ILNews

Class action alleges UPL

Back to TopCommentsE-mailPrintBookmark and Share

The gift of estate planning services that Portland, Ind., resident Jeffrey G. Corle and his wife received in 2010 seemed at first like a thoughtful and worthwhile investment in their future.

The couple felt that way about the gift until questions about Unauthorized Practice of Law began drawing attention away from what the estate planning package offered and focused on what was not included: adequate lawyer involvement.

massillimany-mario-mug Massillamany

Now, the Jay County man is the lead plaintiff in a class-action lawsuit in the Northern District of Indiana that aims not only to recover the $2,495 paid to Michigan-based Estate Planning and Preservation Inc. but also alleges the company was engaged in UPL when it sold the estate planning package to Corle without adequate lawyer involvement.

Whether those estate planning services actually constitute UPL, though, is a question that makes this case stand out as one that may break new legal ground for Indiana. The state Supreme Court hasn’t weighed in on Estate Planning and Preservation and its activity possibly being UPL, typically the first step in actions accusing a person or business of practicing law without a license.

The Logansport law firm Starr Austen & Miller that filed Corle’s suit is applying the Indiana Supreme Court’s decision last year in Indiana State Bar Association v. United Financial Systems Corp., 926 N.E.2d 8 (Ind. 2010), as the basis for this new class-action claim. The lawyers contend that case set the standard for what is and isn’t UPL in Indiana and that it offers guidelines that can be applied to future litigation without first obtaining that determination from state justices as required by court rule and the state constitution.

“This is almost a mirror image of what United Financial did with their course of conduct determined to be illegal,” said attorney Mario Massillamany with Starr Austen & Miller. “We don’t believe there’s any distinction between the two, and there’s no question now what UPL in Indiana is when it comes to this kind of conduct. The justices were pretty detailed in their analysis, and just like any precedent you take this caselaw and apply it to the facts here.”

In United Financial, the Supreme Court examined the Indianapolis company’s activity after the Indiana State Bar Association filed a trust mill suit in 2008. The justices in April 2010 ruled that the company had engaged in UPL based on how it offered estate planning services: a non-attorney salesperson contacts and sells the product, receives the money up front, then passes that information on to a panel attorney who contacts the client by phone and reviews the documents as previously written before returning them to United Financial Systems Corp. for final approval before delivery.

Finding that to be UPL, the justices ordered that customers be notified and reimbursed, but that didn’t happen and the court has since appointed former Monroe Superior Judge Viola Taliaferro as commissioner to preside over the refund and attorney fee matters.

UFSC officials Richard and Beau Follett and Richard L. Follett II failed to appear at a hearing in late June and the commissioner issued warrants for their arrest. But Judge Taliaferro has agreed to stay those warrants temporarily and give the Folletts another chance to appear and post a $50,000 certified check for refunds to those who purchased estate plans from the company. Two class-action lawsuits have been lodged against UFSC, which had its business license revoked in April by the Indiana Department of Insurance. Those lawsuits are pending in state courts. Starr Austen & Miller is one of the firms representing plaintiffs in the Fulton County action, while Cohen & Malad in Indianapolis is handling the other one in Marion County. Both are on hold as the ISBA’s case and the Follett bench warrant issues are resolved.

But even as the UFSC case continues, Massillamany says the specific UPL decision from United Financial is precedent that can be applied to Corle’s case involving Estate Planning and Preservation, an insurance marketing agency that Marie-Dawn Joseph of southern Michigan founded in 2001.

McGoff Kevin McGoff

The business plan calls for convincing senior citizens and retirees to “avoid probate” and purchase a living trust package sold by EPP, the suit says. Much like UFSC, this company operates by soliciting to potential clients and then having a salesperson obtain financial information and sell legal documents such as a living trust, power of attorney, pour over will, deeds and living will. No attorney is involved when these documents are reviewed and sold, the suit says, and the standard price for a living will package is $2,495.

After the money is obtained, information is routed through Joseph’s husband’s law firm, Joseph & Associates. Her husband, Paul T. Joseph, has been a Michigan attorney since 1982, and both he and attorney Amanda Klaiss, who handled the EPP legal services, reviewed and made phone contact with the clients, the suit says. A client’s information is inserted into “boiler plate language” in the forms, the suit claims.

The suit states that Corle’s father in March 2010 paid EPP a premium of $2,495 for a living trust package for Corle and his wife, Kay. The representative didn’t ask about existing estate plans and Corle never met with Klaiss, who was assigned to the case.

The suit asks for disgorgement of fees as a result of the UPL (which the Indiana Supreme Court ordered in United Financial), and alleges constructive fraud, contractual invalidity, conversion, and legal malpractice claims against the law firm and attorneys.

The question of whether the federal court applies the state justices’ UPL holding may not survive. U.S. Magistrate Judge Roger Cosby has issued an order describing the class action and diversity of citizenship jurisdiction claims in the suit “woefully inadequate” and wants an amended complaint by the end of July.

Whether the United Financial holding can be applied to this and future UPL actions is unclear.

Both Article 7, Section 4 of the Indiana Constitution and Indiana Code 33-24-1-2 give the state’s highest court exclusive jurisdiction over UPL matters, and a specific passage from the justices in United Financial says they have not previously nor would they in that ruling attempt to provide “a comprehensive definition because of the infinite variety of fact situations.”

The Indiana attorney general’s office takes the position that United Financial would be precedential in other cases that might be factually similar to it, according to Deputy Attorney General Abigail Kuzma. But the Indiana Supreme Court maintains original jurisdiction on any UPL action and state courts, not federal, would generally be involved.

Indianapolis attorney Don Lundberg, the longtime Disciplinary Commission leader who left that position in 2010, said the issue is complicated. If a case is filed under diversity jurisdiction, Lundberg said it’s an interesting question whether a federal court sitting in diversity can enforce Indiana UPL as interpreted by the justices in UFSC when there’s a specific constitutional provision and state court rule that limits UPL jurisdiction to original actions before the justices, and seems to limit standing to seek injunctive relief.

Kevin McGoff, the Indianapolis attorney with Bingham McHale who represented the ISBA on United Financial, also found interesting the interplay between state court rules and procedure and this federal class-action claim.

“I can certainly appreciate how they’d adopt that theory on how the Supreme Court has reviewed this behavior and decided it’s UPL, as support for a civil claim,” he said. “If you look at caselaw in Indiana and the nation, you’ll find a lot of cases that define what the practice of law is in various states and jurisdictions. By the same token, you’ll find cases defining UPL and all those definitions could be dropped in state or federal court to use as precedent. But obviously, it’s up to the court to see if they’re willing to.”•

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. The voices of the prophets are more on blogs than subway walls these days, Dawn. Here is the voice of one calling out in the wilderness ... against a corrupted judiciary ... that remains corrupt a decade and a half later ... due to, so sadly, the acquiescence of good judges unwilling to shake the forest ... for fear that is not faith .. http://www.ogdenonpolitics.com/2013/09/prof-alan-dershowitz-on-indiana.html

  2. So I purchased a vehicle cash from the lot on West Washington in Feb 2017. Since then I found it the vehicle had been declared a total loss and had sat in a salvage yard due to fire. My title does not show any of that. I also have had to put thousands of dollars into repairs because it was not a solid vehicle like they stated. I need to find out how to contact the lawyers on this lawsuit.

  3. It really doesn't matter what the law IS, if law enforcement refuses to take reports (or take them seriously), if courts refuse to allow unrepresented parties to speak (especially in Small Claims, which is supposedly "informal"). It doesn't matter what the law IS, if constituents are unable to make effective contact or receive any meaningful response from their representatives. Two of our pets were unnecessarily killed; court records reflect that I "abandoned" them. Not so; when I was denied one of them (and my possessions, which by court order I was supposed to be able to remove), I went directly to the court. And earlier, when I tried to have the DV PO extended (it expired while the subject was on probation for violating it), the court denied any extension. The result? Same problems, less than eight hours after expiration. Ironic that the county sheriff was charged (and later pleaded to) with intimidation, but none of his officers seemed interested or capable of taking such a report from a private citizen. When I learned from one officer what I needed to do, I forwarded audio and transcript of one occurrence and my call to law enforcement (before the statute of limitations expired) to the prosecutor's office. I didn't even receive an acknowledgement. Earlier, I'd gone in to the prosecutor's office and been told that the officer's (written) report didn't match what I said occurred. Since I had the audio, I can only say that I have very little faith in Indiana government or law enforcement.

  4. One can only wonder whether Mr. Kimmel was paid for his work by Mr. Burgh ... or whether that bill fell to the citizens of Indiana, many of whom cannot afford attorneys for important matters. It really doesn't take a judge(s) to know that "pavement" can be considered a deadly weapon. It only takes a brain and some education or thought. I'm glad to see the conviction was upheld although sorry to see that the asphalt could even be considered "an issue".

  5. In response to bryanjbrown: thank you for your comment. I am familiar with Paul Ogden (and applaud his assistance to Shirley Justice) and have read of Gary Welsh's (strange) death (and have visited his blog on many occasions). I am not familiar with you (yet). I lived in Kosciusko county, where the sheriff was just removed after pleading in what seems a very "sweetheart" deal. Unfortunately, something NEEDS to change since the attorneys won't (en masse) stand up for ethics (rather making a show to please the "rules" and apparently the judges). I read that many attorneys are underemployed. Seems wisdom would be to cull the herd and get rid of the rotting apples in practice and on the bench, for everyone's sake as well as justice. I'd like to file an attorney complaint, but I have little faith in anything (other than the most flagrant and obvious) resulting in action. My own belief is that if this was medicine, there'd be maimed and injured all over and the carnage caused by "the profession" would be difficult to hide. One can dream ... meanwhile, back to figuring out to file a pro se "motion to dismiss" as well as another court required paper that Indiana is so fond of providing NO resources for (unlike many other states, who don't automatically assume that citizens involved in the court process are scumbags) so that maybe I can get the family law attorney - whose work left me with no settlement, no possessions and resulted in the death of two pets (etc ad nauseum) - to stop abusing the proceedings supplemental and small claims rules and using it as a vehicle for harassment and apparently, amusement.

ADVERTISEMENT