March 17, 2015
While Ohio law allows individuals to represent themselves in court (pro se), non-lawyers may not represent others. This prohibition extends to non-lawyers who are the sole member of a limited liability company or sole shareholder of a corporation.
While for many small businesses there may seem to be no distinction between the sole shareholder/member and the entity itself, the law recognizes the distinction – indeed such recognition is the foundation of corporate existence – and it is important to recognize and respect that same distinction.
We recently handled a case involving two defendants, both of which were limited liability companies. The statutory agents for both defendant entities were non-lawyer members of the respective companies (perfectly legal and acceptable); and the statutory agents for both companies attempted to make “pro se” filings in the case. These filings were stricken by the Court, and treated as if neither defendant had appeared or answered the complaint in the case. Ultimately, the judge entered default judgment in our client’s favor and against the defendants.
Further, the Ohio Supreme Court has held that such attempted “pro se” representation warrants civil fines and sanctions for “unauthorized practice of law.” See Disciplinary Counsel v. Kafele, 843 N.E.2d 169, 174, 108 Ohio St.3d 283, 288, 2006 -Ohio- 904, ¶ 20 (Ohio,2006), finding a $1,000.00 fine appropriate where a non-lawyer member of an LLC made filings and attempted to represent the LLC in a lawsuit, and Cleveland Metro. Bar Assn. v. McGinnis, 137 Ohio St.3d 166 (Ohio,2013) assessing a $6,000.00 fine for such unauthorized practice of law.
If your small business has a legal issue, hire an attorney to make sure you and your business are protected.