Legal Forms + Unauthorized Practice of Law…

David Bilinksy of Thoughtful Law gave a great prediction last year when we first launched our legal forms + video guides: “All it will take is a precedent-setting court decision that these online providers are not engaging in the unauthorized practice of law for the walls to come crumblin’, tumblin’ down.” Well, we may be heading exactly there: in the U.S., a class action lawsuit filed in Missouri against LegalZoom may be going to trial next month.

For those who don’t know, LegalZoom has been around for a number of years. It sells do-it-yourself wills, leases and other documents online. The class action against them is based on the idea that they are illegally practicing law in the state of Missouri.

Now, lets look at that claim here in further detail, shall we? And because I’m from Ontario, Canada and I practice law here, I’ll use this province’s laws as an example. First of all, what exactly is meant by “unauthorized practice of law”? Well, in Ontario, the Law Society Act creates a general prohibition against persons who are not licensed (i.e. non-lawyers and non-paralegals) from providing legal services. So what does “providing legal services” mean? Well, that Act says it generally means engaging in “conduct that involves the application of legal principles and legal judgment with regard to the circumstances or objectives of a person”. So it basically means applying legal principles and judgment to a particular person’s situation.

But that’s not all. In fact, the Act goes on to say that a person provides legal services by:

  • giving advice with respect to legal rights, interests or responsibilities of another person;
  • selecting, drafting, completing or revising certain documents ON BEHALF of another person;
  • representing a person in a proceeding before an adjudicative body; or
  • negotiating the legal interests, rights or responsibilities of another person.

So, at least in Ontario, there’s a definite element of helping someone out by acting in a manner that affects their specific legal interests, rights, and obligations given their specific circumstances.

Now, where does that leave do-it-yourself legal software? Is it legal advice or legal information? Is it recommending a particular result based on a person’s specific circumstances? Is a human (other than the end user) involved in reviewing and advising the end user on certain technical matters or even legal issues? Things can get very blurry here…

My thoughts on this are, however, very clear: if you publish legal form templates and provide generic guidance (as this website does), then you are no more than a legal publisher. There are lots of publishers out there who have for many years been putting out templates and guidance books, kits, etc. which anyone can pick up from the local bookstore or library. These publishers are not engaged in the unauthorized practice of law (otherwise, charges would have been laid under the Act).

In the U.S., legal rebel Richard Granat explained how a long line of cases supported this view:

…there is a well-established line of cases that supports the position that the publication of information about the law, as well as self-help legal books, divorce forms with instructions, and do-it-yourself kits is not the practice of law and protected by the First Amendment of the U.S. Constitution and may be protected by state constitutions as well. See, e.g., New York County Lawyers’ Ass’n v. Dacey, 21 N.Y.2d 694, 234 N.E.2d 459 (N.Y. 1967), aff’ing on grounds in dissenting opinion, 283 N.Y.S.2d 984 (N.Y. App. 1967); Oregon State Bar v. Gilchrist, 538 P.2d 913 (Or. 1975); State Bar of Michigan v. Cramer, 249 N.W.2d 1 (Mich. 1976); The Florida Bar v. Brumbaugh, 355 So.2d 1186 (Fla. 1978); People v. Landlords Professional Services, 215 Cal. App.3d 1599, 264 Cal. Rptr. 548 (Cal. 1989).

But now a debate has been growing over whether LegalZoom has been engaged in the unauthorized practice of law. Why? Because in LegalZoom’s document assembly process, there seems to be an additional off-line step that involves human actors using their discretion. As Richard Granat explained in his aforementioned blog post: “a data file is created, reviewed by a legal technician, and then imported into their – document assembly application utilizing some form of import mechanism. It is not clear whether the document is fully-assembled until this second step takes place, and it’s a distinction that makes a difference.”

I’ve read stories on-line about individuals who – although quite happy with LegalZoom’s services – said that they had been advised by LegalZoom staff about how to properly name their corporation in light of local laws. This seems to be a bit of a grey area. Is that just good old-fashioned generic legal information? Or is that specific legal advice being handed down by non-legal professionals to address a person’s specific situation. I’m not sure where exactly the line gets drawn.

The bottom line is that, for the sake of protecting the public, providers of online legal forms who are NOT competent to speak about legal matters with respect to an individual’s specific needs SHOULD NOT BE dishing out advice to that person. Lawyers go through years of schooling,then article for a period of time, and then go off on their own (with insurance and access to legal information databases that non-lawyers don’t want to pay for or won’t know how to use properly) to be able to do their jobs. Non-lawyers are simply not qualified in dispensing this kind of advice. Non-lawyers should be relegated to providing legal information and nothing more. This helps protect everyday people from having to spend countless thousands of dollars and years wasted on litigating problems caused by poor advice.

My two cents anyways…

FYI, I generally support what anyone does to improve access to justice for everyday middle and lower-class people (so that includes LegalZoom). And U.S. citizens have generally approved of what LegalZoom has done – as evidenced by LegalZoom’s success (according to Richard Susskind, LegalZoom is a more recognized brand name for legal services than any law firm).

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