As a creditor’s rights attorney, I often receive Answers to our Complaints filed Pro Se by Defendants. Sometimes these Answers are in the proper format and I assume that an attorney prepared the response but declined to enter his appearance. Sometimes, however, they simply consist of a paragraph denying liability for the debt or expressing an interest in entering into a payment plan. Whether or not they are in the proper format is irrelevant, however, if the Defendant is a corporation. Thanks to the Pennsylvania case of Walacavage v. Excell 2000, Inc., 331 Pa.Super. 137, 480 A.2d 281 (Pa.Super., 1984) a corporate entity may only appear in court through an attorney licensed to practice law in the Commonwealth of Pennsylvania. This means that if an individual who owns a corporation files a Pro Se response to a Complaint that names only the corporation as the defendant he is in violation of Pennsylvania law.
The Court in Walacavage also addressed the concern that the requirement of a corporate entity to hire counsel puts corporations at a disadvantage. The Court stated that such a requirement does not deny corporations due process or equal protection under the law. It seems that there are several rationales behind this requirement one of which is the fact that a corporation is technically fictitious so that even if the individual filing the Pro Se response is the President of the corporation, the corporation itself is a fabrication and, therefore, cannot represent itself. Another suggested rationale is that incorporating a business brings many benefits including protection from personal liability. By the same token, however, there are responsibilities that come with such protection including the responsibility to hire an attorney for representation. Finally, it is suggested that the legal issues before the court can become confused when an attorney is not representing a corporation, however, I don’t see how it can be any more confusing for the court than when an individual represents himself…it can be bewildering for everyone involved. I, personally, believe that the rationale accounting for equal benefits and responsibilities makes the most sense. If an individual wants to remain shielded from personal liability he is going to have sacrifice some benefits that he would otherwise have if not incorporated such as the ability to represent himself in court. You can’t have your cake and represent it in court, too.
It is always surprising to me how many individuals who have incorporated a business are unaware of the necessity of retaining counsel for a legal matter. In my opinion, the best way to go about dealing with a Pro Se response from a corporate defendant is to file Preliminary Objections to the response. Filing Preliminary Objections to a Pro Se response from a corporate Defendant can save a great deal of time for you and a great deal of money for your client. I find that it often leads to settlement or, better yet, has the effect of getting the response stricken followed by Judgment by Default. From both a financial and expeditious perspective either of these two scenarios is preferable to having to prepare for and attend arbitration or trial as well as requiring your client to send a witness to court.
Jen – nice post. I go both ways on the benefits of the debtor having a lawyer. Before suit, it is usually easier to make a deal and get it properly (and beneficially) documented. After suit, however, it is usually better when the debtor is driven into the hands of counsel who can explain the realities. On the other hand, of course, the “realities” are that it is pretty simple under our system to drag a suit out for month (or years). A pro se debtor may not know that (unless the Judges help!).
This goes both ways? What if you are sued by a corporation representing itself ‘pro se’ ?
Paul,
Thank you for your question. It does, indeed, go both ways and you can use the holding in Walacavage to force a Pro Se corporate Plaintiff to hire counsel in order to continue with their action.