Merrick v. American Security & Trust Co.
Decision Date | 09 October 1939 |
Docket Number | No. 7165.,7165. |
Citation | 107 F.2d 271 |
Parties | MERRICK et al. v. AMERICAN SECURITY & TRUST CO. |
Court | U.S. Court of Appeals — District of Columbia Circuit |
Richard L. Merrick, Leo A. Rover, and William J. Rowan, all of Washington, D. C., for appellants.
Frederic D. McKenney, John S. Flannery, G. Bowdoin Craighill, and John E. Larson, all of Washington, D. C., for appellee.
Before STEPHENS, EDGERTON, and VINSON, Associate Justices.
Writ of Certiorari Denied January 2, 1940. See 60 S.Ct. 380, 84 L.Ed. ___.
Plaintiffs are the members of a Committee on Suppression of Unauthorized Practice of Law of the Bar Association of the District of Columbia. Defendant is an incorporated trust company. Plaintiffs sought an injunction to restrain defendant from practicing law and from holding itself out as authorized or able to furnish legal services or legal advice. In the District Court Justice Bailey, after a hearing on the merits, found that defendant is not engaged in the practice of law. 22 F.Supp. 177. Plaintiffs appeal from his decree dismissing their bill.
Although no statute here forbids corporations to "practice law," we assume that they may not do so and that a court may restrain them from doing so.1 2 But there are no special tribunals for such conflicts, and courts must resolve them as best they can.
The underlying facts are not disputed. Defendant is authorized to, and does, carry on a fiduciary business as executor, administrator, trustee, guardian, agent, custodian, and manager. It solicits employment in some of these capacities. Its advertisements state that it "understands tax and investment problems" and In a 32-page booklet entitled "Modern Methods of Administration and Conservation of Estates," defendant says: To create a life insurance trust "you should consult with your attorney and our officers. * * *"
Twenty of defendant's officers and employees, including eleven members of its trust department, are members of the bar, Its officers and employees, on inquiries from customers and prospective customers, discuss investment and estate problems, give information about tax statutes and statutes of descent and distribution, and discuss the nature of trusts. No charge is made for these services. Defendant does not advise or attempt to influence or guide a customer as to which of several courses he should pursue. When a customer appears to be confronted with a legal problem, defendant insists that he consult his own attorney.
Defendant draws no wills, either by its attorney-officers (a term used herein to mean officers or employees who are members of the bar) or by outside counsel (lawyers who maintain separate offices). It draws no trust agreements except that (a) simple, stereotyped, revocable and non-testamentary agreements to which defendant is a party are sometimes prepared by attorney-officers, and (b) defendant sometimes has its counsel prepare trust agreements to which it is a party, without making a charge then or later against the customer or the trust estate. Defendant's attorney-officers prepare, usually on stereotyped forms, custodian and management agreements to which defendant is a party. Defendant sometimes prepares a release of a deed of trust on a printed form, but usually it has deeds, mortgages and deeds of trust prepared by title companies; and it receives no compensation for such services. Defendant prepares income tax returns for about 50 customers, without charge. It prepares, largely by a lay employee, necessary tax returns in cases where it is a fiduciary. No charge is made for preparation of tax returns and the like; except as employees sometimes do overtime work for which they, and not defendant, are paid by customers.
Defendant's employees appear before tax officials on behalf of estates of which it is fiduciary, but in contested tax matters it is always represented by outside counsel. In uncontested probate matters it is represented before the Register of Wills and the Probate Court by its attorney-officers. No charge is made for their services, apart from the regular commission of an executor or administrator. No part of their salaries is charged to any particular estate. In contested probate matters defendant is represented by outside counsel, who are paid out of the funds of the estate involved. "Neither defendant, nor any of its officers or employees, ever receive or share in any attorney's fee paid by any estate, of which defendant is fiduciary."
Appellants contend, and cite authorities to show, that the practice of law is not limited to the conduct of cases in court but includes the giving of legal advice and the preparation of wills, contracts, and other legal instruments. We have no doubt that one who does those things, and holds himself out to the public as doing them, as a business or profession, practices law. The New York Court of Appeals has held that "Counsel and advice, the drawing of agreements, the organization of corporations and preparing papers connected therewith, the drafting of legal documents of all kinds, including wills" amounts to law practice. "`To practice as an attorney at law' means to do the work, as a business, which is commonly and usually done by lawyers here in this country." People v. Alfani, 227 N.Y. 334, 338, 339, 125 N.E. 671, 673. There the defendant (227 N.Y. at page 336, 125 N.E. at page 672.) His conviction of practicing law without a license, in violation of statute, was affirmed. That case should be compared with People v. Title Guarantee & Trust Co., 227 N.Y. 366, 125 N.E. 666, which the same court decided on the same day. There the defendant was charged with violating a statute which forbade corporations to practice law or hold themselves out as doing so. The corporation circulated a booklet which it called "Fees for the Examination of Titles." This booklet listed also "fees for drawing and recording papers," "fees for surveys," and "Average Charges for Drawing Papers." (227 N.Y. at page 369, 125 N.E. at page 667.) The court interpreted the booklet as referring only to papers which the defendant might be called upon to draw incidentally to its authorized business, and not as indicating that it solicited or engaged in the drawing of legal papers unconnected with that business. The court distinguished the Alfani case and reversed the defendant's conviction. In the opinion of Chief Judge Hiscock and the concurring opinions of Judge Pound and Judge Crane a distinction was drawn between drafting legal papers as a business and drafting legal papers pertinent to other business which the corporation was authorized to carry on. Of drafting as a business Judge Pound said: 3
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