*1 937A.2d 1082 BEYERS Iannece Janie P.C., RICHMOND, Arangio, Forceno & Donald Raymond P. Arangio and Forceno. Robert Arangio, P.C., Appeal Robert of: Forceno & Raymond Arangio P. Forceno. Pennsylvania. Supreme Court of April Argued 28, 2007. Dec. Decided *3 Albert, Jeffrey Rehder, Christie, B. Toki McKissock J.W. & Hoffman, P.C., P.C., for Philadelphia, Forceno & Arangio, Arangio Forceno, Robert and Raymond P. appellants. Coco,
Amy Haber, P.C., Joann Weinheimer Schadel & Pitts- burgh, Mette, Evans & Kathryn Simpson, Woodside, Lease Harrisburg, Ass’n, for Pa. Bar appellant. amicus Smith, Smith, P.C., P. Associates,
Edwin P. Edwin & Janie Iannece Beyers, appellee. CAPPY, C.J., CASTILLE, SAYLOR, EAKIN,
BEFORE: BAER, FITZGERALD, BALDWIN and JJ.
OPINION
Justice FITZGERALD. We determine whether the Unfair Practices Trade (UTPCPL), Consumer §§ Protection Law 201-1-209- P.S. 6, applies to an attorney’s collecting conduct in and distribut- ing settlement proceeds. Superior Court held that the provides UTPCPL against cause action attorneys arising out of the disbursement of settlement funds. We hold the apply misconduct, UTPCPL does not to attorney and reverse Superior decision Court.
FACTS This case arises from the admitted conversion funds by Richmond, Donald an associate of appellants’ Pennsylvania firm, (the Firm), law Arangio, Forceno & P.C. for which the Firm liable, held was and for vicariously preparation of a settlement distribution sheet the Firm which included deductions for unsubstantiated costs.
Appellee Beyers Janice Iannece and companion, her James Piccirilli, injured were in an automobile They accident. re- the Firm to of Donald Richmond and
tained the services injury Appellee in claim. personal them their represent $468,401.67. fee According for to a to settle the ease agreed settlement, was to receive 42.5% agreement, appellee the settlement funds and $205,495.72. The Firm received $185,000 Richmond settlement. Richmond converted $95,000 County into court in of the funds Delaware deposited remaining his action. The divorce personal connection with into funds, deposited were also by appellants, in escrow held schedule, a distribution which Appellants prepared court. fees, $1,576.65 $68,481.91 attorneys’ recovery provided: an costs, $6,480.59 repayment” for a “loan for unidentified accountant, These amounts $18,001.61 for medical bills. The court ordered from settlement. appellee’s were deducted $110,904.96, upon based distri- pay appellee appellants bution schedule.1 reflected on the contended that the deductions
Appellee January improper. schedule On distribution were complaint against appellants alleging negligent filed a appellee interest breach of conflict of supervision, negligence, protection of consumer laws violation fiduciary duty, (UTPCPL), attorneys’ in the of forfeiture of assumpsit form fees, misrepresentation.2 fraudulent of damages. on sole issue On
A trial was held bench to all 25, 2008,. appellee found in August court favor claims, The claims pursuant except violation UTPCPL. court held under advisement. The UTPCPL were $110,198.24, verdict, in the amount of a preliminary rendered attorneys’ fees in the represented recovery which $68,481.91 totaling and non-existent costs amount of calculation, appears computation be a error in this but the There consequence disposition this case. of no error is 22, 2002, against judgment entered Richmond May a default 2. On February complaint. an answer to the On for failure file granted only summaiy judgment was as to appellee's motion for Ap- liability appellants of Richmond. for the malfeasance vicarious dispute Richmond converted funds due pellants the fact that do vicariously damages resulting from they liable for appellee and that are Richmond's actions. *5 $26,058.85,plus simple interest at the rate of 6% statutory per during annum years of in the non-payment amount 2% $15,607.48.3 9, 2003,
On December the Honorable Mark Bernstein found appellee claim, favor of on the her awarding UTPCPL $78,171.00.4 treble damages the amount of Appellee filed a motion for order, clarification of the December con tending that the 25, 2003, entire verdict August entered on $110,198.24, should be Appellee trebled. also 40% requested for attorneys’ fees on the February trebled amount. On 2004, the court damages $467,637.20 assessed in the amount on the filed, denied, UTPCPL claim.5 Post trial motions were judgment was entered. Superior Court affirmed the judgment the trial court, and adopted its reasoning, holding that appellants’ actions law, did not arise from the practice of and therefore appellants profession could not use their as a shield from the application Further, of the UTPCPL. the Superior Court appellee held fraud, established the essential elements that appellants’ malfeasance pertaining to the collection and management funds, of the settlement as well as the breach of their fiduciary responsibility to appellee, placed their actions the scope within of the UTPCPL.
DISCUSSION This case presents law, a question of thus this Glenn, Court’s standard of review is plenary. Norton v. (2004).
Pa. Although find the egre we gious conduct of appellants in this case to be reprehensible, we decline to hold Pennsylvania’s applies UTPCPL to an attorney’s conduct in collecting and distributing settlement $110,148.24. 3. The total of these sums should be This error is not disposition relevant to the of the case. figure costs, represented trebling This of the non-existent $26,058.85. figure represented 5. This trebling judgment of ihe entire $110,198.24, fees, plus attorney's 40% of the trebled amount for $4,804.55 in court costs. these circum- the XJTPCPL under
proceeds. Application *6 upon power stances encroach this Court’s exclusive would re of in this regulate practice law Commonwealth. Larsen, 457, 640, (Sp.Trib.2002). Pa. 812 653 571 A.2d Protection Laws Applicability Consumer
a. of protection statute.6 Most states have enacted a consumer this issue jurisdictions that have addressed majority regulation that the does not fall within have held juris- A protection minority the ambit of consumer laws.7 8-19-5; 45.50.471; § § Ann. 44- 6. Alaska Stat. Ariz.Rev.Stat. Ala.Code 1522; 17500; 4-88-107; 17200, § & Ark.Code Ann. Cal Bus. Prof.Code 1770; 6-1-105; § § Cal. Colo.Rev.Slat. Ann. Conn. Gen.Stat. Civ.Code 28-3901; 42-110b; seq.; § § Fla. Ann. 6 Del. C. 2511 et D.C.Code Ann. 501.204; 10-1-393; § § Ann. Stat. Ann. Ga.Code Ann. Haw.Rev.Stat. 48-603; 481-3; seq.; Comp. § § et Code 815 Ill. Stat. Ann. Idaho 505/1 24-5-0.5-3; 714.16; Ann. Ann. Ind.Code Ann. Code Kan. Stat. Iowa 51:1409; 367.170; 50-626; § Ky.Rev.Stat. §Ann. La.Rev.Stat. Ann. 5 207; 13-301; § § Law Ann. Me.Rev.Stat. Ann. Md. Commercial Code 445.903; 11; Comp. 93A § Mass. Laws Ann. Mich. Laws Ann. Gen. 325D.44; 75-24-5; § §Ann. Ann. Stat. Ann. Mo. Minn.Stat. Miss.Code 30-14-103; 59-1602; 407.020; § Nev. Ann. Neb.Rev.Stat. Mont.Code 598.0979; 358-A:2; §Ann. N.J. Stat. Rev.Stat. Ann. N.H.Rev.Stat. 57-12-2; seq.; § Bus. Law Ann. et. N.M. Stat. Ann. N.Y. Gen. 56:8-1 349; 51-15-02; 75-1.1; § § N.D. Cent.Code Ohio Rev. N.C. Gen.Stat. 1345.02; 751; § § 15 Ann. Or.Rev.Stat. Code Ann. Okla. Stat. 6-13.1-2; 39-5-20; 646.608; § § § Gen. Laws S.C.Code S.D. R.I. Ann. 37-24-6; 47-18-104; § § Ann. Tex. Bus. & Codified Laws Tenn.Code 17.46; 13-5-2.5; § Ann. Com.Code Ann. Utah Code Ann. 9 Vt. Stat. 2453; 59.1-200; 19.86.020; §Ann. Wash. Stat. W. Va.Code Va.Code 46A-6-104; 100.20; Wyo. Ann. Stat. Wis. Stat. 40-12-105. See, Leiter, 185, 488, e.g., Cripe 184 234 703 N.E.2d v. Ill.2d Ill.Dec. 100, (1998) ("legislature furnishing intend to 104 did not include the Act”); legal Jackson v. [Consumer services to clients within the Fraud] Adcock, 1900484, *5, 16888, at *19 2004 WL at 2004 U.S.Dist.Lexis law.”); (E.D.La.2004) ("LUPTA regulate Tet- does not 1189, 456, Mahoney, Goldings, v. Hawkes & 425 Mass. N.E.2d rault 681 (1997) (attorneys engaged in 1195 were not "trade or commerce” 328, Cox, act); subject protection v. 761 consumer Averill 145 N.H. 340, 1083, (2000); Russo, A.2d v. Dello 178 N.J. 1089-90 Macedo (2004) 238, (professionals beyond A.2d are reach of the Con- 231, Act); Ayers, N.C.App. sumer Fraud Reid v. 531 S.E.2d (2000) (recognizing profession” exemption 235-36 to unfair "learned act); Gammarino, practices App.3d Burke v. trade Ohio (1995) (Ohio Sales Act "does not N.E.2d Consumer Practices clients”); apply attorneys and their between Kessler transactions (D.Vt.1997) (claim Loftus, F.Supp. upon based law- 242-43 has dictions carved out an exception entrepreneurial as- pects law, the practice such as and debt advertising collection, recognizing while that claims allege negli- which gence legal malpractice or are exempt from the consumer protection strictly laws.8 Courts separa- which adhere tion of powers doctrine hold that consumer protection laws do not apply attorneys.9 Other jurisdictions hold protection consumer statutes do not to the apply practice of upon boards,10 law based the existence of regulatory explicit or yer’s act); professional judgment not actionable under consumer fraud Quinn Connelly, Wash.App. 821 P.2d (element protection requiring consumer act that the act occur in trade or be commerce “cannot satisfied claims directed at the competence strategy attorney”); Yip, of an 912 F.2d Ikuno v. (9th Cir.1990) (dismissal against 312-13 of CPA claim *7 proper competence strategy since claim was on attorney). based and of See, Schatz, e.g., Beverly Concepts, 8. Hills v. Inc. & & Schatz Ribicoff Kotkin, 48, 724, (1998) 247 Conn. 717 A.2d 740 (entrepreneurial CUPTA, aspects practice of by of law are covered claims of CUPTA); professional negligence do not fall under Reed v. Allison & Perrone, 1067, (La.Ct.App.1979) 376 (advertising legal So.2d 1068 subject UTPCPL); is provisions services trade or commerce of the Burke, 802, 892, (1982) (an Guenard v. 387 Mass. 443 N.E.2d 896 attorney's contingency agreements use of fee rendered unlawful under may state deceptive statute constitute an or practice”); “unfair act or 240, (commercial, Loftus, (D.Vt.1997) F.Supp. Kessler v. 994 243 entre- preneurial aspects practice of the advertising, billing of law include and practices, arrangements, collection obtaining, fee and methods of re- clients); taining Denver, 451, dismissing and Eriks v. 118 Wash.2d 824 1207, (1992) P.2d (legal 1214 generally services do not fall within the commerce”, or except definition "trade as those services relate to the "entrepreneurial aspects” law). practice of the See, Coria, 386, e.g., 9. People (Colo.1997) (Supreme v. 937 P.2d 390 “inherent, Court plenary, authority ‘regulate, has and exclusive govern, supervise practice and of law in protect Colorado and to "); public' Infotechnology, In re Litigation, Inc. Shareholder 582 A.2d 215, (Del.1990) (Supreme 220 responsi- Court “has sole and exclusive bility Bar”); Cox, affecting governance over all matters v. Averill 328, 1083, (2000) (court's 145 N.H. 761 A.2d "comprehensive” regulation practice “protects lawof consumers from the same act); practices” fraud and unfair protection state consumer Vort Hollander, N.J.Super. 1992) v. (App.Div. 607 A.2d ("practice of Jersey law in the regulated, State New the Court”). is 'in first instance, by if exclusively,' Jersey Supreme the New See, Inc., e.g., 10. v. Investigations, State O’Neill 609 P.2d (Alaska 1980) (unfair practices acts exempted purview and from the "only the UTPA regulated where the business is both elsewhere and the However, some for within statutes.11
exemptions that in certain indicated circum- jurisdictions implicitly have against an under brought claim could be stances a act,12 jurisdictions still other protection and have the consumer the issue.13 not decided Pennsylvania’s UTPCPL
b.- the Pennsylvania provides: statute pertinent The section (a) or leases or services person purchases goods who Any or family purposes household primarily personal, loss of or any money prop- suffers ascertainable thereby employ- as a result of the use or erty, real or personal, method, act or declared by any ment person act, may bring a private 8 of this unlawful section hundred dollars damages action to actual one recover ($ 100), may, in its greater. court whichever prohibited”) (emphasis origi practices are therein unfair acts nal); Newman, (“med (C.D.Ill.1992) F.Supp. v. Gadson immunity legal professions from the Consumer ical and are afforded services, because, primarily, unlike other commercial medi Act Fraud bodies”); by governmental Lyne legal regulated bodies are cal Co., (N.D.Ill. 1991) (legal F.Supp. & Arthur Andersen governmental subject fraud profession not to consumer act because Eshleman, legal profession); 128 N.H. regulation of the Rousseau (professional committee of the conduct (and acting statutory regulatory Supreme is "a board under constitutional) State”). authority of this See, 28-3903(c)(2)(C); Commercial Law e.g., D.C.Code Ann. Md. 13-104; 75-1.1(b); Gen.Stat. Ohio Rev.Code Ann. Code Ann. N.C. *8 17.49(c). 1345.01(A); § Tex. Bus. & Com.Code Ann. hold liable under con- 12. Louisiana and Massachusetts implicit profes- protection upon the statutes based inclusion sumer meaning in the of trade or commerce. La.Rev.Stat. sional services Perrone, 1067, 51-1401-1418; 376 Reed v. Allison & So.2d Ann. (attorneys' advertising subject regulation (La.App.1979) 1068-69 association, subject provisions by UTPCPL); bar the state 1-11; 93A, Gerstein, §§ 17 Mass. Laws Ann. Brown Gen. 1043, 558, (1984) (practice of law Mass.App.Ct. 460 N.E.2d 1052 law). protection trade commerce under the consumer constitutes or 241, See, Marks, (S.D.Fla.1979) F.Supp. 242 e.g., LJS Co. v. 480 13. 49, issue); (court Berryman, Mont. not Matthews v. did decide 822, case, (1981) (under did not facts of this UTPCPL 637 P.2d 1229, Mead, Or. 722 P.2d 1234-35 apply); Roach v. (under attorneys). apply UTPA could certain circumstances the discretion, award to three times the actual up damages sustained, ($ 100), but not less than one hundred dollars may provide such additional relief as it deems neces- sary or proper. may The court to the in plaintiff, award section, addition to other provided relief in this costs and reasonable fees. attorney 201-9.2(a).
73 P.S. The applicability of this statute attorneys’ to the conduct in this case presents an issue of first impression Pennsylvania. in Although this Court has not addressed the issue of the appli- cability conduct, of the UTPCPL to Superior Court of Pennsylvania has that the held UTPCPL not does apply to treatment provided another by category profes- Zemel, M.D., sionals: physicians. v. R. Foflygen 420 Pa.Su- per. (1992), denied, A.2d 1345 appeal 535 Pa. (1993); Merzi,
A.2d 1380
Pa.Super.
Gatten
(1990),
denied,
A.2d 974
appeal
528 Pa.
In Walter v. Magee-Womens
Hosp.,
A.2d
curiam,,
(Pa.Super.2005),
per
588 Pa.
664 Act, methods of competition to the unfair
According any in the trade or commerce deceptive conduct practices The “trade or phrase § are 73 P.S. 201-3. unlawful. 201-2(3). includes the of services. commerce” sale 73 P.S. Act are Among practices the condemned the various as conduct misrepresentations well as other fraudulent that misunderstanding. creates a likelihood confusion 201-2(4). However, though Act does not P.S. even the clear that performed by physicians, exclude it is the services relating to to prohibit practices Act intended unlawful trade or and of the associated business type commerce with that the did enterprises. equally legislature It is clear apply rendering intend the Act to medical physicians services. 976).
Walter, Gatten, 407-8, at at (quoting supra reasoning unpublished, are the in an persuaded by We also decision the federal Court for non-precedential from District Ferrera, Pennsylvania the Eastern District Jackson (E.D.Pa.2002), 2002 WL Dist. Lexis 12731 U.S. District court addressed applicability where Jackson, In attorney attorney misconduct. an UTPCPL court, The noting sued that was for violation UTPCPL. rejected nearly having all courts issue had considered conduct in context of applied notion that it law, alone, Plaintiffs held this basis have “[o]n *2, 2002 Lexis failed to state a claim.” Id at U.S. Dist. *4. at Baritz,
inBut
2003 U.S. Dist.
Daniels
2003 WL
(E.D.Pa.2003),
distinguished
Lexis
the District
Daniels,
Jackson.
the defendant
were debt
collectors
of the Fair Debt Collection
meaning
within
(FDCPA),
Practices
the court
Act
U.S.C.
held
in debt
“[attorneys
regularly engage
practices,
collection
who
are
under
apart
legal representation,
their
covered
form
Daniels,
*4,
at
FDCPA.”
at
Dist. Lexis 7707
*11-
U.S.
(emphasis
interpreted
supplied).
UTPCPL
act in trade or
Id. at
apply
debt collection
an
commerce.
*5,
Similarly,
Dist. Lexis
at *14.
the Common-
U.S.
*10
wealth
in
applicability
Court addressed
UTPCPL
physicians’
practices.
context of
fraudulent
In
billing
Com-
Cole,
994,
(Pa.Commw.1998),
monwealth v.
709
ap-
A.2d
997
denied,
611,
(1999),
peal
558 Pa.
c. The Pennsylvania Supreme Authority Court’s “The Supreme Court this is em Commonwealth powered by the Pennsylvania govern Constitution to the con duct of law practicing within Commonwealth.” 513, 1193, (1992). 529 Lloyd Fishinger, Pa. 605 A.2d power granted V, This exclusive is this Court Article 10(c) Section Pennsylvania provides Constitution which in pertinent part Supreme shall “[t]he have the power prescribe general rules governing practice, proce dure conduct all courts.... All shall laws be suspended to the they extent that are inconsistent with rules prescribed under these provisions.” Any legislative enact ment encroaching upon this Court’s exclusive power regu late attorney conduct would be unconstitutional. Lloyd, 605 A.2d at 1196. legislature precluded The is from “exercising powers judiciary.” Stern, entrusted to the Commonwealth v. 505, (1997) (citation omitted).15 549 Pa. A.2d concurring opinion, 14. Cappy his Chief Justice indicates the issue in may dispositively statutory grounds. this case be resolved on We respectfully disagree, may finally hold the matter be determined only through analysis grounds an of the constitutional for this Court’s authority. exclusive See, Commn., e.g., Pennsylvania Shaulis v. State Ethics Pa. (2003) (65 1103(g) Pa.C.S. of the Public Official Employee [barring attorney practicing Act Ethics from before government employer year former employment] he one after leaves regulates unconstitutional to the extent that it the conduct of former government employees who attorneys); are also Gmerek v. State Ethics Comm’n., (Pa.Commw.2000), aff'd, A.2d Pa.
Moreover,
in this
authority
this
area
Court’s exclusive
of our Commonwealth’s
separation
on the
powers
is founded
doctrine can be found
separation
powers
government.
County
Dawphin
1790, 1838,
and 1873.
in the constitutions
342, 2
Proceedings, 332 Pa.
Jury Investigation
A.2d
Grand
(1938).
Pennsylvania
Constitution was
When
on for the
which the court relied
amended
section
More
unchanged.16
doctrine remained
separation
powers
10(c)18
10(a)17
added,
over,
Article
and section
were
V
Act,
(Lobbying
65 Pa.C.S.
1303-1311
667 giving authority this Court the exclusive constitutional regulate the In Commonwealth v. 474 practice Sutley, law. 256, 780, (1977), Pa. opined “[a]ny this Court judicial encroachment upon power by legislature government.” offensive the fundamental scheme of our Furthermore, 10(c) Article V of the Constitution has been held to include the of “the continuous power monitoring of the Supreme Pennsyl law.” Cantor Court of vania, 1307, (E.D.Pa.1973), n. 21 F.Supp. aff'd, (3rd Cir.1973). F.2d 1394 “The Court has declared Supreme 10(c) V, meaning of Article in Rule Disciplin Section its Enforcement ary No. 103.” Public Pennsylvania Utility Commission Bar Thornburgh, Ass’n. v. Pa.Cmwlth. (1981),
A.2d
1331 n. 6
aff'd, 498 Pa.
justice
require,
shall
practice
and for admission to the bar
to
and
and the
supervision
administration of all courts and
of all officers of
branch,
judicial
the
if such
are
rules
consistent with this Constitution
abridge, enlarge
and neither
modify
rights
any
nor
the substantive
of
litigant,
right
Assembly
nor affect the
of the General
to determine the
jurisdiction
any
justice
peace,
suspend
of
court or
nor
nor alter
any
repose.
statute of
suspended
limitation or
All laws shall be
to the
they
extent
prescribed
that
are inconsistent with rules
these
under
provisions.
separation
powers
19. The doctrine of
of
“has been
in
inherent
government
structure of
inception.
this Commonwealth’s
since its
separation appeared
Pennsylvania
early
‘This
in
in
as 1776
the Plan
government
or form of
Pennsylvania
for the Commonwealth or State of
. .. [and
in
has] continued
our constitutions of
of
and of
”
(citation omitted).
Sutley,
1873.’
“Pursuant to our the Rules of of Professional Conduct the Rules adopted and disci Enforcement, the conduct govern which Disciplinary Stern, Pa. attorneys.” Commonwealth pline that (1997). Stern, held a statute this Court A.2d compensating conduct of an criminalized the as violative unconstitutional for client referrals was non-lawyer Stern, at 573. doctrine. powers separation declares Supreme Court to Pa.R.D.E. “[t]he Pursuant to power supervise exclusive inherent and that it has and this Court are its officers” attorneys who conduct govern power and exclusive “the inherent vested with in this law Common practice privileged conduct of those Comm’n, 255, 420 491 Pa. Ethics v. State Wajert wealth.” (1980). authority has no Assembly The General A.2d the conduct regulate Pennsylvania Constitution under Thus, any conclude in the of law. we lawyers of this case would to the facts of the UTPCPL application an be would the conduct regulate purport of this Court.20 power upon encroachment impermissible Superior reasoning Delaware persuaded 20. We are further Prousalis, Del.Super. WL Jamgochian Jamgoc- Superior Court in The Delaware (Del.Super.2000). Lexis 373 author- regarding inherent constitutional opinion expressed its hian regulate attorney conduct in that ity Supreme Court to of the Delaware opined as follows: state. The court authority regulate the granted court Supreme Court is including justice, the attor- system administration for the efficient *13 of the State of the bench. Constitution neys practice who before 13; IV, (1897), of the Del. C. 1906. Control Art. Delaware Pennsylvania’s We hold of Rules Professional Conduct Rules Disciplinary of Enforcement address the exclusively of in this complained conduct case. Pa.R.P.C. Specifically, 1.5(c) provides that a “[u]pon contingent conclusion of fee matter, shall a lawyer provide client with written and, stating statement the outcome of the matter if there ais recovery, showing the remittance to the the method client and 1.15(b) of its determination.” Pa.R.P.C. that provides upon receiving funds or other property in which a client or third interest, person has an lawyer a shall promptly notify client or third person. in or “Except stated this rule client, by otherwise permitted by agreement law with the a shall to lawyer promptly any deliver the client or third person or other funds the client property person or third is entitled to receive and upon request by the client or third person, shall promptly render a accounting regarding full such 8.4(b) property.” provides Pa.R.P.C. that it is professional misconduct for lawyer to “commit a criminal act that reflects by Bar vestige legal system, the Court is an ancient of our derived England. power regulate from the common law This admission discipline highest of the Bar is inherent court of this state, “independent any statutory grant According authority.” Court, Supreme provisions to the of 10 Del. C. 1906 "are nothing legislative recognition more powers than of the inherent this Court.” In long deference to the recogni- tradition and further Court, powers tion of the legislature intrinsic has not regulation undertaken of the Bar statute. Jamgochian, *4, 2000 WL Del.Super. 1610750 at Lexis at *11-12 (internal omitted) (footnote omitted). citations power Inherent in Supreme regulate the Delaware power every aspect Court is the practice of law. authority, Pursuant to promulgated governing this the Court has rules the admission providing and conduct of as well as for the sanctioning lawyers regulations.... Every in violation of these aspect lawyer’s practice encompassed of a Every- by these rules. thing procedures responsibilities from admission attorney anof leaving practice regulated. accounting are Advertising, of client funds, clients, dealings communication with parties, with third com- interest, petence attorney, conflicts of and the unauthorized among myriad law subjects are comprehen- that these contemplate. penalty sive rules misconduct may range violation of these rules from censure fines to disbar- ment, subject to the Disciplinary recommendations of the Office of Counsel. *4, (footnote omitted). at Del.Super.
Id. Lexis at *13-14 *14 trustworthiness, or honesty, fitness lawyer’s on the
adversely 8.4(c) provides that respects.” a in other Pa.R.P.C. lawyer as in lawyer “engage for a misconduct professional it fraud, deceit, or misrepresenta- involving dishonesty, conduct tion.” Penn- addition, Rule 1.15 of the promulgated this Conduct, attor- governs of Professional which Rules
sylvania funds, of a safekeeping directs client neys’ disposition on the creation the Interest and authorized property client’s 4023. And Pa.R.D.E. Trust Account Act. P.S. Lawyers’ of money the issue of reimbursable losses addresses attorney.21 conduct of an by caused dishonest provides Rule 514 as follows: (a) subchapter reimbursable purposes Rule. For the of this General things money, property or other consist of those losses losses following requirements: meet all of the value which (1) by the conduct of a covered The was caused dishonest loss attorney acting: when (i) attorney-at4aw; anas law, (ii) fiduciary customary practice of such as capacity a to the in administrator, executor, trust, guardian express or trustee of an conservator; or (iii) having designated agent fiduciary, been as an escrow or other having by which the arose or as a client in the matter in loss such relationship. client-attorney a been so selected a result of (2) things money, property or other of value The was that of loss by attorney reason of into the of the covered which came hands (1) paragraph having capacity described in of this acted in the subdivision. thereof, loss, (3) portion by covered The or reimbursable fund, any any by fidelity or bond or whether of insurance or similar lawyer, otherwise. the (4) or the claimant or covered by: was not incurred The loss associate, relative, (i) partner, employer spouse or other close entity employee attorney, or business controlled or covered any entity by by attorney, any of the covered or controlled foregoing; insurer, (ii) bonding surety agency company, any entity or or or an any foregoing; by controlled (iii) any government unit. otherwise, fund, (5) by way subrogation or payment A from the any entity paragraph subdivi- specified benefit in this will not sion. (b) Recovery. may maximum which be dis- Maximum amount any respect fund to one claimant with dishonest bursed from the 75,000. $ be any one covered shall conduct Rules, Court, These promulgated by this provide the exclu- remedy sive for the attorney misconduct in this case. We hold appellants’ conduct in collecting and settlement distributing proceeds UTPCPL, does not fall purview within the but rather this within Court’s regulatory powers. exclusive Al- though are extremely we disturbed the conduct of the case, appellants this permit we cannot the trial court’s award this case to stand.22 We reverse order of the Superior Court.
Reversed. Jurisdiction relinquished. Justice CASTILLE and Justice join BALDWIN opinion.
Chief Justice CAPPY files a concurring opinion which joins. Justice BAER
Justice SAYLOR files a dissenting opinion.
Justice EAKIN files a dissenting opinion.
Chief Justice CAPPY concurring. I agree with the majority, to the extent that it holds that as a matter of construction, statutory the Unfair Trade Practices and Consumer (“UTPCPL”), Protection Law 73 Pa.C.S. §§ 201-1 seq., et apply does not practicing law. See Pa.C.S. 1501 et I seq. disassociate from myself remainder of the opinion. Because the of issue the UTPCPL’s applicability is resolved on statutory grounds, any discussion of the constitutional grounds for the majority’s holding is unnecessary. See Com’n, P.J.S. v. Pennsylvania State Ethics (1999) (“[A] 555 Pa. 723 A.2d court should not reach the constitutional issue if the can properly case be decided on grounds.”). non-constitutional joins
Justice BAER this concurring opinion. issue, disposition As a result of our of this we need not address the by appellants. other issues raised dissenting. Justice SAYLOR opinion and additional dissenting I Mr. Eakin’s Join Justice were not legal representation note core functions of ly that activity han Appellant’s ancillary regarding implicated by As this conduct does not proceeds. of the settlement dling legal Dauphin see judgment, generally involve exercise Mazzacaro, 545, 553, v. 465 Pa. County Bar Ass’n (1976) (discussing “practice the boundaries of the and understanding applying legal principles law” terms comfortably it falls more business judgment), within firm, recognized a distinction the activities a law aspects See, 103 Wash.2d e.g., Demopolis, other courts. Short Washington (ruling that 691 P.2d entrepreneuri to “certain protection applied consumer statute law,” including price “how aspects practice al billed, collected”); determined, Daniels v. legal services is 2003) (E.D.Pa. Baritz, 21027238, at *6 Apr. 2003 WL actions out of the “arising (distinguishing lawyer’s between practices, actual of law” and his debt-collection latter violated the holding that a claim activities objections); preliminary UTPCPL survived Goldfarb 2004, cf. Bar, 773, 787-88, 2013- Virginia State 95 S.Ct. U.S. *16 (1975) 14, of an (observing exchange L.Ed.2d money a land for consti attorney’s examining services title and, of the Sherman Act as purposes tutes “commerce” such, But aspect” legal profession). is a “business cf. Leiter, Ill.Dec. N.E.2d 184 Ill.2d Cripe (1998) Act that the Illinois Consumer Fraud did (holding charged her attorney claim that apply plaintiffs fees). excessive dissenting.
Justice EAKIN I I Practices and dissent because believe the Unfair Trade (UTPCPL) applies Protection Law here. Consumer This Constitution vests this Court with the Commonwealth’s this supervising law. “While responsibility this power has from encroachment guarded occasions, rejected on it has also Assembly General numerous calls for micromanagement unrealistic provisions gen over eral applicability.” Shaulis Pennsylvania State Ethics Commission, 574 Pa. (Eakin, J., v. Pennsylvania PJS concurring dissenting) (citing State Commission, Ethics Mau (1999); Pa. A.2d nus v. Pennsylvania Commission, State Ethics 518 Pa. PJS, (1988)).
PJS, at 178.
The UTPCPL is not a law directed at regulating attorneys; rather, it is a law of general applicability. Appellants should not be exempted from the reach of the simply UTPCPL because of their status attorneys. I Accordingly, dissent.