Krier v. Franklin Cty. Bd. of Revision, s. 94APH05-679

• Decision Date: 30 December 1994
• Docket Number: Nos. 94APH05-679,s. 94APH05-679
• Citation: 654 N.E.2d 122,100 Ohio App.3d 344
• Parties: KRIER et al., Appellees, v. FRANKLIN COUNTY BOARD OF REVISION et al., Appellants. * to 94APH05-683.
• Court: Ohio Court of Appeals

Page 344

100 Ohio App.3d 344

654 N.E.2d 122

KRIER et al., Appellees, v. FRANKLIN COUNTY BOARD OF REVISION et al., Appellants. ^*

Nos. 94APH05-679 to 94APH05-683.

Court of Appeals of Ohio,

Tenth District, Franklin County.

Decided Dec. 30, 1994.

Steven Swaim, Columbus, for appellees Geraldine E. Krier, Suzanne Cruickshank, Jane B. Perry, Elmer and Mary Collins and Meadowbrook Partners.

Michael Miller, Pros. Atty., and James R. Gorry, Asst. Pros. Atty., for appellants Franklin County Auditor and Franklin County Bd. of Revision.

Teaford, Rich, Coffman & Wheeler, and Jeffrey A. Rich, Columbus, for appellant City of Columbus School Dist.

DESHLER, Judge.

Appellants, the Franklin County Auditor and Franklin County Board of Revision ("BOR") and the Board of Education of the city of Columbus School District, appeal from a decision of the Ohio Board of Tax Appeals ("BTA") in favor of appellees, who are the separate owners of five parcels of real estate in Franklin County.

Appellees contracted with Ambassador Research, Inc. ("Ambassador"), under a "consultant-agency agreement" authorizing Ambassador to execute and file applications for decrease in property tax valuation for appellees under R.C. 5715.13, which provides as follows:

"The county board of revision shall not decrease any valuation complained of unless the party affected thereby or his agent makes and files with the board a written application therefor, verified by oath, showing the facts upon which it is claimed such decrease should be made."

From the record, it is clear that Ambassador and its president, Douglas Parobek, are in the business of searching local property records for parcels which Parobek believes to be overvalued. Parobek then approaches the property owners and proposes a contingent fee arrangement under which he incurs all costs of the application in exchange for fifty percent of the resulting tax savings for the first two years after the decrease in valuation.

After appellees entered into agreements with Ambassador, Parobek filled out and filed applications under R.C. 5715.13. On August 5, 1992, the BOR heard testimony from a property manager, an appraiser hired by Ambassador, and Parobek as agent for the property owners. On August 6, 1992, the BOR issued a decision maintaining the value of the properties as originally established. An appeal to the BTA ensued.

Appellants moved for dismissal before the BTA, alleging a lack of jurisdiction because the filing of the underlying complaints and appearance by Parobek at the BOR hearing constituted the unauthorized practice of law, which deprived the BTA of jurisdiction. The BTA held that it was without statutory authority to limit its own jurisdiction. The BTA then concluded that based upon the language in R.C. 5715.13 by which an application for decrease in value may be filed by "the party affected thereby or his agent," the statute did not limit such an application to an "attorney/agent." A second BTA hearing was held on the issue of the true value of the property, after which the BTA granted a substantial reduction in the value of all five parcels.

Appellants have timely appealed and bring the following assignments of error:

"1. The Ohio Board of Tax Appeals erred in denying the motion of the board of education and county auditor to dismiss the notices of appeal filed with the board pursuant to R.C. 5715.13, and the decision of the Board of Tax Appeals was unreasonable and unlawful in that regard pursuant to R.C. 5717.04.

"2. The Board of Tax Appeals erred in relying upon the appraisal of Ronald Davis in granting a reduction in the true value of the properties."

The threshold issue raised by appellant's first assignment of error is whether the preparation and filing, in this case, of an application for reduction of valuation and appearance at the board on behalf of the property owner constitutes the practice of law. For the reasons that follow, we conclude that it is.

In addressing this issue, we are confronted with markedly contrasting precedent. The practice of law in Ohio is governed by R.C. 4705.01, providing as follows:

"No person shall be permitted to practice as an attorney and counselor at law, or to commence, conduct, or defend any action or proceeding in which he is not a party concerned, either by using or subscribing his own name, or the name of another person, unless he has been admitted to the bar by order of the supreme court in compliance with its prescribed and published rules. * * * " In interpreting this statute, an opinion issued by the Ohio Attorney General has unequivocally stated that "[t]he representation of a complainant by a layman, in a proceeding before a county board of revision in which a record is made, constitutes the unauthorized practice of law under R.C. 5705.01 [sic., 4705.01]." 1973 Ohio Atty.Gen.Ops. No. 73-041, syllabus. This Attorney General's opinion is in large part based upon Goodman v. Beall (1936), 130 Ohio St. 427, 5 O.O. 52, 200 N.E. 470, in which the practice of permitting union representatives to assist an injured employee in the submission of a workers' compensation claim was upheld. In Goodman, the Supreme Court emphasized that preliminary workers' compensation proceedings must be distinguished from later proceedings at which a record is prepared, upon which a court review of the administrative decision may be made. At that point, Goodman holds, a representative must be a licensed attorney:

"In all fairness, it must be conceded that the preparation of a rehearing record should be in complete charge of an attorney at law. It presents exactly the kind of work for which his training and experience peculiarly fit him. Such record constitutes the entire evidence upon which the merits or demerits of a claim can be determined by a court and jury. If a record be poorly and inexpertly prepared, the rights of interested parties may be seriously prejudiced. Its formation unquestionably comes within any well considered and complete definition of the practice of law." Id., 130 Ohio St. at 433, 5 O.O. at 55, 200 N.E. at 473.

The Attorney General's opinion notes that this holding was reaffirmed in In re Unauthorized Practice of Law in Cuyahoga Cty. (1963), 175 Ohio St. 149, 151, 23 O.O.2d 445, 446-447, 192 N.E.2d 54, 56-57. The Attorney General's opinion concludes that the statutory record-making requirement upon a board of revision under R.C. 4705.08 distinguishes representation before a BOR from the preliminary workers' compensation proceedings in Goodman, and more closely resembles the rehearing situation under which Goodman requires a representative to be a licensed attorney.

Also holding that appearance by a layman before a BOR constitutes the unauthorized practice of law is Cocon, Inc. v. Botnick Bldg. Co. (1989), 59 Ohio App.3d 42, 570 N.E.2d 303. Cocon similarly involved a property tax consultant who entered into a contract with property owners to obtain a reduction in property values. When the property owners subsequently failed to pay the consultant's fees under the contract, the consultant sued for the contract price. The court found that the consultant had failed to obtain the appropriate corporate license to do business in Ohio, thus preventing the consultant from bringing an action in enforcement of its contract. The court further found that an additional reason for finding the contract unenforceable was that the plaintiff had engaged in the unauthorized practice of law: "[A]dvocacy by a layman, on behalf of non- complainants before the county board of revision, constitutes the unauthorized practice of law as prohibited by R.C. 4705.01." Id., 59 Ohio App.3d at 43, 570 N.E.2d at 305.

In contrast to the above authority, we are confronted by the diametrically opposite conclusion reached by the State Board of Commissioners on the Unauthorized Practice of Law in Cleveland Bar Assn. v. Middleton (1994), 66 Ohio Misc.2d 9, 642 N.E.2d 71. Middleton involved similar tax reduction solicitations to those found in the case sub judice. In concluding that representation by a layman before a BOR did not constitute the unauthorized practice of law, the commissioners noted that, since Goodman, the Supreme Court decisions in this area had placed little emphasis upon the making of a record during the proceeding at issue. The commissioners also noted that the Supreme Court should not exercise its authority to regulate the practice of law in too rigid a manner so that the public good would suffer. Id. at 12, 642 N.E.2d at 73, citing Henize v. Giles (1986), 22 Ohio St.3d 213, 22 OBR 364, 490 N.E.2d 585.

The commissioners noted that the Supreme Court decisions since Goodman have placed less emphasis upon the making of a record. Henize, in particular, concluded that an appearance before the unemployment compensation board of review did not constitute the unauthorized practice of law although it is a proceeding of record. The commissioners also noted that the record created at a BOR hearing may be supplemented under some circumstances at the BTA or common pleas level.

We believe, however, that the ultimate foundation of the commissioners' decision is found in the following language:

"It is noteworthy that it is the practice in this state to allow non-attorneys to represent fee holders before boards of revision. This practice is sensible. The issue before the boards of revision--the fair market value of real estate--is not one which requires legal skill to resolve. In fact, that issue is often the subject of expert testimony by law appraisers. Moreover, board of revision proceedings are not governed by the Rules of Evidence and typically the board members are not attorneys. Further, the relator has not alleged or offered any evidence that there is harm to the public by allowing non-attorneys to represent fee holders before boards of revision. For these reasons, and in conformity with Henize v. Giles and other Supreme Court authority, we...