Pioneer Title Ins. & Trust Co. v. State Bar of Nev.
| Decision Date | 06 June 1958 |
| Docket Number | No. 4039,4039 |
| Parties | PIONEER TITLE INSURANCE & TRUST COMPANY, a California corporation, Appellant, v. STATE BAR OF NEVADA, a Public Corporation, and Harvey D. Dickerson, Madison B. Graves, E. P. Carville, Orville R. Wilson, James W. Johnson, Jr., William J. Crowell, Douglas A. Busey, Bryce Rhodes, Bruce Thompson, and William K. Woodburn, as the duly elected, qualified and acting Board of Governors of the State Bar of Nevada, and individually as attorneys-at-law of the State Bar of Nevada, and on behalf of all other attorneys-at-law duly licensed to practice law in the State of Nevada, Respondents. |
| Court | Nevada Supreme Court |
John S. Halley, Reno, McNamee & McNamee, Las Vegas, Allen C. McGurk, San Bernardino, Cal., for appellant.
John W. Bonner, Ralston O. Hawkins, John F. Mendoza, Charles L. Garner, Jack E. Butler, Las Vegas, for respondents.
This is an appeal from an injunction against unauthorized practice of the law.
The State Bar of Nevada has proceeded against the Pioneer Title Company of Las Vegas charging that the company, in connection with its services as escrow agent in real estate sales, itself prepares all instruments necessary to effectuate such transactions. The trial court, finding in accordance with the position of the State Bar, has enjoined the title company from the preparation of such instruments. The instruments specified in the injunction are the following: 'purchase and sale agreements for the purchase and sale of real and personal property, or both, deeds, notes, chattel mortgages, trust deeds, assignments, escrow agreements, escrow instructions, and bills of sale.' The company also was enjoined from 'directly or indirectly holding itself out to the public by offering to perform any of the services hereinabove described.'
From this injunction the present appeal is taken by the title company. It contends that under the facts of the case its services in connection with the preparation of the instruments in question do not constitute unauthorized practice of the law.
The record discloses the procedure followed by the title company in the preparation of the instruments in question. In all cases the preparation of instruments was in connection with an escrow handled by the company and that escrow itself was in connection with an examination of title by the company. No separate charge was made for its services. For the purposes of our decision the following typical case may be regarded as establishing the practice which we must here examine.
An owner and a purchaser were brought to the title company office by their realtor. They had already agreed upon the terms for purchase and sale of residence property and their agreement was evidenced by an earnest money receipt. The parties, together with the realtor, conferred with an escrow officer. In response to his questions information was given by the parties as to the terms of their agreement. This information was taken down by the escrow officer upon a work sheet. When all necessary information had been secured, the work sheet was given to one of the company stenographers who typed it up on a printed form of escrow instructions. This was brought back to conference, checked by all present and signed by the parties. No request was made of the escrow officer for legal advice and no legal advice was given. (The company's employees have been instructed not to answer any questions upon matters of law, but to refer the parties to their attorneys as to all such matters.) The parties were advised that in order to carry out the transaction certain legal instruments would have to be prepared and signed by them: a deed, a bill of sale of personal property, a note for the unpaid balance of the purchase price, a trust deed and chattel mortgage to secure the note. They were asked whether either of them would prefer to have these instruments prepared by his own attorney. They were advised that if not, the documents would be prepared by the company stenographers and checked either by one of the parties' attorneys or by the company attorney, whichever way the parties wished it. The parties stated that they would be satisfied to have the instruments prepared by the company stenographers and checked by the company attorney. The instruments were then prepared by the company stenographers from printed forms which have been in use by the company for many years and which were themselves prepared by the company attorney as suitable for use in such cases as this. The company attorney, as was his practice each day, came by the company office. He picked up the file containing the instruments involved in the case and checked them for their legal sufficiency. He found them in order and made no suggestions for changes.
We have concluded that while the procedures followed by the title company for the most part are acceptable, still the injunction must be affirmed. Since it appears from our opinion which follows that the effect of the injunction may be avoided by the company with but minor changes in its established procedures, our decision may seem to amount to a splitting of hairs. We do not so regard it. Trivial though the refinements in procedure may seem upon their face, the fact is that they are not trivial for the principles which require them are of considerable public importance. To compromise those principles, in order to obtain what may seem a more practical result, would be to place those principles in jeopardy. This we do not choose to do.
The practice of law by others than members of the State Bar of Nevada is forbidden by statute. NRS 7.600. The reason is not the protection of the lawyer against lay competition but the protection of the public.
The rights bestowed upon us by law are to an extent the gauge of our freedom and of our civilized progress. They must be prized as such and the reciprocal obligation to honor the rights of others must be respected. Due respect for these rights and obligations requires that at all times they be susceptible of definition. This proposition lies at the very foundation of our system of law. The public interest therefore requires that in the securing of professional advice and assistance upon matters affecting one's legal rights one must have assurance of competence and integrity and must enjoy freedom of full disclosure with complete confidence in the undivided allegiance of one's counsellor in the definition and assertion of the rights in question.
It is to meet the requirements of public interest that high standards of training and competence are fixed for those who would practice law and that they practice under a strict code of professional ethics and are made answerable to the courts as court officers for the manner in which they meet their professional obligations. The legal profession has, through acceptance of its obligations, traditionally become imbued with a spirit of public service.
The bench and bar may not lightly disregard these public obligations. Nor, in default of duty, may they casually permit the public to be led to rely upon the counselling, in matters of law, of persons not subject to the standards and discipline of the attorney as imposed by law for the public protection.
These principles must remain constant. The circumstances which call for creation of the attorney-client relationship are, however, subject to continuing change. As civilization becomes more complex we find that counselling becomes important in more and more new fields involving legal rights. Conversely we find that the public becomes accustomed to certain areas of transaction and that as transactions in those areas become standardized, legal counselling is no longer generally regarded as a practical necessity or a reasonable precaution. Contracts of insurance and of purchase and sale, the borrowing of money and the extension of credit all are now a familiar every-day experience to thousands of laymen. The nature of the rights and obligations thereby created have become familiar lay concepts. Furthermore, as the public in standardized areas of transaction, becomes familiar with the nature of the rights and obligations which are created, it becomes accustomed to the standardized form of the instruments involved. Custom serves to standardize both the rights and obligations and the form of instrument by which they are created.
The need for legal counselling in any transaction is a question which must be decided by the person whose legal rights are involved. If, in his judgment, he does not need advice as to his legal rights or assistance with respect to them, no one can complain of his self-reliance. Such a case must be a true case of self-reliance, however. If reliance be placed upon the judgment of others as to his legal...
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