Virtual Law Practice

Tag: LegalZoom

  • No Substitute for an Attorney

    During yesterday’s ABA ELawyering Task Force call, we discussed the recent settlement agreement entered into by LegalZoom and the Washington State Attorney General’s Office.

    In an Assurance of Discontinuation, the online legal services company must not state in advertising to the public that its services are less expensive than those of a law firm without also explaining that its services are not a substitute for an attorney.   With the far-reaching and well-funded advertising campaigns of the company, it is easy to see how the message may be misleading to members of the public, many of whom may have never retained the services of a licensed attorney and who may only have the price points and t.v. ads with which to make a judgement.

    One of the statements in Assurance of Discontinuation pertains to the unauthorized practice of law in the state of Washington – a claim we have seen issued against the company in N.C. and Missouri.  While LegalZoom does not admit to UPL in this document, it does agree not to engage in UPL with regards to providing personalized legal guidance that is state-specific within the legal self-help forms.  

    Other concerns that myself and others have brought up in the past related to the practices of online legal service companies are also covered in the agreement.  It will be interesting to see if other state attorney generals will take notice of this and implement similar actions. 

    Here is the  Assurance of Discontinuation:

    WA & LegalZoom Assurance of Discontinuation

  • Technology at Techshow to Enable Online Delivery of Legal Services

    Exhibitor Hall at this year’s ABA Techshow has a number of different web-based technologies that allow  for attorneys to take all or portions of their practice online.  Most of them seem to be practice management applications, and not so much geared towards working online securely with clients. However, there are a few new developments that assist virtual law practice that warrant mention.  

    DirectLaw and VLOTech are again this year the two products intended for the online delivery of legal services. (By way of disclaimer, and as most of my readers know, my husband and I co-founded VLOTech which was acquired by Total Attorneys this past fall).  Both products are SaaS, but with different features and focuses so they will appeal to different types of law practices.  Both products facilitate the unbundling of legal services online and from my exploration of the exhibitors’ booths there are not any other products at the show this year that focus on unbundling legal services for online clients.  DirectLaw has recently launched a new site for members of the public to locate a virtual law firm, MyLawyer.com.  If you operate a virtual law practice, you should see about getting a listing in their directory.  (more…)

  • Top Ten 2008 Developments in Virtual Law Practice

    Happy New Year!  The following is my list of the top ten developments in the delivery of legal services using technology that have happened in the past year.  Please feel free to expand on this list in the comments.  I’m also including at the end my predictions for virtual law practice in the new year.

    1.  Richard Susskind’s book, The End of Lawyers? Rethinking the Nature of Legal Services, is published.  The book discusses “disruptive technologies” that allow attorneys to provide legal services online.  Susskind predicts that attorneys who adopt rather than resist these changes in the technology used to deliver legal services will prosper as the profession adapts to marketplace changes.  The public’s need for affordable and accessible legal services will drive the legal profession’s use of technology to meet this demand.

    2.  State bars and other professional legal organizations offer CLEs and sessions geared at teaching attorneys best practices and security standards for using technology in their law practices.  Popular topics include email security, online backup solutions for law office data, minimizing metadata and using scanners to decrease the use of paper.  See the ABA’s Legal Technology Resource Center’s website for a list of 2008 articles.  In addition to increased law and technology management education in the profession, several state bars provide specific ethics decisions with approval for virtual law offices (VLOs) and/or allow for attorneys to provide unbundled legal services online.

    3.  More attorneys turn to piecemeal technologies and free online apps to collaborate with each other and their clients online.  Basecamp, Google Docs, Adobe ConnectNow, Webex, GoToMeeting, and Dimdim are a few of the popular web-based tools.  

    4.  New web-based, software as a service (SaaS) law practice management products launch, including Rocket Matter and Clio.  Popular legal blogs and listservs discuss the pros and cons involved in the use of “cloud computing.”  The discussions center on the security and backup concerns with a hosted system.

    5.  VLOTech sets up web-based, virtual law offices (VLOs) in Alabama, Maryland, South Carolina, Texas and Virginia with more VLOs planned in Alaska, New York, Pennsylvania, Tennessee and North Carolina for the upcoming year.  The technology aims to provide attorneys with the flexibility to operate a completely online law office or to combine the technology with a traditional law practice and offer unbundled legal services online.  “VLO” becomes a more recognized term for a web-based virtual law practice and elawyering.

    6.  Virtual Law Partners opens its doors as the newest example of BigLaw using technology to allow its attorneys to work remotely and collaborate on legal cases.

    7.  LegalZoom comes under fire over filing fees that the legal document service company charges to online clients, in particular in relation to the filing of trademark applications with the USPTO.  Critics of invention submission companies and of companies that provide form-generated legal documents in general spoke out about what they saw as the potential misleading of the public by online companies offering legal services where an attorney was not involved in reviewing the final legal product. 

    8.  With more attorneys practicing law using mobile devices and relying on electronic forms of communication with clients and other attorneys, management of electronically stored information (ESI) became more of a concern.  Solos and small firms are expected to understand e-discovery and ESI management in their daily practices.  Check out the archives of the EDD Blog co-authored by Bob Krantz and Jeffery Fehrman.

    9. Larger numbers of attorneys adopted popular online social networking tools to meet up with others in the legal profession.  Twitter, Facebook, LinkedIn, Legal OnRamp, JD Supra and other sites connect attorneys with each other and prospective clients. 

    10. Some useful law and tech/practice management blogs came online this year, including Law 21, Above and Beyond KM, 3 Geeks and a Law Blog, and Law Practice Matters, among others.  Blogging continues to grow as an attorney marketing tool and is used as a method of providing the public with basic legal information and resources. Law blogs remain a method for attorneys to educate themselves and network in their individual practice areas.  The Louisiana State Bar’s proposed rules of professional conduct touch on attorney blogging, social networking and other forms of online attorney communication causing some concern and originating in a lawsuit from attorneys in that state. 

    My predictions for virtual law practice in 2009:

    1.  Attorneys will continue to question web-based, hosted software providing law practice management tools. However, companies providing SaaS legal products will band together to establish standards regarding the security of their products for the benefit of the legal profession and the reputation of the companies and the saas business model. 

    2.  The ABA will move forward with proposing standards or policies for the delivery of legal services online. The eLawyering Task Force as well as the Standing Committee on the Delivery of Legal Services will both play a critical role in establishing these guidelines.

    3.   Attorneys hit hard by the downward economy will seek out ways to minimize their law practice overhead using technology.  Some will use piecemeal software solutions to minimize overhead in law office administrative tasks. Others will consider opening completely web-based VLOs to get rid of the law office lease and expand their client base statewide or nationwide depending on their practice areas.  

    4.   More attorneys will realize that customer service is the key to growing a successful practice and that the public is demanding more efficient and convenient legal services through the use of technology.  This will prompt more attorneys to provide unbundled legal services online to clients either as the sole form of virtual law practice or in addition to their traditional law office practice.

  • Avoiding the Unauthorized Practice of Law (UPL) in other Jurisdictions with a Virtual Law Office (Part Two)

    Part I of this post on the unauthorized practice of law in other jurisdictions addressed the following questions:  How does a virtual law practice avoid UPL in other jurisdictions? and If a website is accessible internationally, then how can a VLO be limited to provide legal services only in the state(s) in which the attorney is licensed?

    How is it clear with a Virtual Law Office (VLO) when the attorney/client relationship is established?

    An online client receives adequate notice through his or her individual homepage in the VLO as to the different statuses of the case.  Notice is provided to the online client when the attorney has reviewed the client’s question and posted a response, when the attorney has accepted or declined representation, when the attorney provides details of the scope of representation, and when the attorney has completed legal representation and is formally closing the online case file.

    The attorney/client relationship begins when the online client has registered on the VLO and requested legal services from the attorney.  The client is notified when the attorney has reviewed and responded to his or her legal question.  Then the client is asked follow-up questions by the attorney or is presented with the price quote or terms of representation for the online client to accept or decline.

    Through the VLO, the attorney has several options to define the scope of representation, including providing clients with a traditional written retainer letter uploaded to the system, writing out personalized messages to each client and requiring that the client accept a customized clickwrap agreement solidifying the terms of the attorney/client relationship, or using both traditional and online clickwrap methods.  Basically, the same procedures for establishing attorney/client relationship and defining the scope of representation that are used in a traditional law practice can be integrated into a VLO.

    I would argue that using the technology actually provides clearer notice to the clients of the establishment of the attorney/client relationship and the scope of representation. It may also do a better job of keeping the clients informed of their case status than occurs with a traditional law practice.  One of the biggest malpractice complaints from clients is that their attorney does not communicate effectively with them regarding their case.  The VLO handles so much of the process for the attorney automatically. It also gives clients the ability to check for themselves the status of their file and to review their previous discussions with the attorney.

    Is it UPL in another jurisdiction to draft a legal document, such as a Will, for an online client who is a resident in another state?

    It is my understanding that it would constitute the unauthorized practice of law in another jurisdiction if an attorney used his or her VLO to draft a legal document that pertained to the laws of another state where the online client was a resident but where the attorney did not have a license to practice law.

    However, if the attorney operating the VLO were partnering with attorneys or legal assistants on his or her VLO who were licensed in other jurisdictions, then this would be different.  For example, a virtual paralegal could work on the VLO to draft a Will or other estate planning document for a client a jurisdiction where the virtual paralegal was familiar with that state’s estate planning laws.  The virtual paralegal would then flag the document for review by the attorney on the VLO who was licensed in that online client’s state.

    My understanding is that the review and approval of that legal document by the attorney licensed to handle that state’s laws would permit the virtual paralegal to complete the transaction for the online client without it constituting UPL in another jurisdiction.  You can see through this example how a solo law practice taken online with a VLO could grow very quickly across multiple jurisdictions if well planned out.

    How does the issue of UPL in other jurisdictions relate to legal document automation software?

    Some attorneys are choosing to provide legal services online by using document automation software, similar to the way that LegalZoom and similar companies provide legal documents across jurisdictions.  There is a separate issue here which pertains to assisting a nonlawyer (the software vendor or legal form provider) in the practice of law.  If this form of providing legal services interests readers, I recommend that they check out Richard Granat’s recent blog post regarding the automated delivery of online legal services, or online document assembly, as it relates to UPL.

    VLOTech is preparing a feature for the first of next year that allows attorneys to create forms for clients on the VLO to fill out and send to the attorney securely on the system in addition to the existing VLO forms of communicating online with the client.  The forms could be anything from estate planning and family law questionnaires to customized client intake forms based on the attorney’s virtual law practice areas.  Since the forms would be generated by the attorney individually for the VLO and not pre-packaged from a vendor, then it should avoid the UPL issue completely.  It will be interesting to see how attorneys practicing law online will choose to integrate this additional feature in their virtual law practice.

    Online Resources Regarding UPL

    ABA Model Code, Rule 5.5 Unauthorized Practice of Law; Multijurisdictional Practice of Law

    State by state comparative analysis of UPL – Cornell University Law School, American Legal Ethics Library

    BTW:  By no means do I claim to be a legal ethics expert.  I practice law online from my VLO and work with other attorneys nationwide to set up VLOs.  These issues interest me and I love hearing and learning from other’s experiences.  If anyone has specific ethics decisions from their state bar pertaining to UPL in other jurisdictions and online law practice, I’d love to hear about it.  Please share!

  • Elawyering Ethics: Determining Competency and Contractual Capacity Through a VLO

    A couple good ethics questions came out of my CLE presentation at the GP/Solo and Small Firm Symposium this past week concerning the competency and contractual capacity of a virtual attorney’s clients.  I thought I would share those questions and my thoughts. 

    How can you determine the competency and contractual capacity of a client before providing online legal services through a VLO?

    This ethics concern came from an elder law attorney in the CLE audience specifically regarding the drafting a power of attorney online without meeting the client in person.  The topic has also come up multiple times on the ABA’s Solosez listserv.  It seems to be an issue that attorneys cannot easily agree on. 

    Many states, including North Carolina, have older professional rules of conduct or ethics opinions that require that the attorney meet with a client in person before drafting a power of attorney for that client.  However, in most cases these rules were created without consideration of how web-based technologies in combination with other best practices may be used to provide online legal services. 

    I hope that this question will be revisited by the attorneys who consider these issues and their bar associations because two key factors have changed dramatically in the past couple years: 1) current technology offers additional methods beyond email communication that may establish an online relationship with clients, and 2) there are several online resources available for members of the lay public to acquire legal documents without an attorney ever reviewing them.

    To address the power of attorney, this document creates such broad authority for the named attorney-in-fact that the attorney drafting the document needs to make sure that the client understands what they will be signing and is not being unduly influenced into gifting this power.  However, is it the responsibility of an attorney to judge the competence of a client?

    In my opinion, I am not a psychologist or a medical doctor who may rule professionally on the mental competency of my client.  If from our communications, my client makes it clear to me that he or she understands the nature of the document and the powers that it provides to the named attorney-in-fact, then in my opinion my client is competent to execute that legal document. 

    In all reality, if an individual wants to coerce their relative into signing a power of attorney naming them as attorney-in-fact all that person has to do is go to the Office Depot and spend $60 on a software kit or if they are really cheap, google “sample power of attorney” and cut, paste and edit their way to creating a Power of Attorney that may appear enforceable.  Legalzoom offers a Power of Attorney online for under $50, and it is only reviewed by a paralegal prior to being sent to the client for execution. 

    I find it unlikely that with the easy availability of the public to acquire legal forms someone wanting to use a power of attorney for malicious purposes would go to the trouble to pay an attorney to draft the document for them.  There is the risk that the attorney would speak with their relative and realize the undue influence before the document was executed.  Even if these malicious parties go through a VLO, there are practice methods the virtual attorney may follow to avoid malpractice and ethics risks which I discuss below.

    Can a virtual attorney properly ascertain the contractual capacity of a client through a VLO?

    One audience member at the CLE presentation said he would worry about 13 year olds going online to a VLO and purchasing legal documents.  How would the virtual attorney know the prospective client was not 18 years or older?

    While anyone may accept the multiple clickwrap agreements on a VLO and lie about their age, again, I find it unlikely that many individuals under the age of 18 would want to purchase legal services online through a VLO.  However, it is the attorney’s responsibility to ascertain that the client has the contractual capacity to execute the document.  There are various methods of handling this online which I have discussed in a previous blog post here and will mention again briefly below.  In addition, with many of the legal documents, the witnesses signing in front of the notary public would be signing a statement that they attest that the person signing the documents is 18 year of age or older, of sound mind, and under no constraint or undue influence.  The notary would also verify the client’s identity and hopefully notice if they were dealing with a teenager. 

    The virtual attorney should be able identify that the client is underage through the online discussion, request for the client to scan in and upload their driver’s license, and payment by valid credit card.  If the virtual attorney has any additional hesitations, they may speak with the client by telephone or arrange for a web conference.  In the event that the virtual attorney continues to have any doubt regarding the capacity or competency of his or her client, the attorney has the option of referring that client to a full-service law office and declining the representation.

    In my personal elawyering experience, I have not encountered a situation where there was a question in my mind after communicating with the client as to the capacity or competence of that individual.  In cases where the client was an older citizen and they were not just having me update their original documents, i.e. they sent me the originals and I updated them to NC law without the named parties changing, then I would call them on the phone before drafting the documents and again to follow up after they received them.  It is clear to me that these clients clearly understand what they are asking me to draft and understand the power it conveys to the named parties.  (You might be surprised how many 70+ people register on the VLO.  Many people expect that my clientele would be strictly in the under 40 range.  Happily this is not the case.)

    Perhaps the virtual law practitioner could offer power of attorneys but only after requiring that the client go through additional procedures not required of other clients.  For example, the attorney could require that they receive a scanned copy of the client’s driver’s license and photo id and speak with the client on the telephone before returning to communicating through the VLO.  There are a number of ways the drafting of legal documents may be handled online.

    Virtual attorneys should not be deterred from finding innovative ways to use technology to provide the public with legal services online just because there is the potential for fraud or undue influence.  The bottom line is that the individual virtual law practitioner will have to make the decision regarding what legal services they feel comfortable providing online within their state bar’s rules of professional conduct.

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