Filed February 27, 2013
In re Yinkang Hu
Commission No. 09 CH 95
Synopsis of Review Board Report and Recommendation
The Administrator charged Hu, who was admitted to practice in Illinois as a foreign legal consultant pursuant to Supreme Court Rule 712, with six counts of engaging in the unauthorized practice of law, engaging in dishonest conduct, and failing to identify himself as a foreign legal consultant to clients and other attorneys. The Hearing Board found that the Administrator proved the charges against Hu and recommended that he be disbarred as a foreign legal consultant.
On review, Hu challenged most of the Hearing Board's findings of misconduct. He argued that he acted properly within the scope of his immigration practice and his powers as registered agent and holder of power of attorney for his clients. Hu further contended that the Hearing Board erroneously admitted opinion testimony from one of the Administrator's occurrence witnesses.
The Review Board rejected Hu's arguments and recommended that the Hearing Board's findings of misconduct be affirmed. Because Hu was previously censured for similar misconduct and appeared to lack understanding of his ethical obligations, the Review Board recommended that he be disbarred as a foreign legal consultant.
BEFORE THE REVIEW BOARD
ILLINOIS ATTORNEY REGISTRATION
In the Matter of:
Commission No. 09 CH 95
REPORT AND RECOMMENDATION OF THE REVIEW BOARD
This matter comes before the Review Board on the exceptions of Respondent-Appellant, Yinkang Hu, to the Hearing Board's findings that he engaged in misconduct including the unauthorized practice of law and to its recommendation that he be disbarred as a foreign legal consultant. The Administrator-Appellee charged Respondent in a six-count amended complaint with engaging in the unauthorized practice of law, in violation of Rule of Professional Conduct 5.5(a) and Supreme Court Rule 712(e); engaging in dishonest conduct, in violation of Rule 8.4(a)(4); using a title other than "foreign legal consultant," in violation of Supreme Court Rule 712(e)(10); and failing to identify the jurisdictional limitations on his license on his letterhead, in violation of Rule 7.5(b). Respondent admitted the allegations and misconduct charged in Count I of the amended complaint but denied all misconduct alleged in the remaining counts.
On review, Respondent challenges the Hearing Board's findings that he committed the misconduct charged in Counts II-VI and further challenges the admissibility of testimony from one of the Administrator's witnesses. He asks the Review Board to bar the aforementioned witness, strike his testimony, and remand the matter to the Hearing Board. The
Administrator asks this Board to affirm the Hearing Board's findings and to adopt its recommended sanction.
Respondent, also known as Kelvin Y. Hu, is a native of China who was admitted to practice in Illinois as a foreign legal consultant in 1993. He also holds a Michigan law license. In 2005, Respondent requested that the Administrator place his license to practice as a foreign legal consultant on inactive status. Respondent was removed from the Master Roll of Attorneys in 2007 for failure to register.
Count I-Representation of Juzhen Tong
Respondent admitted the misconduct charged in Count I. The facts pertaining to the charges in Count I are not part of the issues on review except as they pertain to the sanction recommendation. Briefly, in December 2007, Respondent agreed to handle Juzhen Tong's application to the Illinois Department of Financial and Professional Regulation (IDFPR) for an acupuncturist's license. In communicating with IDFPR attorney Louis Mago regarding Tong's application and request for a hearing, Respondent identified himself as Tong's "counsel" and "attorney." Respondent's letterhead identified Respondent's address as the "Law Office of Kelvin Y. Hu." Attorney Mago believed that Respondent was a licensed Illinois attorney and was misled by Respondent's letterhead and references to himself as Tong's attorney of record.
Respondent abruptly withdrew from the Tong matter right before the scheduled hearing date of August 25, 2008. Respondent did so because he knew he was not licensed to practice law in Illinois, but he told Tong that he would be out of town on the hearing date. Respondent characterized his representation to Tong as a "white lie" that did not harm anyone.
The Hearing Board found that Respondent engaged in the unauthorized practice of law, in violation of Rule of Professional Conduct 5.5(a); acted outside the scope of
permissible activities for a foreign legal consultant, in violation of Supreme Court Rules 712(e)(1), (8), and (11); failed to identify the jurisdictional limitations on his right to practice, in violation of Rule 7.5(b) and Supreme Court Rule 712(e)(10); and engaged in dishonest conduct, in violation of Rule 8.4(a)(4).
Counts II-VI are related to Respondent's involvement in five Chinese companies' efforts to purchase business property in Illinois. Respondent was initially hired by Yang Guo Wang to assist the companies' owners with visa applications. Mr. Wang was a physician in China who moved to the United States in 1990 and is now a Untied States citizen. He is a licensed acupuncturist and is also involved in helping Chinese businesses establish bases in the United States. Mr. Wang was under the impression that Respondent was a "general lawyer" who had a good reputation in the Chinese community.
In addition to assisting with the visa applications, Respondent prepared and filed articles of incorporation for each of the Chinese companies with the Illinois Secretary of State. He received a fee of $500 per company for doing so. Respondent advised the companies that they had to rent or purchase offices in Illinois in order to obtain visas. Consequently, the companies sought to purchase business condominiums from a development referred to as the Keystone property in Rolling Meadows. The Keystone property was owned by a company called Linkers, which Mr. Wang and a partner had established in 2007 and sold in 2008. Mr. Wang was an agent of Linkers at the time of the incidents in question.
Attorney Vincent Auricchio represented Linkers in the sale of the business condominiums. Mr. Wang wanted Attorney Auricchio to represent the buyers as well but Attorney Auricchio insisted that Mr. Wang find another attorney to represent the buyers. This
led Mr. Wang to hire Respondent. Attorney Auricchio communicated with Respondent and Mr. Wang in preparation for the closings. When Attorney Auricchio spoke with Respondent over the phone shortly before the closing, he asked Respondent whether he was "the buyers' attorney for the five companies from China." Respondent confirmed that he was. Attorney Auricchio sent Respondent a follow-up letter in which he referred to Respondent as the buyers' attorney. Respondent did not correct Attorney Auricchio's description of him.
The buyers were not able to attend the closings, so they gave Respondent power of attorney for the purpose of executing the closing documents. Attorney Auricchio, Respondent, Mr. Wang, and Lee Ying Hong, a representative of Linkers, attended the closings on March 27, 2009. The closings could not be completed on that date, so they were continued until April 3, 2009. Attorney Auricchio learned on the morning of April 3 that two of the companies would not be going through with the closings on that date.
Respondent attended the closings for the three remaining Chinese companies on April 3, 2009. He reviewed and signed documents and checked the figures on the HUD-1 Settlement Forms. Mr. Wang and Attorney Auricchio believed that Respondent represented the buyers. At no time did Respondent disclose that he was a foreign legal consultant and was not licensed in Illinois. Had Attorney Auricchio known Respondent's status, he would have asked that another attorney be retained to represent the buyers.
Respondent received a $500 fee for each closing. The Final Settlement Statement for one of the transactions showed a $500 charge to the buyer for "Attorney's Fees to the Law Office of Kelvin Hu."
Respondent believed he was allowed to prepare articles of incorporation for the Chinese companies based on 805 ILCS 5/5.05, which provides that an Illinois resident may act
as a registered agent for a corporation. Respondent also drafted the corporate minutes and other documents. Respondent denied that he acted as the buyers' attorneys in the condominium purchases. He testified that he acted only as their "attorney-in-fact" by signing documents and believed he was allowed to do so pursuant to the Illinois power of attorney statute. He believed that Attorney Auricchio represented both the buyers and the sellers.
Respondent was censured on consent on December 1, 2000. In re Hu, 99 CH 99, petition to impose discipline on consent allowed, No. M.R. 17049 (Dec. 1, 2000). He was charged with engaging in the unauthorized practice of law and improperly identifying himself as an attorney at law without limitation or qualification. Specifically, while working as a manager for Illinois corporation New King, Respondent prepared and filed corporate documents, including an Annual Report and amendments to the Articles of Incorporation; attended a closing on the corporation's behalf and reviewed closing documents; handled a liquor license application to the City of Chicago; prepared a store lease and rider; appeared in court on behalf of the corporation; prepared and filed a summons, motion to appoint special process server, and affidavit in a small claims matter; and sent out communications on letterhead identifying himself as "ATTORNEY AT LAW." Respondent represented to the Administrator that he understood that he could not provide legal services on matters involving Illinois law and that he would change his letterhead to reflect the limitations on his license.
On review, Respondent admits his misconduct in connection with the Tong matter but challenges the Hearing Board's findings on the remaining counts. After careful consideration, we recommend that the Hearing Board's findings be affirmed.
As a foreign legal consultant, Respondent was required to abide by the limitations on his practice set forth in Supreme Court Rule 712(e). The portions of Supreme Court Rule 712(e) that apply to this matter are as follows:
Right to Practice and Limitations on Scope of Practice. A person licensed as a foreign legal consultant under this rule may render legal services and give professional advice within the State only on the law of the foreign country where the foreign legal consultant is admitted to practice. A foreign legal consultant in giving such advice shall not quote from or summarize advice concerning the law of this State (or of any other jurisdiction) which has been rendered by an attorney at law duly licensed under the law of the State of Illinois (or of any other jurisdiction, domestic or foreign). A licensed foreign legal consultant shall not:
(1) appear for a person other than himself or herself as attorney in any court, or before any judicial officer, or before any administrative agency, in this State (other than upon admission in isolated cases pursuant to Rule 707) or prepare pleadings or any other papers or issue subpoenas in any action or proceeding brought in any such court or before any such judicial officer, or before any such administrative agency;
(8) render professional legal advice on or under the law of the State of Illinois or of the United States or of any state, territory or possession thereof or of the District of Columbia or of any other jurisdiction (domestic or foreign) in which such person is not authorized to practice law (whether rendered incident to the preparation of legal instruments or otherwise);
(10) use any title other than ?foreign legal consultant' and affirmatively state in conjunction therewith the name of the foreign country in which he or she is admitted to practice (although he or she may additionally identify the name of the foreign or domestic firm with which he or she is associated);
(11) in any way hold himself or herself out as an attorney licensed in Illinois or as an attorney licensed in any United States jurisdiction.
Respondent argues that the actions he took on behalf of the Chinese companies were authorized and did not violate Supreme Court Rule 712(e). He asserts that he acted within the scope of his powers as an immigration attorney, registered agent, and holder of power of
attorney for purpose of the real estate transactions. The Hearing Board considered Respondent's arguments and found that they did not provide a valid basis for his conduct. We agree with the Hearing Board's determination.
We defer to the Hearing Board's factual findings and will not disturb them unless they are contrary to the manifest weight of the evidence. In re Timpone, 157 Ill.2d 178, 196, 623 N.E.2d 300, 191 Ill. Dec. 55 (1993). A finding is against the manifest weight of the evidence only when the opposite conclusion is clearly evident. In re Winthrop, 219 Ill. 2d 526, 542, 848 N.E.2d 961, 302 Ill. Dec. 397 (2006). The Hearing Board's legal conclusions, including whether the facts as found constitute misconduct, are subject to de novo review. Winthrop, 219 Ill. 2d at 542, 848 N.E.2d 961.
While Respondent may have been authorized to assist his clients in immigration matters, that authorization did not extend to assisting them with incorporating and establishing businesses in Illinois. Supreme Court Rule 712(e) expressly limited Respondent to providing legal services in Illinois only on the law of the foreign country where he was admitted to practice. It prohibited Respondent from rendering advice on Illinois law (see Supreme Court Rule 712(e)(8)).
The preparation of articles of incorporation has been found to involve the practice of law in Illinois. Illinois State Bar Association Advisory Opinion 97-5 considered the question and concluded that, "while an individual may complete the forms for him/herself without receiving assistance, anyone giving advice to another in the completion of the corporate documents, such as the articles of incorporation, is unlawfully engaged in the practice of law, regardless of whether compensation is received." (Ill.St. Bar. Assn. 1995). While Respondent disagrees with this position, he has not provided us with a persuasive reason to disregard it.
Respondent's reliance on an advisory opinion from the State of Washington Practice of Law Board is unavailing, as it too concluded that the preparation of articles of incorporation by a non-lawyer constitutes the unauthorized practice of law. (Washington Practice of Law Board Adv. Op. 04-36 (Jan. 2006)). Respondent focuses on the finding that the preparation of annual reports and meeting minutes does not constitute the practice of law, but this does not help Respondent. The Hearing Board in this case did not base its finding on Respondent's preparation of corporate minutes or annual reports. Rather, it expressly found that "Respondent's preparation of the articles of incorporation on behalf of these five corporations involved the practice of law." In re Hu, 09 CH 95, Hearing Board Report and Recommendation at 36.
Moreover, Respondent was on notice from his prior disciplinary case that his preparation and filing of corporate documents constituted the unauthorized practice of law. Respondent was censured for, among other things, preparing and filing with the Illinois Secretary of State a Statement of Change of Registered Agent, the Domestic Corporation Annual Reports for 1996, 1997, and 1998, and Articles of Amendment to the Articles of Incorporation changing the corporation's name. Respondent told the Administrator at the time of his first disciplinary matter "that he now understands that unless he is admitted to the Illinois bar, he cannot provide legal services on behalf of the corporation in matters involving Illinois law." In re Hu, No. M.R. 17049 (Dec. 1, 2000). Thus, Respondent cannot have reasonably believed that he was permitted to prepare and file corporate documents on behalf of the Chinese businesses involved in this matter.
Respondent's status as a registered agent for the Chinese companies does not assist him. The statute cited by Respondent, 805 ILCS 5/5.05 (West 2011), sets forth general
requirements regarding registered agents and does not authorize a non-lawyer registered agent to prepare and file articles of incorporation.
With respect to Respondent's involvement in the Chinese companies' real estate transactions, the Hearing Board rejected Respondent's assertion that he was not acting as the buyers' attorney but was only signing documents pursuant to the powers of attorney executed by the companies. We have no reason to disagree with the Hearing Board's findings. Mr. Wang and Attorney Auricchio testified that Respondent represented the buyers. Their testimony is corroborated by Attorney Auricchio's correspondence with Respondent, which specifically refers to Respondent as the buyer's attorney, as well as Attorney Auricchio's testimony that Respondent's review of the settlement forms and figures at closings was consistent with the conduct of a buyer's attorney. Respondent's testimony that he believed that Attorney Auricchio represented the buyers is inconsistent with Respondent's collection of a $500 fee for each closing that he attended. For these reasons, the Hearing Board's finding that Respondent acted as the buyers' attorney was not against the manifest weight of the evidence.
Respondent further argues that he did not hold himself out as a licensed Illinois attorney and was not required to correct others' mistaken impressions that he was licensed in Illinois. Supreme Court Rule 712(e)(10) and (11) prohibit foreign legal consultants from using any title other than "foreign legal consultant" and from in any way holding themselves out as attorneys licensed in Illinois. Respondent's licensures in Michigan and the immigration courts do not absolve him of his obligation to identify himself as a foreign legal consultant in Illinois. There is no evidence in the record that Respondent ever identified himself as a foreign legal consultant to persons who retained him or to attorneys with whom he communicated. Rather, he identified himself as "attorneyhu" in his email address, and gave his address as "Law Office of
Kelvin Hu." In so doing, he gave others the impression that he was a licensed Illinois attorney. Attorney Auricchio's references to Respondent as Kelvin Hu, Esq. and "the buyer's attorney" should have alerted Respondent of the need to clarify his status, but instead Respondent allowed the mistaken understanding to continue through the completion of the three closings and Respondent's collection of $1500 in fees. Under these circumstances, the evidence amply supports the findings that Respondent violated Supreme Court Rules 712(e)(10) and (11).
Contrary to Respondent's argument, the Hearing Board's findings of misconduct do not defeat his ability to represent clients in immigration cases. Only Respondent's ability to handle matters involving Illinois law is limited. Respondent could have represented the owners of the Chinese companies in their immigration cases but referred their business incorporation and real estate matters to an attorney licensed in Illinois. In this way he could have maintained his immigration practice without violating Supreme Court Rule 712(e). The fact that it may have been inconvenient or less expedient for Respondent to do so does not equate with an impermissible burden on his right to practice in the immigration courts.
Last, we reject Respondent's argument that he was prejudiced when the Hearing Board allowed Attorney Auricchio to present opinion testimony when he was not disclosed as an opinion witness. The record shows that the Administrator disclosed Attorney Auricchio as a fact witness with knowledge of his dealings with Respondent in connection with the real estate transactions and Respondent's involvement in those transactions. According to Respondent, Attorney Auricchio's testimony that Respondent acted as the buyer's attorney was an undisclosed expert opinion. When challenging an evidentiary decision on review, Respondent must demonstrate that the Hearing Board abused its discretion. See In re Blank, 145 Ill.2d 534, 553-554, 585 N.E.2d 105 (1992) (the Hearing Board's evidentiary rulings will not be disturbed
absent an abuse of discretion).He has not met this burden. Attorney Auricchio testified regarding his understanding of Respondent's role based on his communications with and observations of Respondent. He was an occurrence witness, not an expert witness.
Respondent further argues that Attorney Auricchio was not a credible witness because he made inconsistent statements. Respondent's failure to clearly identify the allegedly inconsistent statements and to direct us to the part of the record where the statements appear prevents us from considering this argument and is a violation of Commission Rule 302(f)(5). Moreover, the Hearing Board considered all of the testimony and determined that Attorney Auricchio was a credible witness. We defer to the Hearing Board on issues of credibility. Winthrop, 219 Ill.2d 526, 542, 848 N.E.2d 961. For these reasons, we decline to disturb the Hearing Board's credibility findings. We recommend that the Hearing Board's factual findings and findings of misconduct be affirmed.
Pursuant to Supreme Court Rule 777(a), a foreign legal consultant's disciplinary proceedings are subject to the Supreme Court and Attorney Registration and Disciplinary Commission Rules relating to the discipline of attorneys. Consequently, upon proof of misconduct, Respondent is subject to discipline, including disbarment, as set forth in Supreme Court Rule 770.
We make our sanction recommendation independently of the Hearing Board (In re Ingersoll, 186 Ill.2d 163, 178, 710 N.E.2d 390 (1999)) and, in this case, agree with the Hearing Board's recommendation. As the Hearing Board noted, there is no Illinois precedent for discipline of foreign legal consultants other than Respondent's prior disciplinary proceeding. Nonetheless, the circumstances of this case clearly reveal that Respondent is neither willing nor
able to abide by the limitations upon a foreign legal consultant's practice. Despite Respondent's representations to the Administrator in his first disciplinary matter that he understood those limitations, he abused the privilege of his foreign legal consultant status, gave clients and other attorneys the false impression that he was licensed to practice in Illinois without limitation, and profited from his misrepresentations. Respondent's recidivism is a significant factor in aggravation that supports disbarment. See In re Blank, 145 Ill.2d 534, 555, 585 N.E. 2d 105 (1992) (disbarment is appropriate when previous disciplinary sanctions failed to deter a respondent from repeating his misconduct).
We recognize that Respondent has placed himself on inactive status and is no longer on the Master Roll of Attorneys, but we do not believe that he should have the opportunity to return to active status. We consider it unlikely that he would abide by the applicable ethical rules if he were to return to practice in the future. Therefore, we recommend that Respondent be disbarred as a foreign legal consultant. The purpose of our recommendation is not to punish Respondent, but to protect the public, maintain the integrity of the profession and protect the administration of justice from reproach. In re Timpone, 157 Ill.2d 178, 197, 623 N.E.2d 300 (1993).
We recommend that the Hearing Board's findings of fact and misconduct be affirmed and that Respondent, Yinkang Hu, also known as Kelvin Y. Hu, be disbarred as a foreign legal consultant.
Richard A. Green
I, Kenneth G. Jablonski, Clerk of the Attorney Registration and Disciplinary Commission of the Supreme Court of Illinois and keeper of the records, hereby certifies that the foregoing is a true copy of the Report and Recommendation of the Review Board, approved by each Panel member, entered in the above entitled cause of record filed in my office on February 27, 2013.
Kenneth G. Jablonski, Clerk of the