State ex. Inf. Miller v. St. L. Union Trust Co.

• Decision Date: 27 August 1934
• Docket Number: No. 30928.,30928.
• Citation: 74 S.W.2d 348
• Parties: STATE OF MISSOURI EX INF. FRANKLIN MILLER, Circuit Attorney of the City of St. Louis, Relator, v. ST. LOUIS UNION TRUST COMPANY, a Corporation.
• Court: Missouri Supreme Court

74 S.W.2d 348

STATE OF MISSOURI EX INF. FRANKLIN MILLER, Circuit Attorney of the City of St. Louis, Relator, v. ST. LOUIS UNION TRUST COMPANY, a Corporation.

No. 30928.

Supreme Court of Missouri.

Court en Banc, August 27, 1934.

Quo Warranto.

ORDERED THAT RESPONDENT PAY FINE OF ONE DOLLAR AND COSTS AND HENCEFORTH, CEASE FROM ILLEGAL PRACTICES.

Franklin Miller and Abbott, Fauntleroy, Cullen & Edwards for relator; Irl B. Rosenblum and Cullen, Fauntleroy & Edwards of counsel.

(1) The statutes of Missouri declare that law business, when a valuable consideration is present, is the advising or counseling of any person or corporation as to any secular law; or the drawing or assisting in the drawing of any document or instrument affecting or relating to secular rights; and it also declares that the doing of any act tending to secure for any person any property or property rights is the doing of a law business in a representative capacity and for a valuable consideration. (a) The "practice of law" is the appearance as an advocate, or the drawing of pleadings, papers, or documents in a representative capacity in connection with proceedings pending or prospective before any tribunal having authority to settle controversies. Secs. 11692, 11693, 11695, 11696, 11697-11704, 11706, 11707-11715. R.S. 1929. (2) The statute prohibits a corporation or association from practicing law or doing a law business as defined by statute and there is nothing in the statute under which trust companies are organized which confers any power upon them to practice law or do a law business by or through duly licensed lawyers hired by a trust company. Secs. 5421, 11692, R.S. 1929; 36 Cyc. 1123; State ex rel. v. St. Louis, 174 Mo. 143; Supply Co. v. Smith, 182 Mo. App. 219; State ex rel. Crow v. St. Louis, 174 Mo. 125; Joplin Supply Co. v. Smith, 182 Mo. App. 212; State v. Bailey, 121 Pac. 821; In re Eastern Idaho Loan & Trust Co., 288 Pac. 160; Lewis Pub. Co. v. Rural Pub. Co., 181 S.W. 103; State ex inf. v. Lincoln Trust Co., 144 Mo. 586, 46 S.W. 593; 3 Thompson on Corporations, sec. 2188, p. 843; Central Loans Co. v. Pullman Co., 139 U.S. 49; Townsend v. Brown, 24 N.J. Law, 87; 6 C.J., sec. 11, p. 569; State v. Bailey Dental Co., 234 N.W. 260; Kirby Carpenter Co. v. Burnet, 144 Fed. 635; Conover v. Stilwell, 34 N.J. Law, 54; Stanley v. Schowlby, 162 U.S. 255; Bridges v. Stevens, 132 Mo. 524. (3) By the overwhelming weight of authority, both judicial and textual, the drafting of wills and the writing of instruments (creating trusts) by a salaried employee of a trust company, even though a licensed lawyer, constitutes the unauthorized practice of law, and in many states it is held that such unauthorized practice of law constitutes a contempt of court. In Matter of Co-operative Law Co., 198 N.Y. 479, 19 Ann. Cas. 879, 32 L.R.A. (N.S.) 55, 93 N.E. 15; Eley v. Miller, 7 Ind. App. 529, 34 N.E. 386; People v. Peoples Trust Co., 167 N.Y. Supp. 767, 180 App. Div. 494; In re Eastern Idaho Loan & T. Co., 288 Pac. 157; In re Otterness, 232 N.W. 318; People ex rel. Ill. Bar Assn. v. People's Stock Yards Bank, 176 N.E. 901; New Jersey Photo Engraving Co. v. Schonert & Sons, 95 N.J. Eq. 12, 122 Atl. 307; Creditors Natl. Clearing House v. Baunwart, 227 Mass. 579, 116 N.E. 886; State v. Bailey Dental Co., 234 N.W. 260; Savings Bank v. Ward, 100 U.S. 195; Barr v. Cardell, 173 Iowa, 31; State of New York v. Alfani, 227 N.Y. 335; Illinois v. Schreiber, 250 Ill. 345; People v. California Protective Corp., 244 Pac. 1089; State ex rel. Lundin v. Merchants Protective Corp., 177 Pac. 694; In Matter of Duncan, 83 S.C. 189, 65 S.E. 210, 24 L.R.A. (N.S.) 750, 18 Ann. Cas. 657; People v. People's Trust Co., 167 N.Y. Supp. 767, 180 App. Div. 494; In re Pace, 156 N.Y. Supp. 641; People ex rel. Lawyer's Institute of San Diego v. Merchants Protective Assn., 209 Pac. 363; People ex rel. Florsheimer v. Lawson-Purdy, 221 N.Y. 481; Thornton on Attorneys at Law, sec. 69; People v. Title Guarantee & T. Co., 227 N.Y. 366, 125 N.E. 666.

Bryan, Williams, Cave & McPheeters for respondent.

(1) Since this case is now before this court on the motion of relator to strike out portions of respondent's answer and return, those allegations which are made in relator's information, but which are denied in the answer of respondent, must be held to be untrue, and the allegations of new matter stated in respondent's answer must be held to be true. Hall v. Wilder Mfg. Co., 316 Mo. 830; Ales v. Epstein, 283 Mo. 438; Slater Bank v. Harrington, 218 Mo. App. 645; Regan v. Dickmann, 207 S.W. 792. (2) The Legislature of Missouri has expressly, in clear language, defined the meaning of the term "practice of law," and of the phrase "law business." R.S. 1929, secs. 11692, 11693. (3) And such legislative definition excludes any other definition and renders immaterial and irrelevant any definition which may be found in the decisions cited by relator from other jurisdictions. 36 Cyc. 1122; 19 Cyc. 23; Sutherland on Statutory Construction (2 Ed.), sec. 360; 25 R.C.L., sec. 229. (4) The phrase "valuable consideration" used in the statutory definition, means money or something of value which can be readily and certainly measured in money. R.S. 1929, secs. 11693, 11694. (5) The answer and return of respondent clearly shows that none of the acts of respondent, of which relator complains, were ever done by respondent for a valuable consideration. (a) The mere nomination of respondent as executor or fiduciary under a will cannot constitute a valuable consideration, nor can the mere nomination of respondent as trustee under a revocable trust agreement constitute a valuable consideration, because such nomination may be revoked at any time without any wrong to respondent. Respondent acquires no legal right by his mere nomination. Williston on Contracts, secs. 43, 104; Wald's Pollock on Contracts, p. 46; Page on Contracts (2 Ed.), secs. 569, 572, 634; Kilborn v. Pyne, 279 Fed. 864; Warren v. Castello, 109 Mo. 338; Oakland Motor Car Co. v. Indiana Auto. Co., 201 Fed. 499; Velie Motor Car Co. v. Kopmeier Motor Car Co., 194 Fed. 324; Musick v. Dodson, 76 Mo. 624; Bragg v. Israel, 86 Mo. App. 338; Pershall v. Elliott, 163 N.E. 556, 249 N.Y. 183; Clayman v. Bibler, 231 N.W. 336; M.-K.-T. Ry. Co. v. Smith, 66 L.R.A. 741. (6) While the hope of a trust company that it might ultimately be appointed by the probate court as executor of a will, or that it might ultimately be called upon to act as trustee thereunder, might be a motive which would induce a trust company to draw the will in which it is nominated as executor or trustee, nevertheless, such hope or such motive does not constitute a valuable consideration. Authorities cited, supra. (a) While the hope of ultimately acting as trustee under an insurance trust or other revocable trust in which it is named as trustee might be the motive which would induce a trust company to draw the instrument, still such hope or such motive does not constitute a valuable consideration. Authorities cited, supra. (b) While the hope of expanding the trust company's business of acting as trustee might be the motive which might induce a person to draw an irrevocable trust instrument, still such hope or such motive would not constitute a valuable consideration. The expectancy of receiving fees for services to be thereafter rendered as trustee will not constitute a consideration for the drawing of the instrument, as the trustee would, as trustee, receive the same fees whether he drafted the instrument or whether someone else drafted it. Philpot v. Gruninger, 14 Wallace, 570; Ward v. Hartley, 178 Mo. 135; Elliott on Contracts, sec. 204; 13 C.J. 325; Spears & Sons v. Winkle, 217 S.W. 691; Elliott on Contracts, sec. 211; Williston on Contracts, secs. 111, 147.

Maurice J. O'Sullivan, Francis C. Downey and J. Francis O'Sullivan for Kansas City Bar Association.

Because the trust company is named as executor, or trustee, they claim to be acting as an adversary party in drawing the will or trust agreement, and that the customer understands that they are acting in their own interest, and but seek to protect their own interest as a party to a contract. It must be conceded that a lawyer drawing a will or a trust agreement is acting in a representative capacity, for his client. The courts have repeatedly recognized that he does so and hold that he cannot testify as to any communications made by his client in reference thereto. This is true whether or not he expected to receive, or was paid, a fee. Cross v. Riggins, 50 Mo. 335; Johnson v. Sullivan, 23 Mo. 474; In re Schneider, 293 S.W. 736.

Roy D. Williams, Allen McReynolds, R.E. Culver and Mercer Arnold for Missouri Bar Association.

(1) The conduct of respondents clearly convicts them of doing law business and practicing law in violation of the pertinent statutes of Missouri. Liggett Co. v. Baldridge, 278 U.S. 115, 49 Sup. Ct. 60; People v. Painless Parker Dentist, 275 Pac. 931; State v. Kindy Optical Co., 248 N.W. 332; Hightower v. Detroit Edison Co., 262 Mich. 1, 247 N.W. 97; Smallberg v. State Bar of Cal., 297 Pac. 916; Howe v. State Bar of Cal., 298 Pac. 25; Browne v. Phelps, 211 Mass. 376, 97 N.E. 762; English Statute, 22 George II, Chap. 46, Sec. 11; In re Jackson & Wood, 1 B. & C. 270, 107 Eng. Rep. 101; Dunne v. O'Reilly, 11 U.C.C.P. 404. (2) Even if it be found that respondents are not guilty of a violation of such statutes, respondent corporations engage in the practice of law and thus act beyond the scope of their charter and franchise, and this court has the inherent, exclusive power, independent and regardless of statute, to prevent, prohibit and penalize such unauthorized practice, under its traditional right to regulate and control those who may practice law and the general subject of the practice of law. In re Opinion of the Justices, 180 N.E. 725; People v. People's Stock Yards State Bank, 344 Ill. 462, 176 N.E. 906; Rosenthal v....