SUPREME COURT STATE OF FLORIDA

Transcription

1 IN THE SUPREME COURT STATE OF FLORIDA i hief D uty Clerk Ir By?- THE FLORIDABAR ) I RE: ADVISORY OPtNION 1 NONLAWYER PREPARATION OF ) LIVING TRUSTS 1 1 CASE NO: 78,358 0 INITIAL BRIEF OF RESPONDENTS AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS; FLORIDA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS; ARTHUR ANDERSEN & CO.; COOPERS & LYBRAND; DELOITTE & TOUCHE; ERNST & YOUNG; KPMG PEAT MARWICK; nd PRICE WATERHOUSE I Orig i nl Proceeding Commenced by The Florid Br Stnding Committee on the Unlicensed Prctice of Lw 8 8 Kenneth R. Hrt, Esq. Fl. Br No Ausley, McMullen, McGehee Crothers & Proctor Post Office Box 391 Tllhssee, Florid (904) Counsel for the Florid Institute of Certified Public Accountnts,v.' A hur J. Englnd, Jr., Esq. l. Br No Fine Jcobson Schwrtz Nsh Block & Englnd One CenTrust Finncil Center 100 Southest Second Street Mimi, Florid (305) Counsel for the Respondents Fine Jcobson Schwrtz Nush Block & Englnd

2 c Tble of Conteu.. Tble of Cittions Sttement of the Cse nd Fcts... 1 Summryofthe Argument... 1 Argument Conclusion Certificte of Service Fine Jcobson Schwrtz Ssh Block & Englnd

3 le of Cl-.. u Cses Agrun v. Shcrpiro. 273 P.2d 619 (Cl. Sup. Ct. App. Div. 1954)... 4 Appliction of New York Lwyers Ass n, 78 N.Y.2d 209 (Sup. Ct. App. Div. 1948)... 4 Grdner v. Conwy, 48 N.W.2d 788 (Minn. 1951)... 4 Grce v. Allen, 407 S.W.2d 321 (Tex. Civ. App. Dlls 1966) In the Mtter of the Appliction of the New Jersey Society of Public Accountnts, 507 A.2d 711 (N.J. 1986)... Lowell Bur Ass n v. Loeb, 52 N.E.2d 27 (Mss. 1943) 4... Stte v. Sperry, 140 So.2d 587 (Fl. 1962) vcted on other grounds 373 US. 379 (1963)... 2 The Florid Br re: Advisory Opinion--Nonlwyer Preprtion of Notice to Owner nd Notice to Contrctor, 544 So.2d 1013 (Fl. 1989) The Florid Br re: Advisory Opinion-Nonlwyer Preprtion of Pension Plns,... 2, So.2d 430 (Fl. 1990) The Florid Bur v. Brumbugh, 355 So2d 1186 (H. 1978)... 2 The Florid Bur v. Moses, 380 So.2d 412 (Fl. 1980) Wugh v. Kelley, 555 N.E.2d 857 (Ind. App. 4th Dist. 1990) ii- Fine Jcobson Schwrtz Xsh Block & Englnd I

4 Chpter 473, Florid Sttutes (1989)... 3 Section (3). Florid Sttutes (1989)... 3 Section (4), Florid Sttutes (1989)... 2, 3, 5 Sections , Florid Sttutes ( 1989)... 3 Section , Florid Sttutes ( 1989)... 3 Section , Florid Sttutes (1989)... 3 Section ( l)(), Florid Sttutes (1989)... 3 Section 473,323, Florid Sttutes (1989)... 3 Chpter 21A, Fl. Admin. Code Tx Lwyer No, 1 25 (1982) Fine Jcobson Schwrtx,l'u.rh Block & Englnd

5 This proceeding commenced when the Stnding Committee on the Unlicensed Prctice of Lw filed with the Court on August 1 proposed dvisory opinion ddressing the following question: Whether it constitutes the unlicensed rctice of lw for corportion or other nonlwyer to dr F t living trusts nd relted documents for nother where the informtion to be included in the living trust is gthered by nonlw er gents of the corportion or by the nonlwyer n8 the completed documents re reviewed by member of The Flond Br prior to execution. By order entered on August 2, the Court opened the proceedings to interested prties, On September 29, the following prties were grnted leve to pper by brief nd t orl rgument: Americn Institute of Certified Public Accountnts; Florid Institute of Certified Public Accountnts; Arthur Andersen & Co.; Coopers & Lybrnd; Deloitte & Touche; Ernst & Young; KPMG Pet Mrwick; nd Price Wterhouse. On October 10, these respondents (collectively clled "the CPAs") joined with the Stnding Committee in filing Stipultion to mend the pending proposed dvisory opinion with regrd to certified public ccountnts. A copy of the Stipultion is ppended to this brief. -y of the Areument The prctice of public ccountncy is lerned profession subject to strict regultion, The ctivities involved in this prctice often overlp the ctivities of lwyers. The Court should therefore void ny impliction tht the Stnding Committee's five-step process, its nlysis, or its conclusion concerning living trusts, re pplicble in ny wy to the ctivities of the CPAs. A Stipultion filed by the Stnding Committee nd the CPAs provides lnguge to include in the Court's decision in order to void ny indvertent implictions. Fine Jcobson Schwrtz Xush Block & Englnd

6 Argument In its proposed dvi 3ry opinion, the Stnding Committee h on luded tht the prctice of prepring living trusts constitutes the prctice of lw s defined by the Court in Stiite v. Sperry, 140 So.2d 587 (Fl. 1962), vcted on other grounds, 373 U.S. 379 (1963). According to the Stnding Committee, the cretion of living trust involves five interrelted steps, ech of which flls within the Spry definition: (1) the gthering of the necessry informtion; (2) the ssembly of the document; (3) review with the client; (4) the document's proper execution; nd (5) the funding of the trust document. As the Court hs recognized, "the Sperry definition ws brod nd is given content by this Court only s it pplies to the specific circumstnces of ech cse." The Florid Bur re: Advisory Opinion--Nonlwyer Preprtion of Notice to Owner nd Notice to Contrctor, 544 So.2d 1013, 1016 (Fl. 1989), following the rtionle of The Florid Br v. Brumbugh, 355 So.2d 1186, (Fl. 1978). Any ttempt to formulte lsting, ll encompssing definition of "prctice of lw" is doomed to filure. Id. In cses involving n overlp of professionl disciplines, it is especilly importnt to void rbitrry clssifictions, nd to focus insted on the public's relistic need for protection nd regultion. The Florid Bur re: Advisory Opinion--Nonlwyer Preprtion of Pension Plns, 571 So.2d 430, 433 (Fl. 1990) (herefter "Pension Plns"). Indeed, the Court hs stted tht the single most importnt concern in defining nd regulting the prctice of lw is the protection of the public from incompetent, unethicl, or irresponsible behvior. The Florid Br v. Moses, 380 So.2d 412, 417 (Fl. 1980). For t lest two resons, the Court should void ny impliction tht the Stnding Committee's five-step nlysis nd conclusion concerning living trusts re pplicble in ny wy to the legitimte ctivities of the CPAs when they re engged in the prctice of public ccountncy, s defined in section (4), Florid Sttutes (1989). -2- Fine Jcobson Schwrtx Nsh Block & Englnd

7 t First, the public hs no need for dditionl protection nd regultion of these ctivities, becuse CPAs re subject to stringent regultory requirements under chpter 473, Florid Sttutes, nd chpter 21A. Fl. Admin. Code. Cf. In the Mutter of the Appliction of the New Jersey Society of Public Accountunts, 507 A.2d 72 1, (N.J. 1986) ("New Jersey Society"). No person my engge in the prctice of public ccountncy unless the person is licensed by the Stte of Florid s certified public ccountnt. See sections (3), (4), nd (1)(), Florid Sttutes (1989). In order to receive license s certified public ccountnt, n pplicnt must meet strict requirements concerning morl chrcter, eduction, nd ccounting experience, nd the pplicnt must pss difficult licensure exmintion. See sections through , Florid Sttutes (1989). Ech CPA must lso stisfy continuing eduction requirements. See section , Florid Sttutes ( 1989). Significntly, CPAs re bound by stndrds of prctice, including independence, competence, nd technicl stndrds, nd re subject to disciplinry ctions before the Bord of Accountncy. See sections nd , Florid Sttutes (1989). Second, the prctice of lw nd the prctice of public ccountncy overlp in mny res, nd in some subject res -- most notbly tx plnning nd estte plnning -- the legl nd ccounting spects re "so interrelted, interdependent nd.. overlpping tht they re difficult to distinguish." Uements.Qn Prtice in tk Field of Federl Income Tmn nd Estte Plnniqg, published by the Ntionl Conference of Lwyers nd Certified Public Accountnts, reprinted in 36 Tx Lwyer No. 1, 25, 33 (1982) [herefter cited s the Sttements]. And see New Jersey Society, 507 A.2d t 716. According to the Sttements, the ccounting services of CPAs include "the development nd nlysis of dt, the testing of their vlidity nd relevnce, nd the interprettion nd communiction of the resulting informtion to intended users." 36 Tx Lwyer t 29. CPAs lso "review mny spects of n orgniztion's ctivities nd procedures," "mke constructive suggestion ti on finncil, tx, nd other -3- Fine lcobson Schwrtz i2'sh Block & Englnd

8 I) * operting mtters, "provide objective dvice nd consulttion on vrious mngement problems," nd "ssist in the development nd implementtion of progrms pproved by mngement." /It. t 29. All of these ctivities by CPAs re closely relted to the five-step process identified by the Stnding Committee, but none is ordinrily regrded s the prctice of lw. In certin circumstnces, CPA's my even prepre nd drft documents tht hve legl consequences, or undertke to nswer questions tht hve legl rmifictions, without running foul of prohibitions relting to the prctice of lw. See, e.g., Pension Plns, 571 So.2d t 433; Wugh v. Kelley, 555 N.E.2d 857, 859 (Ind. App. 4th Dist. 1990); Grce v. Allen, 407 S.W.2d 321, (Tex. Civ. App. Dlls 1966); Appliction of New York Luwyers Ass'n, 78 N.Y.2d 209 (Sup. Ct. App. Div. 1948); Grdner v. Conwy, 48 N.W.2d 788 (Minn. 1951); Agrun v. Shpiro, 273 P.2d 619 (Cl. Sup. Ct. App. Div. 1954); Lowell Br Ass'n v. Loeb, 52 N.E.2d 27, (Mss. 1943). In connection with the Court's review of the proposed dvisory opinion, it is unnecessry to explicte demrction between the prctice of lw nd the prctice of public ccountncy, even if it were possible to do so in ny generlized wy. The Stnding Committee did not consider or hve ny informtion regrding the prctice of public ccountncy. See Appendix. It is importnt tht the Court declre the m-pplicbility of the proposed dvisory opinion to CPAs, in whtever form n opinion is ultimtely dopted. To tht end, nd s n mendment to the proposed dvisory opinion, the stipultion of the Stnding Committee nd the CPA contins lnguge to be inserted in the Court's decision in this cse. -4- Fine lcobson Schwrtx Nsh Block & Englnd

9 Conclusion Bsed on the mendment furnished by the Stnding Committee s prt of the Stipultion between the Committee nd the CPAs, the CPAs respectfully request tht the Court incorporte in its opinion the following text: In considering the questions presented in this proceeding, the Stnding Committee did not consider or hve ny informtion regrding the rctice of public ccountnc s defined in section 473. P 02(4), Florid Sttutes (1989. Consequently, the nlysis nd conclusion of the proposed dvisory opinion does not r. ply to nd is not intended to pply to the prctice of pub ic ccountncy s so defined, nd tht prctice is not implicted by the Court's opinion. Y Respec tf u 11 y submitted, Kenneth R. Hrt Post Office Box 391 Tllhssee, Florid (904) H. Br #01925&0 Counsel for FICPA Arthur J. Englnd, Jr. One CenTrust Finncil Center 100 Southest 2nd Street Mimi, Florid (305) Fl. Br # Counsel for AICPA, Arthur Andersen & Co. Coopers & Lybrnd, Deloitte & Touche, Ernst & Young, KPMG Pet Mrwick, nd Price Wterhouse -5- Fine lcobson Schwrtx Ssh Block & Englnd

10 Certificte of Service I certify tht true copy of this brief ws miled on October 25, 1991, to the fo I I o w i n g c o un se I : J, Robert McClure, Jr., Esq. P. 0. Box 190 Tllhssee, Florid Jmes C. Konrske, Esq. P. 0. Box 1166 Zephyrhills, Florid Deborh M. Chlfie, Esq F. Street, Northwest Suite 300 I) Wshington, D.C Kyle A. Silvermn, Esq North Federl Highwy Suite 213 Boc Rton, Florid I) Rohn Kelley, Esq Glt Ocen Drive Fort Luderdle, Florid Dvid R. McCllister, Esq. P. 0. Box 7343 Wesley Chpel, Florid Willim H. Hlker, Jr., Esq Folsorn Blvd. Suite M Sc rmen to. Cliforni Joseph W. Fleece, Jr., Esq. P. 0. Box 330 St. Petersburg, Florid Lori S. Holcomb, Esq. 650 Aplchee Prkwy Tllhssee, FL J. Thoms Crdwell, Esq. Post Office Box 330 St. Petersburg, FL Fine Jcobson Schwrtz Nsh Block & Englnd

11 I

12 IN THE SUPREME'COURT STATE OF FLORIDA The Florid Br, 1 1 Re: Advisory Opinion ) Nonlwyer Preprtion 1 of Living Trust 1 CASE NO. 78,358 Stipultion I) The Stnding Committee of Unlicensed Prctice of Lw, joined by the Americn Institute of Certified Public Accountnts, the Florid Institute of Certified Public Accountnts, Arthur Andersen & Co., Coopers & Lybrnd, Deloitte & Touche, Ernst & Young, KPMG Pet Mrwick, nd Price Wterhouse (collectively "the CPAs"), jointly file this stipultion with the Court reltive to the Committee's proposed dvisory opinion. Bckqround The question presented to the Stnding Committee on Unlicensed Prctice of Lw for proposed forml dvisory opinion ws presented in the context of nonlwyer who is in the business of selling, drfting nd/or providing living trusts for nother either s the only product they sell, drft or provide or in conjunction with other products. The proposed dvisory opinion issued by the Stnding Committee is limited to the question presented nd to the bove fctul context.

13 CASE NO. 78,358 The nlysis nd conclusion in the pro'posed dvisory opinion does not pply nd is not intended to pply to the prctice of public ccountncy s set forth nd defined in section (4), Florid Sttutes (1989). The ctivities of tht form of prctice re not implicted by the opinion, s there ws nothing before the Stnding Committee involving or questioning the ctivities of certified public ccountnts working within the guidelines of the Florid Sttutes nd the rules of the Bord of Accountncy. AqKefXWnt Amonq the Prties The Stnding Committee nd the CPAs stipulte: 1. tht the proposed dvisory opinion does not relte in ny wy to the prctice of public ccountncy s defined in section (4), Florid Sttutes (1989); 2. tht the proposed dvisory opinion should be I) mended in the mnner designted below; 3. tht the CPAs shll mintin their right to file briefs s uthorized by the Court; nd 4. tht the Court is specificlly requested to incorporte in its opinion the following text: In considering the questions presented in this proceeding, the Stnding Committee did not consider or hve ny informtion regrding the prctice of public ccountncy -2-

14 +.. CASE NO. 78,358 e s defined in section (4), Florld Sttutes (1989). Consequently, the nlysis nd conclusion of the proposed dvisory opinion does not pply to nd is not intended to pply to the prctice of public ccountncy s so defined, nd tht prctice is not implicted by the Court's opinion. Respectfully submitted, Kdnneth R. Hrt Lori S. Holcomb Post Office Box Aplchee Prkwy Tllhssee, Florid Tllhssee, Florid (904) (904) Fl. Br # Fl. Br # Counsel for FICPA Counsel for Stnding Committee on UPL One CenTrUt -Finncil Center 100 Southest 2nd Street Mimi, Florid (305) Fl. Br # Counsel for AICPA, Arthur Andersen, Coopers & Lybrnd, Deloitte & Touche, Ernst & Young, KPMG Pet Mrkwick, nd Price Wterhouse -3-

15 CASE NO. 78,358 Certificte of Service I certify tht true copy of the foregoing ws miled on October -, \O 1991, to counsel listed on the ttched Exhibit A, ll of whom hve ppered in the proceeding. 077LT1889F /2/rs