ARKANSAS LAW NOTES NEW ONLiNE EdiTiON COmiNg ThiS SummER www.lawnotes.law.uark.edu Featuring timely articles by Arkansas scholars and practitioners
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or associations cannot meet these prerequisites and therefore cannot engage in the practice of law.52 There are additional reasons for prohibiting corporations from representing third parties. Perhaps a corporation “will exercise impermissible control over [an] attorneyemployee’s judgment and thus impermissibly interfere with the attorney-employee’s independence of judgment and loyalty to the client.”53 Or perhaps the in-house counsel’s judgment will be “clouded by allegiance or influence of the employer entity.”54 Such reasoning was adopted by the majority and concurring opinions in Brown v. Kelton.55 For example, Chief Justice Jim Hannah stated in his concurring opinion, “the attorney-client relationship cannot exist between an attorney employed by a corporation to practice law for it, and a client of the corporation, for [the attorney] would be subject to the directions of the corporation and not to the directions of the client.”56 Exceptions to the Prohibition Against the Unauthorized Practice of Law The Arkansas Supreme Court has created two exceptions to the prohibition against the unauthorized practice of law, one for real estate brokers and another for car dealers. 32
The Arkansas Lawyer
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1. Real Estate Brokers In 1963, the Arkansas Supreme Court held that real estate brokers may, within certain restrictions, fill in the blanks of legal documents without thereby engaging in the unauthorized practice of law.57 For this exception to apply, the following conditions, as set forth in Pope County Bar Association v. Suggs,58 must be satisfied: (1) The person for whom the broker is acting must decline to employ a lawyer to prepare the necessary instruments and must authorize the broker to do so; (2) The forms must be approved by a lawyer either before or after the blanks are filled in but prior to delivery to the person for whom the broker is acting; (3) The forms must not be used for other than simple real estate transactions which arise in the usual course of the broker’s business; (4) The forms must be used only in connection with real estate transactions actually handled by such brokers as a broker; (5) The broker must make no charge for filling in the blanks; and (6) The broker must not give advice or opinions as to the legal rights of the par-
ties, as to the legal effects of instruments to accomplish specific purposes, or as to the validity of title to real estate.59 Thus, as long as a real estate broker satisfies these six requirements, he or she may fill in the blanks of legal documents.60 The court defended this exception as in the public interest.61 First, there are places in Arkansas where there are few, if any, lawyers; thus, real estate brokers fill a need created by the unavailability of lawyers.62 Second, real estate brokers are required to meet professional standards comparable to those required of lawyers.63 Third, real estate brokers are able to prepare certain forms within a few minutes, while lawyers require a few days to prepare those same forms.64 Fourth, even if lawyers were required to prepare these documents, real estate brokers would continue to prepare the forms but then pay attorneys to retype the forms, thus creating unnecessary costs for brokers.65 Finally, mistakes increase, rather than decrease, when forms are passed back and forth between brokers and lawyers.66 2. Car Dealers While the court in 1963 began allowing real estate brokers to fill in the blanks of legal documents, it did not allow any other group to do so for almost 50 years. During that time, title and abstract companies sought the court’s permission to fill in the blanks of legal documents, but the court denied their request.67 Then, in 2011, the court created a second exception to the prohibition against the unauthorized practice of law. In Campbell v. Asbury Automotive, Inc.,68 the court held that car dealers, like real estate brokers, may under certain circumstances fill in the blanks of legal documents without thereby engaging in the unauthorized practice of law.69 Borrowing from Pope County Bar Association v. Suggs,70 the court set forth the following parameters for this exception to apply: (1) The person for whom the car dealer is acting must decline to employ a lawyer to prepare the necessary instruments and must authorize the car dealer to do so; (2) The forms must be approved by a lawyer either before or after the blanks are filled in, but prior to delivery to the person for whom the car dealer is acting; (3) The forms must not be used for