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Rogers Townsend & Thomas, PC v. Peck

Supreme Court of South Carolina

February 22, 2017

Rogers Townsend & Thomas, PC, Petitioner/Respondent,
v.
Stephen H. Peck, Thomas Moore, and Community Management Group, LLC, Respondents/Petitioners. Appellate Case No. 2011-199626

          Heard November 7, 2016

         IN THE ORIGINAL JURISDICTION

          Robert P. Wood, of Rogers Townsend & Thomas, PC, of Columbia, for Petitioner/Respondent.

          Matthew Evan Pecoy and Peter Gerard McGrath, both of McGrath Law Firm, PA, of Mt. Pleasant, for Respondents/Petitioners.

          PER CURIAM:

         The Court accepted this declaratory judgment action in our original jurisdiction to determine whether Community Management Group, LLC; its president, Stephen Peck; and its employee, Tom Moore, engaged in the unauthorized practice of law while managing homeowners' associations. We find Community Management Group engaged in the unauthorized practice of law.

         I. Background

         Community Management Group manages homeowners' associations and condominium associations in Charleston, Dorchester, and Berkeley Counties. The company manages the associations' grounds and common areas, enforces covenants and rules, and takes care of financial matters, including collecting assessments for the associations. Until we issued a temporary injunction in connection with this case, when a homeowner in an association did not pay an overdue assessment, Community Management Group-without the involvement of an attorney-prepared and recorded a notice of lien and related documents; brought an action in magistrate's court to collect the debt; and after obtaining a judgment in magistrate's court, filed the judgment in circuit court. Community Management Group also advertised that it could perform these services.

         We referred the case to the Honorable Stephanie P. McDonald[1] to act as special referee. Judge McDonald recommended we find Community Management Group engaged in the unauthorized practice of law.

         II. Unauthorized Practice of Law

         The supreme court has the power to regulate the practice of law. See S.C. Const. art. V, § 4; S.C. Code Ann. § 40-5-10 (2011) (recognizing "[t]he inherent power of the Supreme Court with respect to regulating the practice of law"); Linder v. Ins. Claims Consultants, Inc., 348 S.C. 477, 486, 560 S.E.2d 612, 617 (2002) ("Under the South Carolina Constitution, this Court has the duty to regulate the practice of law in South Carolina."). Generally, the practice of law includes "the preparation of pleadings, and other papers incident to actions and special proceedings, and the management of such actions and proceedings on behalf of clients before judges and courts." State v. Despain, 319 S.C. 317, 319, 460 S.E.2d 576, 577 (1995) (quoting In re Duncan, 83 S.C. 186, 189, 65 S.E. 210, 211 (1909)). The practice of law "extends to activities . . . which entail specialized legal knowledge and ability." Linder, 348 S.C. at 487, 560 S.E.2d at 617 (quoting State v. Buyers Serv. Co., Inc., 292 S.C. 426, 430, 357 S.E.2d 15, 17 (1987)). "Other than these general statements, there is no comprehensive definition of the practice of law. Rather, what constitutes the practice of law must be decided on the facts and in the context of each individual case." Roberts v. LaConey, 375 S.C. 97, 103, 650 S.E.2d 474, 477 (2007) (citing Linder, 348 S.C. at 487, 560 S.E.2d at 617-18); see also Medlock v Univ. Health Serv., Inc., 404 S.C. 25, 28, 743 S.E.2d 830, 831 (2013) ("We have encouraged any interested individual to bring a declaratory judgment action in this Court's original jurisdiction to determine the validity of any questionable conduct.").

         III. Agent

         In an administrative order titled In re Unauthorized Practice of Law Rules Proposed by South Carolina Bar, 309 S.C. 304, 422 S.E.2d 123 (1992), we modified prior case law to "allow a business to be represented by a non-lawyer officer, agent or employee." 309 S.C. at 306, 422 S.E.2d at 124 (modifying State ex rel. Daniel v. Wells, 191 S.C. 468, 5 S.E.2d 181 (1939)). We also promulgated South Carolina Magistrate Court Rule 21, which provides, "A business . . . may be represented in a civil magistrates court proceeding by a non-lawyer officer, agent, or employee . . . ."

         The central question of this action is whether the word "agent" in Unauthorized Practice of Law and Rule 21 includes a third party agent like Community Management Group. We find "agent" does not include non-lawyer third party entities or individuals. "Agent"-in Unauthorized Practice of Law and Rule 21-includes individuals who are not officers or employees of a business, but who have some nexus or connection to the business arising out of its corporate structure. For example, a member of a corporation's board of directors who is not an officer or employee would qualify as an "agent" under these provisions. However, we now clarify ...


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