to define. Perhaps it does not admit of exact definition. Rhode Island Bar Association v. Automobile Service Association, 1935, 55 R.I. 122, 179 A. 139, 100 A.L.R. 226.

The Supreme Court of Errors of Connecticut, in an opinion (April 15, 1958), in the case of State Bar Association of Connecticut v. Connecticut Bank & Trust Company, 145 Conn. 222, 140 A.2d 863, 870, which we think sound and well reasoned, used this language: 'The practice of law is open only to individuals proved to the satisfaction of the court to possess sufficient general knowledge and adequate special qualifications as to learning in the law and to be of good moral character. A dual trust is imposed on attorneys at law. They must act with fidelity both to the courts and to their clients. They are bound by canons of ethics which are enforced by the courts. The relation of an attorney to his client is pre-eminently confidential. It demands on the part of the...