Supreme Court will wait before considering UPL exemptions

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Should a parent hoping to establish and manage a bank account for a child have to talk to an attorney first?

The answer could be yes, according to Richard R. McGuigan, executive vice president of the Community Bankers of Wisconsin (CBW), depending on which version, if any, of a petition to define the unauthorized practice of law the Wisconsin Supreme Court adopts.

But any decision by the Supreme Court will have to wait, after all seven justices unanimously agreed on April 24 to hold over the petition for review.

“The rule as proposed would not ever allow us to offer advice on those kinds of accounts and customers would have to contact an attorney first,” said McGuigan. “That makes no sense, especially since I’d imagine most attorneys are not well-versed in things related to banking.”

CBW, the Wisconsin Bankers Association and the Wisconsin Credit Union League jointly drafted an exemption to include:

“Any state or federally chartered institution or affiliate of such a financial institution, when engaging in an activity that is within its authority under applicable state or federal law, including any person providing services for it in connection with that activity.”

Acutely aware of similar objections raised by bankers, public accountants and insurance agents, the State Bar requested that the court delay any discussion on the proposal. The request came less than 12 hours before a revised version of petition 07-09 was to be reviewed by the justices.

“Although some of the proposed exceptions were not objectionable to the bar, we needed more time to consider the rest of them,” said State Bar President Thomas J. Basting, Sr., who did not cite any specific exemptions which the bar opposes.

McGuigan and officials from almost 12 other professional organizations submitted exemptions for routine business situations, such as an adult opening a bank account for a minor, and suggested that those activities should not be targeted as the unauthorized practice of law.

Basting has repeatedly indicated that the goal of the petition is not to regulate routine day-to-day practices of legitimate businesses, but to clamp down on people who purposely provide legal services and advice, illegally.

Despite the delay, Basting is confident that a compromise can be reached to “preserve the current practices of other groups who have expressed concerns” and provide maximum protection to consumers of legal services.

“I'm sure that the court is also concerned about that so we asked the court to put this over until early in their next term so we can be sure that we deal with all of the issues, and not make any hasty decisions,” said Basting.

During initial discussion of the petition on March 14, several justices wondered whether any draft could satisfy all interested parties and attorney Thomas D. Zilavy, chairman of the Bar’s Unauthorized Practice of Law Committee, said a “substantially diluted” version of the rule would defeat its purpose of consumer protection.

No timetable has been set for the court to revisit the proposal, which, along with a definition of what constitutes the unauthorized practice of law, will include a mechanism for enforcement.

On April 24, Chief Justice Shirley S. Abrahamson noted that while numerous organizations drafted exemptions, each of them still preferred that there be no rule at all.

“It’s my understanding that their first choice would be to have no rule at all, and the second choice is to exclude them if one is adopted,” said Abrahamson.

McGuigan said he was pleased with initial discussion by members of the court in March, but he has yet to get any feedback from bar leaders on the proposed exemptions for the banking industry.

“At this point, if it’s revised in accordance with discussion of Supreme Court, I don’t think we’ll have a problem,” said McGuigan. “Beyond that, we’d probably be pleased if it just remained it was it is, with no rule.”