The Supreme Court of Florida recently held that a complaint for damages and fees arising from the unauthorized practice of law must allege that the Supreme Court “has ruled that the specified conduct at issue constitutes the unauthorized practice of law.” A copy of the opinion is attached.
Petitioners brought a class action suit against Merrill Lynch Credit Corporation (“Merrill Lynch”) and sought to recover document preparation fees charged by Merrill Lynch for services performed by clerical personnel in the processing of mortgage loans. Merrill Lynch moved to dismiss, arguing that the circuit court lacked jurisdiction to hear any claims relating to the unlicensed practice of law and that only the Florida Bar could prosecute such claims.
The circuit court granted Merrill Lynch’s motion, and the appellate court affirmed, reasoning that a “supreme court determination on the unauthorized practice of law is a prerequisite to such suits.” The Supreme Court of
The Florida Supreme Court first noted that Petitioners’ were not “jurisdictionally barred” from “bringing a private cause of action against an unlicensed practitioner” for damages caused by the unlicensed practice of law. However, the Court affirmed the dismissals because Petitioners did not allege that “Court has ruled that the specified conduct constitutes the unauthorized practice of law,” and therefore Petitioners failed to state a claim.
In effect, “a plaintiff may be able to state a cause of action with proper pleading, even though the defendant accused of the unauthorized practice of law has not been subject to a Florida Bar proceeding.” However, a plaintiff will not be able to do so for a case of first impression, or in situations where a determination has been made but the defendant “believes its identity is relevant to the determination of whether the conduct is actually the unauthorized practice of law.”
In both situations, the case “may be dismissed without prejudice or the action stayed until a determination” is made by the Court pursuant to the
Ralph T. Wutscher
Kahrl Wutscher LLP
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