UPON THE REQUEST OF A MEMBER OF THE SOUTH CAROLINA BAR, THE ETHICS ADVISORY COMMITTEE HAS RENDERED THIS OPINION ON THE ETHICAL PROPRIETY OF THE INQUIRER’S CONTEMPLATED CONDUCT. THIS COMMITTEE HAS NO DISCIPLINARY AUTHORITY. LAWYER DISCIPLINE IS ADMINISTERED SOLELY BY THE SOUTH CAROLINA SUPREME COURT THROUGH ITS COMMISSION ON LAWYER CONDUCT.
Ethics Advisory Opinion 91-06
An attorney intends to solicit by letter persons who have purchased property at tax sales and who have received title by a tax deed to offer representation to clear their tax title and convert same to a fee simple interest. Purchasers of property at a tax sale do not obtain fee simple title thereby limiting their ability to sell or mortgage such property. It is felt that such persons are in need of legal services to assist them in clearing their tax title thereby converting this property to a safe and profitable holding and investment. A record of persons who have purchased property at a tax sale may be found either through the county tax office or by deeds recorded in the R.M.C. Office by the tax collector or treasurer.
Attached is a form letter (Attachment A) intended to be mailed to persons whose names are on the public record who have purchased property at tax sales.
Additional solicitation may be in the form of an advertisement to be published in local, county, or state bar news addressed to attorneys, a copy of which is attached (Attachment B).
A second advertisement would be published in a general newspaper addressed to persons who may have purchased property at tax sales. A copy of this advertisement is also attached (Attachment C).
Questions:
1. May an attorney directly solicit potential clients who may have need of advice to perfect a marketable title on properties obtained through tax sales?
2. Is the form letter (Attachment A) in compliance with Rule 7.3 concerning direct mail solicitation of prospective clients?
3. Are two advertisements (Attachments B and C) in compliance with Rules 7.1 and 7.2?
4. With respect to the direct letter solicitation of perspective clients with possible tax title problems, what are the necessary filings and fees with the Board of Commissioners on Grievances and Discipline?
Summary:
An attorney may through written communication approach prospective clients who have purchased property through tax sales or tax titles. The proposed letter does not adequately comply with the requirements of Rule 7.3 and needs amendment as to both content and form. The proposed advertisement to other attorneys does comply with Rules 7.1 and 7.2.
Opinion:
Rule 7.3 (c) provides:
"Every written or recorded communication from a lawyer soliciting professional employment from a prospective client known to be in need of legal services in a particular matter, and with whom the lawyer has no family or prior professional relationship, shall conform to Rule 7.1 and, in addition, must conform to the following provisions".
The rule then goes on to provide a number of very specific requirements which in some instances the letter (Attachment A) does comply and in others it does not. As required in Rule 7.3 (c) (1), the words, "ADVERTISING MATERIAL", do appear at the top of the letter as required; however, there must be a further notation at the conclusion of the material that it is an advertisement and the words "ADVERTISING MATERIAL" must also appear on the outside of the envelope in which the letter is sent. The letter, while containing similar language, does not comply with Rule 7.3 (c) (2) which requires the following statements to be within the materials verbatim:
(A) "You may wish to consult your lawyer or another lawyer instead of me (us). You may obtain information about other lawyers by consulting the Yellow Pages or by calling the South Carolina Bar Lawyer Referral Service at 799-7100 in Columbia or toll free 1-800-868-2284. If you have already engaged a lawyer in connection with the legal matter referred to in this letter, you should direct any questions you have to that lawyer," and (B) "The exact nature of your legal situation will depend on many facts not known to me (us) at this time. You should understand that the advice and information in this letter is general and that your own situation may vary." In addition, the disclosure concerning the Board of Commissioners on Grievance and Discipline at the closure of the letter is inadequate. It should read and be printed in capitals "ANY COMPLAINTS ABOUT THIS LETTER OR THE REPRESENTATION OF ANY LAWYER MAY BE DIRECTED TO THE BOARD OF COMMISSIONERS ON GRIEVANCES AND DISCIPLINE, POST OFFICE BOX 11330, COLUMBIA, SOUTH CAROLINA, 2921- TELEPHONE NUMBER 803-734-1150." With these additional changes, the letter listed in Attachment A would be acceptable means of direct solicitation to a prospective client with an existing legal problem.
The advertisement directed to attorneys to be printed in the Bar News (Attachment B) does comply with Rule 7.1 and 7.2 by avoiding false or potentially misleading statements and it contains the name of at least one lawyer responsible for its contents.
However, the advertisement to be published in a general newspaper (Attachment C) presents a more difficult question to the extent that it could be read to give the unjustified expectation that the attorney's legal advice would result in a good marketable and full title in every instance that his advice was sought. A safer course would be to reword the advertisement to indicate that the advice would be on the issue of obtaining a marketable title or in the hope of obtaining a marketable title it would be acceptable.
With respect to individual written communications of this type to prospective clients, there is a requirement that each written communication be sent together with a fee of Ten ($10.00) Dollars to the Board of Commissioners on Grievances and Discipline within ten (10) days after the communication is sent. In the instance of a written communication, it is only necessary to file one copy of a form letter and a listing of those individuals to whom it was sent. If there is any material alteration in the form of the letter or there are subsequent mailings at a different time, then additional filing and Ten ($10.00) Dollar fee should be forwarded to the Board of Commissioners on Grievance and Discipline. With the alterations noted the advertisements and the direct letter solicitation may be sent to prospective clients who have purchased property through tax sales.
ATTACHMENT A ADVERTISING MATERIAL
Dear Mr. Smith I have determined from the public records that at one time you owned property located at , ____________________ Columbia, South Carolina which you purchased at a Richland County Tax Sale. If you still are the owner of this property you may have come to realize that property purchased at a "tax sale" is not a good marketable title. You may have difficulty in selling this property at its real market value or to mortgage it as security for a loan because it is a "tax title". This problem can generally be corrected by either obtaining a deed from defaulting taxpayer or clearing the "tax title" through judicial proceedings. Of course, each purchase at a tax sale obtaining title by a tax deed is different and therefore advice given herein is general and your situation may be different. Our law firm may be able to be of assistance to you in correcting this defective title. We have experience in clearing tax titles through legal proceedings and can offer you effective and prompt legal service. We will be pleased, without any obligation on your part, to set an appointment and review your "tax title" and discuss our representation in this matter. You may also wish to consult another attorney concerning these legal proceedings. If you would like to further information or to set an appointment, please complete the enclosed inquiry and return to our office.
Very truly yours _________________ Enclosures Any complaint about this communication to you may be filed with the Board of Commissioners on Grievance and Discipline.
(NOTE: WITHOUT THE REQUIRED ADDITIONAL LANGUAGE MENTIONED IN THE OPINION, THIS SOLICITATION IS IMPROPER.) ATTACHMENT B (to be published in Bar News) Advertising Material TO ATTORNEYS:
ASSISTANCE TO ATTORNEYS WHO REPRESENT CLIENTS IN NEED OF CLEARING TAX TITLES.
Name/Address of attorney ATTACHMENT C (to be published in general newspaper) Advertising Material Notice to purchasers of real estate at tax sale LEGAL ADVICE GIVEN TO CLEAR YOUR TAX TITLE TO A GOOD MARKETABLE TITLE MAKE APPOINTMENT WITHOUT OBLIGATION.
Name/Address of attorney.