Beware of Forming an LLC or Preparing Legal Documents Online

The Case Against Preparing Legal Documents Online

In the last decade or so, many people have begun preparing legal documents online, rather than hiring a local attorney at a traditional law firm. The fact is that although their low fees might be attractive, the old saying still runs true—you get what you pay for. Online legal services websites cannot offer the same personalized service and many of them are devoid of oversight and standards. These legal services websites may promise to be inexpensive and convenient, but relying on them instead of hiring an attorney can be risky. This article explains why using online law services is a bad idea.

What Do Online Legal Services Offer?

Law services websites provide legal document preparation using templates for wills, contracts, business formation, and more. They use automated systems to generate legal documents based on the information you provide. They also offer legal advice that is impersonal and lacking the back-and-forth feedback that you would receive from meeting with a qualified attorney at a traditional law firm. They may be quick and inexpensive, but using them for important legal document comes with risks and could cause major issues. It could also cost you additional legal fees, when you have to pay an attorney at a traditional law firm to fix errors that have been ma

What are the Risks of Using Online Law Services?

One-Size Fits-All Legal Templates? Not a Good Idea.

Legal documents created from a template lacks any sort of personal attention that a real lawyer offers. Each legal issue has its own set of unique circumstances for the individual's situation. What you need is a tailored approach, especially for more complex legal issues.

Can You be Sure You're Fully Protected from a Legal Standpoint?

Online legal services use generic documents and advice. Often, this approach can result in costly errors due to document errors or omissions that could render them unenforceable. When you are not meeting face-to-face with a real attorney, there is no one to identify for address specific issues and could render the documents invalid.

Often, errors or omissions when filling out legal documents online could render them unenforceable.

Also, professional lawyers carry malpractice insurance, so that you have legal recourse in case of errors on their part. Online law services cannot guarantee that their documents are 100% accurate or their generic advice is the right course of action to take. If errors occur due to inaccuracies, omissions, or errors on a template document, you may eventually have pay additional legal fees to a real attorney to resolve any mistakes that were made.

Jurisdiction-Specific Law Requirements

Online legal services may not account for legal requirements that can vary from state-to-state and among different countries. Every legal document must be compliant with the regulatory requirements of all jurisdictions. Can you be sure that an online legal template is meeting all of the specific requirements?

Also, many jurisdictions may see that these online law services do not meet the requirements of being provided by a 'licensed law practitioner'. If your legal document is deemed invalid because the online law service you used is considered an 'Unlicensed Practice of Law', it can result in serious consequences.

Inadequate Services for Complex Legal Matters

If you have a more complex legal matter, it is in your best interest to seek legal counsel from a real attorney at a traditional law firm. Often, online law services are limited in scope and cannot handle complex legal matters. In the case of litigation, there is no one to handle your representation in court. If you seek specialized legal advice in as areas such as tax law, or intellectual property, the online legal service may not be able to provide you with legal advice that requires specialized knowledge in that area.

Online legal document templates are often too basic to handle complex matters.

Case Study #1

Estate Planning Disaster

When this individual decided to create a Will online using an online legal service, she thought she was saving money. Upon her death, the Will was found to be invalid because it did not meet her state's witnessing requirements and therefore, not executed properly. In addition, the online legal service did not take into account specific family dynamics which lead to disputes in court. All of this could have saved her family the stress and financial burden of a long, drawn-out legal battle over her inheritance. If they consulted with an actual estate planning lawyer, all of this could have been avoided.

Case Study #2

Forming an LLC: Maybe You Don’t Really Need an Appendectomy

Most people think they know the type of legal template they will need when they use an online legal service website—but many do not. Unless you’re talking with an actual business lawyer, how will you know if you’re asking for the right template? For example: You wouldn’t go into your doctor’s office and say, “I need you to take out my appendix”. You describe your symptoms, the doctor asks you specific questions, there’s a back-and-forth conversation, and eventually you learn that all you have is indigestion.

Our law offices recently had individuals ask us to assist them in forming a Limited Liability Corporation (LLC) for their new business. After we asked the right questions, learned about the goals, and had some back-and-forth discussions, we determined that their best course of action was for them was to form a C-Corp instead. That’s one of the many problems with using an online legal service. There’s no way of knowing if you’re getting what you really need because there is no real attorney who is asking the proper follow up questions. 

Case Study #3

Business Filing Gone Wrong

A small business recently used an online legal service to form an LLC, but later discovered that they didn't complete a portion of the process. At the end of the filing process, New York State requires you to publish notice of the business formation with the Department of State in Albany. Their filings for an LLC was rejected by the Department of State. That's when they turned to our law firm to help. Not only did they have to spend $300 a year for an online legal service, this business needed to start the process from scratch using my law firm's business law services. Although they thought they were saving money by using an online legal service, in the end they lost valuable time getting the business off the ground and wasted money in the process.

Discussing your goals with an actual attorney ensure your legal matters are handled properly.

Personalized Legal Advice and Representation

When you hire Ronald J. Axelrod & Associates in Rochester, NY, you'll receive a comprehensive legal analysis and personalized services tailored to your specific needs. With over four decades of experience, you can rest assured that your legal matter will be handled skillfully, ethically, and with the personalized service that you deserve. It's in your best interest to refrain from using online legal services and make an appointment with Ron Axelrod. Call our offices at (585) 203-1020.

Visit the Ronald J. Axelrod Website