Benninghoff v. Superior Court

Citation38 Cal.Rptr.3d 759,136 Cal.App.4th 61
Decision Date30 January 2006
Docket NumberNo. G035923.,G035923.
PartiesCharles BENNINGHOFF, Petitioner, v. The SUPERIOR COURT of Orange County, Respondent; The State Bar of California, Real Party in Interest.
CourtCalifornia Court of Appeals
OPINION

IKOLA, J.

Petitioner Charles Benninghoff, a former lawyer who resigned from the State Bar of California (State Bar) with disciplinary charges pending, seeks an extraordinary writ reversing an order whereby the court assumed jurisdiction over his practice. The court found Benninghoff had been illegally practicing law by representing parties before federal and state agencies as a self-styled "lay representative." Benninghoff contends that laypeople may represent parties in state administrative hearings, and so this kind of representation must not constitute the practice of law. Because he was not practicing law, he argues, the court lacked any basis to assume jurisdiction over his lay practice.

Benninghoff's conclusions do not follow from his premise. Representing parties in state administrative hearings constitutes the practice of law. As a "lay representative," Benninghoff used his legal knowledge to offer legal advice and counsel, prepare legal documents, and attempt to secure his clients' legal rights. If laypeople are allowed to engage in this kind of representation—an issue we need not decide—it would be an exception to the general rule that only active bar members may practice law. At most, the exception would allow laypeople to practice law in state administrative hearings. It does not render this work anything other than the practice of law. By representing parties in state administrative hearings, Benninghoff practiced law in California—something he has lost the right to do by reason of his resignation from the State Bar with disciplinary charges pending.

But Benninghoff is correct on one point. The court could not assume jurisdiction over his federal practice, because federal regulations governing practice before federal courts and agencies preempt state law prohibiting the unauthorized practice of law. Thus, we grant his petition to this extent only.

FACTS

In 1999, Benninghoff pleaded guilty to conspiring to defraud the United States and three other federal felonies.1 He resigned from the State Bar with disciplinary charges pending. In his resignation letter, Benninghoff "acknowledge[d] that [he] will be ineligible to practice law or to advertise or hold [him]self out as practicing or as entitled to practice law."

No longer an active member of the State Bar, Benninghoff plied his trade outside the court system. He represented professional licensees in state administrative hearings and federal prisoners in prison transfer applications. He sent direct mail solicitations and operated websites advertising his services as a "professional advocate." Eventually, the Medical Board of California (Medical Board) asked the State Bar to clarify whether Benninghoff could represent parties in its disciplinary hearings. While the State Bar investigated the matter, two administrative law judges ruled on petitions to disqualify Benninghoff from Medical Board hearings. Both judges found that Benninghoff was practicing law by representing parties in administrative hearings.

The State Bar filed an application asking the court to assume jurisdiction over Benninghoff's practice. The court granted the order. Benninghoff petitioned for an extraordinary writ, and later filed a motion for a partial stay to allow him to continue representing federal prisoners.

DISCUSSION

This is the first appellate opinion construing Business and Professions Code section 6180,2 which authorizes a court to assume jurisdiction over the law practice of an attorney who "dies, resigns, becomes an inactive member of the State Bar, is disbarred, or is suspended from the active practice of law ...." One explanation for the dearth of appellate opinions is that an order granting an application to assume jurisdiction is not appealable; review may be sought only by a writ petition. (§ 6180.13.)

The first issue we must address is the standard of review. As usual, we review the court's implied and express factual findings for substantial evidence, and review its statutory interpretation independently. (See Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 632, 80 Cal.Rptr.2d 378 ["When the trial court has resolved a disputed factual issue, the appellate courts review the ruling according to the substantial evidence rule"]; see also Harbor Island Holdings v. Kim (2003) 107 Cal.App.4th 790, 794, 132 Cal.Rptr.2d 406 [questions of law reviewed de novo].)

But the ultimate determination to assume jurisdiction over a law practice rests in the court's discretion. The statute says the court "may make an order assuming jurisdiction" if the lawyer dies or ceases active membership in the State Bar. (§ 6180.5, italics added; accord In re Richard E. (1978) 21 Cal.3d 349, 354, 146 Cal.Rptr. 604, 579 P.2d 495 ["The ordinary import of `may' is a grant of discretion"].) Also, we imagine that when most lawyers die or resign, clients usually pick up their files and obtain new counsel without court intervention. The court's decision to assume jurisdiction over a practice to protect the clients is akin to a decision to appoint a receiver, which calls for the exercise of discretion. (City and County of San Francisco v. Daley (1993) 16 Cal.App.4th 734, 744, 20 Cal.Rptr.2d 256.) Thus, we will review the order assuming jurisdiction over Benninghoff's practice for an abuse of discretion.

Benninghoff May Not Represent Parties in State Administrative Hearings

Benninghoff contends that laypeople may represent parties in state administrative hearings. He relies on various sections of the Administrative Procedure Act (Gov.Code, § 11370 et seq., hereinafter APA) that refer to a party's "attorney or other authorized representative."3 He also relies on several regulations that refer to a party's "counsel or other representative."4

The State Bar hedges its bet on the question. In its brief, it assumes for the sake of argument that laypeople may represent parties in state administrative hearings. But it also directs our attention to the Medical Board's amicus brief filed below, which contended that laypeople have no such right. The Medical Board relied primarily on Government Code section 11509. This statute requires agencies to notify parties that they "have the right to be represented by an attorney at [their] own expense," but makes no mention of any right to be represented by a layperson. It also relied on other APA sections referring to a party's attorney without mentioning any other kind of representative. It contends that the APA sections and regulations mentioning "authorized representatives" or "other representatives" should be construed to refer to corporations, who have the right to represent themselves in agency hearings and must do so through a natural person: i.e., a "representative."

We decline to resolve this issue. To decide this case, we need not resolve the broad question of whether laypeople in general may represent parties in state administrative agencies. Rather, we will assume that laypeople may do so, and turn to the specific question of whether Benninghoff may do so, too.

Our specific question arises because Benninghoff is not the typical layperson—he used to be lawyer. The statute prohibiting the unauthorized practice of law treats true laypeople differently than lawyers who have lost their bar membership. Section 6126, subdivision (a) addresses true laypeople. It provides that "[A]ny person ... practicing law who is not an active member of the State Bar, or otherwise authorized pursuant to statute or court rule to practice law in this state at the time of doing so, is guilty of a misdemeanor." (Italics added.) Section 6126, subdivision (b) addresses lawyers like Benninghoff. It provides that "[a]ny person who ... has resigned from the State Bar with charges pending, and thereafter practices or attempts to practice law ... is guilty of a crime punishable by imprisonment in the state prison or county jail."5 Thus, a true layperson may practice law when "authorized pursuant to statute or court rule"; a defrocked lawyer like Benninghoff may not practice law at all. (§ 6126, subds. (a) & (b).)

This leads us to determine whether the representation of parties in state administrative hearings constitutes practicing law. The State Bar Act, section 6000 et seq., was enacted in 1927 to set forth "a comprehensive scheme regulating the practice of law in the state." (Birbrower, Montalbano, Condon & Frank v. Superior Court (1998) 17 Cal.4th 119, 127, 70 Cal.Rptr.2d 304, 949 P.2d 1 (Birbrower).) It provided that only active State Bar members may practice law, but did not itself define the term "practice law." (Id. at p. 128, 70 Cal.Rptr.2d 304, 949 P.2d 1.) Thus, as subsequent courts found, the State Bar Act implicitly adopted the common law definition of "practice law" as "`"the doing and performing services in a court of justice in any matter depending therein throughout its various stages and in conformity with 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."'" (Id. at p. 142, 70 Cal.Rptr.2d 304, 949 P.2d 1.)

The California Supreme Court addressed what it means to "practice law" in Baron v. City of Los Angeles (1970) 2 Cal.3d 535, 86 Cal.Rptr. 673...

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