By: Anna Lants
On December 16, 2024, the U.S. District Court for the Eastern District of North Carolina dismissed a lawsuit challenging the state’s prohibition on the unauthorized practice of law (“UPL”), igniting a debate over free speech, access to justice, and the regulation of the legal profession.[1]
The plaintiffs—two certified paralegals in coordination with the North Carolina Justice for All Project—argue North Carolina’s UPL laws, which prohibit non-lawyers from giving legal advice, violate their First Amendment right to free speech and exacerbate an already significant access-to-justice gap.[2] Last month, the plaintiffs appealed the district court’s dismissal in Polaski v. Lee, setting the stage for a legal battle that could have significant implications for the regulation of the legal profession in the state.[3]
North Carolina’s Law on the Unauthorized Practice of Law
North Carolina’s UPL statutes broadly define the practice of law to include “performing any legal service for any other person, firm or corporation, with or without compensation.”[4] This includes representing individuals or entities in legal matters, preparing legal documents or court filings, and providing legal advice or counsel.[5] Excluding narrow exceptions carved out for mediators, real estate brokers, and licensed motor vehicle dealers, non-lawyers who hold themselves out as being “competent or qualified” to perform these legal services may be found guilty of a criminal offense.[6]
Paralegals, as non-lawyers, are subject to these UPL laws. While the North Carolina State Bar and North Carolina Supreme Court recognize that paralegal utilization is essential to the provision of affordable legal services (and accordingly adopted proficiency standards for paralegal certification in 2004), paralegals are still constrained in the type and extent of services they may perform.[7] For example, paralegals must be directly supervised by a licensed attorney.[8] Furthermore, paralegals may perform only “legally-related tasks,” as distinguished from “legal services.”[9] According to the North Carolina State Bar, such tasks include communicating settlement terms with insurers, requesting client signatures on documents, and handling the disbursements of proceeds for transactions.[10] However, in all instances, paralegals are prohibited from exercising “independent legal judgment.”[11]
Why Paralegals Argue UPL Laws Violate Their Right to Free Speech
In January 2024, two North Carolina paralegals, who combined have more than 40 years of experience working under licensed attorneys,[12] sued to challenge North Carolina’s UPL statutes on First Amendment grounds. Joined by the North Carolina Justice for All Project, a nonprofit advocating for expanded access to legal assistance for low-income individuals, the plaintiffs argued the state’s broad UPL laws unconstitutionally restrict speech, namely legal advice.[13]They maintain that legal advice constitutes protected speech under the First Amendment, which has “no occupational licensing exception.”[14]
Specifically, the Polaski plaintiffs seek to provide free or low-cost legal advice on basic court-created forms for common legal problems, such as evictions, restraining orders, estate planning, and uncontested divorces.[15] The primary beneficiaries of this legal advice, they argue, would be North Carolinians who cannot afford a lawyer but who earn too much to qualify for free legal assistance;[16] the North Carolina Justice for All Project has dubbed this group the “missing middle.”[17]
However, although the plaintiffs characterize such services as very “simple,” they require paralegals to tailor their advice to their clients’ “factual circumstances and legal goals,” thus forcing them to exercise “independent legal judgment.”[18]As a result, performing these services would constitute the “practice of law,” in violation of the state’s UPL laws.[19]
In Defense of North Carolina’s UPL Laws
The defendants—five North Carolina prosecutors and the then-president of the North Carolina State Bar—moved to dismiss the plaintiff’s First Amendment challenge, citing to Capital Associated Industries, Inc. v. Stein (in which the Fourth Circuit ruled that North Carolina’s UPL statutes were content-neutral laws regulating conduct, with only an incidental impact on speech).[20] Notably, the Fourth Circuit held that UPL statutes “don’t target the communicative aspects of practicing law, such as the advice lawyers may give to clients,” but rather “focus more broadly on the question of who may conduct themselves as a lawyer.”[21] According to the Fourth Circuit, any effect on speech “is merely incidental to the primary objective of regulating the conduct of the profession.”[22]
Siding with the defense, the Polaski court dismissed the First Amendment challenge, holding that North Carolina’s UPL statutes satisfy the requisite intermediate scrutiny analysis.[23] As noted by the Polaski court, UPL laws serve a substantial state interest: protecting citizens from unqualified legal assistance and ensuring adherence to professional ethical standards.[24] Because only attorneys, and not paralegals, are governed by the Rules of Professional Conduct, which impose duties of competence and loyalty, the court emphasized that clients lack sufficient recourse against non-lawyers.[25]
Looking Ahead: What Polaski Means for Access to Legal Services
Last month, the plaintiffs appealed the dismissal to the Fourth Circuit.[26] In support, they point to a number of other states—including Arizona and Utah—that have reformed their UPL laws to create limited practice rights for paralegals.[27] A favorable ruling from the Fourth Circuit could encourage similar reforms in North Carolina.
Ultimately, Polaski is a critical case in the ongoing debate over access to justice and the regulation of legal services. Its outcome will undoubtedly have lasting implications for both the legal profession and the many North Carolinians who struggle to afford basic legal assistance.[28]
[1] Polaski v. Lee, No. 7:24-CV-4-BO-BM, 2024 WL 5121029, at *1 (E.D.N.C. Dec. 16, 2024).
[2] Id.
[3] Notice of Appeal, Polaski v. Lee, No. 7:24-CV-4-BO-BM, 2024 WL 5121029 (E.D.N.C. Dec. 16, 2024).
[4] N.C. Gen. Stat. § 84–2.1 (2024).
[5] Id. See also N.C. Gen. Stat. § 84–4 (2024).
[6] N.C. Gen. Stat. §§ 84–2.1(b), 84–4, 84–8.
[7] Guidelines for Use of Paralegals in Rendering Legal Services, N.C. State Bar Paralegal Certification (2010), https://www.nccertifiedparalegal.gov/guidelines/guidelines-on-the-use-of-paralegals/.
[8] Reporting and Preventing the Unauthorized Practice of Law, N.C. State Bar, https://www.ncbar.gov/for-the-public/reporting-and-preventing-the-unauthorized-practice-of-law/ (last visited Feb. 10, 2025).
[9] Guidelines for Use of Paralegals in Rendering Legal Services, supra note 7.
[10] Id.
[11] Id.
[12] Sydney Haulenbeek, ‘Our Speech is Chilled’: North Carolina Paralegals Sue to Provide Legal Advice, Courthouse News Service(Jan. 4, 2024), https://www.courthousenews.com/our-speech-is-chilled-north-carolina-paralegals-sue-to-provide-legal-advice/.
[13] Polaski, 2024 WL 5121029, at *1.
[14] Haulenbeek, supra note 12.
[15] Polaski, 2024 WL 5121029, at *1–2.
[16] Id. at *1.
[17] Plaintiffs’ Memorandum in Opposition to Defendants’ Motion to Dismiss, Polaski v. Lee, No. 7:24-CV-4-BO-BM, 2024 WL 5121029 (E.D.N.C. Dec. 16, 2024).
[18] Polaski, 2024 WL 5121029, at *2.
[19] See N.C. Gen. Stat. §§ 84–2.1(a), 84–4, 84–8.
[20] Polaski, 2024 WL 5121029, at *1 (citing Cap. Associated Indus., Inc. v. Stein, 922 F.3d 198, 207 (4th Cir. 2019)).
[21] Cap. Associated Indus., 922 F.3d at 208.
[22] Id.
[23] Polaski, 2024 WL 5121029, at *2–4.
[24] Id. at *4.
[25] Id. (citing N.C. R. Pro. Conduct r. 1.1; 1.7–1.13).
[26] Notice of Appeal, supra note 3.
[27] Plaintiffs’ Memorandum in Opposition to Defendants’ Motion to Dismiss, supra note 17. Arizona, Minnesota, Oregon, and Utah currently allow paralegals to obtain a limited license “to provide viable alternatives to hiring a lawyer for uncomplicated legal needs,” particularly in the areas of family law and landlord-tenant law, “when the client cannot afford a lawyer.” Tara Hughes & Joyce Reichard, How States Are Using Limited Licensed Legal Paraprofessionals to Address the Access to Justice Gap, Am. Bar Ass’n(Sep. 2, 2022), https://www.americanbar.org/groups/paralegals/blog/how-states-are-using-non-lawyers-to-address-the-access-to-justice-gap/.
[28] Phillip Suderman, North Carolina Nonprofit, Paralegals Plan to Appeal Court’s Ruling Dismissing Case Challenging State’s Ban on Legal Advice from Non-Lawyers, Institute for Justice (Dec. 18, 2024), https://ij.org/press-release/north-carolina-nonprofit-paralegals-plan-to-appeal-courts-ruling-dismissing-case-challenging-states-ban-on-legal-advice-from-non-lawyers/#:~:text=JFAP%27s%20lawsuit%20challenges%20North%20Carolina%27s,restraining%20orders%2C%20and%20uncontested%20divorces (“According to a comprehensive study, 71 percent of low-income North Carolinians will experience at least one civil legal problem each year, and 86 percent of those legal needs will ‘go unmet because of limited resources for civil legal aid providers.’”)