Amended July 10, 2017 Iowa Supreme Court Commission on the Unauthorized Practice of Law v. Raymond William Sullins ( 2017 )

IN THE SUPREME COURT OF IOWA
No. 15–1081
Filed April 7, 2017
Amended July 10, 2017
IOWA SUPREME COURT COMMISSION
ON THE UNAUTHORIZED PRACTICE OF LAW,
Appellee,
vs.
RAYMOND WILLIAM SULLINS,
Appellant.
Appeal from the Iowa District Court for Emmet County, Duane E.
Hoffmeyer, Chief Judge.
Disbarred attorney appeals district court order enjoining him from
the unauthorized practice of law. DISTRICT COURT INJUNCTION
AFFIRMED.
Raymond William Sullins, pro se.
N. Tré Critelli of Iowa Supreme Court Commission on the
Unauthorized Practice of Law, Des Moines, for appellee.
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WATERMAN, Justice.
In this appeal, we must decide whether a disbarred attorney
engaged in the unauthorized practice of law when he took a partial
assignment of a judgment for back-due child support from a friend who
owed him money and they both pursued collection in the same court
proceedings. Nonlawyers can represent themselves in court to pursue
collection on claims they wholly own by assignment. But a nonlawyer
cannot represent another party in court. After a bench trial, the district
court found this former lawyer engaged in the practice of law because his
friend stood to receive part of the recovery on the assigned claim, and he
helped her pursue collection of her own claims. We reach the same
conclusion on our de novo review of the record and, therefore, affirm the
injunction entered by the district court.
I. Background Facts and Proceedings.
On our de novo review, we find the following facts.
In 2012, Raymond Sullins met Sarita Henricksen, a woman living
in Earlham, Iowa. They became friends, and he loaned her between
$24,000 and $28,000 by paying her living expenses for six months. This
case arises from his efforts to collect money her
ex-husband owed her.
We revoked Sullins’s license to practice law in 2002. Iowa
Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Sullins (Sullins III), 648
N.W.2d 127, 136–37 (Iowa 2002). Sullins had previously received an
admonishment, two public reprimands, and a license suspension of one
year. See Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Sullins
(Sullins II), 613 N.W.2d 656, 656, 657 (Iowa 2000) (per curiam)
(suspending license); Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v.
Sullins (Sullins I), 556 N.W.2d 456, 456, 457 (Iowa 1996) (reprimanding
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Sullins and noting prior reprimand and admonishment). When we
suspended his license due to trust account violations and neglect of four
client matters, we stated Sullins was “unwilling or unable to discharge
the duties required in the practice.” Sullins II, 613 N.W.2d at 656. When
we later revoked his license for neglect of another six client matters and
additional trust account violations, we stated,
We must bear in mind the purposes of attorney
disciplinary proceedings which include: protecting the courts
and the public from persons unfit to practice law, vindicating
public confidence in the integrity of our system of justice,
assuring the public the courts will maintain the ethics of the
profession, and deterring other lawyers from similar
misconduct. The evidence clearly shows Sullins should not
practice law. His conduct reflects a deep misunderstanding
of his obligations as a lawyer and disrespect for this entire
profession. We find the seriousness of these violations
warrant revocation of his license to practice law.
Sullins III, 648 N.W.2d at 136 (citation omitted). Sullins remains
disbarred.
In 1989, Sarita and her husband, Jim Henricksen, obtained a
divorce in Oklahoma. The Oklahoma decree ordered Jim to pay Sarita
child support for their two children, born in 1984 and 1987, respectively.
Jim failed to pay much of his child support, resulting in a substantial
arrearage. Jim’s parents owned farmland in Iowa and died two decades
after his divorce. Jim stood to receive a sizeable inheritance. On
October 5, 2012, a probate petition was filed in the Iowa District Court
for Emmet County to administer Jim’s father’s estate. Two months later,
another probate petition was filed to administer Jim’s mother’s estate.
The combined estates included property valued at over $2.4 million.
In August 2013, Sullins began giving Sarita money for her living
expenses after she lost her teaching job. Sullins loaned Sarita money for
her mortgage payment, utility bills, car payment, student loan payment,
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groceries, medical bills, medication bills, veterinarian bills, and other
expenses. Sometimes he paid her bills directly. Sullins estimated he
paid Sarita about $2000 monthly. Sullins knew Sarita’s ex-husband
owed her money. He told Sarita that he wanted an assignment of part of
her interest in the support judgment, to repay the money he loaned her
or spent on her behalf. Sarita agreed to the assignment. Sarita and
Sullins disagree about whether he planned to remit to her amounts
collected on the assigned claims above what she owed him.
A. Proceedings to Secure Child Support Payments. In October,
Sullins and Sarita met with attorney Phil Redenbaugh in Storm Lake
about collecting the back-due support payments. Redenbaugh agreed to
review the documents Sarita brought and advise her about how to
proceed. Because Redenbaugh was a long-time family friend of Sarita,
he told her he would not charge for his services. Sullins informed
Redenbaugh of his intent to take an assignment and enter the action to
secure the funds. Redenbaugh told Sarita she may be able to “join in”
whatever Sullins filed. Redenbaugh asked Sullins to send him any
documents before filing so he could review them and determine whether
he was comfortable with Sarita joining.
Redenbaugh gave Sarita the impression that recovering the
back-due child support would be simple. She told Sullins after the
meeting she did not “want to be imposing on Phil any more than what
[she had] to” and “if it’s so easy, why [couldn’t she] do it [herself]?” She
asked what “join in” meant. Sullins introduced her to Jerry Wieslander,
an attorney friend, to help her. Sarita spoke with Wieslander by phone.
On October 9, Sarita sent a letter and a copy of the Oklahoma divorce
decree to the clerk of Emmet County, claiming a portion of Jim’s
inheritance. Five days later, the clerk filed a notice of foreign judgment,
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captioned “Sarita Henricksen v. Jim Henricksen, Emmet County
No. TJCV018129.” Two months later, Sarita asked the clerk to issue a
writ of general execution to the sheriff in the amount of $353,819.10 plus
interest. The writ was issued December 30. On the estate executor’s
application, the court scheduled a “Hearing of Priority of Claims” on
March 3, 2014. Shortly before the hearing, the executor requested a
continuance until March 17, which the court granted.
Sullins and Sarita filed a number of legal documents on March 3. 1
Each of them signed and filed their respective documents “pro se,”
unrepresented by counsel.
In the matter of Henricksen v. Henricksen, Sarita filed a
handwritten, unnotarized document entitled “ASSIGNMENTS OF
JUDGMENTS IN CASE #TJCV018129,” purportedly assigning to Sullins
her support judgments for the years 1987, 1988, and 1989. The filing
stated:
Sarita Henricksen for good and valuable consideration
receipt of which is hereby acknowledged assigns the
following judgments to Ray Sullins:
All support judgments for 1987, 1989 [sic], and 1989 in the
Oklahoma decree in Emmet County Iowa in case
#TJCV018129.
The assignment was signed by Sarita but not dated. The document did
not mention any release of Sarita’s indebtedness to Sullins or what was
paid for the assignment.
Sullins the same day filed a typewritten “APPLICATION FOR
ORDER UNDER SECTION UNDER SECTION [sic] 252K.305(2)(f) AND (g)
CODE OF IOWA” as “assignee of Sarita Henricksen.” Sullins sought to
1Wieslander had died a month earlier on February 2.
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levy on real estate Jim was going to inherit. Sarita filed a handwritten
document bearing the same caption, including the same error:
“APPLICATION FOR ORDER UNDER SECTION UNDER SECTION [sic]
252K.305(2)(f) AND (g) CODE OF IOWA.” Sarita joined Sullins’s
application. Sarita’s motion was filed at 10:03 a.m., four minutes before
Sullins’s motion.
In the estate proceedings, Sullins filed a typewritten “RESISTANCE
TO MOTION TO CONTINUE HEARING ON CLAIMS AND REQUEST FOR
ORDER” as “assignee of Sarita Henricksen” at 10:08 a.m. This filing
incorrectly put a space in the caption, “ES PROO9643,” and used capital
“O”s instead of zeros. Three minutes earlier, Sarita had filed a
handwritten “RESISTANCE TO MOTION TO CONTINUE HEARING ON
CLAIMS AND REQUEST FOR ORDER” bearing the same errors in the
caption. Sarita requested to join Sullins’s motion.
On March 17, the district court held the hearing of priority of
claims under section 252K.305. Sarita did not appear. Sullins reported
she attempted to call into the hearing but could not get through. Sullins
appeared and claimed the assignment gave him standing to participate in
the action. He made arguments in support of both of their claims.
B. Proceedings Regarding the Unauthorized Practice of Law.
On August 13, the Iowa Supreme Court Commission on the
Unauthorized Practice of Law (Commission) filed a complaint in the Iowa
District Court for Emmet County pursuant to Iowa Court Rule 37.2. The
complaint alleged the Commission had reasonable cause to believe
Sullins was practicing law without a license. The Commission alleged
Sullins committed the following acts constituting the practice of law:
a. The drafting and filing of legal documents in two
matters in Emmet County:
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i. In Sarita Henricksen v. Jim Henricksen, Emmet
Cnty. No. TJCV018129; and
ii. In the Matter of the Estate of Darlene
Henricksen, Emmet Cnty. Probate Docket
ESPR009643
b. The representation of the legal interests of Sarita
Henricksen in the above captioned matters.
The Commission did not contest the validity of Sarita’s assignment.
However, it pointed out this complaint was not the first instance of
Sullins attempting to use assignments to represent another person.
Four years earlier, Sullins had received a cease and desist letter from the
Commission after obtaining an assigned interest and attempting to use it
to represent other parties. See Daggy v. Mersch, No. LACV–017595,
Ruling on Mot. to Recuse (Iowa Dist. Ct. for Humboldt Cty. filed July 20,
2010).
The Commission requested the district court enter a “permanent
injunction prohibiting [Sullins] from engaging in activities which
constitute the unauthorized practice of law, including but not limited to
the use of legal assignments of interest as a means for representing the
legal interests of others.” On October 31, the district court held a show-
cause hearing pursuant to Iowa Court Rule 37.2(2). The Commission
argued the matching incorrect captions and near-simultaneous filings by
Sullins and Sarita indicated Sullins either drafted Sarita’s filings or
allowed her to copy his filings. The Commission asserted Sullins
represented Sarita’s interests by advising her on the significance of the
documents. It also alleged Sullins represented Sarita’s interests at the
hearing on March 17 because all of his arguments were in support of her
interest in the payments. Sullins admitted most of the factual
allegations but disagreed they constituted the unauthorized practice of
law.
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The district court issued a ruling that stated,
Based on the pleadings and the testimony at the show-cause
hearing, it is still unclear whether Sullins advised Sarita on
how to draft [her filings]. Thus, pursuant to Rule 37.2(3),
the Court will order a bench trial on the issue. However, the
pleadings and testimony also fail to substantiate the
Commission’s claim that Sullins improperly filed Exhibits 8
and 10. Thus, the Court will deny the Commission’s request
for a permanent injunction on that basis.
The district court credited Sullins’s explanation for the simultaneous
filing times: he had driven Sarita to the courthouse on March 3 and they
had filed them together. But the court noted inconsistencies in Sarita’s
and Sullins’s recollections about the drafting of the motions. It also
raised concerns that Sullins planned to secure the judgment and remit a
portion back to Sarita. Because Sullins could not identify what he paid
Sarita for the assignment, the district court could not determine whether
the assignment was “less than, equal to, or exceeding the value” of
Sullins’s expenditures. The court denied the Commission’s request for
injunction and set the matter for bench trial pursuant to Iowa Court
Rule 37.2(3). 2
On April 16, 2015, the court held a bench trial. Sullins appeared
pro se. Sullins and Sarita testified. Sarita testified Redenbaugh had
typed the assignment, while Sullins testified it was definitely “not”
Redenbaugh, although he could not say who did. Sarita testified Sullins
had given her between $24,000 and $28,000, and the assignment was
2Rule 37.2 provides,
If it appears that the facts are incapable of being adequately
developed at a summary hearing, the matter may be set for trial before
that judge, who shall hear the evidence and make findings of fact in an
appropriate dispositional order.
Id. r. 37.2(3).
 9
intended to repay that debt. But Sarita estimated the assignment was
worth about “a third of a million” dollars. Sarita testified she expected to
receive funds collected above what she owed Sullins:
Q. Why would you assign Mr. Sullins that much
money if he only paid you $28,000? A. Because I wanted
the rest of it.
....
Q. So there is a difference between the $300,000 and
the $28,000, isn’t there? A. Yes.
Q. But according to this assignment, you assigned
Mr. Sullins all of that judgment for those three years?
A. . . . [W]ell, then I don’t know that this was written
correctly then.
Q. Okay. If Mr. Sullins recovered more money than
the $28,000, would you expect him to give it back to you?
A. Yes.
By contrast, Sullins testified any amounts he collected on the assigned
three years were his to keep, including any amount recovered over what
she owed him. He testified he selected the years for the assignment after
calculating the recovery that would roughly equal what Sarita owed him.
He stated Sarita told him, “[I]f it comes out to a little bit more, . . . I’m
certainly not going to be concerned.” Sullins did not advise Sarita to
speak to an attorney before making the assignment. In fact, the
assignment entitled Sullins to collect more than Sarita owed him. 3
3There is conflicting testimony on the value of the assignment. As noted, Sarita
testified the assigned three years were worth about “a third of a million dollars.” At the
priority hearing in probate court, Sullins testified as follows:
MR. SULLINS: She assigned to me the child support judgments
out of the Oklahoma decree for the years 1987, ’88, and ’89. And that’s
in the court file. That assignment—
THE COURT: What years?
MR. SULLINS: 1987, 1988, and 1989.
THE COURT: And how much are those claims for each year?
MR. SULLINS: The child—the child support claims, those
judgments are about $4,200 a year, for that which is designated
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Sarita testified she drafted the joinders herself based on prior
advice from Redenbaugh and Wieslander, and that Sullins advised her as
to the joinders’ legal significance. She testified she did not look at any
document prior to drafting the joinders, including Sullins’s filings.
Sullins, on the other hand, recalled, “I—I don’t like to be in a position of
really disputing directly testimony of Ms. Henricksen today, but she did
in fact have copies of the motion and the resistance that I had prepared,
and she copied those captions because that’s exactly what Jerry told her
to do.”
On May 21, the district court entered an order granting the
Commission’s request for permanent injunction. Because of the
potential “windfall” to Sullins, the district court credited Sarita’s
explanation that some of the funds Sullins recovered would be remitted
back to her. The court “believe[d] Sarita was attempting to get her back
________________________
specifically child support. Then there are child—strike that. There are
day care judgments, as well, which are also child support judgments as
characterized in the Oklahoma decree.
The Iowa writ of execution on the judgment indicates that Jim was ordered to pay
Sarita $658 monthly. Three years of monthly backpayments at that rate total $23,699
without interest. Simple interest accrued at ten percent annually. See Lee v.
Volkswagen of Am., Inc., 743 P.2d 1067, 1069 (Okla. 1987) (quoting Okla. Stat. tit. 12,
§ 727 (Supp. 1986)). With accrued interest, that amount would have increased to
$82,947 by March 2014, when the assignment was filed in probate court.
But the Oklahoma divorce decree filed April 10, 1989, contradicts Sullins’s
testimony that Jim owed Sarita substantial unpaid child support for 1987–1988
because that decree specifically awarded only $1974 for “temporary arrearage.” The
decree also awarded $500 for attorney fees and $109 in court costs. Those sums, plus
payments for the remaining eight months of 1989 ($658 monthly), total $7849. With
accrued interest, the amount Sullins potentially could have collected on the assignment
had increased to $28,320 by May 2015, when the district court conducted its bench
trial on the Commission’s complaint against Sullins. We need not resolve the conflicts
in the evidence to specifically determine the value of the assigned claim (the amount
Jim owes Sarita for 1987–1989 with accrued ten percent interest) because we find even
the lowest amount supported by the evidence exceeds the $24,000-$28,000 Sarita owed
Sullins.
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child support ‘on the cheap’ utilizing this assignment and a disbarred
lawyer.” The court further noted the discrepancies between Sarita’s and
Sullins’s accounts about the drafting of the documents. The district
court found,
Ray was in his assignee capacity taking action to protect,
enforce or defend the legal rights of another; namely, Sarita.
The court finds he advised Sarita regarding legal matters
specifically including, but not limited to, the assignment,
prepared court pleadings which he permitted Sarita to join in
and made appearances in court on “their” claims.
The court also pointed out that “Ray testified he used his judgment and
knowledge of the legal process to project how long it may take for the
case to be resolved and money received and balanced that against
expenses he may be asked to pay.” The court concluded Sullins
“engaged in the practice of law” and entered a permanent injunction.
Sullins appealed, arguing the district court erred by (1) allowing
the Commission to prosecute claims outside the pleadings, and (2)
concluding Sullins engaged in the unauthorized practice of law.
II. Scope of Review.
“A request for an injunction invokes the district court’s equitable
jurisdiction.” Iowa Supreme Ct. Comm’n on Unauthorized Practice of Law
v. A–1 Assocs., 623 N.W.2d 803, 805 (Iowa 2001) (quoting Sear v. Clayton
Cty. Zoning Bd. of Adjustment, 590 N.W.2d 512, 515 (Iowa 1999)). Our
review is de novo. Id. Although we are not bound by the district court’s
findings of fact, “[w]e give weight to” them, “especially when considering
the credibility of witnesses.” Matlock v. Weets, 531 N.W.2d 118, 121
(Iowa 1995). “As difficult as it is to assess credibility of live testimony, it
is more difficult to assess credibility from a cold transcript.” In re
Marriage of Woodward, 228 N.W.2d 74, 75 (Iowa 1975) (quoting Zaerr v.
Zaerr, 222 N.W.2d 476, 477 (Iowa 1974)). Our deference to the district
12
court is particularly important on close questions of fact. In re Marriage
of Udelhofen, 444 N.W.2d 473, 474 (Iowa 1989) (deeming deference
“especially strong” when “the case turns . . . upon the implications of the
words and actions of the parties” because “a trial court, as first-hand
observer of witnesses, holds a distinct advantage over an appellate
court”).
III. Analysis.
We must decide whether Sullins was representing Sarita in the
collection efforts. If so, he engaged in the unauthorized practice of law.
In his telling, he was simply pursuing collection on a claim he owned by
assignment. The district court found otherwise after hearing the live
testimony of both Sullins and Sarita. On the key disputed factual issue,
the district court found Sarita more credible than Sullins and found that
he was to repay her any amount collected on his assigned claim that
exceeded what he had loaned her for living expenses. Based on our
de novo review, we agree and affirm the injunction.
We first address whether the Commission’s pleadings
encompassed the violations found by the district court. We conclude the
pleadings adequately notified Sullins of the claims adjudicated. Next, we
review caselaw addressing when a nonlawyer pursuing collection on
assigned claims in court engages in the unauthorized practice of law. We
conclude Sullins crossed the line by pursuing collection for Sarita. Then
we address restrictions on drafting and legal assistance by one
nonlawyer to another. We conclude Sullins crossed the line by assisting
Sarita with her own court filings.
A. Due Process. Sullins argues the district court followed an
improper procedure because it “sua sponte interjected issues into the
proceedings.” Sullins argues the Commission’s complaint only alleged
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Sullins “draft[ed] and fil[ed]” legal instruments for Sarita. The district
court nonetheless evaluated whether “Sarita drafted [the filings] . . . at
Sullins’[s] direction,” or whether “Sullins advised Sarita on how to draft
these exhibits.” Because the complaint did not allege Sullins “directed”
or “advised” Sarita, Sullins contends the consideration of these issues
was improper. Sullins further argues the district court should not have
considered whether Sullins “engaged in the unauthorized practice by
taking Sarita’s assignment with the intent to remit part of the recovery to
her” because the complaint only alleged he “represent[ed] . . . the legal
interests of Sarita.” We reject these challenges.
The Commission is charged with “considering, investigating, and
seeking the prohibition of matters pertaining to the unauthorized
practice of law and the prosecution of alleged offenders.” Iowa Ct. R.
38.1. After conducting an investigation into any alleged unauthorized
practice of law, the Commission may “initiate an action pursuant to Iowa
Ct. R. 37.2.” Id. r. 38.7(3). Rule 37.2 states,
37.2(1) If the commission has reasonable cause to
believe that any person who has not been admitted to
practice law within this state is engaged in the practice of
law or holding out to the public that the person is qualified
to provide services constituting the practice of law in this
state, the commission may file a verified complaint with the
clerk of the district court in any county in which the
unauthorized practice is alleged to have occurred.
37.2(2) The complaint shall be filed with the clerk of
the district court, be given a docket number, and be
captioned in the Iowa District Court for ___________ County.
The commission shall be designated as the complainant.
The respondent shall be named and designated as the
respondent. The complaint shall be presented to the chief
judge of the judicial district for entry of an order to be served
on the respondent requiring that person to appear before the
court and show cause why that person should not be
enjoined from such activity. The show-cause hearing shall
be held before the chief judge or another judge designated by
the chief judge.
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Id. r. 37.2(1)–(2). The Commission filed a verified complaint in
accordance with this rule after investigating Sullins’s activities.
“Iowa is a notice pleading state.” Rieff v. Evans, 630 N.W.2d 278,
292 (Iowa 2001). Only “facts sufficient to apprise the defendant of the
incident must be included in the petition in order to provide ‘fair notice’
of the claim asserted.” Id. (quoting Schmidt v. Wilkinson, 340 N.W.2d
282, 283 (Iowa 1983)). “A petition complies with the ‘fair notice’
requirement if it informs the defendant of the incident giving rise to the
claim and of the claim’s general nature.” Rees v. City of Shenandoah,
682 N.W.2d 77, 79 (Iowa 2004)). A petition need not allege a specific
legal theory, so long as it meets the “fair notice” requirement. Rieff, 630
N.W.2d at 292.
The purpose of the verified complaint is to set forth “reasonable
cause to believe” an individual is engaged in the unauthorized practice of
law, sufficient to allow the district court to require the individual to
appear at a show-cause hearing. Iowa Ct. R. 37.2(1)–(2). To that end,
the Commission concedes the complaint must be more detailed than the
typical “notice pleading” used in civil matters. See GE Money Bank v.
Morales, 773 N.W.2d 533, 537 (Iowa 2009) (interpreting statute requiring
a “verified account” and noting that “[i]f . . . the verified account
substantiates the plaintiff’s claim, the court should enter judgment
against the defendant” (emphasis added)); ITT Fin. Servs. v. Zimmerman,
464 N.W.2d 486, 488 (Iowa Ct. App. 1990) (stating verified complaint
must provide the court with “information sufficient to compute the
amount to which the creditor claims to be entitled” under Iowa
Consumer Credit Code).
This complaint meets the standard of pleading required under rule
37.2 by providing information sufficient to give the court reasonable
15
cause to believe Sullins engaged in the unauthorized practice of law. It
alleged Sullins engaged in the unauthorized practice of law in three
particulars: (1) the drafting of legal documents, (2) the filing of legal
documents, and (3) the representation of the legal interests of Sarita. It
detailed the factual basis for its claims in over twenty paragraphs and
submitted twelve exhibits in support. The complaint was notarized. See,
e.g., State v. Phippen, 244 N.W.2d 574, 575 (Iowa 1976) (construing a
verified complaint as one that bears a statement under oath). The
Commission’s verified complaint provided sufficient information to
substantiate its claims.
We also conclude the district court did not sua sponte interject
issues into the proceeding. The district court evaluated whether Sullins
“directed” or “advised” Sarita about drafting her filings. This falls within
the complaint’s allegation that Sullins “drafted” documents. Nor was the
claim Sullins planned to remit funds to Sarita outside the pleadings; that
claim is encompassed within the allegation that Sullins attempted to
represent her legal interests. See Bump v. Barnett, 235 Iowa 308, 313,
16 N.W.2d 579, 582 (1944) (prohibiting using assignment to render legal
services to another). The complaint need not plead specific legal theories
to give Sullins fair notice. We find no due process violation.
B. Sullins Engaged in the Unauthorized Practice of Law. On
our de novo review, we agree with the district court’s determination that
Sullins engaged in the unauthorized practice of law. Sarita, a nonlawyer,
owed Sullins, a disbarred lawyer, between $24,000 to $28,000. She
provided him an assignment of her Oklahoma judgment against her
ex-husband Jim for three years of child support (1987, 1988, and 1989)
that with accrued statutory ten percent interest exceeded the amount
Sarita owed Sullins. The assignment was silent as to the consideration
16
paid and included no language extinguishing Sarita’s debt to Sullins.
Sarita retained her interest in the Oklahoma judgment for other years.
Jim was poised to inherit Iowa farmland from his deceased parents worth
several million dollars. Sarita planned to piggyback on Sullins’s
collection efforts in the probate proceedings and expected to receive any
amount Sullins collected above what she owed him. Essentially Sullins
represented both Sarita’s interest and his own in pursuing collection of
the child support Jim owed. Their arrangement was akin to a lawyer
working a collection case on a contingent, percentage fee. Sullins
thereby practiced law after his license had been revoked.
Our court has the “authority to define and regulate the practice of
law” in Iowa. Iowa Supreme Ct. Comm’n on Unauthorized Practice of Law
v. Sturgeon, 635 N.W.2d 679, 681 (Iowa 2001). Although we have
“refrained from attempting an all-inclusive definition of the practice of
law,” we have stated it includes,
representing another before the courts; giving of legal advice
and counsel to others relating to their rights and obligations
under the law; and preparation or approval of the use of legal
instruments by which legal rights of others are either
obtained, secured or transferred even if such matters never
become the subject of a court proceeding.
Comm. on Prof’l Ethics & Conduct v. Baker, 492 N.W.2d 695, 701 (Iowa
1992) (quoting Iowa Code of Prof’l Responsibility EC 3–5 (emphasis
added)). “[P]rofessional judgment lies at the core of the practice of law.”
Id. When lawyers determine “what the issues are and use their
knowledge of the law to solve them in an ethical way,” they exercise
professional judgment. Id. When an unlicensed person goes beyond the
role of a “scrivener” and engages in analysis of legal information, he or
she practices law. Sturgeon, 635 N.W.2d at 684.
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1. Representing another’s interest by assignment as unauthorized
practice of law. Using an assignment to render legal services to others
has long been considered the unauthorized practice of law in Iowa. See
Barnett, 235 Iowa at 313, 16 N.W.2d at 582. W. Thomas Barnett, a
nonattorney, contracted with “various creditors to collect their accounts
on a commission basis” by having the creditors assign him the claim and
“bringing suit . . . as assignee” on a pro se basis. Id. at 309, 16 N.W.2d
at 580. On appeal from the district court’s injunction, Barnett argued
such a practice was authorized. Id. at 312, 16 N.W.2d at 582. He noted
that statutes allowed “the assignment of a claim or debt and vest[ed] the
assignee with the right to maintain action thereon in his own name” and
that “a party may try his own case even in a court of record.” Id. We
held using an assignment to secure collection for third parties
constituted the practice of law:
Undoubtedly one might for example engage in the business
of buying claims as investments and might take assignments
of them to himself and maintain actions thereon in his own
name. But when he does not purchase the claims and only
takes colorable assignment of them so he may render or
cause to be rendered legal service to others and holds
himself out as engaged in such practice, it is a quite different
matter. In one case he is dealing in property on his own
account, in the other he is selling service and merely
adopting the guise of an investor to conceal the real nature
of his operations.
Id. at 313, 16 N.W.2d at 582. We cautioned if Barnett was truly
representing himself, his right to proceed pro se was “unquestionable.”
Id. But when he placed his action in his own name “so as to enable him
to render service to that other under the pretext of trying his own case,”
he engaged in the unauthorized practice of law. Id. We affirmed the
district court’s injunction. Id. at 318, 16 N.W.2d at 585.
18
We reaffirmed this principle over sixty years later in A–1
Associates, 623 N.W.2d at 803. A–1, a debt collection agency, received
assignments from creditors, collected on the debts pro se, and then
remitted the recoveries to the creditors after deducting a thirty to fifty
percent fee as compensation. Id. at 804. We held such assignments
constituted the unauthorized practice of law because they involved
representation of another’s legal interest. Id. at 808. A–1 effectively
pursued legal claims on its own behalf and on behalf of the creditors:
The assignment form executed by A–1’s clients
purports to transfer absolutely all right, title, and interest in
described accounts receivable owned by A–1’s clients. If
such instrument actually meant what it said, it would come
within the ordinary meaning of assignment—a transfer of the
assignor’s entire interest or rights in the property. . . .
A–1’s claimed status as a bona fide assignee is
defeated under this record, however, because the
assignment—though absolute in form—is, in fact, a transfer
intended primarily to secure payment for services rendered.
This is demonstrated by the fact that A–1 pays nothing for
the purported “assignment.” The letter accompanying the
“assignment” confirms that the creditor will receive the
proceeds of any recovery less a fixed sum representing A–1’s
commission for its services. In the case of small claims
litigation, those services are indisputably legal in nature.
Id. (citations omitted). When an individual uses an assignment and
pro se litigant status to represent another, the individual renders legal
services and engages in the unauthorized practice of law. See id.
Other courts have reached the same conclusion: a nonlawyer
cannot use an assignment “as a subterfuge to enable [a party] to indulge
his overwhelming desire to practice law, without complying with the
requirements for admission to the bar.” Biggs v. Schwalge, 93 N.E.2d
87, 88 (Ill. App. Ct. 1950); see also Todd v. Franklin Collection Serv., Inc.,
694 F.3d 849, 851–52 (7th Cir. 2012) (“By attempting to litigate
Fletcher’s claims through the guise of an assignment, Todd sought to
19
practice law without a license.”); In re Brooms, 447 B.R. 258, 266 (B.A.P.
9th Cir. 2011) (“If Jorgenson retained any interest in the Judgment or
any recovery thereon, then Carter was engaging in the unauthorized
practice of law by representing another party when he is not a licensed
attorney.”), aff’d, 520 F. App’x 569 (9th Cir. 2013); In re UPL Advisory Op.
2002–1, 591 S.E.2d 822, 823 (Ga. 2004) (per curiam) (“[I]f the purported
assignment from the physician is purely for the purpose of debt
collection on the physician’s behalf . . . , then the assignment is nothing
more than a means through which the collector is representing the
physician.”); In re Mills, 23 Haw. 224, 227 (1916) (“[Claims] that were
assigned . . . [through an agreement] he would undertake collection of
same and if successful pay to the assignor a stated sum . . . constituted
an evasion of the judgment of disbarment . . . .”); Toledo Bar Ass’n v.
Ishler, 339 N.E.2d 828, 830 (Ohio 1975) (per curiam) (stating
assignments were a “devious scheme” that was “contrived to circumvent
the . . . order of this court indefinitely suspending him from the practice
of law”).
The problem often arises when a business attempts to circumvent
rules requiring corporate representation by assigning its interests to a
shareholder, who then proceeds pro se. See In re Thomas, 387 B.R. 808,
815 (D. Colo. 2008) (collecting cases “demonstrating that courts will look
past legal title to determine whether a pro se purported assignee is
circumventing rules and statutes requiring that corporations be
represented by counsel in legal proceedings”). Here, the district court
properly looked behind the assignment and determined that Sullins was
effectively representing Sarita because she would receive amounts
collected beyond what she owed him. A contrary conclusion would allow
Sullins to practice law through the artifice of an assignment.
20
“Although our state law allows pro se litigants to represent their
own claims, it does not authorize pro se litigants to prosecute the claims
of others.” Yulin Li ex rel. Lee v. Rizzio, 801 N.W.2d 351, 360 (Iowa Ct.
App. 2011). In Rizzio, the court of appeals held a parent pursuing a loss-
of-consortium claim may represent himself, but not his minor child. Id.
at 359–60. Yulin Li, a nonlawyer, filed a district court lawsuit against a
babysitter alleging her negligence injured his son Gordon. Id. at 353.
His petition included two counts, one for Gordon’s injury and pain and
suffering, the other for Yulin’s loss of “society and services of a healthy
child.” Id. Yulin represented both Gordon and himself, “acting pro se for
his own claim and as next friend on behalf of Gordon.” Id. The court of
appeals concluded Yulin engaged in the unauthorized practice of law,
stating, “Yulin’s action—namely trying a personal-injury case on behalf
of his son—required the exercise of professional judgment.” Id. at 360.
Our laws allowing self-representation do not authorize a pro se litigant to
exercise professional judgment on behalf of another, even within the
same proceeding. Id.; see also Bergantzel v. Mlynarik, 619 N.W.2d 309,
313 (Iowa 2000) (negotiating an uninsured motorist settlement on behalf
of another constituted unauthorized practice of law).
We prohibit unlicensed persons from practicing law for good
reason. “[E]very man is entitled to receive legal advice from men skilled
in law, qualified by character, sworn to maintain a high standard of
professional ethics, and subject to the control and discipline of the
court.” Bump v. Dist. Ct., 232 Iowa 623, 639, 5 N.W.2d 914, 922 (1942).
Securing and litigating assignments that result in recovery for both the
assignee and assignor results in the public being cheated, “either by
receiving incompetent and unethical advice, or by being served by
lawyers who are not disinterested, whose real client is not the person
21
advised but the entrepreneur furnishing the services.” Id. (quoting Am.
Bar Ass’n, 66 Proceedings of Am. Bar Ass’n 268 (1941)). Such concerns
are not implicated when a party has independent, licensed
representation. Hauge Assocs., Inc. v. McGriff, 666 N.W.2d 151, 152
(Iowa 2003) (per curiam) (“The considerations involving the unauthorized
practice of law [with assignments] do not exist in the present case
because Hauge Associates, Inc. was, at all times, represented by a
licensed attorney.”). Nor are those concerns implicated when the
assignor retains no right of recovery and assigns all claims against the
target of collection. In that scenario, the assignee represents solely his or
her own interests and keeps one hundred percent of any recovery. But
that is not what we have here.
We also conclude Sullins practiced law by advising Sarita about
the effect of her assignment and selecting what years to assign based on
his knowledge of accrued child support obligations and interest rates on
judgments. See Office of Disciplinary Counsel v. Tagupa, No. 26762,
2016 WL 1219536, at *1 (Haw. Mar. 24, 2016) (determining suspended
attorney engaged in unauthorized practice by “interpreting relevant
statutes and case law, performing legal analysis and developing legal
strategies”); In re Disciplinary Action Against Ray, 610 N.W.2d 342, 346
(Minn. 2000) (per curiam) (concluding attorney engaged in unauthorized
practice while suspended when attorney accompanied friend to court and
advised on legal rights); In re Chavez, 1 P.3d 417, 424 (N.M. 2000)
(per curiam) (holding suspended attorney engaged in practice of law by
providing “advice and assistance” (quoting In re Herkenhoff, 931 P.2d
1382, 1384 (N.M. 1997) (per curiam)); Houts v. State ex rel. Okla. Bar
Ass’n, 486 P.2d 722, 725 (Okla. 1971) (“[S]election of forms by an
22
attorney, filling in the blank spaces, and making no charge for the
service constitute[d] practice of law.”).
Sullins was not engaged in assignments and debt collection as a
business enterprise like the assignees in A–1 or Barnett. But the
“definitive issue,” is whether Sullins’s “actions required the exercise of
professional judgment on a legal issue or question that affected the
rights of a third party.” Bergantzel, 619 N.W.2d at 313. Here, the
district court credited Sarita’s testimony stating amounts Sullins
recovered over the debt would be remitted to her. Sarita, therefore, still
maintained an interest in the assigned claim. We, too, credit her
testimony on that issue. The assignment nowhere provided that Sarita’s
indebtedness to Sullins was discharged. Every dollar he failed to collect
was a dollar she still owed him. Every dollar he collected above what she
owed him was money in her pocket. Sullins therefore effectively
represented both his own interest and Sarita’s in pursuing collection
from the estates. Each filing by Sullins ultimately aided Sarita in
collecting on the judgment. See Bump, 232 Iowa at 636, 5 N.W.2d at 920
(“[O]ne who, in a representative capacity, engages in the business of
advising clients as to their rights under the law, or while so engaged,
performs any act or acts either in court or outside of court for that
purpose, is engaged in the practice of law.” (quoting Liberty Mut. Ins. Co.
v. Jones, 130 S.W.2d 945, 954 (Mo. 1939) (en banc)).
Even if Sarita would not receive extra amounts Sullins recovered
on his assigned claims, the two remain intertwined in their interests in
maximizing the recovery from the estates. Sarita was piggybacking on
his collection efforts. She needed a lawyers’ expertise to intercept her
23
ex-husband’s inheritance from his parents’ estates. 4 Sullins and Sarita
effectively had a joint prosecution arrangement that poses potential
conflicts of interest. The estates could attempt to buy off Sullins to
undermine Sarita’s collection efforts. If an estate offered to settle for the
exact amount Sarita owed Sullins, would he abandon efforts to collect
more? Or if he settled his assigned claims for less than Sarita owed him,
would he forgive her remaining indebtedness? Was he continuing to loan
her money or pay her bills? The testimony is in conflict on key points,
and the key document—the assignment—is silent. Sullins could have
navigated around the grey areas by including explicit terms in the
assignment that discharged her indebtedness regardless of the amount
he collected. He failed to include such a provision. We construe the
assignment against Sullins, the disbarred lawyer, not against Sarita, his
debtor.
Sullins was already on notice that he was prohibited from using
assignments to represent others. Four years before Sarita’s assignment,
the Commission sent Sullins a cease and desist letter when he engaged
in similar misconduct. In Daggy v. Mersch, the Daggys asserted civil
claims against their farm tenants, the Mersches. After their attorneys
withdrew, the Daggys had fourteen days to secure new counsel.
No. LACV–017595, Ruling on Mot. to Recuse. The Daggys executed a
partial assignment giving Sullins a legal interest in the claim. 5 Id. They
4Sarita could have proceeded with a licensed attorney on a contingent or hourly
basis, with the lawyer paid from the recovery. She and Sullins chose to proceed without
separate representation through counsel of record for her in the probate proceedings.
We agree with the district court’s finding that she sought to save money by using a
disbarred attorney to represent her interests.
5The Daggy assignment is suspiciously similar to Sarita’s assignment. The
Daggy assignment states, “Mark C. Daggy and Lee Ann Daggy, for good and valuable
consideration, receipt of which is acknowledged, do hereby assign a 20% portion of their
24
then filed a motion to add Sullins to the action, “suggest[ing] that
Mr. Sullins will be serving as ‘attorney’ for Plaintiffs due to the
assignment and his claimed status as a ‘pro se’ party.” Id. The
defendants resisted, claiming “the assignment represents nothing more
than a poorly disguised 20% contingent fee arrangement with an
unlicensed attorney attempting to get back into the courtroom under the
guise of an assignment, masquerading as a pro se litigant.” Id. The
court found the Daggys’ attempt to add Sullins as a party was untimely.
Id. The court further ordered Sullins to recuse himself from the action:
In the opinion of this Court, to allow Mr. Sullins to proceed
under the facts and circumstances as noted would be in
total disregard of the earlier decision of the Iowa Supreme
Court [revoking Sullins’s license] and would further sanction
the unauthorized practice of law by a person not licensed to
do so within the State of Iowa. This Court will not permit
this to happen and so ORDERS.
Id.
“We expect lawyers and judges to learn from their mistakes.” In re
Krull, 860 N.W.2d 38, 40 (Iowa 2015). And we expect former lawyers to
learn from their mistakes as well. See id. Sullins, by means of Sarita’s
assignment, once again represented another’s interest in collection
litigation and thereby engaged in the unauthorized practice of law.
2. Drafting as unauthorized practice of law. “Giving legal advice,
directly or indirectly . . . concerning the application, preparation,
advisability or quality of any legal instrument or document or forms
thereof” constitutes the unauthorized practice of law. Baker, 492 N.W.2d
at 702 (quoting In re Fla. Bar, 215 So. 2d 613, 613–14 (Fla. 1968)
________________________
claims in this case to Ray Sullins.” Sarita’s assignment states “Sarita Henricksen for
good and valuable consideration receipt of which is hereby acknowledged assigns the
following judgments to Ray Sullins . . . .”
25
(per curiam)). This includes drafting pleadings and counseling clients on
which documents need to be filed. Sturgeon, 635 N.W.2d at 683
(“Clearly, Sturgeon counseled clients on which documents they needed to
file, and this has been held to be the practice of law.”); Bump, 232 Iowa
at 631, 5 N.W.2d at 918 (“There is no question that the preparation of
pleadings . . . by one not a member of a bar constitutes the illegal
practice of law.”). It also includes the act of drafting a filing for another
and allowing that person to submit it under his or her own name. See
Iowa Supreme Ct. Att’y Disciplinary Bd. v. Rauch, 746 N.W.2d 262, 265
(Iowa 2008) (noting “ghostwriting” for a pro se party could be considered
practicing law).
But a party does not practice law when he or she merely assumes
the role of a “scrivener.” Sturgeon, 635 N.W.2d at 684. In “ ‘determining
what is the unauthorized practice of law,’ ‘practical considerations and
common sense will prevail, not impractical and technical restrictions that
may hamper or burden the public interest with no reasonable
justification.’ ” Bergantzel, 619 N.W.2d at 316 (quoting In re Opinion No.
26, 654 A.2d 1344, 1354 (N.J. 1995)). In Sturgeon, we drew a line
between unauthorized drafting and filling blanks on preprinted forms.
635 N.W.2d at 682. We explained drafting became unauthorized practice
when “data entry (either by typewriter or computer) crosses the line
between copying written information provided by the client and oral
solicitation of the information necessary to fill out the documents
selected by the preparer.” Id. LeRoy Sturgeon helped clients in his office
prepare Chapter 7 bankruptcy documents. Id. at 680. Sturgeon claimed
he “merely typed information, furnished by his clients, into preprinted
forms.” Id. at 682. But Sturgeon did more than that; he “drew on his
26
knowledge and experience in bankruptcy matters” in representing
clients:
Sturgeon conducted an initial interview to solicit
information, which he then typed into the computer. He also
advised clients to bring certain information with them to the
interview. . . . Clearly, Sturgeon counseled clients on which
documents they needed to file, and this has been held to be
the practice of law.
Id. at 683. We held “Sturgeon’s assistance in the preparation of
bankruptcy documents went far beyond the role of a scrivener and
constituted the unauthorized practice of law. Id. at 684.
Considering Sullins’s services from this perspective, we
acknowledge there is no evidence Sullins physically drafted any filings for
Sarita. Sarita testified Redenbaugh or Wieslander instructed her about
how to draft her March 3 filings, and she wrote them herself at the
courthouse. The record reveals Sarita’s filings consisted of the caption
and one line in the body, stating she joined Sullins’s motions. It is
apparent Sarita copied Sullins’s captions—typos included. Although
Sullins did not physically draft Sarita’s filings, he guided her through his
own motions, which he suggested Sarita join. He acknowledged advising
Sarita with respect to her filings, including the legal effect of joining the
252K motion and the desirability of assigning certain years of her claim.
The record shows Sullins went beyond a mere scrivener of legal
information. He selected a particular course of action and advised Sarita
about its desirability and effects. We believe this invokes the
professional judgment ordinarily used by one who is engaged in the
practice of law.
27
IV. Disposition.
We affirm the district court’s determination that Sullins engaged in
the unauthorized practice of law and affirm the district court’s
injunction.
DISTRICT COURT INJUNCTION AFFIRMED.