While the internet has increased the availability of forms and instruction and “virtual” lawyers, there are certain times and places where only an actual lawyer will do.  There could be many an article written about the errors or omissions in documents drafted through forms off the internet by individuals or principals in a corporation, because they do not have the requisite degree of legal skill and knowledge that a lawyer practicing in a specific area possesses.  Starting a corporation or limited liability company or other formal business entity (“corporation”) needs to involve research, consulting, and formally organizing with the secretary of state and the drafting of an important document needs an understanding of the basic elements, options and possible outcomes when enforcing the rights provided in the document.

But, this article is about times when there is a requirement for a lawyer, not just the need for a lawyer.  This article highlights the rule that corporations are required to have a licensed lawyer when bringing or defending lawsuits.  A corporation is a legal entity that is separate and distinct from its owners, whether there is a single shareholder or member or multiple shareholders or members.  Corporations enjoy many of the rights and responsibilities that individuals possess, as they can enter contracts, loan and borrow money, own assets, pay taxes, hire people and sue or be sued.  But, unlike individuals, a corporation cannot “appear” in a lawsuit to enforce or protect its rights without a lawyer.  It is well known that individuals can appear pro se, derived from Latin and meaning “for oneself” or “on behalf of themselves”.  Putting aside the advisability of representing oneself, the law allows an individual to argue on one’s own behalf as the plaintiff or defendant in civil cases.

But when it comes to corporations, there is a well-established rule in North Carolina courts that prohibits a non-lawyer from representing a corporation in the court system.  This includes any pleading or personal appearance before a civil court of a Division of Motor Vehicles hearing (absent small claims court).  In Lexis-Nexis, Division of Reed Elsevier, Inc. v. Travishan Corp., 155 N.C. App. 205, 573 S.E.2d 547 (2002), the court held that, in North Carolina, a corporation must be represented by a duly admitted and licensed attorney-at-law and cannot represent itself in a legal proceeding.  This means any appearance, such as filing an extension of time, filing an answer or pleading, or appearing in court for a motion or trial.

The courts are aware of and routinely enforce this requirement and any corporation that ignores the requirement will likely find themselves on the wrong end of a default, or sanction motion, or botched appeal from small claims court.  The most gentile of lawyers will point out this necessity, but the worst of lawyers will exploit it to their client’s advantage.  So, if you find your corporation in a position to have to sue or if you have been sued, find a lawyer with experience in civil litigation to enforce your rights or protect your investment.

Miller Monroe Holton & Plyler represents a wide range of businesses, investors, shareholders, and individuals – from large national corporations to small local businesses. Our commercial litigation practice is focused on honest, aggressive representation with a cost-effective client-focused approach. Our lawyers have the business experience necessary to guide you through a complex and sometimes daunting litigation process.

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There is a lack of consensus among lawyers about the correct time to schedule the mediation.  According to recent studies, delaying the mediation even for a short time decreases the likelihood of settlement.  There are many factors at work, but generally the investment in the litigation and the level of contentiousness between the parties grows as the case goes forward.

In a previous article, I reviewed the use of the pre-litigation mediation tool.  Whether required by contractual clauses or proposed by lawyers who know their clients can benefit from trying to resolve disputes before they incur the time, expense, emotion and distraction of litigation, early mediations are becoming much more of a “norm” than ever before.  Mediation is a reality in most civil superior court cases, so is it worth taking a shot to resolve a dispute before the parties dig deeper into their pockets and positions?

The obvious advantages to early mediation include the relatively small amount of time, fees and costs invested, with the potential of a prompt resolution.  Pre-litigation mediation has the advantage of the confidential nature of the proceedings as opposed to the public record of court proceedings.  The parties may not want to air their dirty laundry, or may not want their competitors, customers or employees to find out about the issues.

Even early in litigation, studies suggest that cases referred to mediation at an earlier stage are more likely to be settled than the cases that advanced to the pre-trial stage.  Preparation for an early mediation is key, as the parties have typically not conducted much discovery.  Lawyers may need to flesh out the key facts and provide evidence or documents and legal precedent for the mediation and should be prepared to share their positions.  A bonus is that, if the pre-litigation or early mediation is unsuccessful, the lawyers are better prepared to draft a complaint or answer without extensive additional investigation, or in some circumstances, the mediator can adjourn the conference until the necessary questions are answered in the case.

Paul T. Flick is a NCDRC Certified Superior Court Mediator at Flick Dispute Resolution in Raleigh, North Carolina

About Miller Monroe Holton & Plyler

At Miller Monroe Holton & Plyler, our attorneys have helped many clients resolve their disputes throughout alternative dispute resolution before a lawsuit is ever filed.  We recommend engaging experienced counsel if you are involved a dispute that may lead to litigation, so that you can effectively navigate the process.  Contact us today for a consultation, or click here to learn more about our practice areas.

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Some of the advantages to pre-litigation mediation are obvious and some are not.  The obvious advantages include the relatively small amount of time invested, with the potential of a prompt resolution, the limited attorney fees and costs incurred, and the possibility of avoiding the uncertainty of a judge, jury or arbitrator.  One less obvious advantage is the confidential nature of the proceedings as opposed to the public record of court proceedings.  The parties may not want to air their dirty laundry, or may not want their competitors, customers or employees to find out about the issues.   Another less obvious advantage is the possibility of protecting a business or personal relationship between the parties that a contested lawsuit could destroy.  A skillful mediator can facilitate communication designed to resolve the dispute, without creating on-going ill will that typically accompanies our adversary system in litigation.  It allows a problem to be solved without assigning a “win” or “loss” label.  And perhaps what should be obvious but is not always, the advantage of the parties fashioning their own remedy and being allowed to be creative in doing so.  There may be more ways to solve the issues than the exchange of money, if the parties’ interests and “hot buttons” in the dispute can be addressed.  Many business disputes can be better resolved without relying on an expert witness to determine the “value” of a claim.

Of course, the form and rules used in mediation matter.  Mediation is generally an informal process that encourages parties to reach a settlement agreement of a dispute through the use of a third party neutral.  The parties generally control the decision making as the mediator attempts to provide open lines of communication and understanding to resolve the dispute.  The Mediated Settlement Conference Rules under N.C. Gen. Stat. §7A-38.1 and the local rules establish the selection of the mediator, the timing, attendance, fees, the mediator’s duties and confidentiality, among other things.  It would be wise for the parties to adopt those Rules or to agree on the applicable rules prior to undertaking the mediation, particularly as to confidentiality and the memorialization and enforcement of any settlement that is achieved.

Preparation for a pre-litigation mediation is required.  In the usual Mediated Settlement Conference, the lawyers have often conducted discovery and usually know their cases well.  With pre-litigation mediations, the lawyers may need to flesh out the key facts and legal precedent in preparation for the mediation and share their positions.  Mediation is the best chance to help each side understand that there are two sides to every story.   The preparation for a pre-litigation mediation is also the time to manage the client’s expectations so that valuable communication and understanding can take place.  A bonus is that if the pre-litigation fails, the lawyer is prepared to draft a complaint or answer without extensive additional investigation.

Of course, for any mediation to be successful, the parties must want to resolve the issues between them and believe that mediation is a possible vehicle to do so.  Lawyers should be more open to the alternative dispute resolution available in pre-litigation mediation, without any preconception that it is a showing of weakness or strength, but rather embrace it as an opportunity.

Experienced Litigation Attorneys

At Miller Monroe Holton & Plyler, our attorneys have helped many clients resolve their disputes throughout alternative dispute resolution before a lawsuit is ever filed.  We recommend engaging experienced counsel if you are involved a dispute that may lead to litigation, so that you can effectively navigate the process. Contact us today for a consultation, or click here to learn more about our practice areas.

This article does not establish an attorney-client relationship and must not be construed as legal advice.

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Business North Carolina magazine honors Tar Heel lawyers by publishing Business North Carolina’s Legal Elite, a listing of the State’s top lawyers in business-related categories.  Winners are choosen not by the magazine’s editors, but by the state’s lawyers.  In developing the list, Business North Carolina made ballots available to more than 20,000 Tar Heel Lawyers and only 3% were selected for Legal Elite (including Mr. Miller’s wife Kimberly Miller of Owens & Miller PLLC).

Jason A. Miller has litigation experience in state and federal courts throughout North Carolina and beyond.  He has represented Fortune 500 companies in complex business litigation matters, builders and developers in real property disputes, information technology companies in trade secrets disputes, partners in closely-held company disputes, investors in business deals gone awry, and dozens of cases in between.  Jason has litigated matters in more than a dozen counties in North Carolina and is licensed to practice in every state and federal court in North Carolina.

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