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Hulse v. Criger

Supreme Court of Missouri, Court en Banc
Apr 14, 1952
363 Mo. 26 (Mo. 1952)

Summary

determining a person "may not make a separate charge for completing any standardized forms" and finding a party who had "fill[ed] in such form or forms" had violated the law

Summary of this case from McKeage v. Bass Pro Outdoor World, L.L.C.

Opinion

No. 42810.

April 14, 1952.

SUMMARY OF DECISION

Original proceeding in contempt by the Advisory Committee of the Missouri Bar Administration against respondent real estate broker alleging unlawful practice of law. The opinion defines what does and does not constitute the unlawful practice of law by a real estate broker. Respondent is held guilty of such unlawful practice and is fined $1 and ordered to cease and desist.

HEADNOTES

1. ATTORNEY AND CLIENT: Practice of Law: Judicial Department Arbiter. The judicial department is the sole arbiter of what constitutes the practice of the law.

2. ATTORNEY AND CLIENT: Brokers: Real Estate Brokers: Use of Standardized Forms Not Practice of Law. A real estate broker is not unlawfully practicing law when he uses earnest money contracts on standardized forms to complete a contract. And the preparation of warranty deeds and deeds of trust to complete transactions in which he is acting as broker is not such practice. And the same applies to ordinary short term leases, notes and chattel mortgages in transactions which the broker procures. But he cannot make separate charges, in addition to his commission, for preparing such instruments, or engage in the field of conveyancing and drafting contracts or other legal instruments for the public generally.

3. ATTORNEY AND CLIENT: Brokers: Real Estate Brokers: Practices Permitted and Not Permitted Stated. The conclusions as to what does and does not constitute unauthorized practice of law by a real estate broker are stated.

4. ATTORNEY AND CLIENT: Brokers: Contempt: Unauthorized Practice of Law by Real Estate Broker. Respondent real estate broker was engaged in the unlawful practice of law when he prepared legal instruments for persons in transactions in which he was not acting as a broker, making a charge therefor, and when he made separate additional charges in transactions in which he was acting as a broker.

Original Information in Contempt.

RESPONDENT FINED $1 AND ORDERED TO CEASE AND DESIST.

P.L. Edwards, Harry Gershenson and James A. Finch, Jr., for Informants.

(1) This court has power and authority to curb and punish unauthorized practice of law. Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977. (2) The Missouri Bar Administration Advisory Committee is authorized to institute and prosecute proceedings to prevent and suppress unauthorized practice of law. Rule 5 of Supreme Court of Missouri. (3) Respondent, by eliciting information from parties to real estate transactions and then, based thereon, plus information disclosed by the abstract of title selecting the forms to be used and preparing such deeds, deeds of trust and mortgages, promissory notes secured thereby, options for purchase, leases and contracts of sale and agreements as he considered necessary under the facts, was engaged in the practice of law, and not being licensed to practice law, such practice was unauthorized. Clark v. Reardon, 231 Mo. App. 666, 104 S.W.2d 407; In re Gore, 58 Ohio App. 79, 15 N.E.2d 968; People ex rel. Illinois State Bar Assn. v. Schafer, 87 N.E.2d 773; People v. Lawyers Title Corp., 282 N.Y. 515, 27 N.E.2d 30; Malia State Bank Comr. v. Giles, 114 P.2d 208; In re Matthews, 57 Idaho 75, 62 P.2d 578; Paul v. Stanley, 168 Wn. 371, 12 P.2d 401; People v. Sipper, 61 Cal.App. Supp.2d 844, 142 P.2d 960; Stewart Abstract Co. v. Judicial Committee, 131 S.W.2d 686; Hexter Title Abstract Co. v. Grievance Committee, 142 Tex. 506, 178 S.W.2d 946; L. Meisel Co. v. National Jewelers Board of Trade, 90 Misc. 19, 152 N.Y.S. 913; In the Matter of the Petition of the Detroit Bar Assn. v. Arthur H. Bichy, Misc. No. 73,947, Circuit Court of Wayne County Mich. (4) The fact that printed blank forms may have been used, and that respondent completed same instead of typing the entire instruments, does not alter the fact that the instruments are ones by which legal rights and obligations are defined and established. The determination of what was a proper form to employ, and then filling in what respondent conceived to be the proper substance and the proper and necessary provisions to carry out the transaction, is the practice of law. Cases cited under (3), supra. (5) The fact that respondent received only nominal consideration for drafting the legal instruments, over and above his real estate broker's commission, does not alter the fact that the preparation of the instruments by respondent was the unauthorized practice of law. Clark v. Reardon, supra; State ex inf. Miller v. St. Louis Union Trust Co., 335 Mo. 845, 74 S.W.2d 348; Hexter Title and Abst. Co. v. Grievance Committee, supra. (6) The statute, under which respondent was licensed as a real estate broker, does not confer on him any right to determine upon and draft legal instruments. Chap. 339, R.S. 1949. (7) The right to practice law which includes the field of conveyancing, is a license and privilege accorded only to those licensed as qualified by the Court, and the denial of such a privilege to others does not violate any constitutional rights or guarantees. State ex rel. McKittrick v. C.S. Dudley Co., 340 Mo. 852, 102 S.W.2d 895; L. Meisel Co. v. National Jewelers Board of Trade, supra. (8) The restrictions, on the right to practice law, are primarily for the benefit of society, in whose interest it is desirable that only those trained and qualified to perform legal services do so. Clark v. Reardon, supra.

Albert Copaken and Sylvia Copaken for respondent.

(1) Respondent, in doing the acts as admitted in respondent's Answer, was not "doing law business" but as a licensed real estate broker was doing that which is properly the business of a real estate broker and which respondent had a legal right and even a duty to do: A. Under the law and statutes of Missouri. B. By reason of the general custom and practice in the community in which respondent carried on his business as a licensed real estate broker. C. By reason of said acts being necessary, proper, appropriate, convenient and suitable to the conduct of respondent's business and by reason of said acts having been done incident to said business and in the ordinary and general course thereof. (2) Statute of Frauds requires writing in real estate transactions. Chap. 339, R.S. 1949; People v. Title Guarantee Trust Co., 227 N.Y. 366, 125 N.E. 666; Wiley v. Stewart Sand Material Co., 240 Mo. App. 392, 206 S.W.2d 362; Official Rules and Regulations, Missouri Real Estate Commission; Code of Ethics, adopted and promulgated by Missouri Real Estate Commission; 1951-1952 Brochure, The Real Estate Institute of the Real Estate Board of Kansas City, Missouri; Chap. 432, R.S. 1949. (3) Respondent's acts, if searchingly evaluated and put to proper tests in relation to all the pertinent factors and circumstances, are not the practice of law or the doing of law business, but are the doing of services properly within the sphere of a licensed real estate broker in the ordinary conduct of his business. Liberty Mut. Ins. Co. v. Jones, 344 Mo. 932, 130 S.W.2d 945; Cowern v. Nelson, 207 Minn. 642, 290 N.W. 795; Commonwealth v. Jones Robins, Inc., 186 Va. 30, 41 S.E.2d 720; Lowell Bar Assn. v. Loeb, In re Loeb, 315 Mass. 176, 52 N.E.2d 27; American Bar Assn. Journal, Vol. XVI, No. 9, p. 558 (1930); Missouri Real Estate Commission: Official Rules and Regulations; and Code of Ethics, supra; Real Estate Institute: 1951-1952 Brochure, supra; and Text Material for Students. (4) The character of respondent's acts cannot be judged by the authorities set out in Informants' Brief since, for various reasons, said authorities are inapplicable. Gustafson v. V.C. Taylor Sons, Inc., 138 Ohio St. 392, 35 N.E.2d 435; Land Title Abstract Trust Co. v. Dworken, 129 Ohio St. 23, 193 N.E. 650; Judd v. City Trust Savings Bank, 133 Ohio St. 81, 12 N.E.2d 288; People v. Title Guarantee Trust Co., 227 N.Y. 366, 125 N.E. 666; People v. Title Guarantee Trust Co., 191 App. Div. 165; affirmed 230 N.Y. 578, 130 N.E. 901. (5) If this court should so rule as to deny to respondent the right to do the acts complained of and which he and all licensed real estate brokers in Missouri have a right to do under the law in the regular course of their business, then and in that event this court would be acting in violation of and contrary to the provisions of the Constitution of Missouri (1945), Article I, Sections 2 and 10; Article II; and of the Constitution of the United States, Article XIV, Section 1; in that: A. The court would be usurping the legislative function by making law instead of construing the Missouri Real Estate Licensing Law and the law of Missouri as it finds it; and in so doing would be acting contrary to the provisions of Article II of the Missouri Constitution (1945) providing for the distribution of powers among the three departments of the state government. B. It would deprive respondent of his legal and natural rights and property without due process of law by acting contrary to the provisions of Sections 2 and 10, Article I of the Constitution of Missouri (1945) and of Section 1, Article XIV of the Constitution of the United States. C. It would deny respondent the equal protection of the laws guaranteed him by Section 2, Article I of the Missouri Constitution (1945), and Section 1, Article XIV, of the Constitution of the United States. Constitution of Missouri, 1945, Secs. 2, 10, Arts. I, II; Constitution of the United States, Sec. 1, Art. XIV; City of Charleston v. McCutcheon, 360 Mo. 157, 227 S.W.2d 736.

Leonard E. Martin, Chairman, The Unauthorized Practice of Law Committee of the Bar Association of St. Louis, and Theodore E. Beckemeier for and on Behalf of the Bar Association of St. Louis, amicus curiae.

(1) The preparation of deeds to real estate, deeds of trust, promissory notes, leases, options for purchase, contracts of sale and agreements affecting real estate in behalf of others is the practice of law. Sec. 484.010, R.S. 1949; Clark v. Reardon, 231 Mo. App. 666, 104 S.W.2d 407; Liberty Mutual Ins. Co. v. Jones, 344 Mo. 932, 130 S.W.2d 945; 125 A.L.R. 1149, Annotated at 1178; State ex inf. Miller v. St. Louis Union Trust Co., 335 Mo. 845, 74 S.W.2d 348; Clark v. Austen, 340 Mo. 467, 101 S.W.2d 977; In re Gore, 58 Ohio App. 79, 15 N.E.2d 968; People ex rel. Illinois State Bar Assn. v. Shafer, 87 N.E.2d 773. (2) The preparation of such instruments is the practice of law even though the consideration therefor be nominal, the goodwill developed thereby being adequate consideration. Clark v. Reardon, 231 Mo. App. 666, 104 S.W.2d 407; State ex inf. Miller v. St. Louis Union Trust Co., 335 Mo. 845, 74 S.W.2d 348. (3) The purpose of preventing laymen from practicing law is to protect the interests and rights of the public. To allow this respondent, a real estate broker, to hold himself out as ready, willing and able to prepare legal documents affecting property rights and as competent to do the same is to ensnare the public and for that reason the practice should be enjoined and the respondent found in contempt. Liberty Mutual Ins. Co. v. Jones, supra; Clark v. Reardon, supra; Clark v. Austen, 340 Mo. 467, 101 S.W.2d 977.

Joseph Boxerman for St. Louis Real Estate Board, amicus curiae.

(1) It is axiomatic, and would seem to require no citation of authority, that a layman may, without consulting or engaging a lawyer, prepare and execute any legal instrument to which he is a party without being guilty of illegally practicing law so long as he does not pretend authoritatively to advise the other party to the instrument of the legal purport or consequences thereof. (2) It is also generally accepted that the lay agent or lay employee of a layman may prepare and execute legal instruments to which his principal is a party as an incident to carrying out his functions as agent or employee of such principal. Liberty Mutual Ins. Co. v. Jones, 344 Mo. 932, 130 S.W.2d 945, 125 A.L.R. 1149, noted at 1178; Cain v. Merchants' Natl. Bank Trust Co., 66 N.D. 746, 268 N.W. 719; Detroit Bar Assn. v. Union Guardian Trust Co., 282 Mich. 707, 281 N.W. 432. (3) Although styled a "broker," and acting as such in negotiating and consummating the real estate transaction, the realtor is acting as the amanuensis (or mere clerical agent) of the parties when he prepares for them, at their instance and direction, the papers incident to such transaction; and, hence, when a real estate broker elicits factual data from the parties to a real estate transaction, in which he is acting as broker, and, at the instance and direction of the parties, executes for them the several documents necessary to consummate the sale or lease of the premises, the conveyance, the evidences of indebtedness and the security therefor, merely through filling the requisite factual data in the blanks provided therefor in prepared printed forms so as to complete the instruments and/or by merely making simple deletions and/or insertions to state the express agreements of the parties, such real estate broker does not thereby engage in the practice of law and does not thereby render himself liable to prosecution, citation or restraint for engaging in the practice of law; and when a real estate broker, in the course of a real estate transaction, in which he is acting as broker, "selects and determines" which form-in-blank is appropriate to the occasion, or stage in the transaction, merely by picking and using a form for a contract to purchase and sell, or for a deed of trust, or for promissory notes, or for a conveyance, etc., as dictated by the exercise of ordinary business intelligence, such real estate broker does not thereby engage in the practice of law and does not thereby render himself liable to prosecution, citation or restraint for engaging in the practice of law. (4) On these narrow, precise propositions, the authorities are divided. Those squarely sustaining the contention of amicus curiae are: Childs v. Smeltzer, 315 Pa. 9, 171 A. 883, in which, in direct response to briefs of real estate boards, amici curiae, the Pennsylvania Supreme Court excepted, distinguished and clarified the permissible area of realtors' activities as here contended-for; Northampton County Bar Assn. v. Young, 1 Monroe Leg. Rep. (Pa.) 94, 26 North County Rep. 363, noted in 125 A.L.R. 1173 at 1176; Cowern v. Nelson, 207 Minn. 642, 290 N.W. 795, citing and discussing but expressly refusing to follow In Re Gore (1937), 58 Ohio App. 79, 15 N.E.2d 968, cited and chiefly relied on by Informants; In re Matthews, 58 Idaho 772, 79 P.2d 535 [which is not to be confused with In Re Matthews (1936), 57 Idaho 76, 62 Pa.2d 578, cited by Informants, which is the same case but then before the court only on demurrer to the complaint and before a finding of the facts involved]; People v. Sipper, 61 Cal.App. Supp.2d 844, 142 P.2d 960, dictum at 142 P.2d 962; Cain v. Merchants' Natl. Bank Trust Co., 66 N.D. 746, 268 N.W. 719, dictum at 268 N.W. 723; State v. Barlow, 131 Neb. 294, 268 N.W. 95, dictum at 268 N.W. 96, and cf. same case (1937) 132 Neb. 166, 271 N.W. 282; See also Gustafson v. V.C. Taylor Sons, 138 Ohio St. 393, 35 N.E.2d 435, which limits In Re Gore, supra, cited and chiefly relied on by Informants; See also, the Keyes Co. v. Dade County Bar Assn., 46 So.2d 605; And see also People ex rel. Atty. Gen. v. Jersin, 101 Colo. 406, 74 P.2d 668. (5) The only authorities squarely contrary to the position here contended for by amicus curiae are: In Re Gore (1937), 58 Ohio App. 79, 15 N.E.2d 968, cited and chiefly relied on by Informants, see also Gustafson v. V.C. Taylor Sons, supra; In Re Detroit Bar Assn. v. Bichy, Misc. No. 73,947 (Mich.), cited by Informants but to which amicus curiae did not have ready access. (6) The following cases tend to support a position contrary to that contended for by amicus curiae but all of them also involve additional factors, such as a holding out of legal skill and competency, the giving of legal advice, preparing instruments for others than principals as by a "public conveyancer," etc." Paul v. Stanley, 168 Wn. 371, 12 P.2d 401; People ex rel. Illinois Bar Assn. v. Schaefer, 404 Ill. 45, 87 N.E.2d 773. (7) Sound social policy requires that the line of demarcation between the legitimate activities and practices of real estate brokers and the unauthorized practice of law be drawn with a view to business necessities and realism rather than merely by an appeal to verbal formalism. Cowern v. Nelson, 207 Minn. 642, 290 N.W. 795; People ex rel. Atty. Gen. v. Jersin, 101 Colo. 406, 74 P.2d 668; In Re Matthews, 58 Idaho 772, 79 P.2d 535. (8) A failure to draw the line between the legitimate activities and practices of real estate brokers and the unauthorized practice of law, so as not to unduly hamper the carrying on of the otherwise lawful business of real estate brokerage, will violate and deny constitutional rights and guarantees. Liberty Mutual Ins. Co. v. Jones, 344 Mo. 932, 130 S.W.2d 945.

Kenneth Teasdale, Bourne Bean and Cobbs, Blake, Armstrong, Teasdale Roos amicus curiae.

(1) To deny to the real estate broker the right to prepare instruments incident to the sale of property by filling in those facts agreed upon by the parties to the sale would impose an unreasonable burden upon the transaction of real estate business. Repeated reference to legal counsel would unduly delay the transaction of the sale of real estate. People ex rel. Atty. Gen. v. Jersin, 101 Colo. 406, 74 P.2d 668; Cowern v. Nelson, 207 Minn. 642, 290 N.W. 795. (2) The standardized nature of the instruments incident to the sale or lease of real estate does not warrant the additional financial burden of the employment of legal counsel. Gustafson v. V.C. Taylor Sons, 138 Ohio St. 392, 35 N.E.2d 435; Childs v. Smeltzer, 315 Pa. 9, 171 A. 883; In re Matthews, 58 Idaho, 772, 79 P.2d 535; People ex rel. Atty. Gen. v. Jersin, 101 Colo. 406, 74 P.2d 668. (3) The present manner of conducting real estate transactions has not resulted in defective conveyancing. Cowern v. Nelson, 207 Minn. 642, 290 N.W. 795; In re Matthews, 58 Idaho 772, 79 P.2d 535; Liberty Mutual Ins. Co. v. Jones, 334 Mo. 932, 130 S.W.2d 945, 125 A.L.R. 1149. (4) The use of instruments of legal significance is a commonly accepted practice in many kindred fields of commerce. Cowern v. Nelson, 207 Minn. 642, 290 N.W. 795; Lowell Bar Assn. v. Loeb, 315 Mass. 176, 52 N.E.2d 27. (5) There are adequate safeguards protecting the public from any abuses in the real estate brokerage business. Chap. 339, R.S. 1949; Liberty Mutual Ins. Co. v. Jones, 334 Mo. 932, 130 S.W.2d 945, 125 A.L.R. 1149. M.J. Doherty and Albert Miller for George W. Curran, for Himself and for and on Behalf of the Lawyers Association of St. Louis, amici curiae.

(1) The Information is adequate to define the offense and to identify the offender. It is sufficiently definite and makes proper and substantial charges. And the Court has jurisdiction. Secs. 484.010, 484.020, 476.110, 476.120, 476.130, R.S. 1949; Constitution of Missouri, Art. V, Secs. 1, 2 and 5; Rules of Supreme Court of Missouri, Rules 5 and 8; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; In re Richards, 333 Mo. 907, 63 S.W.2d 672; In re Sparrow, 90 S.W.2d 401; In re Conner, 357 Mo. 270, 207 S.W.2d 492; Curry v. Dahlberg, 341 Mo. 897, 110 S.W.2d 742; Clark v. Reardon, 231 Mo. App. 666, 104 S.W.2d 407. (2) The "Practice of Law" has been defined by a committee of the American Bar Association as follows: "Practicing as an attorney or counselor at law, according to the laws and customs of our courts, is the giving of advice or rendition of any sort of service by any person, firm or corporation when the giving of such advice or rendition of such service requires the use of any degree of legal knowledge or skill." (See article on "Giving Legal Advice by Laymen as Contempt," by Mr. David R. Hardy, in 3 Mo. Law. Rev., p. 56), citing: People ex rel. State Bar Association v. People's Stock Yards Bank, 344 Ill. 462, 176 N.E. 901; Cain v. Merchant's Natl. Bank Trust Co., 66 N.D. 746, 268 N.W. 719; In re Duncan, 83 S.C. 186, 65 S.E. 210; Savings Bank v. Ward, 100 U.S. 195; In re Day, 181 Ill. 73, 54 N.E. 646; People ex rel. v. People's Stock Yards Bank, 344 Ill. 462; People v. Alfani, 227 N.Y. 334, 125 N.E. 671. (3) The "Practice of Law" embraces the preparation of pleadings and other papers incident to actions and special proceedings, and the management of such actions and proceedings on behalf of clients before judges and courts; and in addition, conveyancing, the preparation of legal instruments of all kinds, and, in general, all advice to clients and all action taken for them in matters connected with the law. In re Duncan, 83 S.C. 186, 65 S.E. 210, 24 L.R.A. (N.S.) 750. (4) The word "Legal" means according to the principles of law; according to the methods required by statute; by means of judicial proceedings; conformity to positive rules of law; legal imports that the forms of law are observed and the proceeding is correct in method — that the rules prescribed have been obeyed. Anderson's Law Dictionary; State ex rel. Van Nice v. Whealey, 5 S.D. 427, 59 N.W. 211; Estate of Folwell, 68 N.J. Eq. 728, 2 L.R.A. (N.S.) 1193, 62 A. 414. (5) A legal right is a claim recognizable and enforceable at law. Estate of Folwell, supra. (6) The terms "Property" and "Property Rights" are words of most general import, and signify not only the physical thing which may be the subject of ownership, but the right of dominion or indefinite right of user and disposition which one may lawfully exercise over particular things or subjects. They signify not only those tangible things which one may own, but everything he may have of an exchangeable value. They include every interest anyone may have in any and everything that is the subject of ownership by man, together with the right freely to possess, use, enjoy, and dispose of the same; and include every right and interest capable of being enjoyed as property and recognized as such, upon which it is practicable to place a money value. In a strict legal sense, they signify that dominion or indefinite right of user and disposition which one may lawfully exercise over particular things or objects. 6 R.C.L. 261; 26 R.C.L. 136; 22 R.C.L. 37. (7) The word "Secular" means temporal; pertaining to temporal things, things of the world; worldly, as opposed to spiritual, or holy. The giving of a note pertains to things of this world and is a matter of secular business. Allen v. Deming, 14 N.H. 133. (8) The word "Document" means any matter expressed or described upon any substance by means of letters, figures or marks, or by more than one of those means, intended to be used, or which may be used, for the purpose of recording that matter. 10 R.C.L. 1086. (9) The word applies to writings, to words printed, lithographed or photographed, to seals, plates, or stones on which inscriptions are cut or engraved, to photographs and pictures, to maps and plans. Arnold v. Pawtucket Valley Water Co., 18 R.I. 189, 19 L.R.A. 602, 26 A. 55. (10) The word "Instrument," in its broadest sense, includes formal or legal documents in writing, such as contracts, deeds, wills, bonds, leases and mortgages. In the law of evidence it has a still wider meaning, and includes not merely documents, but witnesses, and things animate and inanimate, which may be presented for inspection. Cardenas v. Miller, 108 Cal. 250, 49 Am. St. Rep. 84, 39 P. 783, 41 P. 472, citing Wharton on Evidence and Black's Law Dictionary. (11) In Missouri it is within the inherent power of the Court to punish as contempt any illegal or unauthorized practice of law. Constitution of Missouri, Art. V. Secs. 1, 2 and 5; Rules of Supreme Court of Missouri, Rules 5 and 8; State ex rel. Selleck v. Reynolds, 252 Mo. 639, 158 S.W. 671; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; In re Sizer and Gardner, 300 Mo. l.c. 377, 254 S.W. 82; In re Sizer and Gardner, 306 Mo. l.c. 368, 267 S.W. 922; In re Richards, 333 Mo. 907, 63 S.W.2d 672; In re Sparrow, 338 Mo. 203, 90 S.W.2d 401; In re Conner, 357 Mo. 270, 207 S.W.2d 492. (12) The power to punish for Contempt is derived from the Constitution; and is part of the inherent judicial power of the courts. Constitution of Missouri, Art. V. Secs. 1, 2, 4 and 5; State ex rel. Pulitzer Pub. Co. v. Coleman, 347 Mo. 1238, 152 S.W.2d 640. (13) The most important and essential of the inherent powers of a court is the authority to protect itself against those who disregard its dignity and authority or disobey its orders, by punishing for contempt. State ex rel. Gentry v. Becker, 351 Mo. 769, 174 S.W.2d 181. (14) The Supreme Court has both inherent and statutory power to punish a criminal contempt. State ex inf. McKittrick v. Koon, 356 Mo. 284, 201 S.W.2d 446; Secs. 476.110, 476.120, 476.130, R.S. 1949. (15) The control of the bar is a matter within the inherent power of the court. In re Richards, 333 Mo. 907, 63 S.W.2d 672; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; In re Morse, 98 Vt. 85, 126 A. 550. (16) This court controls the admission of members to the bar, and should have the inherent power to punish as contempt the illegal practice of law by persons not licensed to practice, as the power to regulate the practice of law is, in its exercise, essentially judicial and not legislative. In re Hagan, 295 Mo. 435, 245 S.W. 336; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; State ex rel. Atty. Gen. v. Barlow, 131 Neb. 294, 268 N.W. 95; In re Morse, supra. (17) While the case of Murphy v. Townley, a North Dakota case reported in 274 N.W. 857, and a few others, perhaps, hold that the unauthorized practice of law by one not a member of the bar is not within the inherent power of the court to punish as contempt, the great weight of authority is to the effect that it is within the inherent power of the court to punish as contempt the illegal or unauthorized practice of law by a layman or one not duly licensed to practice. Ex parte Creasy, 243 Mo. 679, 148 S.W. 914; State ex rel. Selleck v. Reynolds, supra; Clark v. Austin, supra; Bowles v. United States, 50 F.2d 848, certiorari denied 284 U.S. 648; People v. People's Stock Yards Bank, 344 Ill. 462; 176 N.E. 901; People ex rel. Bar Assn. v. Motorists Assn. of Ill., 354 Ill. 595, 188 N.E. 827; Rhode Island Bar Assn. v. Automobile Service Assn., 55 R.I. 122, 179 A. 139; In re Morse, supra. (18) Is this inherent power of the court subject to reasonable regulation by statute? The earlier expressions of the Supreme Court seem to favor that view. (See Ex parte Creasy, supra; State ex rel. Selleck v. Reynolds, supra, and In re Richards, supra.) But later, and the more recent, expressions of that court hold to the view that the inherent power of the court to punish for contempt cannot be reasonably regulated by statute because it runs counter to the positive mandate of the Constitution, which provides that no person or collection of persons, charged with the exercise of powers properly belonging to one department of the government, shall exercise any powers properly belonging to either of the others. Constitution of Missouri, Art. II, Sec. 1; Clark v. Austin, supra, l.c. 476; In re Hagan, 295 Mo. 435, 245 S.W. 336; 144 A.L.R., p. 153, note. (19) The purpose of the separation of the different branches of the government was to preserve the liberties of the people. Rhodes v. Bell, 230 Mo. 138, 130 S.W. 465; State ex rel. Otto v. Kansas City, 310 Mo. 542, 276 S.W. 389. (20) The State Constitution is not a grant of power to the Legislature, but a limitation on the power of the Legislature. State ex rel. McDonald v. Lollis, 326 Mo. l.c. 648, 33 S.W.2d 98. (21) The Legislature, in prohibiting the Circuit Courts by statute (see Sec. 1617, R.S. 1899) from imposing a fine in any case of contempt in excess of fifty dollars and in limiting the imprisonment to ten days, exceeded its constitutional powers. Chicago, B. Q. Ry. v. Gildersleeve, 219 Mo. 170, 118 S.W. 86. (22) Limitations on legislative powers expressly declared or clearly implied by the Constitution are to be construed as mandatory rather than dictatory. State ex rel. United Railways v. Public Service Comm., 270 Mo. 429, 192 S.W. 958; State ex rel. Kansas City v. Public Service Comm., 301 Mo. 179, 257 S.W. 462. (23) The fact that the offense is punishable under criminal statutes will not interfere with the power of the court to punish the same acts as contempt of court. Clark v. Reardon, 231 Mo. App. 666, 104 S.W.2d 407; People v. People's Stock Yards Bank, 344 Ill. 462, 176 N.E. 901; Rhode Island Bar Assn. v. Automobile Service Assn., 55 R.I. 122, 179 A. 139. (24) The Legislature may, under the police powers of the state, enact a statute making the practice of law without a license a public offense and providing a punishment for its violation in order to protect the public against the hazards of unlicensed practitioners; and, at the same time, this court may, in order to protect itself, and to enforce its rules and orders, and to define and regulate the practice of law, exercise its inherent power, exclusive and independent of any statute enacted by the Legislature. Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; People ex rel. v. People's Stock Yards Bank, supra; People v. Real Estate Taxpayers, 354 Ill. 102, 187 N.E. 823; People ex rel. Chicago Bar Assn. v. Motorists Assn., 354 Ill. 595, 188 N.E. 827; Rhode Island Bar Assn. v. Automobile Service Assn., supra; In re Morse, 98 Vt. 85, 126 A. 550; State ex rel. Wright v. Barlow, 131 Neb. 294, 268 N.W. 95; Commonwealth v. Harrington, 98 S.W.2d 53; In re Conner, 357 Mo. 270, 207 S.W.2d 492. (25) The purpose of defining and regulating the practice of law is not to protect any vested right or interest in those lawfully engaged in the practice, but to protect the public and the court. People ex rel. Karlin v. Culkin, 248 N.Y. 465, 162 N.E. 487; People v. People's Stock Yards Bank, supra; Clark v. Reardon, 231 Mo. App. 666, l.c. 673, 104 S.W.2d 407; Curry v. Dahlberg, 341 Mo. 897, 110 S.W.2d 742; Clark v. Austin, supra. (26) The inherent power of the court to regulate the practice of law being derived from the Constitution giving judicial power to the court, it follows that from the power to regulate the practice of law this court can prohibit laymen and unlicensed practitioners engaged in the practice of law from so doing; and, also, punish as for contempt anyone who has violated the law and the rules promulgated by this court by engaging in and performing acts which infringe the law and said rules. Constitution of Missouri, Art. V, Secs. 1, 2, 3, 4 and 5; In re Richards, supra; Clark v. Austin, supra; Clark v. Reardon, supra; People v. People's Stock Yards Bank, supra; Rules of the Supreme Court of Missouri, Rule 8.


This is an information by the Advisory Committee of the Missouri Bar Administration alleging that C.L. Criger, a licensed real estate broker of Kansas City, has engaged in the unlawful practice of law, as a practice and as a business. Informants seek to have respondent enjoined from practicing law and punished for contempt of this Court. They move for judgment on the pleadings which are the information and answer.

The acts alleged to constitute such practice which respondent admits in his answer are as follows: "Respondent admits that in numerous transactions in the general and ordinary course of his business as a licensed real estate broker and incidental thereto, respondent, either in his own person or through his agents, servants and employees, has prepared for persons other than himself, many instruments relating to and affecting real estate and the title to real estate, including deeds conveying real estate, deeds of trust and mortgages encumbering real estate, promissory notes secured by such deeds of trust or mortgages; leases of real estate, options for purchase, contracts of sale and agreements."

Respondent admits he has not been licensed to practice law but denies that he "has been engaged in the unlawful practice of law or doing law business"; and "denies that he has given legal advice to the parties to such instruments as to the legal effect thereof." Respondent also admits that "in his own person, or through his agents, servants and employees, customarily in each instance conferred with one or more of the parties to the transaction or their agents; elicited in such conference what were considered to be the [857] pertinent facts; in the light of the information elicited and the information contained in the abstract of title selected and determined upon the blank form or forms to be used and then prepared one or more of the instruments mentioned by filling in such form or forms in such manner as the respondent himself or the agent, servant or employee of the respondent preparing the same in his or her judgment, deemed proper in the light of the information elicited in such conference and the information contained in the abstract of title."

Respondent also admits that he was not a party to any of the instruments so prepared by him; that his usual connection (but he does not claim his exclusive connection) with transactions, as a part of which said instruments were prepared, was in consummation or closing of transactions procured by him as a real estate broker and for which he received commissions for his services as such; and that "in almost all the transactions in which the respondent and his agents, servants or employees prepared legal instruments in the manner and circumstances hereinbefore mentioned, the respondent had been employed as a real estate broker to procure purchasers for the properties involved in the transactions and had procured purchasers for such properties and had become entitled to and was paid commissions for his services as a real estate broker in procuring such purchasers." Respondent also admitted he charged one or both of the parties for his preparation of these instruments but stated he made only nominal charges for mere clerical services. In his brief he says that these charges were for the cost of the forms used and his clerical help.

Informants contend that what respondent admits doing is the practice of law and that a test as to whether the particular transaction or form is simple or complex is not a satisfactory or logical solution. Amicus Curiae briefs of Bar Associations take the same position.

Respondent contends that his admitted acts were properly the business of a real estate broker which he had a right and even a duty to do. He says that preparing and completing instruments necessary to the closing of real estate transactions is one of the most important services performed by realtors, because the statute of frauds requires written instruments in real estate transactions. He also relies upon the Missouri Real Estate License Law (RSMo 1949, Chap. 339, VAMS) as authorizing "all the things real estate brokers were then and had been customarily doing." Respondent further says that to deny him the right to do these things would violate the equal protection and due process clauses of the state and federal constitutions (Sec's. 2 and 10, Art. 1, Const. of Mo., Sec. 1, Art. 14, Const. of U.S.) and the provisions of Art. 2 of the Const. of Mo. providing for the distribution of powers among the three departments of the state government. Briefs amicus curiae for the St. Louis Real Estate Board and the Missouri Real Estate Association disclaim any right to make a separate charge, or to prepare instruments affecting rights for persons not represented in a real estate transaction, but do argue for the right of a real estate broker to prepare standardized instruments incident to the sale or lease of real estate in transactions in which he acts as broker.

The controlling principles are: Only the judicial department of the government has power to license persons to practice law. "Statutes may aid by providing machinery and criminal penalties, but may not extend the privilege of practicing law to persons not admitted to practice by the judicial department." (Lowell Bar Association v. Loeb, 315 Mass. 176, 52 N.E.2d 27; Opinion of the Justices to the Senate 289 Mass. 607, 194 N.E. 313; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; In Re Richards, 333 Mo. 907, 63 S.W.2d 672.) Thus the judicial department is necessarily the sole arbiter of what constitutes the practice of law. In this connection it should be noted that Sec. 339.010 of the Real Estate License Law specifically provides: "Nor shall this chapter be construed to include in any way the service rendered by an attorney at law in the performance of his duties as such." The duty of this Court is not to protect the Bar from competition but to protect the public from being advised or represented [858] in legal matters by incompetent or unreliable persons. Our purpose must be to make sure "that legal services required by the public, and essential to the administration of justice, will be rendered by those who have been found by investigation to be properly prepared to do so by conforming to strict educational standards, and who demonstrate that they have the character to conform to higher standards of ethical conduct than are ordinarily considered necessary in business relations which do not involve the same fiduciary and confidential relationships." (Curry v. Dahlberg, 341 Mo. 897, 112 S.W.2d 345.) These are the reasons for our high standards of admission to the Bar. Furthermore, for these same reasons, prevention of persons, not admitted to the Bar, from acts amounting to the practice of law does not violate the constitutional provisions invoked.

This question of real estate brokers has been considered in several states. In Cowern v. Nelson, 207 Minn. 642, 290 S.W. 795, an injunction against a realtor was modified to eliminate "any restraint on the defendant, when acting as a broker for the parties, or as agent for one of them, to a sale or trade or lease of property or to a loan, from drawing or assisting in drawing without charge therefor such papers as may be incident to such transaction." (Our italics.) The Court said: "It is the duty of this court so to regulate the practice of law and to restrain such practice by laymen in a common-sense way in order to protect primarily the interest of the public and not to hamper and burden such interest with impractical technical restraints no matter how well supported such restraint may be from the standpoint of pure logic. Viewing the problem before us in that light, we do not think it would be in the interest of the public welfare to restrain brokers from drafting the ordinary instruments necessary to effectuate the closing of the ordinary real estate transaction in which they are acting. We do not think the possible harm which might come to the public from the rare instances of defective conveyances in such transactions is sufficient to outweigh the great public inconvenience which would follow if it were necessary to call in a lawyer to draft these simple instruments."

In Childs v. Smeltzer, 315 Pa. 9, 171 A. 883, the Court held that a person, who was a stenographer and notary public, was illegally practicing law in drawing a great variety of legal instruments including wills. However, the Court limited its decision as follows: "A number of realty boards have filed briefs as amici curiae in which they envisage dire results to real estate brokers if laymen are prohibited from drafting legal instruments. There can be no objection to the preparation of deeds and mortgages or other contracts by such brokers so long as the papers involved pertain to and grow out of their business transactions and are intimately connected therewith. The drafting and execution of legal instruments is a necessary concomitant of many businesses, and cannot be considered unlawful. Such practice only falls within the prohibition of the act when the documents are drawn in relation to matters in no manner connected with the immediate business of the person preparing them, and when the person so drafting them is not a member of the bar and holds himself out as specially qualified and competent to do that type of work. A real estate broker is not prohibited from drawing a deed of conveyance or other appropriate instrument relating to property of which he or his associates have negotiated a sale or lease."

In this case, the Supreme Court of Pennsylvania, referred to the concurring opinion of Pound, J. in People v. Title Guaranty Trust Co., 227 N.Y. 366, 380, 125 N.E. 666, 670, quoting part of the following statement: "This does not imply that a real estate broker may not prepare leases, mortgages, and deeds, or that an installment house may not prepare conditional bills of sale, in connection with the business and as a part thereof. The preparation of the legal papers may be ancillary to the daily business of the actor or it may be the business itself. The emphasis may be upon the services of the broker or the business of the trader, or it may be upon the practice of law." (See also LaBrum v. [859] Commonwealth Title Co., Pa., 56 A.2d 246.)

In Commonwealth v. Jones Robbins, 186 Va. 30, 41 S.E.2d 720, a definition of the practice of law was approved to the effect that "one is deemed to be practicing law, whenever * * * (2) One, other than as a regular employee acting for his employer, undertakes, with or without compensation, to prepare for another legal instruments of any character, other than notices or contracts incident to the regular course of conducting a licensed business." The Court held that simple contracts of sale obtained by real estate brokers from a buyer, without charge, are included in the words "contracts `incident to the regular course of conducting a licensed business'." However, as to a deed the Court said: "It is a muniment of title and must become a matter of permanent record. Such instruments, in this sense, are not incidental to the conduct of a real estate brokerage business. The broker makes a separate and distinct charge for the preparation of each such instrument, which it seems he would not do if the preparation of such papers was a mere incident to the conduct of his business. * * * Usually the instruments whereby title passes from the seller to the purchaser are not prepared, executed or delivered until after the title has been examined and approved by the attorney for the purchaser. As a practical solution of the question, it was deemed advisable to permit a real estate broker to prepare simple contracts of sale, options, leases, etc., and to prohibit him from preparing legal instruments whereby the legal title to property passes from the seller to the purchaser." The Court ordered: "A decree declaring that the preparation of deeds, deeds of trust, mortgages and deeds of release by real estate brokers constitutes the illegal practice of law." In Keyes Co. v. Dade County Bar Assn., 46 So.2d 605, the Supreme Court of Florida reached substantially this same result.

The case upon which informants most strongly rely is In Re Gore, 58 Ohio App. 79, 15 N.E.2d 968, which upheld a judgment that a real estate broker was engaging in the unauthorized practice of law in "making for others the determination of what constitutes a proper blank and then filling in what he conceives to be the proper substance to carry out the transaction." This ruling covered contracts between the seller and purchaser in instances where he was the acting broker as well as deeds and mortgages essential to the consummation of the deal. However, the Supreme Court of Ohio (without mentioning the Gore case but considering the Ohio cases cited therein as controlling) in Gustafson v. V.C. Taylor Sons, 138 Ohio 392, 35 N.E.2d 435, ruled as follows: "The sole question presented by the plaintiffs' appeal is whether the defendant has violated this rule by merely filling printed blank forms of contract for the purchase of realty. More specifically, does the filling of these printed blank forms require the exercise of legal skill, or does it constitute merely the clerical service of recording the stated agreement of the parties to the transaction? This Court finds itself in agreement with the reasoning and conclusion of the lower courts to the effect that the supplying of simple, factual material such as the date, the price, the name of the purchaser, the location of the property, the date of giving possession and the duration of the offer requires ordinary intelligence rather than the skill peculiar to one trained and experienced in the law."

Other cases discussed in the briefs, concerning preparation of deeds and other legal instruments (and which do not so directly concern real estate brokers) are People v. Sipper, 61 Cal.App. Supp.2d 844, 142 P.2d 960; People ex rel. Atty. Gen. v. Jersin, 101 Colo. 406, 74 P.2d 668; In Re Matthews, 57 Idaho 75, 62 P.2d 578; In Re Matthews, 58 Idaho 772, 79 P.2d 535; People ex rel. State Bar Assn. v. People's Stock Yards Bank, 344 Ill. 462, 176 N.E. 901; People ex rel. Illinois Bar Assn. v. Schafer, 404 Ill. 45, 87 N.E.2d 773; Lowell Bar Assn. v. Loeb, 315 Mass. 176, 52 N.E.2d 27; State ex inf. Miller v. St. Louis Union Trust Co., 335 Mo. 845, 74 S.W.2d 348; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977; State ex rel. McKittrick v. Dudley [860] Co., 340 Mo. 852, 102 S.W.2d 895; Clark v. Reardon, 231 Mo. App. 666, 104 S.W.2d 407; Liberty Mutual Ins. Co. v. Jones, 344 Mo. 932, 130 S.W.2d 945; State ex rel. Wright v. Barlow, 131 Neb. 294, 268 N.W. 95; People v. Alfani, 227 N.Y. 334, 125 N.E. 671; Cain v. Merchants National Bank Trust Co., 66 N.D. 746, 268 N.W. 719; Stewart Abstract Co. v. Judicial Comm., Tex., 131 S.W.2d 686; Hexter Title Abstract Co. v. Grievance Comm., 142 Tex. 506, 179 S.W.2d 946; Paul v. Stanley, 168 Wn. 371, 12 P.2d 401; See also Annotations 111 A.L.R. 24, 125 A.L.R. 1175, 151 A.L.R. 783. In some of these cases, persons found to be illegally practicing law were preparing many kinds of legal instruments as a regular practice; in others they were giving advice as to the legal effect of certain methods or transactions. In some of them, in which there were only single or infrequent acts of preparing instruments, it was held that such isolated conduct did not constitute the practice of law.

We have a statute (RSMo 1949, Sec. 484.010) which makes a comprehensive definition of the practice of law and law business (which is a part of the practice of law) including "the advising or counseling for 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 valuable consideration of any paper, document or instrument affecting or relating to secular rights." We have also stated a similar definition in Clark v. Austin, supra, (101 S.W.2d, l.c. 982) although it does not so specifically cover the situation here. However, we recognized in the Austin case (101 S.W.2d, l.c. 984) that "perhaps the major portion of the actual practice of law under modern conditions consists of the work of attorneys outside of any court and has nothing to do with court proceedings." In the Dudley case, supra, (102 S.W.2d, l.c. 899) both definitions were approved and we held that a corporation (conducting a collection agency) could properly "collect debts for others provided it does not employ an attorney or promise to employ one or threaten the debtor with suit if he does not pay." In the Liberty Mutual case, supra, (130 S.W.2d, l.c. 961), we held that law employees could investigate the facts relating to claims and fill in printed forms prepared by counsel for the release to settle claims; and could participate in informal conferences to settle Workmen's Compensation claims. Thus we have recognized the principles so well stated by the Supreme Court of Massachusetts in the Lowell Bar Association case, supra, (52 N.E.2d, l.c. 31): "The proposition cannot be maintained, that whenever, for compensation, one person gives to another advice that involves some element of law, or performs for another some service that requires some knowledge of law, or drafts for another some document that has legal effect, he is practicing law. All these things are done in the usual course of the work of occupations that are universally recognized as distinct from the practice of law. There is authority for the proposition that the drafting of documents, when merely incidental to the work of a distinct occupation, is not the practice of law, although the documents have legal consequences." The Court gave several examples including architects, insurance brokers, property valuers, auctioneers, and accountants, the work of the latter being directly involved in the decision.

It is true that a real estate broker has earned his commission when he has found a purchaser ready, willing and able to take the property at the price and upon the terms fixed by the owner. However, we know as a practical matter that he does not get his money at that time; and often there are several written offers and counter offers which result in a contract before it can be said that a purchaser has been found. It is a matter of great importance to the broker to get an agreement in writing and then to close the transaction as promptly as possible, because as a matter of practice that is usually when he gets paid. Thus he is personally concerned in the transaction and actually he is acting partly in his own interest in getting a contract signed and the deal closed. This is recognized [861] by the form of contract, used by the St. Louis Real Estate Board, as shown by our Court records, which is signed by the broker, as well as by the buyer and seller, and which provides for the seller in signing to approve not only the buyer's offer but also the commission to be paid the broker. Thus the broker's function is commercial in character and not merely advisory. As a matter of fact, what he seeks to do is to negotiate a completed deal and he often bargains to some extent with both parties to get them together. While as an agent he is required to reveal to his principal everything within his knowledge relating to the transaction and must not put himself in a position antagonistic to his interests, nevertheless, because of his personal interest in negotiating an agreement, he is not in the same completely disinterested position to give him advice about his rights and obligations as a lawyer should be. This, as well as lack of legal training, is an important reason why real estate brokers cannot be permitted to give legal advice to their customers.

However, this is also a practical reason why the completion of the contract is a part of the business of the real estate broker in the transaction; and it is usually to the interest of the seller he represents, as well as his own, to get a binding agreement completed promptly while the parties are together on its terms. Such agreements may be complicated and one or both of the parties may or should realize the need for a lawyer to prepare the contract rather than to use a standardized form; but more often they are simple enough so that such a form will suffice and the parties will wish to avoid further delay or expense by using them. So much real estate business is done in this way, without harmful results, that we do not think the public interest requires it to be changed. In this connection, we note a 1942 agreement approved in principle by the Board of Governors of the American Bar Association and the Board of Directors of the National Association of Real Estate Boards (67 A.B.A. Reports 224) which provides in part as follows: "* * * when acting as broker, a realtor may use an earnest money contract form for the protection of either party against unreasonable withdrawal from the transaction, provided that such earnest money contract form, as well as any other standard legal forms used by the broker in transacting such business, shall first have been approved and promulgated for such use by the bar association and the real estate board in the locality where the forms are to be used." In view of the authorities herein above reviewed, and our conclusions above stated, we hold that completing such contracts on standardized forms under such circumstances is not unlawful practice of law.

Likewise, general warranty deed and trust deed forms are so standardized that to complete them for usual transactions requires only ordinary intelligence rather than legal training. They are in fact less complicated than contracts for sale of real estate. We know that these forms are furnished to the public at the offices of Recorders of Deeds through the state. We think the preparation of these instruments in closing transactions in which a real estate broker is acting as broker is so closely related to the transaction and the business of the broker as to be practically a part of it and that he is not engaging in unlawful practice of law to prepare them under such circumstances. The same thing is true of ordinary short term leases, notes, chattel mortgages and trust deeds in transactions which the broker procures. However, he cannot properly make separate charges, in addition to his commission, for preparing any instruments or engage in the field of conveyancing and drafting contracts or other legal instruments for the public generally, with or without separate charge. Such conduct would not be any part of his business as a real estate broker but would be placing the emphasis upon conveyancing as a practice of law instead of on his services as a broker; and it would also violate the provisions of RSMo 1949, Chap. 484.

We are mindful of the statement of Pound, J. in the Title Guaranty Trust case, supra, (125 N.E., l.c. 670), cited by informants, and also approved in People [862] v. Lawyers Title Corp., 282 N.Y. 513, 27 N.E.2d 30, as follows: "I am unable to rest any satisfactory test on the distinction between simple and complex instruments. The most complex are simple to the skilled, and the simplest often trouble the inexperienced." Realizing the truth of that statement, we are, nevertheless, inclined to take the view of the Supreme Court of Massachusetts in the Lowell Bar Association case, supra, (52 N.E.2d, l.c. 34), "We are aware that there has been said to be no difference in principle between the drafting of simple instruments and the drafting of complex ones. (Citations.) But though the difference is one of degree, it may nevertheless be real. (Citations.) There are instruments that no one but a well trained lawyer should ever undertake to draw. But there are others, common in the commercial world, and fraught with substantial legal consequences, that lawyers seldom are employed to draw, and that in the course of recognized occupations other than the practice of law are often drawn by laymen for other laymen, as has already been shown. The actual practices of the community have an important bearing on the scope of the practice of law." As to this matter of degree, it has also been well said: "Things do not have to be in broad contrast to have different practical and legal consequences. Actions take estimation from degrees, and of this life and law are replete with examples." Industrial Accident Commission v. Davis, 259 U.S. 182, 42 S.Ct. 489, 491, 66 L.Ed. 888. (See also discussion of simple forms in Liberty Mutual Ins. Co. v. Jones, 130 S.W.2d l.c. 958.) We think the guiding principle must be whether under the circumstances the preparation of the papers involved is the business being carried on or whether this really is ancillary to and an essential part of another business. The simplicity or complexity of the forms, the nature and customs of the main business involved, the convenience to the public, and whether or not separate charges are made, all have a bearing upon the determination of this question.

We reach the following conclusions:

First: A real estate broker, in transactions in which he is acting as a broker, may use a standardized contract in a form prepared or approved by counsel and may complete it by filling in the blank spaces to show the parties and the transaction which he has procured.

Second: A real estate broker, in transactions in which he is acting as a broker, may use standardized forms of warranty deeds, quit claim deeds, trust deeds, notes, chattel mortgages and short term leases, prepared or approved by counsel and may complete them by filling in the blank spaces to show the parties, descriptions and terms necessary to close the transaction he has procured.

Third: A real estate broker may not make a separate charge for completing any standardized forms, and he may not prepare such forms for persons in transactions, in which he is not acting as a broker, unless he is himself one of the parties to the contract or instrument.

Fourth: The required approval by counsel of standardized forms to be used in real estate transactions properly may be made either by lawyers selected by real estate brokers individually or selected by real estate boards of which they are members.

Fifth: Even in transactions in which he is acting as a broker, a real estate broker may not give advice or opinions as to the legal rights of the parties, as to the legal effect of instruments to accomplish specific purposes or as to the validity of title to real estate; and he may not prepare reservations or provisions to create estates for life or in remainder or any limited or conditional estates or any other form of conveyance than a direct present conveyance between the parties, as provided for in standardized approved forms, to be effective upon delivery.

Sixth: A real estate broker in conferring with parties to obtain facts and information about their personal and property status, other than is necessary to fill in the blank spaces in standardized forms necessary to complete and close transactions in which he is acting as a broker, for the purpose of advising them of their rights and the action to be taken concerning them, is engaging in the practice of law.

[863] We also hold that respondent's acts in preparing legal instruments for persons in transactions in which he was not acting as a broker, making a charge therefor, amounted to the practice of law; and that his separate additional charges even in transactions in which he was acting as broker tend to place emphasis on conveyancing and legal drafting as a business rather than on his business of real estate broker. The character of this work is indicated by respondent's admissions that he "elicited in conference what were considered to be the pertinent facts" and "in the light of the information elicited and the information contained in the abstract of title, selected and determined upon the blank form or forms to be used and then prepared one or more of the instruments mentioned as the respondent * * * in his * * * judgment deemed proper." This tends to go beyond preparation of simple standardized forms and into the field of legal advice. However, since the matter had not previously been decided in this State and respondent had been frank and helpful to the Bar Administration, we think no substantial penalty should be imposed.

It is, therefore, ordered and adjudged that respondent pay a fine of One Dollar and the costs herein and henceforth cease and desist the practices we have held to be improper.

Ellison, C.J., Conkling, Leedy, Dalton and Hollingsworth, JJ., concur; Tipton, J., not sitting.


Summaries of

Hulse v. Criger

Supreme Court of Missouri, Court en Banc
Apr 14, 1952
363 Mo. 26 (Mo. 1952)

determining a person "may not make a separate charge for completing any standardized forms" and finding a party who had "fill[ed] in such form or forms" had violated the law

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In Hulse, the Missouri Supreme Court determined that the defendant had engaged in unauthorized practice of law but found that "since the matter had not previously been decided in this State and [the defendant] had been frank and helpful to the Bar Administration, we think no substantial penalty should be imposed. It is, therefore, ordered and adjudged that [the defendant] pay a fine of one dollar."

Summary of this case from McKeage v. Bass Pro Outdoor World, L.L.C.

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In Hulse, real estate brokers obtained standardized form documents, including notes and deeds of trust, and then filled in blanks on these documents based on the specific information provided by their clients.

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In Hulse v. Criger, 363 Mo. 26, 247 S.W.2d 855, 857-858 (banc 1952), we stated that the regulation by this court of the unauthorized practice of law "... is not to protect the Bar from competition but to protect the public from being advised or represented in legal matters by incompetent or unreliable persons.

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In Hulse v. Criger (1952), 363 Mo. 26, 45-46, 247 S.W.2d 855, 862, the court outlined in very succinct terms the limits placed upon such real estate brokers and agents, and what they may and may not do, which statement, we feel, in the main is a wise guide to our course of conduct.

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Case details for

Hulse v. Criger

Case Details

Full title:FRED B. HULSE, O.W. WATKINS, JAMES M. REEVES, C.O. INMAN and CHARLES M…

Court:Supreme Court of Missouri, Court en Banc

Date published: Apr 14, 1952

Citations

363 Mo. 26 (Mo. 1952)
247 S.W.2d 855

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