Bob T. Patterson v. Perry Pritchard

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-10-00211-CV

Bob T. Patterson, Appellant

v.

Perry Pritchard, Appellee

FROM THE DISTRICT COURT OF LLANO COUNTY, 424TH JUDICIAL DISTRICT

NO. 16134, HONORABLE PAUL DAVIS, JUDGE PRESIDING

C O N C U R R I N G A N D D I S S E N T I N G O P I N I O N

I concur with the majority that appellee Perry Pritchard's no-evidence motion for

summary judgment was procedurally improper because Pritchard bore the burden of proving his

affirmative defense of illegality. See Tex. R. Civ. P. 166a(i). I cannot agree, however, with the

majority's conclusion that Pritchard failed to prove that the contract was illegal as a matter of law.

I therefore respectfully dissent to the portion of the majority opinion reversing the trial court's

summary judgment.

The practice of law embraces all advice to clients and all action taken for them in

matters connected with the law. Brown v. Unauthorized Practice of Law Comm. , 742 S.W.2d 34,

41 (Tex. App.--Dallas 1987, writ denied). A person may confer legal advice not only by word of

mouth, but also by a course of conduct that encourages litigation and the prosecution of claims. Id.

at 40 . A non-lawyer may not advise individuals of their legal rights, duties, and privileges under

the law. Id.

The language of the agreement--requiring Patterson to "obtain payment of the

notes . . . or [] obtain a return of the underlying collateral property," allowing Pritchard to terminate

the contract if no lawsuit is pending within three years, and allowing Patterson to terminate the

contract if he sees "no reasonable sufficient legal grounds" to anticipate recovery--makes clear that

the parties intended that the property or debt owed would be recovered by a lawsuit. Because

Patterson was personally charged with obtaining payment on the notes and because the parties

anticipated that this would be done through a lawsuit, we must necessarily interpret the agreement

as requiring Patterson to oversee and manage that lawsuit. Pritchard, in his deposition, supported

this interpretation of the contract, explaining that he "had an agreement . . . that [Patterson] would

take over and do everything since [he] was not able to do anything. . . . Bob Patterson was supposed

to be taking care of [the lawsuit]." Advising persons about their rights and the advisability of

making legal claims, as Patterson contracted to do when he agreed to manage the legal

proceedings for Pritchard, requires the use of legal skill and knowledge and embodies the practice

of law. Green v. Unauthorized Practice of Law Comm. , 883 S.W.2d 293, 298 (Tex. App.--Dallas

1994, no writ).

The fact that Patterson then hired a third-party attorney to advocate on Pritchard's

behalf in court does not change the fact that, by the contract's language, Patterson was required to

"obtain payment of the notes" through the anticipated legal proceedings. The contract called for

Patterson, not a third-party attorney, to acquire payment of the notes by either lawsuit or foreclosure,

both of which require the practice of law. While Patterson and Pritchard could have legally

contracted to allow Patterson to hire an attorney and fully control the litigation--either by entering

into a joint-venture agreement or by fully assigning Pritchard's cause of action to Patterson--the

Performance Agreement does not reflect either of these legal alternatives.

Furthermore, entering into a contract to assist individuals with their claims in the

context of property damage and personal injury disputes has been defined as the practice of law. See

Green , 883 S.W.2d at 298 ; Brown , 742 S.W.2d at 37 . In Green v. Unauthorized Practice of Law

Committee , the "clients" entered into a contract and power of attorney giving Green the authority to

do "whatever he needed to do" to settle his clients' claims. 883 S.W.2d at 298 . The Green court

held that "contracting with persons to represent them with regard to their personal causes of action

for property damage or personal injury" and "entering into contracts with persons to represent them

in their personal injury or property damage matters on a contingent fee basis" constituted the practice

of law. Id. at 299 .

Similarly, in Brown v. Unauthorized Practice of Law Commitee , Brown entered into

contracts with individuals to "represent them in resolving their personal injury and/or property

damage claims on a contingent fee basis." 742 S.W.2d at 37 . Under the contracts, Brown reserved

the right to hire legal counsel if necessary. Id. The Dallas Court of Appeals held that "entering into

contracts with persons to represent them in their personal injury and/or property damage matters on

a contingent fee together with an attempted assignment of a portion of the person's cause of action

involves the practice of law." Id. at 42 . Further, it concluded that entering into contracts "which

purport to grant the exclusive right to select and retain legal counsel to represent the individual in

any legal proceeding" constituted the practice of law. Id.

I see no relevant difference between the contracts for the practice of law in Green and

Brown and the contract at issue here. Though Pritchard's claim is not a personal injury or property

damage claim, the actions to recover the collateral property also required the practice of law. The

majority notes that debt collecting may be done legally by a non-lawyer. The actions contracted for,

however, were not mere debt collection. The Performance Agreement and Power of Attorney

anticipated that Patterson would either initiate a lawsuit to recover the money owed or initiate a

foreclosure proceeding.

Given the fact that the clear language of the contract calls for Patterson to manage

Pritchard's interests in a legal proceeding, I would hold that the Performance Agreement required

Patterson to engage in the unauthorized practice of law. As courts will not enforce a contract made

for the unauthorized practice of law, I would hold that the Performance Agreement is

unenforceable and would affirm the trial court's summary judgment. See Lewis v. Davis ,

199 S.W.2d 146, 149 (Tex. 1947) ("A contract to do a thing which cannot be performed without a

violation of the law is void.").

___________________________________________

Diane M. Henson, Justice

Before Justices Henson, Rose and Goodwin

Filed: August 4, 2011