Can a firm distribute printed real-estate sale forms that show the attorneys' names and the firm as escrow agent?

Plain-English summary

A grievance committee referred to the Committee a complaint about a firm that provided printed real-estate sales agreement forms bearing the firm's name as escrow agent. The forms, printed in lots of 1,000 to 5,000 and assembled in pads, showed the names of the issuing attorneys and a clause by which the attorneys acknowledged receipt of the earnest money and agreed to execute the escrow for both parties, signed "Doe and Roe, Attorneys." The attorneys said they distributed the forms only to parties requesting them, who were already clients or who, by asking for the forms, indicated they expected to use the firm; some local real-estate firms had picked up unused pads. The question was whether the practice violated the advertising Canons.

The Committee concluded that the conduct complained of, as amplified in the grievance committee's letter, unqualifiedly violates Canon 24 of the Canons of Ethics of the State Bar of Texas (5-1).

Currency note

This opinion was issued in 1956, under the former Texas Canons of Ethics, which the Texas Disciplinary Rules of Professional Conduct replaced effective January 1, 1990. It also predates Bates v. State Bar of Arizona, 433 U.S. 350 (1977), which loosened categorical advertising restrictions, though prohibitions on solicitation were not eliminated. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Could the firm hand out printed real-estate forms showing its name as escrow agent?

A: No. A majority held the practice unqualifiedly violates Canon 24, the advertising canon (5-1).

Q: Did it matter that the forms went only to the firm's clients?

A: No. The Committee found the violation even though the parties requesting the forms were the attorneys' clients.

Background and rules framework

The opinion interprets former Texas Canon 24 (advertising and solicitation). The modern analogs are ABA Model Rules 7.1 (communications concerning a lawyer's services) and 7.2 (advertising), under which the categorical bans of the canon era were substantially narrowed after Bates.

Citations and references

Rules of Professional Conduct:

• MR 7.1 (communications concerning a lawyer's services), as the modern analog
• MR 7.2 (advertising), as the modern analog
• Texas Canon 24 (advertising and solicitation)

See also

• TX Ethics Op. 138: Phone Numbers in City Directories
• TX Ethics Op. 155: Bold-Face Directory Listings
• TX Ethics Op. 160: Lending Letterhead for Collections

Source

• Landing page: https://www.legalethicstexas.com/resources/opinions/opinion-134/
• Original PDF: https://tcle-web.s3.amazonaws.com/public/documents/Opinion_134.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

QUESTION PRESENTED

This question was first submitted to the Committee on Interpretation of the Canons of Ethics for the 1954-55 period, but action by the committee was withheld because the inquiry was then pending before a grievance committee

Since then the chairman of this committee has received the following letter from the chairman of the grievance committee involved:

"(There has been) forwarded to me a photo copy of your letter dated October 18, 1955, concerning inquiry of . . . involving the practice by a firm of attorneys here of providing printed forms of agreements for use in sales of real estate with their firm name shown as escrow agent.

"This committee held a hearing last night on the complaint . . . against the firm that provides these forms. The evidence showed that these lawyers have a Form No. 25 entitled 'Real Estate Sales Agreement (Providing for Title Insurance),' a copy of which is enclosed, and a Form No 26 entitled 'Real Estate Sales Agreement (Assumption of Existing Loan),' a copy of which is enclosed. These forms are printed in lots of 1000 to 5000 and assembled in pads. The attorneys involved stated that they do not make any distribution of the forms except to parties requesting them and that the parties requesting the forms are their clients already or by asking for the forms indicate that they expect to use the services of their firm. They estimated that ten or fifteen local real estate firms have picked up and now have some of the unused forms. A former president of the Real Estate Board, who testified for them, said that he now has a pad of the forms.

"Our committee voted to hold in abeyance action on the complaint until further study and consideration whether the practice with respect to the forms is violative of the Canons of Ethics.

"We are not trying to avoid any of our responsibility but we feel that your committee, through broader and special experience in interpreting the Canons of Ethics, can reach a better informed opinion as to the propriety of the practice than we can. Also, we feel that the attitude toward the practice ought to be uniform over the state. Accordingly, we would like very much to have the opinion and ruling o, your committee

"Actually, by indicating whether or not the practice is proper, you will not be determining whether disciplinary action will be taken by our committee, because if it is determined ultimately that the practice is not proper, members of the firm involved have indicated that they will cease and desist or at least modify their practice to conform with any rule, and under these circumstances our committee will not feel impelled to take any further action."

On the real estate forms complained of, there are shown the names of the attorneys issuing them and at the bottom of each form there appears the following:

"Doe and Roe (the attorneys) hereby acknowledge receipt of the earnest money set out in Paragraph 7 hereof and agree to execute this trust for both parties hereto.

Doe and Roe, Attorneys

The question submitted is: Is this a violation of the Canons of Ethics regarding advertising?

Since the question was first submitted to the 1954-55 committee, that committee has been asked to render an opinion.

18 Baylor L. Rev. 249 (1966)

SOLICITATION - PRINTED FORMS
Providing printed forms of agreements for use in sales of real estate which show the names of the attorneys issuing them and also show their firm name as escrow agents is prohibited even though the parties requesting the forms are the attorneys' clients.

Canon 24.

The committee is of the opinion that the conduct complained of, as amplified and explained in the letter from the chairman of the grievance committee unqualifiedly violates Canon 24 of the Canons of Ethics of the State Bar of Texas. (5-1)

Tex. Comm. On Professional Ethics, Op. 134 (1956)