Hawkeye Bank and Trust, Nat. Ass'n v. Baugh, No. 89-1086

CourtUnited States State Supreme Court of Iowa
Writing for the CourtNEUMAN
Citation463 N.W.2d 22
Decision Date21 November 1990
Docket NumberNo. 89-1086
PartiesHAWKEYE BANK AND TRUST, NATIONAL ASSOCIATION, Appellee, v. Terry B. BAUGH, Defendant, and Baugh Family Farms, Inc., Appellant.

Page 22

463 N.W.2d 22
8 A.L.R.5th 991
HAWKEYE BANK AND TRUST, NATIONAL ASSOCIATION, Appellee,
v.
Terry B. BAUGH, Defendant,
and
Baugh Family Farms, Inc., Appellant.
No. 89-1086.
Supreme Court of Iowa.
Nov. 21, 1990.

Page 23

Reta Noblett-Feld, Iowa City, and Ajili Hodari, Student Legal Intern, for appellant.

Daniel P. Wilson of Drake, Wilson & Jay, Centerville, for appellee.

Considered by HARRIS, P.J., and LARSON, SCHULTZ, CARTER, and NEUMAN, JJ.

NEUMAN, Justice.

In April 1988, Hawkeye Bank and Trust brought an action to set aside alleged fraudulent conveyances of farmland between Terry B. Baugh and Baugh Family Farms, Inc. Russell Baugh, the son of Terry Baugh and president of Baugh Family Farms, Inc., filed an answer on behalf of the corporation. 1 He subsequently appeared at a trial setting conference, was notified by the court administrator about the trial date, and ultimately prevailed on a motion to recuse the judge originally assigned to hear the case.

The only wrinkle in the orderly progress of this litigation is that Russell Baugh is not an attorney. His status did not become an issue, however, until the morning of trial. In opening statement, counsel for the bank objected that if Baugh persisted in representing the corporation, he would be engaging in the unauthorized practice of law. The court concurred, ruling that Baugh could not submit evidence on behalf of the corporation but, as a corporate officer, he could "remain in the courtroom ... [to] hear and see and observe what happens."

Baugh, who had prepared seven exhibits and subpoenaed one witness, expressed surprise at the court's ruling. He promptly moved for a brief continuance to secure counsel to assert the corporation's defense. The court summarily overruled the motion, citing only the fact that the case "has been on the assignment for months." It then proceeded to hear the plaintiff's evidence--without response by the corporation--and entered judgment for the full relief requested.

On appeal, Baugh argues that (1) the court erred as a matter of law by denying him the right to represent this closely held corporation, and (2) the court abused its discretion by denying him a continuance to obtain counsel. We affirm on the issue of pro se representation but reverse on the denial of a continuance and remand for further proceedings.

I. Whether a corporation may lawfully appear pro se is a question of first impression for this court. Other courts that have considered the question generally adhere to the rule laid down by Chief Justice Marshall in 1824: "[a] corporation ... can appear only by attorney, while a natural person may appear for himself." Osborn v. United States Bank, 22 U.S. (9 Wheat.) 738, 830, 6 L.Ed. 204 (1824); see, e.g., In re Victor Publishers, Inc., 545 F.2d 285, 286 (1st Cir.1976) (citing nine cases in support of general rule); Securities & Exch.

Page 24

Comm'n v. Research Automation Corp., 521 F.2d 585, 589 (2d Cir.1975); In re Highley, 459 F.2d 554, 555 (9th Cir.1972); Simbraw, Inc. v. United States, 367 F.2d 373, 373 (3d Cir.1966); Oahu Plumbing and Sheet Metal, Ltd. v. Kona Constr., Inc., 60 Haw. 372, 374-75, 590 P.2d 570, 572-73 (1979) (citing twenty-four cases in support of general rule); Land Management, Inc. v. Department of Envtl. Protection, 368 A.2d 602, 604 (Me.1977) (citing twenty-three cases in support of general rule); Show-Me Restoration Servs. v. Harlan, 778 S.W.2d 350, 350n. 1 (Mo.App.1989). See generally 9A W. Fletcher, Cyclopedia of the Law of Private Corporations, § 4463, at 38 (1985 and Supp.1989) ("It is generally held that a corporation must appear by an attorney...."); 19 Am.Jur.2d Corporations § 2172, at 89 (1986) (same).

Most courts justify their adherence to the general rule on one of two grounds. First, it is thought that the rule protects the court and the public from ineptitude and delay at the hands of persons who are unskilled as well as unlicensed in the practice of law. See National Indep. Theatre Exhibitors, Inc. v. Buena Vista Distrib. Co., 748 F.2d 602, 609 (11th Cir.1984); City of Akron v. Hardgrove Enter., Inc., 47 Ohio App.2d 196, 202, 353 N.E.2d 628, 634 (1973); Walacavage v. Excell 2000, Inc., 331 Pa.Super. 137, 142-43, 480 A.2d 281, 284 (1984). Second, courts have striven to preserve the corporation as a legal entity separate from its shareholders. See In re K.M.A., Inc. v. General Motors Acceptance Corp., 652 F.2d 398, 399 (5th Cir.Unit B July 1981); Richter v. Higdon Homes, Inc., 544 So.2d 300, 300 (Fla.App.1989); Oahu Plumbing and Sheet Metal, 60 Haw. at 376, 590 P.2d at 573; Varney Enters., Inc. v. WMF, Inc., 402 Mass. 79, 82, 520 N.E.2d 1312, 1314 (1988); Walacavage, 331 Pa.Super. at 142, 480 A.2d at 284.

The general rule is not without its detractors, however. Exceptions are made on a case-by-case basis, motivated principally by findings that the corporation and its representative are so closely related that their identities are virtually indistinguishable. See, e.g., Margaret Maunder Assocs., Inc. v. A-Copy, Inc., 40 Conn.Supp. 361, 363-65, 499 A.2d 1172, 1174 (1985) (sole shareholder in effect "acting for herself"); Phoenix Mut. Life Ins. Co. v. Radcliffe on the Del., Inc., 439 Pa. 159, 167, 266 A.2d 698, 702 (1970) (all three shareholders of closely held corporation were in court and none objected to representation by one of them); Willapa Trading Co. v. Muscanto, Inc., 45 Wash.App. 779, 787, 727 P.2d 687, 692 (1986) (corporation's president was sole shareholder and director and no other financial interests were involved). One court, observing that pro se representation by a bankrupt corporation is a "manageable...

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41 practice notes
  • Downtown Disposal Servs., Inc. v. City of Chi., Docket No. 112040
    • United States
    • Supreme Court of Illinois
    • November 1, 2012
    ...Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d 570 (Haw. 1979); Hawkeye Bank & Trust, National Ass'n v. Baugh, 463 N.W.2d 22, 26 (Iowa 1990); First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792 A.2d 325 (Md. Ct. Spec. App. 2002); Waite v. Carpenter, 49......
  • Downtown Disposal Servs., Inc. v. City of Chi., Docket No. 112040
    • United States
    • Supreme Court of Illinois
    • November 1, 2012
    ...Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d 570 (Haw. 1979); Hawkeye Bank & Trust, National Ass'n v. Baugh, 463 N.W.2d 22, 26 (Iowa 1990); First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792 A.2d 325 (Md. Ct. Spec. App. 2002); Waite v. Carpenter, 49......
  • Cld Const., Inc. v. City of San Ramon, No. A102742.
    • United States
    • California Court of Appeals
    • July 23, 2004
    ...unrepresented by attorney during motion to set aside judgment might be allowed time to get one; Hawkeye Bank & Trust v. Baugh (Iowa 1990) 463 N.W.2d 22: abuse of discretion not to grant trial continuance to allow corporation time to secure attorney; Waite v. Carpenter (1992) 1 Neb.App. 321,......
  • Shenandoah Sales & Serv., Inc. v. Assessor of Jefferson Cnty., Nos. 11–0248
    • United States
    • Supreme Court of West Virginia
    • February 9, 2012
    ...is also intended to preserve the corporation as a legal entity separate from its shareholders. Hawkeye Bank & Trust, Nat. Ass'n v. Baugh, 463 N.W.2d 22, 24 (Iowa 1990). In the present case, Mr. Tabb acknowledges the existence of the general rule that a corporation must be represented by a l......
  • Request a trial to view additional results
41 cases
  • Downtown Disposal Servs., Inc. v. City of Chi., Docket No. 112040
    • United States
    • Supreme Court of Illinois
    • November 1, 2012
    ...Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d 570 (Haw. 1979); Hawkeye Bank & Trust, National Ass'n v. Baugh, 463 N.W.2d 22, 26 (Iowa 1990); First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792 A.2d 325 (Md. Ct. Spec. App. 2002); Waite v. Carpenter, 49......
  • Downtown Disposal Servs., Inc. v. City of Chi., Docket No. 112040
    • United States
    • Supreme Court of Illinois
    • November 1, 2012
    ...Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d 570 (Haw. 1979); Hawkeye Bank & Trust, National Ass'n v. Baugh, 463 N.W.2d 22, 26 (Iowa 1990); First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792 A.2d 325 (Md. Ct. Spec. App. 2002); Waite v. Carpenter, 49......
  • Cld Const., Inc. v. City of San Ramon, No. A102742.
    • United States
    • California Court of Appeals
    • July 23, 2004
    ...unrepresented by attorney during motion to set aside judgment might be allowed time to get one; Hawkeye Bank & Trust v. Baugh (Iowa 1990) 463 N.W.2d 22: abuse of discretion not to grant trial continuance to allow corporation time to secure attorney; Waite v. Carpenter (1992) 1 Neb.App. 321,......
  • Shenandoah Sales & Serv., Inc. v. Assessor of Jefferson Cnty., Nos. 11–0248
    • United States
    • Supreme Court of West Virginia
    • February 9, 2012
    ...is also intended to preserve the corporation as a legal entity separate from its shareholders. Hawkeye Bank & Trust, Nat. Ass'n v. Baugh, 463 N.W.2d 22, 24 (Iowa 1990). In the present case, Mr. Tabb acknowledges the existence of the general rule that a corporation must be represented by a l......
  • Request a trial to view additional results

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