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Keywords

contractdamagesattorneyinjunctionappealtrial
contractdefendantattorneylawyerinjunctionappealtrial

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Cultum v. Heritage House Realtors, Inc., 103 Wash.2d 623, 694 P.2d 630, 53 USLW 2387

Facts

In 1980, Diane Cultum contacted Heritage House Realtors in response to an advertisement and worked with realtor Yvonne Ramey to purchase a home. Cultum expressed a desire for a structural inspection contingency in her offer, but Ramey failed to include a subjective right in the contingency clause. After the offer was accepted, Cultum found the inspection report unsatisfactory and demanded her earnest money back, leading to a dispute with the sellers and ultimately this legal action.

In 1980 Cultum contacted Heritage in response to an advertisement in the Seattle Times and was put in touch with Yvonne Ramey (Ramey), a real estate agent for Heritage.

Issue

Whether the completion by a real estate salesperson of a form earnest money agreement containing a contingency clause constitutes the unauthorized practice of law in violation of RCW 2.48.170 –.190.

At issue in this appeal is whether the completion by a real estate salesperson of a form earnest money agreement containing a contingency clause constitutes the unauthorized practice of law in violation of RCW 2.48.170 –.190.

Rule

Licensed real estate brokers and salespersons may complete standardized real estate forms, provided they comply with the standard of care demanded of an attorney.

We believe it is in the public interest to permit licensed real estate brokers or licensed salespersons to complete such lawyer prepared standard form agreements; provided, that in doing so they comply with the standard of care demanded of an attorney.

Analysis

The court determined that while the completion of earnest money agreements might be seen as the practice of law, it is in the public interest to allow licensed real estate professionals to complete such forms. The court emphasized that these professionals must adhere to the standard of care expected of attorneys, particularly when they fail to follow explicit client instructions, which in this case led to Cultum's damages.

We think there are sound and practical reasons why some activities which fall within the broad definition of 'the practice of law' should not be unauthorized simply because they are done by laypersons.

Conclusion

The Supreme Court reversed the trial court's finding of unauthorized practice of law, dissolved the injunction against Heritage, and remanded for a determination of contractual attorney fees, while affirming the award of damages to Cultum.

We now reverse the decision of the trial court that defendant's actions constituted the unauthorized practice of law, dissolve the injunction, and remand for a determination of contractual attorney fees.

Who won?

Heritage House Realtors, Inc. prevailed in the appeal because the Supreme Court found that their actions did not constitute the unauthorized practice of law.

The Supreme Court, Pearson, J., held that: (1) act of licensed realtor in completing a form earnest money agreement did not constitute the unauthorized practice of law.

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