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Rhode Island Closings and the Unauthorized Practice of Law

On May 29, 2020, the Rhode Island Supreme Court released its opinion regarding what functions involved in a real estate closing require the efforts of an attorney and which can be performed by non-attorneys.

The Supreme Court acknowledged that “parties to a real estate transaction are best served if they are represented by licensed attorneys” and “allowing such transactions to be conducted by non-attorneys exposes [the parties] to the possibility of harm,” but the Court ultimately opined that non-attorneys who perform services associated with real estate transactions are not engaging in the unauthorized practice of law.

Specifically, the Court found the following:

(1) Real estate closings can be conducted by non-attorneys in conjunction with the issuance of a title insurance policy; (2) Title insurance companies may conduct title examinations in purchase transactions only if an attorney engaged or employed by the title insurance company conducts the title examination; (3) A licensed attorney must either draft the deed or review a deed that has been drafted by a non-attorney; (4) Title insurance companies may draft a residency affidavit, but if the seller has a question regarding his or her residency, the seller must consult an attorney; and (5) Title insurance companies may draft a durable power of attorney for the limited purpose of a real estate closing.

Citing: In re William E. Paplauskas, Jr.; In re Daniel S. Balkun and Balkun Title & Closing, Inc.; and In re SouthCoast Title and Escrow, Inc., 18-161, 162, 163 (R.I. 2020).

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