VIRGINIA UPL OPINION 177
Corporations; Employment of Lawyers; Real Estate Settlement Services Offered Through National Corporation; Attorney Employed By Corporation Providing Legal Services Through Private Practice.
I am writing in response to your letter of March 2, 1994 requesting an Unauthorized Practice of Law advisory opinion dealing with real estate settlement practice. The Committee considered your inquiry at its March 3, 1994 meeting and has directed me to transmit its conclusions to you.
You have provided the Committee with two hypotheticals for consideration.
A. The first involves an attorney who is an active member of the Virginia State Bar and who is employed by a national corporation performing duties as senior attorney managing the corporation’s residential real estate settlement department. As corporate counsel, the attorney is aware that he may not offer or provide legal counsel to another [client of the corporation] nor may he prepare for another [client of the corporation] legal instruments of any character except as provided in the Unauthorized Practice Rules.
The attorney seeks to prepare legal instruments related to residential real estate transactions (notably deeds and other necessary documentation) for others in his capacity as an active status attorney, in his own name as legal counsel. All communications, billing, etc., would clearly note that these services are being performed by the attorney in his capacity as an active licensed attorney. The attorney also seeks to give advice to purchasers when necessary, including how to take title to property. The attorney would be compensated for the advice/document preparation, which compensation would be noted separately on the settlement statement on the “document preparation??? line as “Attorney, Esquire.??? The compensation would be paid directly to the attorney, and would not be paid to the corporation which would be compensated on a separate line for settlement services.
As to this first hypothetical, you have requested that the committee opine as to whether the giving of advice and preparation of legal documents by the attorney, acting in his capacity as an active, licensed attorney while employed by the corporation, constitutes the unauthorized practice of law.
The appropriate and controlling Virginia Unauthorized Practice Rule are contained in the (a) preamble to Part Six: Section I: (B): Rules of the Supreme Court of Virginia and (b) Unauthorized Practice Rule 6.
The former, in pertinent part, generally defines the practice of law as (l) advising another, not his regular employer, for direct or indirect compensation, in matters involving the application of legal principles to facts, purposes, or desires; (2) preparing for another, with or without compensation, legal instruments of any character; or (3) representing the interest of another, with or without compensation, before any tribunal. Subsection (A) of the same preamble prohibits a non-lawyer from engaging in the practice of law or in any manner holding himself out as authorized or qualified to practice law in the Commonwealth of Virginia except as may be authorized by rule or statute.
The latter specifically delineates the parameters of a non-lawyer’s activities in the area of real estate practice, including the giving of legal advice (UPR 6-101), the preparation of legal instruments (UPR 6-103), the conduct of real estate closings (UPR 6-104), and the referral of business to lawyers by parties interested in real estate transactions.
The Committee has earlier opined that it would constitute the unauthorized practice of law for a lay corporation to provide legal services to its customers and that it would be improper for any attorney employee of a lay corporation to assist the lay corporation in that unauthorized practice of law. UPL Op. 57, Approved by the Supreme Court of Virginia, December 2, 1983, Effective March 1, 1984.
Thus, the Committee is of the opinion that it would not constitute the unauthorized practice of law for the lawyer to maintain a private practice through which he would deliver legal services to the parties to a real estate transaction. See also UPL Ops. 76, 86, 91; Legal Ethics Opinion 1329 (April 20, 1990). In accord with UPL Op. 57, however, the Committee cautions that the giving of advice and preparation of legal documents by the attorney, acting in his capacity as an active, licensed attorney while employed by the corporation would be improper if provided under the auspices of the corporation.
In addition, however, the Committee cautions that, should the attorney's private clients be referred to the attorney by the corporate employer, the employer is required to comply with the dictates of UPR 6-106 which mandates that the [real estate transaction] customer must first have the opportunity to select a lawyer of his own choosing and, if the customer does not so select a lawyer, the corporation must submit a list of lawyers from which the customer may make his selection.
B. The second hypothetical involves the attorney, in his capacity as corporate counsel performing duties as senior attorney managing the corporationís residential real estate settlement department, seeking to determine from purchaser customers the manner in which the customer wishes to take title to the property. The attorney has devised a form which states the facts as to the several types of property ownership, but does not advise the customer which form of ownership would better serve the customerís needs. The proposed form requests that the customer complete the bottom portion of the form noting how the customer wishes to take title, and requests that the form be returned to the corporate settlement department. That information would then be communicated to the seller's attorney for the purpose of having the deed and other seller documents prepared.
You have requested that the Committee opine as to whether either the provision of the information contained in the form or the conveyance of the form and return of the same to the corporate settlement department similarly constitutes the unauthorized practice of law.
The Committee is of the opinion that those segments of the Part Six: Section I: Unauthorized Practice Rules of the Supreme Court of Virginia which are cited above are similarly appropriate and controlling to this question.
The Committe has consistenty opined that a non-lawyer's provision of general legal information to the general public does not constitute the unauthorized practice of law provided that the non-lawyer does not give assistance in the completion of any forms or render any legal advice concerning the completion of the forms. See UPL Ops. 56, 73, 104, 116, 131, 153.
Thus, the Committee is of the opinion that it would not constitute the unauthorized practice of law for the corporation to either provide a form which would include information as to the several types of property ownership; to convey the form to the purchaser; or to accept the return of the same for purpose of communicating the information to the seller's attorney so that the deed and other seller documents may be prepared.Committee Opinion
March 15, 1994
Updated: Aug 28, 2006