Chapter 260 Oregon Laws 2003
AN ACT
SB 43
Relating to the unauthorized practice of law; creating new provisions; and amending ORS 9.160, 9.166 and 9.241.
Be It Enacted by the People of the State of
Oregon:
SECTION 1. ORS 9.160 is amended to read:
9.160. (1) Except [for the right reserved to litigants by ORS 9.320 to prosecute or defend a cause in person] as provided in this section, [no] a person [shall] may not practice law or represent that person as qualified to practice law unless that person is an active member of the Oregon State Bar.
(2)
Subsection (1) of this section does not affect the right to prosecute or defend
a cause in person as provided in ORS 9.320.
(3)
A person licensed under ORS 696.022 acting in the scope of the person’s license
to arrange a real estate transaction, including the sale, purchase, exchange,
option or lease coupled with an option to purchase, lease for a term of one
year or longer or rental of real property, is not engaged in the practice of
law in violation of subsection (1) of this section.
(4)
A title insurer authorized to do business in this state, a title insurance
agent licensed under the laws of this state or an escrow agent licensed under
the laws of this state is not engaged in the practice of law in violation of
subsection (1) of this section if, for the purposes of a transaction in which
the insurer or agent provides title insurance or escrow services, the insurer
or agent:
(a)
Prepares any satisfaction, reconveyance, release, discharge, termination or
cancellation of a lien, encumbrance or obligation;
(b)
Acts pursuant to the instructions of the principals to the transaction as
scrivener to fill in blanks in any document selected by the principals;
(c)
Presents to the principals to the transaction for their selection any blank
form prescribed by statute, rule, ordinance or other law; or
(d)
Presents to the principals to the transaction for their selection a blank form
prepared or approved by a lawyer licensed to practice law in this state for one
or more of the following:
(A)
A mortgage.
(B)
A trust deed.
(C)
A promissory note.
(D)
An assignment of a mortgagee’s interest under a mortgage.
(E)
An assignment of a beneficial interest under a trust deed.
(F)
An assignment of a seller’s or buyer’s interest under a land sale contract.
(G)
A power of attorney.
(H)
A subordination agreement.
(I)
A memorandum of an instrument that is to be recorded in place of the instrument
that is the subject of the memorandum.
(5)
In performing the services permitted in subsection (4) of this section, a title
insurer, a title insurance agent or an escrow agent may not draft, select or
give advice regarding any real estate document if those activities require the
exercise of informed or trained discretion.
(6) The exemption provided by subsection (4) of this section does not apply to any acts relating to a document or form that are performed by an escrow agent under subsection (4)(b), (c) or (d) of this section unless the escrow agent provides to the principals to the transaction a notice in at least 12-point type as follows:
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YOU WILL BE REVIEWING, APPROVING AND SIGNING IMPORTANT DOCUMENTS AT CLOSING. LEGAL CONSEQUENCES FOLLOW FROM THE SELECTION AND USE OF THESE DOCUMENTS. THESE CONSEQUENCES AFFECT YOUR RIGHTS AND OBLIGATIONS. YOU MAY CONSULT AN ATTORNEY ABOUT THESE DOCUMENTS. YOU SHOULD CONSULT AN ATTORNEY IF YOU HAVE QUESTIONS OR CONCERNS ABOUT THE TRANSACTION OR ABOUT THE DOCUMENTS. IF YOU WISH TO REVIEW TRANSACTION DOCUMENTS THAT YOU HAVE NOT YET SEEN, PLEASE CONTACT THE ESCROW AGENT.
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(7)
The exemption provided by subsection (4) of this section does not apply to any
acts relating to a document or form that are performed by an escrow agent under
subsection (4)(b), (c) or (d) of this section for a real estate sale and
purchase transaction in which all or part of the purchase price consists of
deferred payments by the buyer to the seller unless the escrow agent provides
to the principals to the transaction:
(a)
A copy of any proposed instrument of conveyance between the buyer and seller to
be used in the transaction;
(b)
A copy of any proposed deferred payment security instrument between the buyer
and seller to be used in the transaction; and
(c)
A copy of any proposed promissory note or other evidence of indebtedness
between the buyer and seller to be used in the transaction.
(8)
The notice and copies of documents that must be provided under subsections (6)
and (7) of this section must be delivered in the manner most likely to ensure
receipt by the principals to the transaction at least three days before
completion of the transaction. If copies of documents have been provided under
subsection (7) of this section and are subsequently amended, copies of the
amended documents must be provided before completion of the transaction.
(9) Failure of any person to comply with the requirements of subsections (3) to (8) of this section does not affect the validity of any transaction and may not be used as a basis to challenge any transaction.
SECTION 2. ORS 9.160 is added to and made a part of ORS 9.162 to 9.166.
SECTION 3. ORS 9.166 is amended to read:
9.166. [(1)] If the board has reason to believe that a person is practicing law without a license, the board may maintain a suit for injunctive relief in the name of the Oregon State Bar against any person violating ORS 9.160. The court shall enjoin any person violating ORS 9.160 from practicing law without a license. Any person who has been so enjoined may be punished for contempt by the court issuing the injunction. An injunction may be issued without proof of actual damage sustained by any person. The court may also order restitution to any victim of any person violating ORS 9.160. The prevailing party may recover its costs and attorney fees in any suit for injunctive relief brought under this section in which the board is the plaintiff.
[(2) A person licensed under ORS 696.022 acting in the scope of the person’s license to arrange a real estate transaction, including the sale, purchase, exchange, option or lease coupled with an option to purchase, lease for a term of one year or longer or rental of real property, is not engaged in the practice of law in violation of ORS 9.160.]
SECTION 4. The amendments to ORS 9.160 by section 1 of this 2003 Act apply only to activities of title insurers, title insurance agents and escrow agents as described in the amendments to ORS 9.160 by section 1 of this 2003 Act that take place on or after the effective date of this 2003 Act.
SECTION 5. ORS 9.241 is amended to read:
9.241. (1) Notwithstanding ORS 9.160, the Supreme Court may adopt rules to govern the appearance in judicial and administrative proceedings by attorneys who have not been admitted to practice law in this state. Subject to those rules, an attorney [of the highest court of record in any other state or country] who has not been admitted to practice law in this state may appear as counsel for a party in an action or proceeding before a court, or may appear as counsel for a party in an administrative proceeding, if the attorney is associated with an active member of the Oregon State Bar.
(2) Notwithstanding ORS 9.160, the Supreme Court may adopt rules pursuant to the procedures established by ORS 9.490 that allow attorneys who have not been admitted to practice law in this state to practice law in Oregon on a temporary basis, including performing transactional or prelitigation work.
[(2)] (3) The Supreme Court may by rule require the payment of a fee by an attorney appearing as counsel for a party in an action or proceeding before a court under the provisions of subsection (1) of this section. All amounts collected from any fee imposed by the Supreme Court under the provisions of this subsection shall be deposited with the Oregon State Bar and are continuously appropriated to the Oregon State Bar. Amounts appropriated to the Oregon State Bar under this subsection may be used only for the funding of legal services provided through the Legal Services Program established under ORS 9.572 and for expenses incurred by the Oregon State Bar in the administration of the Legal Services Program and in collecting fees imposed under this subsection.
Approved by the Governor June 10, 2003
Filed in the office of Secretary of State June 11, 2003
Effective date January 1, 2004
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