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Bar Journal - June 1, 2002

Reconsidering the Regulation of the Practice of Law in NH

By:
Reconsidering the Regulation of the Practice of Law in New Hampshire
 

RSA Chapter 311 addresses both the regulation of the practice of law, and the unauthorized practice of law in the State of New Hampshire, the history of which is the subject of a separate article.1 Both of these subjects are undoubtedly within an area of overlapping jurisdiction of both legislative and judicial branches of government that is tacitly recognized by the General Court.2  RSA 311:1 and RSA 311:7 address the conflicting provisions of the right of the individual to choose or appoint another to represent that individual, and the legislatively granted (or inherent) right of the courts to regulate those who practice law.3  These two sections appear to have served their dual and cross purposes as the case law has developed over the recent years. The Supreme Court has balanced the RSA 311:1 right of a person to represent his or herself, or to appoint a trusted friend or confidant to act as his or her attorney-in-fact in a judicial proceeding, with the Court's obligation under the RSA 311:7 admission process to protect the public from the provision of unreliable legal services by unqualified persons. The legitimacy of the admission process is based upon this public protection purpose.4 

Public protection is the public policy intent underlying the development and enforcement of unauthorized practice of law (UPL) provisions of RSA 311:7-a et seq. Leaving aside the Jacksonian influence of those few who don't want to hire an attorney for philosophical reasons, the greater problem is that there are many citizens who want and need an attorney, cannot afford to hire one, and thus find themselves in the unenviable position of either attempting to represent themselves or are duped into paying for bad advice and inadequate representation. This unmet need not only includes visible legal services such as courtroom appearances but extends to everyday law-related services such as real estate negotiations and transactions, landlord-tenant contracts and disputes, domes tic relations and child custody matters, estates and trusts, employment concerns, contracts etc.

Why do these citizens desire an attorney? Does a public interest exist in having these prospective clients represented by an attorney? Lawyers, as officers of the court, trained in the law, and so regulated, have certain guiding principles and core values established by both professional rules of conduct and the individual's professionalism.6  These values include honesty, competence, civility, reliability, and fairness. This structure affords clients of lawyers with the protections of attorney-client confidentiality, safeguards against conflicts of interest, and the benefits of the lawyer's independent, critical judgment.

These same principles or core values serve the public's interest as well in assuring that the wheels of justice turn smoothly due to the professionalism of the attorneys who appear before the courts.

"We should also emphasize that there are firm constraints upon the conduct of lawyers. The lawyer is forbidden to lie, to assist the client in criminal or fraudulent conduct; to present evidence known to be false to destroy evidence in litigation; to commit crimes involving moral turpitude; to assert frivolous claims; or to use tactics that have no justification in fact or law solely for the purpose of harassment or delay."7 

Having attorneys represent clients in all facets of the law encourages and supports the rule of law, for "it [is] understood that a good lawyer help[s] his client not to evade the law but to obey it."8  By bringing their core values to their everyday dealings with clients, N.H. attorneys help their clients avoid or resolve disputes, most often out of court, thus not making any demands on the judicial resources of the state, and providing a more timely and satisfying resolution for all parties.

"The advocate has more than a private fiduciary relationship with a client, he also has a public trust. In his counseling and planning functions, the attorney not only expedites his client's wishes and lightens the workload of the courts; he enforces the law as well.... [T]here are simply not enough government officials charged with the responsibility of enforcing our laws to relegate the assessment of legality solely or even primarily to adjudicatory forums. The smooth functioning of our society requires the private attorney to pass his client's proposal through the filters of every relevant area of the law, so that the client can proceed confidently on a legal course of action, and so that the chaos of multiplicity of improperly planned, ultimately illegal, courses of action can be avoided."9 

The New Hampshire Bar Association has attempted to provide for these unmet needs through its Pro Bono Referral Program, its Reduced Fee Lawyer Referral Service, and the IOLTA mechanism of using the interest on lawyer trust accounts to fund legal services for the poor.10 But these programs are not enough. The State of New Hampshire has over-relied on pro bono volunteers and N.H. Legal Assistance and the like, which for the most part only partially address the legal needs of the very poor, but address in no way the legal service requirements of the vast majority of its citizens, the middle class. While the number of lawyers continues to grow, the economic reality is that the legal profession cannot meet all of the demands for legal services without some fundamental changes.

For instance, the Supreme Court of the State of Maine recently adopted a rule that authorizes the unbundling of legal services. This rule permits lawyers to assist clients by forming relationships that are limited in the manner and scope of representation, thereby reducing the cost and making legal assistance from a lawyer more affordable.11 

This kind of change alone, however, cannot and will not fill the void, and does not address the protection of the public from the illegal providers of legal services, who may be dishonest, incompetent, unreliable or unfair, and who has neither the training nor the courage to exercise independent judgment. Such individuals practicing outside the regulatory system are not bound by conflict rules, nor are their interactions with clients protected by attorney-client privilege.

Virtually every state and the District of Columbia, either by statute or court rule, has prohibited the unauthorized practice of law" But to truly protect the public, the enforcing agency or court, however, must eventually address the obstacle of proving that such illegal activity falls within the "practice of law."

The New Hampshire Supreme Court acknowledged that "[i]t would be difficult to give an all-inclusive definition of the practice of law, and that its "determination must be made on a case-by-case basis."12 

The court has, however, provided some guideposts. Clearly constituting the practice of law is appearing,13 or filing of documents,14 on behalf of another in a court before an administrative agency.15  In transactional practice, the court has held that drafting letters on behalf of clients, and holding yourself out as a practicing attorney also indicates the practice of law.16

But to truly protect the public, the enforcing agency or court must eventually address the obstacle of proving that such illegal activity falls within the "practice of law." Such an ad hoc approach, however, is difficult at best, requiring the development of case law to eventually provide the necessary substance to the public protection function of RSA 311:7-a et seq.

In 1997, the NHBA Unauthorized Practice of Law Committee developed proposed extensive amendments to RSA Chapter 311, which addressed in part the definition of the practice of law. The definition portions of those proposals are as follows:

311:1-a Definitions

  1. For the purposes of this chapter, "law" is the governing body of legislative enactments, judicial rules and opinions, administrative rules and regulations, and executive orders, defining the rights and obligations of persons subject to that government.
  2. For purposes of this chapter, "the practice of law" is a course of conduct by someone with a sufficient knowledge of the law and the appropriate quality of character and judgment, who commonly advises others as to their rights and obligations under the law.
  3. For purposes of this chapter, "unauthorized practice of law" is the practice of law by a person not admitted to the practice of law in the state of New Hampshire, unless such person shall be otherwise legally authorized to so act.
  4. For the purposes of this chapter, an "attorney" is someone who has been admitted to the practice of law in the State of New Hampshire, has taken the oath and remains in good standing under applicable Rules of the New Hampshire Supreme Court.

The problem with the proposed definition of the "practice of law" of Section II above, is it neither defines "commonly," and includes both the activity with the qualifications of those who are otherwise authorized to practice, e.g. "sufficient knowledge of the law and the appropriate quality of character and judgment...." This latter inclusion confuses the distinction between the "authorized" and "unauthorized" practice of law. An argument could made that the activity of an unqualified person does not fall within the definition of the practice of law. In fact, it should be the licensing authority that defines the qualifications of individuals.17

A number of other states have defined the practice of law either by rule or statute. Many of these many of definitions substantively address what acts or activities constitute the practice of law. The following are a sampling of those definitions:

District of Columbia

Rule 49 (b)(2) "Practice of Law" means the provision of professional legal advice or services where there is a client relationship of trust or reliance. One is presumed to be practicing law when engaging in any of the following conduct on behalf of another:

  1. Preparing any legal document, including any deeds, mortgages, assignments, discharges, leases, trust instruments or any other instruments intended to affect interests in real or personal property, wills, codicils, instruments intended to affect the disposition of property of decedents' estates, other instruments intended to affect or secure legal rights, and contracts except routine agreements incidental to a regular course of business;
  2. Preparing or expressing legal opinions;
  3. Appearing or acting as an attorney in any tribunal;
  4. Preparing any claims, demands or pleadings of any kind, or any written documents containing legal argument or interpretation of law, for filing in any court, administrative agency or other tribunal;
  5. Providing advice or counsel as to how any of the activities described in sub-paragraph (A) through (D) might be done, or whether they were done, in accordance with applicable law;
  6. Furnishing an attorney or attorneys, or other persons, to render the services described in subparagraphs (A) through (E) above.

Kentucky

SCR 3.020. Practice of Law Defined.

The practice of law is any service rendered involving legal knowledge or legal advice, whether of representation, counsel or advocacy in or out of court, rendered in respect to the rights, duties, obligations, liabilities, or business relations of one requiring the services. But nothing herein shall prevent any natural person not holding himself out as a practicing attorney from drawing any instrument to which he is a party without consideration unto himself therefor. An appearance in the small claims division of the district court by a person who is an officer of or who is regularly employed in a managerial capacity by a corporation or partnership which is a party to the litigation in which the appearance is made shall not be considered as unauthorized practice of law.

Louisiana

37:212. A. The Practice of law means and includes:

  1. In a representative capacity, the appearance as an advocate, or the drawing of papers, pleadings or documents, or the performance of any act in connection with pending or prospective proceedings before any court of record in this state; or
  2. For a consideration, reward, or pecuniary benefit, present or anticipated, direct or indirect;

  1. The advising or counseling of another as to secular law;
  2. In behalf of another, the drawing or procuring, or the assisting in the drawing or procuring of a paper, document, or instrument affecting or relating to secular rights;
  3. The doing of any act, in behalf of another, tending to obtain or secure for the other the prevention or the redress of a wrong or the enforcement or establishment of a right; or
  4. Certifying or giving opinions as to title to immovable property or any interest therein or as to the rank or priority or validity of a lien, privilege or mortgage as well as the preparation of acts of sale, mortgages, credit sales or any acts or other documents passing titles to or encumbering immovable property.

North Carolina

84-2.1. The phrase "practice law" as used in this Chapter is defined to be performing any legal service for any other person, firm or corporation, with or without compensation, specifically including the preparation or aiding in the preparation of deeds, mortgages, wills, trust instruments, inventories, accounts or reports of guardians, trustees, administrators or executors, or preparing or aiding in the preparation of any petitions or orders in any probate or court proceeding; abstracting or passing upon titles, the preparation and filing of petitions for use in any court, including administrative tribunals and other judicial or quasi-judicial bodies, or assisting by advice, counsel, or otherwise in any legal work; and to advise or give opinion upon the legal rights of any person, firm or corporation: Provided, that the above reference to particular acts which are specifically included within the definition of the phrase "practice law" shall not be construed to limit the foregoing general definition of the term, but shall be construed to include the foregoing particular acts, as well as all other acts within the general definition.

Rhode Island

11-27-2. Practice of law defined.

The term "practice law" as used in this chapter shall be deemed to mean the doing of any act for another person usually done by attorneys at law in the course of their profession, and, without limiting the generality of the fore going, shall be deemed to include the following:

  1. The appearance or acting as the attorney, solicitor, or representative of another person before any court, referee, master, auditor, division, department, commission, board, judicial person, or body authorized or constituted by law to determine any question of law or fact or to exercise any judicial power, or the preparation of pleadings or other legal papers incident to any action or other proceeding of any kind before or to be brought before the court or other body;
  2. The giving or tendering to another person for a consideration, direct or indirect, of any advice or counsel pertaining to a law question or a court action or judicial proceeding brought or to be brought;
  3. The undertaking or acting as a representative or on behalf of another person to commence, settle, compromise, adjust, or dispose of any civil or criminal case or cause of action;
  4. The preparation or drafting for another person of a will, codicil, corporation organization, amendment, or qualification papers, or any instrument which requires legal knowledge and capacity and is usually prepared by attorneys at law.

Tennessee

23-3-101. Definitions.

As used in this chapter, unless the context otherwise requires: (1) "Law business" means the advising or counseling for a valuable consideration of any person, firm, association, or corporation, as to any secular law, or the drawing or the procuring of or assisting in the drawing for a valuable consideration of any paper, document or instrument affecting or relating to secular rights, or the doing of any act for a valuable consideration in a representative capacity, obtaining or tending to secure for any person, firm, association or corporation any property or property rights whatsoever, or the soliciting of clients directly or indirectly to provide such services; and (2) "Practice of law" means the appearance as an advocate in a representative capacity or the drawing of papers, pleadings or documents or the performance of any act in such capacity in connection with proceedings pending or prospective before any court, commissioner, referee or any body, board, committee or commission constituted by law or having authority to settle controversies, or the soliciting of clients directly or indirectly to provide such services.

Texas

81.101. Definition.

  1. In this chapter the "practice of law" means the preparation of a pleading or other document incident to an action or special proceeding or the management of the action or proceeding on behalf of a client before a judge in court as well as service rendered out of court, including the giving of advice or the rendering of any service requiring the use of legal skill or knowledge, such as preparing a will, contract, or other instrument, the legal effect of which under the facts and conclusions involved must be carefully determined.
  2. The definition in this section is not exclusive and does not deprive the judicial branch of the power and authority under both this chapter and the adjudicated cases to determine whether other services and acts not enumerated may constitute the practice of law.

Washington

2.48.180 (2) The following constitutes unlawful practice of law:

  1. A nonlawyer practices law, or holds himself or herself out as entitled to practice law;
  2. A legal provider holds an investment or ownership interest in a business primarily engaged in the practice of law, knowing that a nonlawyer holds an investment or ownership interest in the business;
  3. A nonlawyer knowingly holds an investment or ownership interest in a business primarily engaged in the practice of law;
  4. A legal provider works for a business that is primarily engaged in the practice of law, knowing that a nonlawyer holds an investment or ownership interest in the business; or
  5. A nonlawyer shares legal fees with a legal provider.

Wyoming

Rule 11 (a) "Practice of law" means advising others and taking action for them in matters connected with law. It includes preparation of legal instruments and acting or proceeding for another before judges, courts, tribunals, commissioners, boards or other governmental agencies.

The definition by the State of North Carolina appears to define and include within itself those activities that generally fall within the practice of law within the State of New Hampshire. At such time an opportunity presents itself, the public would be well served if the N.H. Supreme Court incorporated such language into an inclusive definition of the practice of law.

While most states have attempted to address the unauthorized practice of law, few have effectively addressed how to fill the void of reliable legal services given that the organized bar lacks the resources to provide adequate and affordable legal services for all citizens.

Washington's Dual Approach

The Supreme Court of the State of Washington is, however, the exception. The Washington Court has taken the lead in identifying areas of legal or law-related services that may be provided by trained, licensed, and regulated non-lawyers, while vigorously protecting the public from those who are not so trained and qualified. Initially, the Washington Court, in a compromise with the state legislature over allowing non-lawyers to handle real estate closings, adopted Admission to Practice Rule 12, a Limited Practice Rule for Closing Officers,18  the purpose of which was "to authorize certain persons to select, prepare and complete legal documents incident to the closing of real estate and personal property transactions and to prescribe the conditions of and limitations of such activity."

The rule permitted non-lawyers to handle real estate closings, but defined as well the training, forms, continuing education, discipline, disclosure, financial responsibility and the like to regulate closing officers. The rule established a Limited Practice Board, made up of four lawyers, and one each of the following industries: escrow, lending, title insurance and real estate. Among the responsibilities of the board is establishing the minimum education requirements, examining applicants, providing discipline, and approving in advance all forms to be used by closing agents, including "deeds, promissory notes, guaranties, deeds of trust, reconveyances, mortgages, satisfactions, security agreements, releases, Uniform Commercial Code documents, assignments, contracts, real estate excise tax affidavits, and bills of sale."19  The rule also required that closing accounts maintained by closing officers participate in the IOLTA program.

Subsequently, the Washington Court adopted General Rule 23 addressing the certification of professional guardians. This rule followed a similar format, with the creation of a board of lawyers and non-lawyers with similar responsibilities as the board regulating closing officers.

Most recently, the Washington Court adopted effective September 1, 2001, General Rule 26, which establishes a Practice of Law Board.

"The purpose of this rule is to create a Practice of Law Board in order to promote expanded access to affordable and reliable legal and law-related services, expand public confidence in the administration of justice, make recommendations regarding the circumstances under which non-lawyers may be involved in the delivery of certain types of legal and law-related services, enforce rules prohibiting individuals and organizations from engaging in unauthorized legal and law-related services that pose a threat to the general public, and to ensure that those engaged in the delivery of legal services in the state of Washington have the requisite skills and competencies necessary to serve the public."

The Practice of Law Board consists of lawyers and non-lawyers. It is to render advisory opinions as to whether particular conduct falls within the definition of the practice of law, handle complaints and make investigations into the unauthorized practice of law. The Board is to make recommendations to the Supreme Court regarding the Provision of Legal and Law-Related Services by Non-Lawyers by subject matter, including the activities that would be authorized and the regulations necessary to protect the public including the establishment of minimum and uniform standards of competency, conduct, and continuing legal education. Importantly, General Rule 26 contemplates that the Practice of Law Board will not only develop reliable legal and law-related services by non-lawyers, but gives the board the necessary complimentary authority to prevent the unauthorized practice of law as well.

The adoption of a similar rule by the N.H. Supreme Court and its well-considered implementation could address many unanswered issues in the State of New Hampshire. For instance, unregulated title and closing companies have sprung up in New Hampshire which offer no protection for the consumer. Out-of-state lenders have instituted "notary-only closings," in which a closing package, including a real estate mortgage for a loan applied for and approved over the Internet or telephone, is executed by borrowers who receive no explanations of the consequences of their actions.

REGULATING NON-LAWYER PRACTICE

If these entities were regulated under rules similar to the non-lawyer practice regulations established in Washington, for example, consumers could be assured that the title company closing personnel were competent and reliable, and that - as required for attorneys- the trust accounts maintained by the title companies would be subject to periodic random audits. An additional benefit for facilitating access to the justice system would be if the interest on these trust accounts were paid into the IOLTA fund to support legal and law-related services to the poor.

Other examples where regulation of non-lawyer practice could benefit society include the certification of guardians ad litem in matters of family law, where consistent standards and the need for a grievance procedure are needed given the impact that GALs have on the children and families.

New Hampshire has an immediate need to expand access to affordable and reliable legal and law-related services for all citizens. The time is ripe for the N.H. Supreme Court to follow the lead of its counterpart in the State of Washington and use its inherent rule making authority to protect the public from the unauthorized practice of law by unqualified persons, and create alter natives to full-scale attorney representation, such as regulating reliable legal and law-related services by non-lawyers.

ENDNOTES

1. Gordon, J, Impersonating a Lawyer? History of New Hampshire's Unauthorized Practice of Law Statute, __ N.H.B.J. June (2002)
2. RSA 311:7-c.
3. In Appeal of Campaign for Ratepayers' Rights, the N.H. Supreme Court rejected an interpretation of RSA 311:7 to limited to proceedings in a court of law. 137 N.H. 707, 715 (1993).
4. The N.H. Supreme Court in unifying the N.H. Bar Association acknowledged that one of its quasi-public duties was "the protection of the public from the unauthorized practice of law by unqualified persons...." In re Unification of New Hampshire Bar, 109 N.H. 260 (1968).
5. The N.H. Rules of Professional Conduct as adopted by the N.H. Supreme Court.
6. N.H. Bar Association Professionalism Creed
7. Haskell, P., Why Lawyers Behave as They Do, p. 21 (1998).
8. Linowitz, S., LawYering at the End of the Twentieth Century, The Betrayed Profession, p. 3 (1994).
9. Rifkind, S., One Man's Word, pp. 502-3 (1986).
10. N.H. Supreme Court Rule 50.
11. Maine Bar Rule 3.4(i).
12. Appeal of CRR, 137 N.H. 707 (1993
13. Bilodeau v. Antal, 123 N.H. 39 (1983)
14. State v. Settle, 124 N.H. 832, 837 (1984)
15. Appeal of Campaign for Ratepayers' Rights, supra.
16. Tocci's Case, 140 N.H. 68, 70-71 (1995).
17. This apparent problem would be eliminated by amending Section II to read as follows: "For purposes of this chapter, "the practice of law" is a course of conduct by someone, who advises others as to their rights and obligations under the law."
18. Washington Supreme Court APR 12.
19. Id. Section (d).

The Author

Attorney Randall F. Cooper, NHBA President in 1998-1999, is a member of Executive Council of the National Conference of Bar Presidents, and practices with the North Conway law firm of Cooper, Deans & Cargill.

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