In re Creasy

• Citation: 12 P.3d 214,198 Ariz. 539
• Decision Date: 17 October 2000
• Docket Number: No. SB-96-0043-D.,SB-96-0043-D.
• Parties: In the Matter of a Former Member of the State Bar of Arizona, Frederick C. CREASY, Jr., Respondent.
• Court: Arizona Supreme Court

12 P.3d 214

198 Ariz. 539

In the Matter of a Former Member of the State Bar of Arizona, Frederick C. CREASY, Jr., Respondent.

No. SB-96-0043-D.

Supreme Court of Arizona.

October 17, 2000.

State Bar of Arizona, by Yigael M. Cohen, Phoenix, Attorney for State Bar.

Frederick C. Creasy, Jr., Scottsdale, Pro Se.

OPINION

FELDMAN, Justice.

¶ This court disbarred Frederick C. Creasy, Jr. on September 16, 1996, for a number of violations of the Code of Professional Conduct and other Rules of the Supreme Court. The most serious involved failure to properly maintain client funds entrusted to him on two separate occasions, failure to adequately supervise a non-lawyer, and failure to assist in the State Bar's investigation of these matters. In the eleven years prior to his disbarment, Creasy received six informal reprimands from the State Bar.

¶ 2 On April 14, 1999, the State Bar received a report from attorney William Shrank regarding Creasy's possible violations of the disbarment order. The submission included the transcript of the sworn statement of a witness taken in what is described in the record as a private arbitration matter involving a claim for underinsured motorist benefits made by Sterling K. Smith against his insurer, USAA Casualty Insurance Company. Smith's USAA policy required him to submit this disputed claim to arbitration.

¶ 3 Along with his wife, Marilyn Creasy, a certified public adjuster and owner of The Legal Shoppe, Creasy "represented" Smith in this arbitration. Shrank represented USAA. At the time of the accident with the underinsured motorist, Smith evidently had some preexisting injuries caused by industrial accidents and covered under workers' compensation. Creasy sought to establish that the automobile accident, rather than the industrial problems, caused specific injuries.¹ During a sworn statement of Dr. Dennis Crandall, Smith's treating physician, and over Shrank's objections, Creasy extensively and probingly examined Dr. Crandall concerning Smith's injuries.

¶ 4 Based on Creasy's appearance at and actions during the sworn statement, the State Bar filed a petition asking this court for an order directing Creasy to appear and show cause why he should not be held in contempt for violating the 1996 disbarment order by engaging in the practice of law. Creasy appeared in response to our order and the issues were briefed and argued.

¶ 5 Creasy, no longer a member of the bar, contests the jurisdiction of this court to regulate the actions of a non-lawyer. He also denies that he practiced law when he examined Dr. Crandall, arguing that actions that constitute the practice of law before a court are not the practice of law when done in the context of a private arbitration proceeding. Finally, he contends that because he was employed by an insurance adjuster licensed under A.R.S. § 20-281 (1990), the Arizona Department of Insurance has sole jurisdiction to regulate his conduct in this matter. We disagree with all three of his submissions.

DISCUSSION

A. Jurisdiction

¶ 6 We first address Creasy's argument that this court lacks jurisdiction over him because he is a non-lawyer. The argument is without merit. As we have previously said:

Article III of the Arizona Constitution creates the judicial branch of government, separate and distinct from the other branches.

* * *

This court has long recognized that under article III of the Constitution "the practice of law is a matter exclusively within the authority of the Judiciary. The determination of who shall practice law in Arizona and under what condition is a function placed by the state constitution in this court."

In re Smith, 189 Ariz. 144, 146, 939 P.2d 422, 424 (1997) (quoting Hunt v. Maricopa County Employees Merit Sys. Comm'n, 127 Ariz. 259, 261-62, 619 P.2d 1036, 1038-39 (1980) (citations omitted)).

¶ 7 The court's authority over the practice of law is also based on the creation of an integrated judicial department and the revisory jurisdiction of this court as provided in article VI, sections 1 and 5(4) of the Arizona Constitution. See Smith, 189 Ariz. at 146, 939 P.2d at 424. Prior to 1985, the Arizona Legislature prohibited the practice of law by unlicenced persons. See generally A.R.S. tit. 32, ch. 2. Effective January 1, 1985, however, the entire title regulating attorneys was repealed; since then the practice of law has been under the exclusive regulatory jurisdiction of this court, governed by the Supreme Court Rules, in particular Rule 31(a)(3). See Marchant v. U.S. Collections West, Inc., 12 F.Supp.2d 1001, 1005 (D.Ariz. 1998) (applying Arizona law to hold that debt collector's application for writ of garnishment was unauthorized practice of law). This constitutional power to regulate the practice of law extends to non-lawyers as well as attorneys admitted to bar membership. See Rule 46(b); Marchant, 12 F.Supp.2d at 1005 (citing Anamax Mining Co. v. Arizona Dep't of Econ. Sec., 147 Ariz. 482, 484-85, 711 P.2d 621, 623-24 (App.1985)) (prohibiting corporate officer or employee from representing corporate employer before the Department of Economic Security).

¶ 8 The facts of this case do not require us to determine the extent of our power to regulate "practitioners" who are not and have never been lawyers. In the situation presented here, our rules specifically apply to both active lawyers and those who have been disbarred. Rule 31(a)(3) states:

Privilege to practice. Except as hereinafter provided in subsection 4 of this section (a), no person shall practice law in this state or hold himself out as one who may practice law in this state unless he is an active member of the state bar, and no member shall practice law in this state or hold himself out as one who may practice law in this state, while suspended, disbarred, or on disability inactive status.

(Emphasis added.) We see no reason why we would have jurisdiction over lawyers and not over disbarred lawyers like Creasy. Creasy's case actually presents an even stronger situation for jurisdiction than that of a person never admitted to the bar. On admission, Creasy submitted himself to the authority of the State Bar and this court. He is still bound by the restrictions imposed on him by this court's disbarment order, made under Rule 31, which explicitly prohibits a disbarred lawyer from continuing or resuming practice. His expulsion from the bar in no way frees him from these restrictions. It would be strange doctrine that as a result of being disbarred, a lawyer may not only resume practice but be free of the obligations imposed on lawyers who have not been disbarred.

¶ 9 Given our authority over the practice of law and those who have been admitted to the bar, we conclude that we have continuing jurisdiction to prevent Creasy from resuming the practice of law. We turn, then, to the question of whether he was engaged in the practice of law.

B. The practice of law

¶ 10 Creasy argues that his actions during the private arbitration proceeding— unconnected to any pending judicial matter— do not constitute the practice of law. We long ago defined the practice of law as

those acts, whether performed in court or in the law office, which lawyers customarily have carried on from day to day through the centuries constitute the practice of law. Such acts ... include rendering to another any other advice or services which are and have been customarily given and performed from day to day in the ordinary practice of members of the legal profession. . . .

State Bar of Arizona v. Arizona Land Title & Trust Co., 90 Ariz. 76, 95, 366 P.2d 1, 14 (1961) (emphasis added). More recently, we applied this definition to hold that a judge who represented a corporation in contract negotiations and who advised the corporation regarding those negotiations had engaged in the practice of law. See In re Fleischman, 188 Ariz. 106, 111, 933 P.2d 563, 568 (1997). As these cases make clear, a person need not appear in a judicial proceeding to engage in the unauthorized practice of law. Creasy concedes that he represented Smith when he took Dr. Crandall's sworn statement but argues that the medical claim evaluation issues at stake did not require the "application of a trained legal mind." Baron v. City of Los Angeles, 2 Cal.3d 535, 86 Cal.Rptr. 673, 469 P.2d 353, 358 (1970) (quoting Agran v. Shapiro, 127 Cal.App.2d Supp. 807, 273 P.2d 619, 626 (1954)). He also argues that because his examination of Dr. Crandall occurred in the context of a private arbitration, his actions do not constitute the unauthorized practice of law. We are unpersuaded for the following reasons.

¶ 11 In this case we need not decide whether the Arizona Land Title definition should be changed or whether the Baron definition of the practice of law is an appropriate narrowing of Arizona Land Title or Fleischman. Whatever may be the line separating the proper activities of lay people and lawyers in a non-adversary context, even a cursory look at the caption of the proceedings at which Creasy appeared and a sample of Creasy's examination of Dr. Crandall during the sworn statement makes it apparent that Creasy rendered the kind of core service that is and has "been customarily given and performed from day to day [only] in the ordinary practice of members of the legal profession."² See Arizona Land Title, 90 Ariz. at 95, 366 P.2d at 14. As noted, our cases make clear that a person need not appear in a judicial proceeding to engage in the practice of law. If negotiation of a contract in Fleischman was the practice of law, then, a fortiori, Creasy's representation of Smith by examining a witness in an adversary setting involving a disputed claim certainly falls within that definition as well, particularly in light of the nature of the examination, which was no less exhaustive or rigorous than one would ordinarily see during a formal deposition in a judicial proceeding.

¶ 12 We are quite aware of the social, technological, and economic...