People v. Adams
243 P.3d 256
Colo.2010Background
- Respondent, David J. Adams, is not licensed to practice law in Colorado and operated Bulldog Construction Services, a collection business.
- Adams pursued subcontractors' claims in federal bankruptcy court under the Colorado Trust Fund Statute (section 38-22-127) on a contingent-fee basis.
- The Presiding Disciplinary Judge (PDJ) found Adams engaged in unauthorized practice of law by acting in a representative capacity for others.
- The PDJ concluded assignments were not valid, recommending costs ($3,029.91) and a permanent injunction, but imposing no fines.
- The Court of Appeals majority held that Trust Fund claims may be assigned except treble-damages under section 38-22-127(5) cannot be assigned, and Adams engaged in unauthorized practice of law; the concurrence/dissent dispute the fines and some attribution of representation.
- The final decision enjoins Adams from further unauthorized practice and orders payment of costs; fines were declined.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Assignability of Trust Fund claims under §38-22-127(1) | Adams could pursue assignable trust fund claims | Claims assignable except treble-damages under §38-22-127(5) | Trust Fund claims are assignable, except treble-damages not assignable |
| Whether Adams acted in a representative capacity violating the Unauthorized Practice of Law | Adams represented others’ rights via assignments | Adams acted within a valid final, complete assignment after 2006 | Adams engaged in unauthorized practice of law in bankruptcy proceedings |
| Imposition of fines | Fines appropriate for five incidents | Fines improper given circumstances | Fines declined; costs awarded instead |
| Costs and injunction | Costs and injunction needed to remedy unauthorized practice | Costs and injunction unnecessary or overbroad | Costs of $3,029.91 imposed; permanent injunction issued |
Key Cases Cited
- Thibodeaux v. Creditors Serv., Inc., 191 Colo. 215 (Colo. 1976) (contingent fee valid for assignment; real party in interest)
- Sprint Communications Co. v. APCC Services, Inc., 554 U.S. 269 (U.S. 2008) (contingent payments can support assignment; ownership remains with assignee)
- Kruse v. McKenna, 178 P.3d 1198 (Colo. 2008) (penalty-based damages not assignable; standing considerations)
- In re Regan, 151 P.3d 1281 (Colo. 2007) (trust fund mechanics' liens; broad assignability; policy considerations)
- Roberts v. Holland & Hart, 857 P.2d 492 (Colo.App.1993) (assignment of legal claims and personal service concerns)
- Lookout Mountain Paradise Hills Homeowners' Ass'n v. Viewpoint Assoc., 867 P.2d 70 (Colo.App.1993) (intent and clarity required for assignments; parol evidence limits)