Hargis v. JLB Corp.
2011 Mo. LEXIS 257
Mo.2011Background
- JLB is a Missouri mortgage broker that gathers borrower information and intermediates with lenders; documents such as notes and deeds of trust are prepared by third parties (title companies/investors/Document Systems) and then sent back to JLB for transfer to the borrower; Hargis refinanced her Barnhart, Missouri home with JLB and was charged multiple processing-related fees; JLB claims it did not draw or procure legal documents and only acted as middleman; the trial court granted summary judgment on all three counts; on appeal the court affirmed on Counts I-II (unauthorized practice of law) and reversed/ remanded Count III (unjust enrichment); this opinion proceeds under de novo standard for summary judgment and examines jurisprudence on unauthorized practice of law in Missouri
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether JLB engaged in procuring or assisting in drawing legal documents (Counts I-II) | Hargis asserts JLB procured/assisted in drawing notes/deed of trust and charged for it | JLB did not procure/draw; it served as middleman gathering information | No material fact showing procurement; Counts I-II affirmed |
| Whether loan applications/financial disclosures are legal documents subject to the unauthorized practice of law | Preparation of loan applications involves legal discretion | These are financial, standardized forms, not legal documents | Not legal documents under UPL; Counts I-II affirmed |
| Whether unjust enrichment (Count III) feasibly survives | JLB was unjustly enriched by charging for non-provided services | Count III lacks proper basis in motion and facts; not addressed by summary judgment | Count III reversed and remanded; separate analysis required |
Key Cases Cited
- Hulse v. Criger, 247 S.W.2d 855 (Mo. banc 1952) (definition/limits of unauthorized practice of law in real estate context)
- In re First Escrow, 840 S.W.2d 839 (Mo. banc 1992) (non-lawyer escrow employees may fill blanks in standard forms under supervision; cannot prepare nonstandard documents or charge extra fees)
- In re Mid-America Living Trust Associates, Inc., 927 S.W.2d 855 (Mo. banc 1996) (distinguishes between mere information gathering and active legal drafting; proprietary documents not ancillary to valid business)
- Eisel v. Midwest BankCentre, 230 S.W.3d 335 (Mo. banc 2007) (holding that charging for completing legal documents (notes/deeds) constitutes UPL when non-attorneys draft/prepare legal documents)
- Giles v. California, 554 U.S. 353 (U.S. Supreme Court 2008) (definition of procure; causation and active involvement required)
- Tabb v. Burt, 296 S.W. 820 (Mo. App. 1927) (historical definition of procure: to bring about by care and pains)
- Carpenter v. Countrywide Home Loans, Inc., 250 S.W.3d 697 (Mo. banc 2008) (addresses fee varying as an indicator of UPL despite other distinctions)