Providing Routine Legal Services to the "Masses" in the 21st Century, Part One: Internet-Based Legal Document Prep Services

Does LegalZoom's business practices violate Missouri law which bars non-lawyers from preparing legal documents? Been wondering when we would see this issue presented in court. Now that Missouri federal judge Nanette K. Laughrey has set a trial date, August 22, 2011, we may have an answer. In Class Action Claims Online Legal Forms Pose Threat To Consumers,WSJ Law Blog's Nathan Koppel interviewed David Butsch, counsel to the plaintiffs’ class, which apparently consists of 15,000 users of LegalZoom products.

"The state licensure of attorneys was established to protect the public from those untrained and uneducated in the practice of law,” Butsch said. The preparation of wills and other legal documents “may seem simple to a layman, but they aren’t,” he added. “There are consequences of signing a will . . .and those consequences can be great and they can’t be properly communicated by a company over the internet.”

We asked Butsch about the concern that many have voiced that legal services are cost prohibitive to many consumers, a problem that has likely become even more acute in recent years.

Aren’t online legal documents, however crude, preferable to having folks go without any form of legal guidance? In response, Butsch noted that there is now a glut of legal talent in the market, with many law graduates unable to find full-time employment. That fact, he said, has made customized legal help from practicing lawyers increasingly affordable. “I know quite a few lawyers who offer a quality legal service at very good rates,” he said.

(Emphasis added.)

Well, there is "affordable" from a lawyer's perspective and then there is "affordable" from a individual's perspective. Again quoting from Nathan Koppel's WSJ Law Blog post:

“If the plaintiffs are successful, we believe it is going to become a lot more expensive for small businesses and individuals to obtain basic legal forms,” Chas Rampenthal, Legal Zoom’s General counsel, said... . “Missouri would become the only state in the nation to take away a consumer’s right to access online legal document software.”

The comment trail for Koppel's WSJ Law post makes for interesting reading

On Communications. Whoa. I don't think we are talking about just downloadable forms-only purchasers, although I have no idea how many members of the class were just downloadable forms-only customers. Rampenthal fails to mention LegalZoom's personalized "Peace of Mind Review" by automated checks and document specialists who may contact individual LegalZoom users with follow-up questions and its 100% guarantee claim and lifetime customer support. See LegalZoom's partal front page screen capture taken on August 6, 2011, click to enlarge. Quoting from LegalZoom's website:

What is a LegalZoom Peace of Mind Review?

Unlike software or do-it-yourself kits, LegalZoom services include a personal review of your work for completeness, consistency and common mistakes. Along with hundreds of automated checks, our document specialists carefully review the answers you provide for the following:

• Complete information. Our document specialists will contact you by phone and email if additional information or clarification is needed.
  Internal consistency.
• Spelling, grammar and punctuation. We do not rely solely on software spell checkers. Every document is proofread by a document specialist.
• Correct capitalization and lowercasing where required.
• Proper pagination and blank space elimination.
• Complete words. We spell out abbreviations or symbols in English.
• Professional and consistent font usage.
• Correct residency information. Indicating the proper state is critical to ensure the document conforms to your state's requirements.
• Full names. We verify that full names are given (first and last) and that all names appear consistently throughout the document.
• Correct shipping addresses and email addresses to ensure timely delivery.

(Emphasis added; no direct link because the statement is a pop-up)

Granted, this is the sort of work paralegals commonly perform for routine matters but they do so under the supervision of a licensed attorney and firm-employed paralegals are covered by the firm's malpractice insurance. No malpractice insurance available if this issue sounds in "unauthorized practice if law;" just the proforma legal disclaimer.

LegalZoom has the usual prophylactic legal disclaimer. It states in part:

LegalZoom's document service also includes a review of your answers for completeness, spelling and grammar, as well as internal consistency of names, addresses and the like. At no time do we review your answers for legal sufficiency, draw legal conclusions, provide legal advice or apply the law to the facts of your particular situation. LegalZoom and its services are not a substitute for the advice of an attorney.

Although LegalZoom takes every reasonable effort to ensure that the information on our website and documents are up-to-date and legally sufficient, the legal information on this site is not legal advice and is not guaranteed to be correct, complete or up-to-date. Because the law changes rapidly, is different from jurisdiction to jurisdiction, and is also subject to varying interpretations by different courts and certain government and administrative bodies, LegalZoom cannot guarantee that all the information on the site is completely current. The law is a personal matter, and no general information or legal tool like the kind LegalZoom provides can fit every circumstance.

Do note the testimonial about LegalZoom's "professional services" by attorney Rene R. It is displayed above the legal disclaimer text. (August 6, 2011 image capture, above right, click to enlarge)

Will this disclaimer provide LegalZoom with a caveat emptor defense accepted at the conclusion of the trial?

As a Practical Matter... On our little county law library's Legal Forms Research: Guide to Online Resources for Agency, Court, Business & Personal Forms web page, we currently list LegalZoom with the following warning under the heading "Business & Personal Forms Services (selective):" 

Warning: The Butler County Law Library does not endorse any commercial online legal document preparation service or use of downloadable forms. Advice from an attorney is strongly recommended, even for the drafting of ordinary, uncontested documents.

...

The commercial services listed below are provided for informational purposes only to illustrate the types of services available online; note well the fees and other expenses incurred in the purchase and/or use of online legal document services.

As a law librarian who once did his fair share of legal work under attorney supervision (and the firm's malpractice insurance) but now is a public law librarian, I certainly can say that it oftentimes takes more time to explain to our non-attorney public patrons that we cannot tell them which transactional form they should use (or how if one were to take clauses A, B and C from one form sample, clause "D" from another form and clauses "E and F" form a third form, fill in the blanks and "that will work") because that would be an unauthorized practice of law.

Frustrating? Yes. Required? Yes. Necessary as a practical matter? Not usually. However, I am not suggesting public law librarians be permitted to take the "next step."

Hat to to Legal Skills Prof Blog for calling attention to the August 22, 2011 trial date for LegalZoom. [JH]