Wisconsin Supreme Court Rules chapter 23.01 contains the definition of the practice of law in Wisconsin.
SCR 23.01 Definition of practice of law.So what does this mean? Every time one person gives another advice clearly does not always implicate the practice of law. Barbershops and taverns would be out of business. The advice has to relate to "legal rights or responsibilities." The idea of "legal rights and responsibilities" also implicates the portion of the definition which includes "the knowledge, judgment, and skill of a person trained as a lawyer."
The practice of law in
is the application of legal principles and judgment with regard to the circumstances or objectives of another entity or person(s) where there is a client relationship of trust or reliance and which require the knowledge, judgment, and skill of a person trained as a lawyer. The practice of law includes but is not limited to:(1) Giving advice or counsel to others as to their legal rights or the legal rights or responsibilities of others for fees or other consideration.(2) Selection, drafting, or completion for another entity or person of legal documents or agreements which affect the legal rights of the other entity or person(s).(3) Representation of another entity or person(s) in a court, or in a formal administrative adjudicative proceeding or other formal dispute resolution process or in an administrative adjudicative proceeding in which legal pleadings are filed or a record is established as the basis for judicial review.(4) Negotiation of legal rights or responsibilities on behalf of another entity or person(s).(5) Any other activity determined to be the practice of law by the Wisconsin Supreme Court. Wisconsin
Isn't this definition somewhat circular? "Legal advice" seems to mean advice given by lawyers.
The definition also indicates that the practice of law is "for fees or other consideration." So, if a person doesn't collect a fee, they aren't practicing law, right? Wrong. The consideration could be the commission earned on a sale, a profit realized in conjunction with the advice, or any number of other possibilities.
The definition indicates that the practice of law involves "a client relationship of trust or reliance." When does a "client relationship" begin? Elsewhere in the attorney rules of professional conduct, it is clear that the client relationship can begin without the "attorney" necessarily agreeing to represent the "client." Trust and reliance are examined from the perspective of the client or potential client. Attorneys must consider "inadvertent clients" to whom they owe duties.
People not licensed as lawyers are not permitted to engage in the practice of law. If a person wants to practice law, they must complete law school, meet the Wisconsin Board of Bar Examiners standards, subscribe to the code of professional conduct stated in the Supreme Court Rules and then get admitted. These requirements set a minimum threshold of competency and create a strict code of professional conduct with attendant enforcement provisions. Lawyers also typically carry malpractice insurance to insure against liability arising in the event they make a mistake.
Unlicensed people have not proven the minimum level of competency. They do not generally know, let alone agree to be bound by, the attorney's code of professional responsibility. Further, they almost certainly do not carry legal malpractice insurance.
Real estate brokers are exempt from the law license requirement when they are practicing within the scope of practice authorized by Chapter 452, Stats. Among the duties of a real estate broker to a client is the "duty to provide, when requested by the client, information and advice to the client on matters that are material to the client's transaction and that are within the scope of the knowledge, skills, and training required under (Chapter 452, Stats.).
A real estate broker has a duty to provide advice within the scope of the knowledge, skills and training required of real estate brokers, and a broker does not need a law license to give such advice. However, a broker would need a law license to give advice of the type typically given by lawyers which is outside of the scope of knowledge, skills and training required of real estate brokers. (Incidentally, although most brokers are insured for errors and omissions, many E&O policies exclude coverage for legal malpractice claims).
Whether a broker has crossed the line in giving legal advice not exempted by the broker's scope of training clearly is a fact-specific question. Client Question: What can I write in this State approved form contract? A licensed broker's clearly is excluded from needing a law license to give this advice. Client Question: What are my options if I want to cancel this contract? A broker answering this question almost certainly would be practicing law.
A client who wants or needs advice as to their legal rights and responsibilities is seeking legal advice. A person who wants to give such advice should be licensed to practice law.