Landlord tenant cases comprise a large portion of the dockets of the District Courts in Michigan. Given the relatively rapid pace at which summary proceedings move and the important interests at stake for both parties involved, it is important to have a thorough understanding of the relationship between landlord-tenant actions and the unauthorized practice of law. Confusion sometimes arises regarding what types of landlords may file and litigate eviction cases on an in pro per basis, without engaging in the unauthorized practice of law.
In Michigan, landlord-tenant law is governed by statute and specific court rules. In small claims actions, MCR 4.302(B)(2) allows a corporation or partnership to appear and prosecute the proceeding through a lay representative. However, no statute or court rule exists in Michigan allowing corporations or other business entities to file and litigate matters on an in pro per basis in actions other than small claims court. Accordingly, the general body of case law addressing what constitutes the unauthorized practice of law applies to all landlord tenant proceedings.
Individual, layperson landlords, i.e. those that own rental property in their individual capacity, may file and litigate eviction actions, in pro per, as they are acting on their own behalf and only their individual interests are affected by the proceeding. In contrast, Michigan law views corporations, partnerships and other legal entities as separate from their individual officers, shareholders, and partners. Lay officers, directors, partners and employees of corporate or partnership entities may not represent the entity in court proceedings or sign court documents without engaging in the unauthorized practice of law. Peters v. Desnick Broadcasting Co., 171 Mich App 283, 429 N.W. 2d 654 (1988). Detroit Bar Association v. Union Guardian Trust Co., 282 Mich 707, 282 N.W.2d 432 (1938). See also Ginger v. Cohn, 426 F.2d 1385 (1970). Labato v. Pauline, 304 Mich 668 (1943), 8 N.W.2d 873. Yenglin v. Mazur, 121 Mich App 218, 328 N.W.2d 624 (1982).
Michigan statutes are in accord with this case law. MCL 450.681, MSA 21.311 provides that corporations may not practice law or offer legal services. MCL 660.2051(2); MSA 27A 2051(2) recognizes partnerships as entities separate from their individual partners.
The above restrictions do not prohibit lay employees of corporations and partnerships from drafting petitions, orders and other papers to be filed in court, provided the papers are filed under the name of, and by, an attorney who becomes personally responsible for the filings as if he or she had drafted them personally. Detroit Bar Association v. Union Guardian Trust Co., 282 Mich 707 (1938).
Under current statutory and case law, a lay employee of a corporation or partnership cannot sign and file a complaint for termination of tenancy without engaging in the unauthorized practice of law. Further, any attempt to litigate the matter, by appearing in court on behalf of the business entity, leaves the individual open to prosecution for engaging in the unauthorized practice of law. MCL 600.916; MSA 27A916. The Supreme Court empowers the State Bar of Michigan, with authorization from its Board of Commissioners, to investigate and prosecute incidents of the unauthorized practice of law. Rule 16 of the Rules Concerning the State Bar.
Michigan lawyers confronted with a non-lawyer appearing in court for a corporation or partnership have an ethical duty to bring the fact to the attention of the tribunal. Informal ethics opinion RI-10. The lawyer may also move for disqualification of the lay representative and to strike the pleadings.
Likewise, Michigan judges are also under an ethical duty to prevent the unauthorized practice of law. Informal judicial ethics opinion JI-26 states, in part,
"Administrative responsibilities of judges require them to instruct court personnel to regularly check pleadings filed with the court for signature and professional identification ("P" number) to assure the person representing a party is a member of the State Bar. Judges must instruct court staff to reject pleadings having no professional identification unless the person is appearing pro se.
"When unauthorized practice of law activity occurs within the presence of a judge, the judge must stop the proceeding; place as much information on the record as possible; advise the party to seek the services of a licensed lawyer; and take other remedial action authorized by law."
Given the important interests at stake for both parties in a landlord tenant proceeding, it is important for all involved to be sensitive to the unauthorized practice of law issue and how it may arise in such cases. A judge or lawyer who encounters unauthorized practice of law activity should report the incident to the State Bar of Michigan and its Committee on the Unauthorized Practice of law for investigation and possible prosecution.