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UTPCPL Does Not Apply to Physicians Rendering Medical Services or Attorneys Performing Professional Services.

Posted By Cliff Tuttle | August 2, 2015

No. 1,194

WALTER v. MAGEE-WOMENS HOSPITAL, 867 A. 2d 400 (Pa. Super, 2005).

BEYERS v. FORCENO & ORANGIO, P.C., 937 A.2d 1082 (Pa. Supreme Ct. 2007)

GLOVER v. UDREN LAW OFFICES, P.C. et. al. 92 A.3d 24 (Pa. Super. 2014).

Image: healthcare global.com

Image: healthcare global.com

The Pennsylvania Unfair Trade Practices Consumer Protection Law (UTPCPL) provides a remedy for unfair methods of competition and deceptive practices in the conduct of trade or commerce.  The phrase “trade or commerce” includes the sale of services.

However, the Pennsylvania courts have refused to apply UTPCPL to medical services.  Professional services rendered by a health care provider are not trade and commerce by a business enterprise.  They have held that the legislature did not intend to include private actions against the medical profession. See Walter, supra, Foflygen v. R. Zemel, M.D., 420 Pa. Super. 18, 615 A.2d 1345 (1992), appeal denied 535 Pa. 619, 629 A.2d 1380 (1993); Gatten v. Merzi, 397 Pa. Super, 148, 597 A.2d 974 (1990), appeal denied, 528 Pa. 611, 596 A.2d 157 (1991).

Similarly, in Beyers, supra, the Supreme Court reversed a decision by the Superior Court applying the UTPCPL to a distribution of proceeds from settlement of a case by a law firm which included padded expenses.  The Supreme Court held that UTPCPL does not apply to attorney misconduct.

In so ruling, the Supreme Court distinguished an unpublished federal case applying the Fair Debt Collection Practices Act to attorneys who regularly engage in debt collection practices, apart from their legal representation.  Debt collection, as opposed to the practice of law, is an act of trade and commerce. It also noted that the Commonwealth Court had applied the UTPCPL when a physician had attempted to collect debts when the statute of limitations had expired.  Commonwealth v. Cole, 709 A.2d 994, (Pa. Commw. 1998). This involved business practices, not professional misconduct.

Two justices dissented in Beyers, arguing that the distribution of settlement proceeds involved business practices.  In this regard, it was more like debt collection than the practice of law, according to the dissent.

The Superior Court applied  Beyers in Glover, supra. The Superior Court sustained preliminary objections to a complaint under UTPCPL and several other consumer protection statutes against two mortgage foreclosure law firms. The complaint focused on Section 406 of Act 6 of 1974, which set a ceiling on pre-foreclosure attorneys fees. The Court stated:

“Glover argues that Udren, as foreclosure counsel, violated section 406 by collecting certain costs and fees prohibited by that provision. Glover’s Brief at 8-11. The premise of this claim is that Udren, acting in its capacity as the attorney for the mortgagee, violated section 406 by collecting fees in excess of those allowed under Act 6, and therefore, Glover is entitled to treble damages as provided by section 502, infra, which provides remedies for violation of the Act.”

It then recited the applicable language of Section 406 of Act 6, involving foreclosure fees and the remedy set forth in Section 502, as well as some fundamental provisions of statutory construction.

Recapping Glover’s argument: “Because section 502 provides a remedy against a person who collects excess fees and charges, and person is defined broadly to ‘include but not be limited to residential mortgage lenders,’Glover can maintain a cause of action against the residential mortgage lender’s foreclosure attorney for collecting attorney’s fees in excess of those described in section 406.”

Under the literal language of Section 406, the Superior Court stated, only residential lenders can violate these provisions, not their attorneys. Since Udren is not a residential mortgage lender, it cannot violate Section 406.  “Because section 502 provides a remedy against a person who collects excess fees and charges, and person is defined broadly to “include but not be limited to residential mortgage lenders,” Glover can maintain a cause of action against the residential mortgage lender’s foreclosure attorney for collecting attorney’s fees in excess of those described in section 406.”

The Court went on to cite Beyers, holding that UTPCPL cannot be utilized in cases involving practice of law by attorneys.

CLT

 

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CLIFF TUTTLE has been a Pennsylvania lawyer for over 45 years and (inter alia) is a real estate litigator and legal writer. The posts in this blog are intended to provide general information about legal topics of interest to lawyers and consumers with a Pittsburgh and Western Pennsylvania focus. However, this information does not constitute legal advice and there is no lawyer-client relationship created when you read this blog. You are encouraged to leave comments but be aware that posted comments can be read by others. If you wish to contact me in privacy, please use the Contact Form located immediately below this message. I will reply promptly and in strict confidence.

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