Iowa Supreme Court Com'n v. Sturgeon, No. 99-0417.

CourtUnited States State Supreme Court of Iowa
Writing for the CourtLARSON, Justice.
Citation635 N.W.2d 679
PartiesIOWA SUPREME COURT COMMISSION ON UNAUTHORIZED PRACTICE OF LAW, Appellee, v. LeRoy James STURGEON, Appellant.
Decision Date10 October 2001
Docket NumberNo. 99-0417.

635 N.W.2d 679

IOWA SUPREME COURT COMMISSION ON UNAUTHORIZED PRACTICE OF LAW, Appellee,
v.
LeRoy James STURGEON, Appellant

No. 99-0417.

Supreme Court of Iowa.

October 10, 2001.

As Revised on Denial of Rehearing November 28, 2001.


635 N.W.2d 680
LeRoy J. Sturgeon, Sioux City, pro se

Thomas J. Miller, Attorney General, and Grant K. Dugdale, Assistant Attorney General, for appellee.

LARSON, Justice.

LeRoy Sturgeon has appealed from a district court order enjoining him from the unauthorized practice of law arising out of his bankruptcy business. We modify and affirm.

Sturgeon meets with clients in his office and interviews them to obtain information to prepare chapter 7 bankruptcy documents. Signs posted in his office, as well as his advertising, state he is a "non-attorney bankruptcy specialist" and "no legal advice" is given, although he was an attorney prior to his disbarment in 1992.1 According to his testimony,

I conduct an initial interview to obtain information from them. I take that information and on some occasions have to seek out additional factual information and I input that data into a computer that contains bankruptcy software. And then that information fills in the blanks on the forms.
I then print off those forms, have those debtors return to my office, read them, let me know whether or not they're accurate. If they're not, I then make corrections or changes as they direct so that they're finally determined to be accurate.
And then they sign them so that they may be copied and filed with the Clerk of the United States Bankruptcy Court.

635 N.W.2d 681
On April 13, 1998, our Commission on the Unauthorized Practice of Law (commission) sought an injunction against Sturgeon, claiming his bankruptcy business violated our unauthorized practice rules. The district court granted the injunction, and Sturgeon appealed

Sturgeon's appeal raises six issues, which we consolidate into four: (1) the court's interpretation of 11 U.S.C. § 110, concerning the scope of work permitted to be performed by a nonattorney; (2) the adequacy of the factual record to support the charge; (3) the constitutionality of our unauthorized practice rules; and (4) the scope of the court's injunction.

I. Interpretation of 11 U.S.C. § 110.

Sturgeon argues 11 U.S.C. § 110 prevents Iowa from

totally ban[ning] all forms of non-attorney bankruptcy preparers.
....
... Congress could not have intended that some states may allow non-attorney bankruptcy preparers to perform the limited services in the federal courts located in those states, while other states may preempt this Congressional act and ban any and all such services.

However, the statute provides that states may do exactly that:

Nothing in this section shall be construed to permit activities that are otherwise prohibited by law, including rules and laws that prohibit the unauthorized practice of law.

11 U.S.C. § 110(k) (1994). "As a result of this provision, a document preparer may not use § 110 as a `safe harbor' if a rule or certain rules prohibit the unauthorized practice of law or the document preparer's activities are otherwise prohibited by law." In re Gabrielson, 217 B.R. 819, 826 (Bankr.D.Ariz.1998); see also In re Farness, 244 B.R. 464, 470 (Bankr.D.Idaho 2000) (stating that the ability of nonlawyers to practice before bankruptcy courts in a given jurisdiction will be governed by the relevant state laws and rules prohibiting the unauthorized practice of law); Florida Bar v. Catarcio, 709 So.2d 96, 99 n. 1 (Fla.1998) ("[W]e disagree with his argument that 11 U.S.C. § 110 (1994), preempts this Court's authority to regulate the unlicensed practice of law in Florida in the bankruptcy context.").

We hold these unauthorized practice proceedings are not proscribed by 11 U.S.C. § 110 and therefore proceed to a determination of the merits of the charge.

II. Sufficiency of the Evidence.

This is an equity proceeding, so our review is de novo. Iowa R.App. P. 4. Sturgeon asserts the commission must prove the allegations of their complaint by a convincing preponderance of the evidence, citing Committee on Professional Ethics & Conduct v. Baker, 492 N.W.2d 695, 700 (Iowa 1992). Baker, however, was not an unauthorized practice case, so its standard of proof is not necessarily binding here. The commission, however, does not argue for a different standard of review, so for purposes of this appeal, we will assume the standard is a convincing preponderance of the evidence.

Iowa Court Rule 118A.1 authorizes injunctions against the unauthorized practice of law. The commission notes that this court has the inherent authority to define and regulate the practice of law, citing Baker. In Baker we approved the nonexclusive definition of the practice of law found in Ethical Consideration 3-5:

It is neither necessary nor desirable to attempt the formulation of a single, specific definition of what constitutes the practice of law. However, the practice of law includes, but is not limited to,

635 N.W.2d 682
representing another before the courts; giving of legal advice and counsel to others relating to their rights and obligations under the law; and preparation or approval of the use of legal instruments by which legal rights of others are either obtained, secured or transferred even if such matters never become the subject of a court proceeding. Functionally, the practice of law relates to the rendition of services for others that call for the professional judgment of a lawyer. The essence of professional judgment of the lawyer is the educated ability to relate the general body and philosophy of law to a specific legal problem of a client; and thus, the public interest will be better served if only lawyers are permitted to act in matters involving professional judgment. Where this professional judgment is not involved, nonlawyers, such as court clerks, police officers, abstracters, and many governmental employees, may engage in occupations that require a special knowledge of law in certain areas. But the services of a lawyer are essential in the public interest whenever the exercise of professional judgment is required

Iowa Code of Prof'l Responsibility EC 3-5; see also Baker, 492 N.W.2d at 701 (approving a similar version of this definition).

Sturgeon claims that he merely typed information, furnished by his clients, into preprinted forms. The commission, however, has a different view: Sturgeon solicited information to complete the forms, chose the forms to be used, rendered advice to his clients as to the information that would be required, and inserted the information obtained into appropriate blanks in the forms. In at least one case, Sturgeon actually drafted a pleading to be filed in the bankruptcy case.

Cases have drawn the unauthorized practice line at the point at which data entry (either by typewriter or computer) crosses the line between copying written information provided by the client and oral solicitation of the information necessary to fill out documents selected by the preparer. See, e.g., Hastings v. United States Trustee (In re Agyekum), 225 B.R. 695, 702 (B.A.P. 9th Cir.1998) ("Soliciting information from a debtor which is then typed into [bankruptcy] schedules constitutes the unauthorized practice of law."); Farness, 244 B.R. at 472 (use of preprinted bankruptcy forms or bankruptcy software that automatically places solicited information in appropriate schedule does not save preparer from...

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17 practice notes
  • In re Lerner, 49331.
    • United States
    • Nevada Supreme Court of Nevada
    • December 24, 2008
    ...251, 683 A.2d 1359, 1361 (1996); State v. Wees, 138 Idaho 119, 58 P.3d 103, 107 (Ct.App.2002); Iowa Supreme Court Com'n v. Sturgeon, 635 N.W.2d 679, 684-85 (Iowa 2001); Montana Supreme Court Com'n on Unauthorized Practice v. O'Neil, 334 Mont. 311, 147 P.3d 200. 215 (2006); State v. Rogers, ......
  • Dressel v. Ameribank, Docket No. 119959, Calendar No. 1.
    • United States
    • Supreme Court of Michigan
    • June 24, 2003
    ...Engineering and Erection, Inc., 87 Hawai'i 37, 951 P.2d 487 (1998); Iowa Supreme Court Comm. on Unauthorized Practice of Law v. Sturgeon, 635 N.W.2d 679 (Iowa, 2001); Bd of Overseers of Bar v. Mangan, 2001 ME 7, 763 A.2d 1189 (2001); Cardinal v. Merrill Lynch Realty/Burnet, Inc., 433 N.W.2d......
  • State v. Wees, 27573.
    • United States
    • Court of Appeals of Idaho
    • September 30, 2002
    ...vague as applied to defendant who took a deposition); Iowa Supreme Court Comm'n on Unauthorized Practice of Law v. Sturgeon, 635 N.W.2d 679, 685 (Iowa 2001) (holding court rule prohibiting unauthorized practice of law was not unconstitutionally vague as applied to defendant who prepared for......
  • Yulin Li v. Rizzio, 10–0677.
    • United States
    • Court of Appeals of Iowa
    • April 13, 2011
    ...authority to define and regulate the practice of law” in Iowa. Iowa Supreme Ct. Comm'n on Unauthorized Practice of Law v. Sturgeon, 635 N.W.2d 679, 681 (Iowa 2001). Although our supreme court has not articulated an “ ‘all-inclusive definition of the practice of law,’ ” it has stated that th......
  • Request a trial to view additional results
17 cases
  • In re Lerner, 49331.
    • United States
    • Nevada Supreme Court of Nevada
    • December 24, 2008
    ...251, 683 A.2d 1359, 1361 (1996); State v. Wees, 138 Idaho 119, 58 P.3d 103, 107 (Ct.App.2002); Iowa Supreme Court Com'n v. Sturgeon, 635 N.W.2d 679, 684-85 (Iowa 2001); Montana Supreme Court Com'n on Unauthorized Practice v. O'Neil, 334 Mont. 311, 147 P.3d 200. 215 (2006); State v. Rogers, ......
  • Dressel v. Ameribank, Docket No. 119959, Calendar No. 1.
    • United States
    • Supreme Court of Michigan
    • June 24, 2003
    ...Engineering and Erection, Inc., 87 Hawai'i 37, 951 P.2d 487 (1998); Iowa Supreme Court Comm. on Unauthorized Practice of Law v. Sturgeon, 635 N.W.2d 679 (Iowa, 2001); Bd of Overseers of Bar v. Mangan, 2001 ME 7, 763 A.2d 1189 (2001); Cardinal v. Merrill Lynch Realty/Burnet, Inc., 433 N.W.2d......
  • State v. Wees, 27573.
    • United States
    • Court of Appeals of Idaho
    • September 30, 2002
    ...vague as applied to defendant who took a deposition); Iowa Supreme Court Comm'n on Unauthorized Practice of Law v. Sturgeon, 635 N.W.2d 679, 685 (Iowa 2001) (holding court rule prohibiting unauthorized practice of law was not unconstitutionally vague as applied to defendant who prepared for......
  • Yulin Li v. Rizzio, 10–0677.
    • United States
    • Court of Appeals of Iowa
    • April 13, 2011
    ...authority to define and regulate the practice of law” in Iowa. Iowa Supreme Ct. Comm'n on Unauthorized Practice of Law v. Sturgeon, 635 N.W.2d 679, 681 (Iowa 2001). Although our supreme court has not articulated an “ ‘all-inclusive definition of the practice of law,’ ” it has stated that th......
  • Request a trial to view additional results

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