ON STANDARDS OF JUDICIAL CONDUCT
OPINION NO. 1 - 2012
RE: Propriety of a judicial law clerk, who is also an accountant, submitting a Power of Attorney form to the IRS in order to discuss tax returns on behalf of a friend.
A newly-licensed attorney, who serves a law clerk for a circuit judge, is also an accountant, though not a CPA. The law clerk has recently prepared some amended tax returns for a friend and is planning on submitting them and an IRS Power of Attorney form to the IRS, so that the law clerk can speak to the IRS as the friend’s accountant. However, to complete the Power of Attorney form, certain qualifications are required; the person submitting the form must either be a CPA or a licensed attorney. The law clerk intends to use his or her South Carolina Bar number for the form to qualify to speak to the IRS. The law clerk will not appear before any court on this matter, but will merely speak to the IRS via telephone. The law clerk inquires as to whether this would constitute the practice of law in violation of Canon 5, Rule 506.
Under these circumstances, the law clerk may use his or her Bar number to submit a Power of attorney form to the IRS in order to discuss tax returns on behalf of a friend.
Rule 506, SCACR governs the conduct for staff attorneys and law clerks. Canon 5 states:
A staff attorney or law clerk shall not practice law in any federal, state, or local court, except in his official capacity as a staff attorney or law clerk, or undertake to perform legal services for any private client in return for remuneration.
This prohibition, however, shall not be construed to preclude the performance of legal work necessary to the management of the personal affairs of the staff attorney or law clerk, his spouse or minor child, so long as:
(1) such work is done without compensation;
(2) it does not require any act, including the entry of an appearance in a court of this State or of the United States, that would suggest that his position is being misused, that preferential treatment is being sought by virtue of the holding of that position, or that would otherwise be inconsistent with his primary responsibility to the employing court;
(3) such activity does not conflict or reasonably appear to conflict with court duties or will not reflect adversely on the court or create the appearance of impropriety.
Canon 5D, Rule 506, SCACR. According to the facts presented, whether the conduct here is permissible depends on whether the law clerk would be practicing law or performing legal services. “The generally understood definition of the practice of law ‘embraces the preparation of pleadings, and other papers incident to actions and special proceedings, and the management of such actions and proceedings on behalf of clients before judges and courts.’ ” State v. Despain, 319 S.C. 317, 319, 460 S.E.2d 576, 577 (1995) (quoting In re Duncan, 83 S.C. 186, 189, 65 S.E. 210, 211 (1909)). The practice of law, however, “is not confined to litigation, but extends to activities in other fields which entail specialized legal knowledge and ability.” State v. Buyers Service Co., Inc., 292 S.C. 426, 430, 357 S.E.2d 15, 17 (1987). This State has refrained from adopting a precise definition of the practice of law and has stated that what constitutes the practice of law must be considered on the facts of each specific case. Doe v. McMaster, 355 S.C. 306, 585 S.E.2d 773.
While the inquiring law clerk must complete the IRS’s “Power of Attorney” form by submitting a South Carolina Bar number, it cannot be said discussion of an amended tax return in and of itself “entail[s] specialized legal knowledge and ability,” such that it constitutes the practice of law. In this situation, the discussion would appear to entail specialized knowledge of accounting, which the inquiring law clerk has as an accountant. Thus, the law clerk may use an SC Carolina Bar number on an IRS Power of Attorney form and converse with IRS about that tax return for a friend without practicing law or performing legal services in violation of Canon 5, Rule 506, SCACR.
January 11, 2012.