Szteinbaum v. Kaes Inversiones y Valores, C.A.

• Decision Date: 24 September 1985
• Docket Number: No. 84-1184,84-1184
• Parties: 10 Fla. L. Weekly 2209 Victor SZTEINBAUM and Bella Szteinbaum, Appellants, v. KAES INVERSIONES y VALORES, C.A., Appellee.
• Court: Florida District Court of Appeals

Page 247

476 So.2d 247

10 Fla. L. Weekly 2209

Victor SZTEINBAUM and Bella Szteinbaum, Appellants, v. KAES INVERSIONES y VALORES, C.A., Appellee.

No. 84-1184.

District Court of Appeal of Florida,

Third District.

Sept. 24, 1985.

Lisa Bennett and Richard Bennett, Coral Gables, for appellants.

Simson Unterberger, Tampa, for appellee.

Before DANIEL S. PEARSON and FERGUSON and JORGENSON, JJ.

DANIEL S. PEARSON, Judge.

The question on this appeal is whether a complaint filed by a non-attorney on behalf of a corporation may be amended to cure this deficiency. We decide that such a complaint may be amended and affirm the order under review.

The plaintiff corporation, Kaes Inversiones y Valores, C.A., sued Szteinbaum. The corporation's complaint and summons were personally served on the defendant. The defendant moved to quash service of process and dismiss the complaint on the ground, inter alia, that it did not appear from the complaint that the corporate plaintiff was represented by an attorney. The trial court granted the motion to dismiss with leave to amend. The corporate plaintiff filed an amended complaint signed by an attorney and served it on Szteinbaum's attorney by mail. Szteinbaum again moved to dismiss contending now that because the original complaint was a nullity, it was necessary that the amended complaint be personally served upon him. ¹ The trial court denied the motion, and this appeal followed.

It is well recognized that a corporation, unlike a natural person, cannot represent itself and cannot appear in a court of law without an attorney. Nicholson Supply Co. v. First Federal Savings & Loan Association of Hardee County, 184 So.2d 438 (Fla. 2d DCA 1966). Courts have reflexively applied this common law rule prohibiting the unauthorized practice of law and have offered three primary justifications in support of it. First, because a corporation is a "hydra-headed entity and its shareholders are insulated from personal responsibility," there must be one designated spokesperson accountable to the court. Oahu Plumbing and Sheet Metal, Ltd. v. Kona Construction, Inc., 60 Hawaii 372, 377-78, 590 P.2d 570, 574 (1979) (citing Austrian, Lance & Stewart, P.C. v. Hastings Properties, Inc., 87 Misc.2d 25, 27, 385 N.Y.S.2d 466, 467 (Sup.Ct.1976)). Second, "[u]nlike lay agents of corporations, attorneys are subject to professional rules of conduct and thus amenable to disciplinary action by the court for violations of ethical standards." Oahu Plumbing and Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d at 574 (citing Merco Construction Engineers, Inc. v. Municipal Court, 21 Cal.3d 724, 727, 581 P.2d 636, 641, 147 Cal.Rptr. 631, 636 (1978) (in bank)). Third, attorneys purportedly have the legal skills necessary to competently participate in litigation and other proceedings. Oahu Plumbing and Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d at 575. ² See also State ex rel. Western Parks v. Bartholomew County Court, 270 Ind. 41, 44-5, 383 N.E.2d 290, 293 (1978) (when corporate agents are not attorneys, "a lack of legal expertise combined with a failure to maintain a proper chain of communication between the agents at each level of the action may act to frustrate the continuity, clarity and adversity which the judicial process demands"); Land Management, Inc. v. Department of Environmental Protection, 368 A.2d 602, 603 (Me.1977) ("To allow a corporation to maintain litigation and appear in court represented by corporate officers or agents only would lay open the gates to the practice of law for entry to those corporate officers or agents who have not been qualified to practice law and who are not amenable to the general discipline of the court.") (citing Union Savings Ass'n v. Homeowners Aid, Inc., 23 Ohio St.2d 60, 64, 262 N.E.2d 558, 561 (1970)). Since there can be little doubt that the act of filing a complaint constitutes the practice of law, compare Chicago Bar Association v. Quinlan and Tyson, Inc., 34 Ill.2d 116, 214 N.E.2d 771 (1966) (real estate broker may fill in usual form of earnest money contract which involves merely supplying factual data without committing unauthorized practice of law), with Housing Authority of County of Cook v. Tonsul, 115 Ill.App.3d 739, 75 Ill.Dec. 369, 450 N.E.2d 1248 (1983) (filling out forcible entry and detainer complaint constitutes the unauthorized practice of law), and the corporate plaintiff, not being an attorney, did thus engage in the unauthorized practice of law, our inquiry will turn to whether the product of that unauthorized practice--the complaint--must therefore be treated as a nullity.

In Nicholson Supply Co. v. First Federal Savings & Loan Association of Hardee County, 184 So.2d 438, the Second District held that a complaint filed by a corporation which did not bear the signature of an attorney is a nullity which, thus defined, cannot be saved by a later amendment affixing the attorney's signature. In our view, Nicholson, with which our holding today directly conflicts, ³ was wrongly decided. ⁴ , ⁵

As this court declared in Puga v. Suave Shoe Corp., 417 So.2d 678, 679 (Fla. 3d DCA 1981) (en banc), public policy dictates that, whenever possible, cases "should be determined on their merits, instead of upon irrelevant technicalities." Thus, dismissal of the amended complaint in the present case in derogation of this "welcome policy," Puga v. Suave Shoe Corp., 417 So.2d at 679, is warranted only if it can be said that treating the defect of the initial complaint as incurable will somehow substantially advance some other more compelling public policy.

To be sure, the "protection of the public from incompetent, unethical, or irresponsible representation," The Florida Bar v. Moses, 380 So.2d 412, 417 (Fla.1980), through the prevention of the unauthorized practice of law is a compelling public policy. We suggest, however, that this latter policy is not served by a rule of law that declares that a complaint filed by a non-attorney on behalf of a corporation cannot be cured by the later appearance of counsel to represent the corporation and, moreover, that such a rule of law disserves the policy that cases should be decided on their merits. Where, as here, the representation of the plaintiff corporation, confined as it was to the filing of the complaint, was brief, minimal and essentially innocuous, ⁶ the unauthorized practice of law was adequately curtailed by the trial judge's eminently sensible decision to allow an attorney to appear for the corporation and thereby amend the complaint. Moreover, given the liberal rules of amendment in this state, see, e.g., Alvarez v. DeAguirre, 395 So.2d 213 (Fla. 3d DCA 1981), the filing of a complaint by a non-lawyer will rarely, if ever, permanently prejudice the plaintiff corporation, since once the corporation has been given leave to obtain counsel, such counsel will likely be permitted to amend the complaint as necessary. Indeed, prohibiting amendment and dismissing as a nullity the complaint would yield the ironic result of prejudicing the constituents of the corporation, the very people sought to be protected by the rule against the unauthorized practice of law.

Several courts have concluded that a dismissal without leave to amend is an unduly harsh result where the defect of the complaint is that it was filed by a non-attorney on behalf of another. For example, in Kasharian v. Wilentz, 93 N.J.Super. 479, 226 A.2d 437 (App.Div.1967), the court stressed that non-lawyers should not be permitted to conduct legal proceedings, but nonetheless allowed an appeal filed by the decedent's father as administrator ad proscequendum to continue in order to provide time for the administrator to engage counsel. Similarly, in Owens v. Bank of Brewton, 53 Ala.App. 529, 302 So.2d 114 (Civ.App.1974), the court refused to dismiss an appeal taken by an attorney who, at the time of filing, had not purchased an occupational license required of all attorneys. ⁷ It concluded that the "[f]ailure to purchase a license to practice as required by statute is a possible criminal violation by the one so failing, but such violation should not serve to punish the appellants by dismissal of their appeal." Id. 302 So.2d at 117. See also Aarrow Ambulance v. Davis, 16 Ill.App.3d 318, 306 N.E.2d 363 (1974); Rader v. Snyder, 3 W.Va. 413 (1869) (holding that fact that counsel was not qualified to practice law did not justify dismissal of the action, though attorney in error should suffer punishment imposed by law); Annot. 7 A.L.R.4th 1146 (1981), Right of Party Litigant To Defend or Counterclaim on Ground That Opposing Party or His Attorney Is Engaged in Unauthorized Practice of Law. In short, only unquestioning adherence to the rigid mechanistic rule of Nicholson would require the draconian measure of nullifying a complaint filed by a non-attorney on behalf of a corporation.

That the rule against the unauthorized practice of law must yield to the strong public policy in favor of having cases decided on the merits has likewise been recognized in cases dealing with entry of defaults (or the setting aside of defaults where the default had already been entered) where a non-attorney appeared on behalf of a corporation rendering defective any defensive pleading. For example, in Starrett v. Shepard, 606 P.2d 1247 (Wyo.1980), the court held that the trial judge did not abuse his discretion in not granting the plaintiff's motion for a default judgment despite the fact that a non-lawyer corporate agent represented the defendant corporation. The court acknowledged that "[p]leadings filed in actions taken by a non-lawyer corporate officer in a legal action are subject to be stricken or held to be a nullity; and there may be cases in which the entry of a default judgment against a corporation may be justified on the ground that the corporation was improperly represented in the action by a non-lawyer corporate officer, but such is not justified in...