Bar Rules

UPL Advisory Opinion No. 2004-1

State Bar Programs / Part XIV - Rules Governing the Investigation and Prosecution of the Unlicensed Practice of Law / Unlicensed Practice of Law Advisory Opinions / UPL Advisory Opinion No. 2004-1

Issued by the Standing Committee on the Unlicensed Practice of Law on August 6, 2004.
Note:  This opinion is only an interpretation of the law, and does not constitute final action by the Supreme Court of Georgia.  Unless the Court grants review under Bar Rule 14-9.1(g), this opinion shall be binding only on the Standing Committee on the Unlicensed Practice of Law, the State Bar of Georgia, and the petitioner, and not on the Supreme Court of Georgia, which shall treat the opinion as persuasive authority only.

QUESTION PRESENTED
Is the preparation or filing of a lien considered the unlicensed practice of law if it is done by someone other than the lienholder or a licensed Georgia attorney?

SUMMARY ANSWER
A nonlawyer's preparation of a lien for another in exchange for a fee is the unlicensed practice of law.  The ministerial act of physically filing a lien with a court is not the practice of law.

OPINION
There are two components to the question presented above, viz., the preparation of a lien and the filing of a lien.  With regard to the latter, the Committee is of the opinion that the mere ministerial act of physically filing a lien with a court does not in itself constitute the practice of law. 

As far as the preparation of a lien, the Committee looks in part to O.C.G.A. §15-19-50(3), which states that the practice of law includes "[t]he preparation of legal instruments of all kinds whereby a legal right is secured."  The Supreme Court of Georgia has recently indicated that O.C.G.A. §15-19-50(3) continues to aid the judiciary in the performance of its functions with regard to defining the practice of law in this state.  In re UPL Advisory Opinion 2003-2, 277 Ga. 472, 474 (2003).  See also In re UPL Advisory Opinion 2002-1, 277 Ga. 521, 522 (2004).

A lien is "'a hold or claim which one person has on the property of another as a security for some debt or charge.'"  Waldroup v. State, 198 Ga. 144, 149 (1944).  See also Miller v. New Amsterdam Cas. Co., 105 Ga. App. 174, 176 (1961).  With regard to real estate, a lien encumbers title.  Lincoln Log Homes Mktg., Inc., v. Holbrook, 163 Ga. App. 592, 594 (1982).  There are a variety of liens available under Georgia law.  See, e.g., O.C.G.A. §44-14-320.  They may vary as to the particulars of their operation, but all assert the perceived rights of the lienholder.  A lien affects the status of title as to the relevant property, and is an instrument designed to secure a legal right.  It follows that under O.C.G.A. §15-19-50(3) the preparation of a lien constitutes the practice of law.

During the public hearing regarding this matter, the Committee heard a presentation made by a nonlawyer business entity that prepares mechanics' and materialmen's liens for others.  The customer provides the company with relevant background information, and the company performs a title search, prepares a legal description of the property, and inserts the description into the lien document.  The company then prints the lien, files it with the appropriate court, and provides notice to the property owner.  According to the company, its employees do not provide legal advice to the customer.  The company claims that this activity is not the practice of law, notwithstanding the existence of O.C.G.A. §15-19-50(3).

The company first asserts that its activity is essentially tantamount to performing a title search and preparing an abstract of title, an activity allowed by O.C.G.A. §15-19-53.  An abstract of title "should be a complete showing in more or less abbreviated form of all instruments appearing of record in any way affecting the title, either adversely or beneficially...." 3 Hinkel, Pindar's Georgia Real Estate Law and Procedure, §26-7, p. 44 (6th ed. 2004).  In the Committee's view, it is not proper to equate a title search or abstract of title with a lien.  As noted above, an abstract identifies a lien; it is not itself a lien.  Moreover, an abstract, being a history of the title to land, is at its core a neutral, informational document.  A lien, on the other hand, asserts a legal claim.  Given the foregoing, it would be unreasonable to read O.C.G.A. §15-19-53 as extending to the preparation of liens.

In the alternative, the company states that its activity is allowed under O.C.G.A. §15-19-52, which does not prohibit drafting a legal instrument for another "provided it is done without fee and solely at solicitation and the request and under the direction of the person, firm, or corporation desiring to execute the instrument."  The company claims that it collects a fee from its customer solely for preparing an abstract of title or providing a legal description of the property, and that it then prepares the lien free of charge.

The Committee views the latter contention as being disingenuous.  Accepting such a deconstruction of the transaction would effectively eviscerate O.C.G.A. §15-19-50(3), because the nonlawyer preparer of a legal document could always claim to be charging the fee for something other than the preparation of the instrument.  An interpretation of O.C.G.A. §15-19-50(3) that leads to such a result cannot be a correct one.  Rather, it seems more sensible to examine the reason the customer contacted the nonlawyer document preparer, the expectations of the customer, and the ultimate product of the transaction.  In the situation described above, the goal of the customer is to procure a lien, not a mere abstract of title or legal description of property.  The customer in fact obtains the lien, and pays the company for its services in this regard.  Under the circumstances, the transaction involves the practice of law as set out in O.C.G.A. §15-19-50(3), and the consequent furnishing of legal services within the meaning of O.C.G.A. §15-19-51(a)(4).



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