ILNews

Report issued in UPL claim on trust mill case

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The Indiana Supreme Court has never determined whether the money spent during the prosecution of an Unauthorized Practice of Law claim fits into the "costs and expenses incurred by such a hearing" category, which means that a losing party pays under Administrative Disciplinary Rule 24.

Justices may now have that chance as they consider whether an estate planning company engaged in unlawful legal work.

Presenting an issue of first impression, a special commissioner on Monday submitted an 88-page report to the state's highest court regarding a UPL claim brought by the ISBA last October in a trust mill case, State of Indiana, Ex Rel. Indiana State Bar Association v. United Financial Services, et al., No. 94S00-0810-MS-551.

ISBA initiated the action against estate planning service United Financial Systems in Indianapolis, accusing it of operating a trust mill that engaged in unauthorized practice of law and wrongly collecting more than $1 million from at least five families throughout the state. A total of five counts are made in ISBA's action - one for each person or couple who bought an estate-planning package with United Financial.

In March, Senior Judge Bruce Embrey from Miami Superior Court was brought on as a special commissioner to consider the facts in this case. He held an out-of-court, two-day trial in late May and has now given his findings to the state's justices to determine whether any UPL occurred.

As part of his 266 findings of fact and conclusions of law, Judge Embrey noted that between October 2006 and March 29, 2009, about 0.09 percent of United Financial's total income from all national operations came from estate planning assistance in Indiana; 18.8 percent of the fee income generated nationally came from Indiana estate planning services.

Aside from requests that United Financial permanently stop any UPL in Indiana, ISBA also asks that the Supreme Court order a disgorgement of fees and reimbursement of money collected by the company to those people affected.

Judge Embrey notes that ISBA has never settled a UPL case in exchange for money from an individual or corporation accused of violating the state provisions, and that no costs or fees have been received by ISBA in the course of processing these cases.

In the instant case, ISBA paid about $25,882 to various vendors for copies and transcripts, and paid an attorney who testified in rebuttal to the company's evidence. ISBA also paid $11,093 to Indianapolis law firm Bingham McHale for legal counsel on this case, copies, long-distance phone calls, and other routine office expenses. The report details nearly $36,975 in expenses.

However, Judge Embrey points out that the terms "costs and expenses incurred by such a hearing" in the context of Administrative Disciplinary Rule 24, which are to be paid by the losing party, have not been defined by the court.

"Including the cost to the ISBA of engaging counsel to prosecute a UPL claim pursuant to Rule 24 is a matter of first impression," he wrote.

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  1. Hmmmmm ..... How does the good doctor's spells work on tyrants and unelected bureacrats with nearly unchecked power employing in closed hearings employing ad hoc procedures? Just askin'. ... Happy independence day to any and all out there who are "free" ... Unlike me.

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  3. The practitioners and judges who hail E-filing as the Saviour of the West need to contain their respective excitements. E-filing is federal court requires the practitioner to cram his motion practice into pigeonholes created by IT people. Compound motions or those seeking alternative relief are effectively barred, unless the practitioner wants to receive a tart note from some functionary admonishing about the "problem". E-filing is just another method by which courts and judges transfer their burden to practitioners, who are the really the only powerless components of the system. Of COURSE it is easier for the court to require all of its imput to conform to certain formats, but this imposition does NOT improve the quality of the practice of law and does NOT improve the ability of the practitioner to advocate for his client or to fashion pleadings that exactly conform to his client's best interests. And we should be very wary of the disingenuous pablum about the costs. The courts will find a way to stick it to the practitioner. Lake County is a VERY good example of this rapaciousness. Any one who does not believe this is invited to review the various special fees that system imposes upon practitioners- as practitioners- and upon each case ON TOP of the court costs normal in every case manually filed. Jurisprudence according to Aldous Huxley.

  4. Any attorneys who practice in federal court should be able to say the same as I can ... efiling is great. I have been doing it in fed court since it started way back. Pacer has its drawbacks, but the ability to hit an e-docket and pull up anything and everything onscreen is a huge plus for a litigator, eps the sole practitioner, who lacks a filing clerk and the paralegal support of large firms. Were I an Indiana attorney I would welcome this great step forward.

  5. Can we get full disclosure on lobbyist's payments to legislatures such as Mr Buck? AS long as there are idiots that are disrespectful of neighbors and intent on shooting fireworks every night, some kind of regulations are needed.

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