Oregon State Bar v. Taub

• Decision Date: 22 October 2003
• Citation: 78 P.3d 114,190 Or. App. 280
• Parties: OREGON STATE BAR, Appellant, v. Barry L. TAUB, Respondent.
• Court: Oregon Court of Appeals

78 P.3d 114

190 Or. App. 280

OREGON STATE BAR, Appellant, v. Barry L. TAUB, Respondent.

16-00-18160; A115841.

Court of Appeals of Oregon.

Argued and Submitted June 19, 2003.

Decided October 22, 2003.

Terence J. Hammons, Eugene, argued the cause for appellant. With him on the briefs was Hammons & Mills.

John C. Fisher, Dallas, argued the cause and filed the brief for respondent.

Before EDMONDS, Presiding Judge, and DEITS, Chief Judge,¹ and SCHUMAN, Judge.

SCHUMAN, J.

Plaintiff, the Oregon State Bar, brought this action to enjoin defendant from engaging in the unauthorized practice of law. Both parties filed motions for summary judgment. The trial court granted defendant's motion, denied plaintiff's, and entered judgment in favor of defendant. Plaintiff appeals. We reverse and remand.

Plaintiff assigns error to both the order granting defendant's motion for summary judgment and to the order denying plaintiff's. Both are subject to review, Cochran v. Connell, 53 Or.App. 933, 939-40, 632 P.2d 1385, rev. den., 292 Or. 109, 642 P.2d 311 (1981), and both are reviewed according to the same standard: summary judgment is appropriate if the record and all reasonable inferences that may be drawn from it, viewed in the light most favorable to the nonmoving party, disclose no issue of material fact and the moving party is entitled to judgment as a matter of law. ORCP 47 C; Jones v. General Motors Corp., 325 Or. 404, 408, 939 P.2d 608 (1997).

The parties agree on the following facts. Defendant practiced as an attorney specializing in bankruptcy and dissolution of marriage until he was disbarred in 1998. In re Taub, 326 Or. 325, 951 P.2d 720 (1998). He then began conducting what he advertises to the public as a paralegal service, principally in the same fields. When a potential customer first contacts defendant, he sends the customer a letter requesting information relevant to the customer's legal problem. In dissolution cases, that letter asks the customer to provide basic personal information and details about the marriage the customer wishes to dissolve and to send the answers to defendant. In bankruptcy cases, the defendant asks the customer to complete a list of monthly expenditures and requests that the customer provide defendant with financial documents and information. Both letters anticipate a meeting, either in person or by telephone: the dissolution letter states, "As soon as I receive this form from you I will call you to discuss what you want on the paperwork[,]" and the bankruptcy letter states, "At the appointment we will discuss everything else that needs to be on the paperwork." The customer also receives a letter asking him or her to authorize defendant to prepare the necessary documents; that letter contains a check-the-box list asking the customer to indicate whether the case is a Chapter 7 Bankruptcy, CoPetitioner Divorce, Divorce, or "Other."

Defendant and the customer then meet, either in person or by telephone. Using the information elicited from the customer, defendant completes the appropriate documents. The level of the customer's participation in document preparation varies from customer to customer. Sometimes the customer provides all of the necessary information with no input from defendant; on other occasions, as defendant testified in his deposition, "to some extent, I might use [the customer's answers on the forms], and to some extent not, depending upon, you know, what the individual situation is." On occasion, customers have questions about the information defendant has asked them to provide; when that occurs, defendant "[u]sually * * * answer[s] the question with it is best to go have a consultation with an attorney about that * * *." Where a document requires the result of a mathematical calculation based on the application of a statutory formula to raw data provided by the customer, defendant performs the calculation and fills in the appropriate space on the document. Ultimately, defendant himself prepares a final version of the documents, returns them to the customer, and, based on information available from the clerk of the court, instructs the customer as to where and how to file them.

Oregon law provides that, with the exception of pro se litigants, "no person shall practice law * * * unless that person is an active member of the Oregon State Bar"; the Bar has authority to seek an injunction against a person its Board of Governors believes to be violating that restriction. ORS 9.160; ORS 9.166. Because defendant has been disbarred, the sole question in this case is whether his business constitutes the practice of law. This court recently defined "the practice of law" in Oregon State Bar v. Smith, 149 Or.App. 171, 942 P.2d 793, rev. den., 326 Or. 62, 944 P.2d 949 (1997), cert. den., 522 U.S. 1117, 118 S.Ct. 1055, 140 L.Ed.2d 117 (1998). The defendants in Smith operated a paralegal services business that provided customers with legal forms and individualized legal advice. Id. at 173, 942 P.2d 793. In holding that the defendants had unlawfully engaged in the practice of law, we stated that "certain core criteria are well settled. * * * [T]he practice of law means the exercise of professional judgment in applying legal principles to address another person's individualized needs through analysis, advice, or other assistance." Id. at 183, 942 P.2d 793.

This definition of law practice has two aspects: exercise of professional judgment and application of legal principles to individual cases. An exercise of professional judgment occurs any time there is "informed or trained discretion * * * exercised in the selection or drafting of a document to meet the [legal] needs of the persons being served[;]" an "intelligent choice [made] between alternative methods" of drafting a legal document, State Bar v. Security Escrows, Inc., 233 Or. 80, 89, 91, 377 P.2d 334 (1962); or advice given that "involves the application of legal principles[,]" State Bar v. Miller & Co., 235 Or. 341, 344, 385 P.2d 181 (1963). Application of legal principles to individual circumstances occurs when, for example, a paralegal gives advice to clients that is specific to the individual client, see In re Morin, 319 Or. 547, 878 P.2d 393 (1994), or when a nonlawyer recommends particular legal forms tailored to the recipient's particular problems, State ex rel Oregon State Bar v. Wright, 280 Or. 713, 719, 573 P.2d 294 (1977).

Oregon courts have frequently applied these criteria to the preparation by nonlawyers of legally significant documents and forms. In Security Escrows, Inc., the Oregon Supreme Court stated that, "[i]f the customer does not know what forms to use or how to direct their completion, then he needs legal advice. If the customer does know what he wants and how he wants it done, he needs only a scrivener." 233 Or. at 93,377 P.2d 334. In Oregon State Bar v. Gilchrist, 272 Or. 552, 538 P.2d 913 (1975), the nonlawyer defendants sold do-it-yourself divorce kits and conceded that they conducted interviews, recommended which forms within the kit to use, answered questions and otherwise counseled their customers. Id. at 557, 538 P.2d 913. The court held that the advertising and sale of the kits was not the practice of law, but that

"all personal contact between defendants and their customers in the nature of consultation, explanation, recommendation or advice or other assistance in selecting particular forms, in filling out any part of the forms, or suggesting or advising how the forms should be used in solving particular customer's marital problems does constitute the practice of law * * *."

Id. at 563-64, 538 P.2d 913.

Gilchrist was refined in later cases. In Oregon State Bar v. Fowler, 278 Or. 169, 172, 563 P.2d 674 (1977), the court held that the Oregon State Bar was not entitled to injunctive relief where the evidence showed only that the nonlawyer defendant used specific legal forms provided by the customer and that the customer dictated the precise terms and legal definitions used in the forms; in that situation, the court held, the defendant had not exercised any independent judgment. In Oregon State Bar v. Ortiz, 77 Or.App. 532, 713 P.2d 1068 (1986), the nonlawyer defendant advised and assisted customers in the preparation of citizenship and immigration visa applications. The court stated that, although "it does not require legal skill to fill out the forms, [an] understanding of the consequences attendant on their completion and filing * * * does require legal skill and judgment." Id. at 536, 713 P.2d 1068. Finally, in In re Morin, the court held that a paralegal unlawfully practiced law when he exercised his own discretion in recommending...