Miami County Bar Ass'n v. Wyandt & Silvers, Inc. ( 2005 )

[Cite as Miami Cty. Bar Assn. v. Wyandt & Silvers, Inc., 107 Ohio St. 3d 259, 2005-Ohio-6430.]
MIAMI COUNTY BAR ASSOCIATION v. WYANDT & SILVERS, INC. ET AL.
[Cite as Miami Cty. Bar Assn. v. Wyandt & Silvers, Inc.,
107 Ohio St. 3d 259, 2005-Ohio-6430.]
Unauthorized practice of law enjoined—Advice on choice of business structure—
Civil penalty imposed.
(No. 2004-2176 – Submitted August 23, 2005— Decided December 21, 2005.)
ON FINAL REPORT by the Board on the Unauthorized Practice of Law of the
Supreme Court, No. UPL 04-02.
__________________
Per Curiam.
{¶ 1} On February 11, 2004, relator, Miami County Bar Association,
charged that respondents, Roland A. Wyandt of Piqua, Ohio, and Wyandt &
Silvers, Inc., a company that provides tax preparation and bookkeeping services in
Piqua, had engaged in the unauthorized practice of law. The complaint alleged
that Wyandt, acting on behalf of Wyandt & Silvers, had provided legal advice to
his customers about how and whether to incorporate certain Ohio businesses and
then prepared the necessary corporate documents. Similar charges were lodged
against Katherine J. Silvers, respondents’ associate, but these were ultimately
dismissed for lack of evidence.
{¶ 2} After respondents were served with the complaint, Wyandt
responded to the allegations in a letter dated March 1, 2004. He argued that his
knowledge of corporate law, obtained in earning his accounting degree, qualified
him to counsel clients as to the legal requirements and implications of the various
corporate structures. He sent the letter to relator in care of the Miami County Law
Library, and a librarian forwarded it to relator’s attention. Relator received
nothing else in answer to the complaint
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{¶ 3} The Board on the Unauthorized Practice of Law heard the cause on
November 17, 2004. Silvers appeared pro se. Wyandt was served with notice of
the proceedings but did not appear.
{¶ 4} Evidence substantiated that Wyandt & Silvers, Inc. is an Ohio
corporation created in 1999 and that Wyandt and Silvers are the two principal
shareholders. Wyandt is not and has never been admitted to the practice of law in
this state. Acting on behalf of Wyandt & Silvers, Inc. after 1999, however,
respondent Wyandt gave legal advice to and prepared legal documents for clients
who inquired about setting up various businesses under Ohio law. Charging
hundreds of dollars in fees, Wyandt advised at least five different clients — the
founders of B.A.D. Trucking, Inc, UR Square, Inc., Vulchers Row, Inc., and
Multi Clean, Inc., and the cofounder of Finishing Touches, Etc., Inc. – about
advantages and disadvantages associated with incorporation, although he
sometimes also mentioned partnerships and other business structures. For each
corporation, Wyandt then filled out and perhaps filed basic forms available from
the Ohio Secretary of State to establish articles of incorporation and appoint a
statutory agent.
{¶ 5} The board concluded that respondents’ actions constituted the
unauthorized practice of law and recommended that we enjoin them from
engaging in such practices in the future. The board also recommended that we
impose a $20,000 civil penalty against respondents, representing $4,000 for each
offense.
{¶ 6} The board specified the factors justifying the penalty. First,
despite sufficient notice, Wyandt did not appear at any of the board proceedings.
Wyandt had also flagrantly engaged in the unauthorized practice of law on at least
five occasions, causing harm to those who relied on him to practice only within
the field of his professional competence.
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January Term, 2005
{¶ 7} Pursuant to Gov.Bar R. VII(8)(B)(5), allowing consideration of
other relevant factors, the board also relied on Wyandt’s recidivism as
justification for the civil penalty. In 1995, the Miami County Court of Common
Pleas ordered Wyandt to cease practicing law without a license after finding that
he and his former firm, Wyandt & Associates, had prepared wills, leases, trusts,
and articles of incorporation for others and had advised others on the legal
consequences of their actions, all in violation of R.C. 4705.01. Miami Cty. Bar
Assn. v. Wyandt (Mar. 31, 1995), Miami C.P. No. 94-371.
{¶ 8} Respondents have not filed objections to the board’s findings and
recommendation.
{¶ 9} Upon review, we agree that respondents engaged in the
unauthorized practice of law and that an injunction is warranted. Pursuant to
Gov.Bar R. VII(19)(D)(1)(c), we further agree that respondents’ illegal conduct
calls for the recommended $20,000 civil penalty. See, e.g., Toledo Bar Assn. v.
Chelsea Title Agency of Dayton, Inc., 100 Ohio St. 3d 356, 2003-Ohio-6453, 800
N.E.2d 29.
{¶ 10} Section 2(B)(1)(g), Article IV of the Ohio Constitution confers on
this court original jurisdiction over all matters related to the practice of law. A
person who is not admitted to practice law in Ohio under Gov.Bar R. I and is not
granted active status under Gov.Bar R. VI or certified under Gov.Bar R. II, IX, or
XI engages in the unauthorized practice of law when he or she provides legal
services to another. Gov.Bar R. VII(2)(A); see, also, R.C. 4705.01.
{¶ 11} “[T]he practice of law is not limited to appearances in court, but
also includes giving legal advice and counsel and the preparation of legal
instruments and contracts by which legal rights are preserved.” Cleveland Bar
Assn. v. Misch (1998), 82 Ohio St. 3d 256, 259, 695 N.E.2d 244; Land Title
Abstract & Trust Co. v. Dworken (1934), 129 Ohio St. 23, 28, 1 Ohio Op. 313, 193
N.E. 650. Moreover, a corporation cannot lawfully engage in the practice of law
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through its officers who are not licensed to practice law. Cincinnati Bar Assn. v.
Clapp & Affiliates Financial Serv., Inc. (2002), 94 Ohio St. 3d 509, 764 N.E.2d
1003; Disciplinary Counsel v. Lawlor (2001), 92 Ohio St. 3d 406, 750 N.E.2d
1107; Union Sav. Assn. v. Home Owners Aid, Inc. (1970), 23 Ohio St. 2d 60, 52
O.O.2d 329, 262 N.E.2d 558. Furthermore, an accountant unlicensed in law
engages in the unauthorized practice by drafting documents to create a business
entity for a client. In Columbus Bar Assn. v. Verne, 99 Ohio St. 3d 50, 2003-Ohio-
2463, 788 N.E.2d 1064, ¶ 5, we explained:
{¶ 12} “While we recognize that certified public accountants perform a
valuable function in advising on financial matters in the formation of a company,
such as how best to structure a business entity for tax benefits, there are still many
remaining issues that require legal analysis in choosing a business structure. This
case highlights the dangers when those lines are blurred. In this case, respondent
helped his clients choose a business structure, a decision that ordinarily requires a
significant amount of legal judgment in addition to tax and other accounting
considerations. Clients need to know the legal differences between and
formalities of available structures and then be advised according to their best
interests, taking into account personal and practical concerns, not just tax
consequences. Where there is more than one principal involved in the venture,
the existing and potential conflicts also must be assessed. This undertaking is
hardly the clerical service that respondent insists he performed and that is
permissible under Gustafson v. V.C. Taylor & Sons, Inc. (1941), 138 Ohio St.
392, 20 Ohio Op. 484, 35 N.E.2d 435. To the contrary, respondent’s advice to his
clients about which business structure they should choose is just what Gustafson
determined to be the unlicensed practice of law. Id. at 397, 35 N.E.2d 435, 20
Ohio Op. 484.”
{¶ 13} Respondents are therefore enjoined from engaging in the
unauthorized practice of law in Ohio, including the preparation on another’s
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January Term, 2005
behalf of legal papers necessary to form a business entity under the laws of Ohio.
Moreover, because a civil penalty furthers the purposes of Gov.Bar R. VII,
respondents are hereby fined $20,000. Costs are taxed to respondents.
Judgment accordingly.
MOYER, C.J., RESNICK, PFEIFER, LUNDBERG STRATTON, O’CONNOR,
O’DONNELL and LANZINGER, JJ., concur.
__________________
Dysinger, Stewart & Downing, L.P.A., and Bryan K. Stewart; and James
Bennett, for relator.
______________________
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