The Legal Timebomb Ticking In Your Business: Act Now

DIY legal services like LegalZoom, Rocket Lawyer and Mama Bear promise to save you money on filings, trademarks, drafting contracts and other business law needs. Unfortunately, cutting corners with these services will end up costing you more in the long run.

Using online templates for filings, trademarks and drafting contracts will leave your company vulnerable to expensive litigation down the road. Here are just a few reasons why.

Expenses

There are DIY TV channels, websites, apps and even old-fashioned classes that teach people the step-by-step instructions for refinishing furniture, tiling a bathroom or renovating a home. This same concept has spilled over into the world of legal services. Online services like LegalZoom, Rocket Lawyer and Mama Bear promise fast, low-cost access to legal forms that are designed to cut out the middleman — the attorney — and save business owners money. But if the legal work is not done correctly, it can end up costing the company much more than the original savings would have been.

In the case of DIY legal work, mistakes can result in expensive legal disputes that far outweigh any initial “savings.” The problem is that these online companies rely on the lowest common denominator when creating their templates and do not factor in unique circumstances or the potential for changes in laws. For example, we recently worked with a family who used an online DIY service to complete a divorce filing. The couple mistakenly selected a form that waived their interest in community property in exchange for additional spousal support. However, their lawyer informed them that the form did not meet the statutory requirements for waiver of property interests. This was a costly error that could have been avoided with the help of an experienced legal professional.

In addition to the actual time spent working on client cases, the practice management software Clio estimates that legal professionals spend an average of 2.4 hours per day on activities other than billing and invoicing clients. This includes time spent on marketing and business development. These are important tasks that require thought and strategy in addition to the execution needed for a successful law practice.

Time

There is a reason for the saying, “time is money.” Every minute that you spend dealing with unnecessary legal disputes and lawsuits represents a lost opportunity to devote that time to growing your company. That lost opportunity cost can easily outweigh the initial savings you might have realized by using a DIY legal service.

Many people use DIY legal services to save on the costs of hiring an attorney. While it is true that an attorney can often charge a much higher fee than a legal service, that is because these legal services are tailored to your specific needs. DIY legal services are not tailored to your unique situation and do not provide you with the individualized focus and advice an attorney provides.

Additionally, DIY legal services do not consider the laws of your jurisdiction. For example, if you are looking to form a business or file for a trademark, these online services will likely use forms that are designed for businesses in other jurisdictions. These generic forms may not comply with the laws of your jurisdiction, which can have significant consequences down the road.

Similarly, when handling family law matters such as divorce, custody, visitation or legal guardianship, it is important to have the proper knowledge and guidance from an attorney. These issues involve complex and emotional matters, and if a mistake is made, it could have long-lasting effects on the entire case. Most DIY legal services have disclaimers stating that they bear no responsibility or liability for any legal problems that result from the use of their products. This is far too risky for any company or individual to take. If you would like to learn more about the pitfalls and risks of DIY legal solutions, please contact us.

Mistakes

Many people are attracted to DIY (do-it-yourself) options when they need to solve a legal issue. This could include forming a business or nonprofit, filing for a trademark, or creating form contracts. This option may save money up front, but it can cost more in the long run.

The risk of mistakes is often greater when a person handles their own legal work rather than working with an experienced attorney. There are countless stories of individuals and businesses that have used DIY legal services, only to end up spending thousands in fees, fines, or lawsuits as a result of poor or incomplete documents, incorrect filings, or unintended consequences.

For example, the terms of service for most DIY legal services state that they have no responsibility or liability for the legality or appropriateness of their products. Unfortunately, this is often the case when a legal problem arises from using their forms.

Another big mistake that many people make when they use DIY legal services is not considering the specific laws of their location or industry. For example, the laws that govern the formation of a business entity vary from state to state, and using generic documents can create significant problems down the road.

DIY legal services are also typically one-size-fits-all and don’t take into account how a company’s business structure or contractual agreements might change over time. By contrast, a skilled attorney can identify potential issues and address them with clarity to avoid problems in the future. The resulting peace of mind and confidence that an experienced lawyer brings to the table can easily outweigh the upfront costs associated with collaborating with them on large and small legal matters.

Unnecessary Disputes

There’s nothing wrong with trying a DIY approach to a small project around the home or office. There are plenty of YouTube channels, apps, programs and old-fashioned classes that provide step-by-step instructions for refinishing furniture, tiling a bathroom and a myriad of other projects that can be handled without the help of a professional. However, when it comes to legal matters there’s no substitute for a qualified attorney.

Online services such as LegalZoom, Rocket Lawyer, Mama Bear and ZenBusiness promise a quick fix for legal issues like forming an LLC, setting up a nonprofit, filing trademarks and drafting contract templates. These companies eliminate the middleman (an attorney) and cut costs by allowing people to handle legal tasks on their own. Unfortunately, these online services can have significant repercussions for business owners.

The major problem with these online services is that it’s often impossible to know when the contracts and other forms were created. Using a form that is outdated can cause serious problems in future legal matters. This is especially true for intellectual property issues, such as trademarks.

It is also important to note that many of the non-attorney-focused DIY/service companies are revenue oriented, and thus they will upsell their clients on ancillary services and include hidden subscriptions in their contracts. A competent law firm that focuses on service will provide only what is needed and will not hide additional fees in the fine print of their contracts.

A skilled, experienced lawyer will be well-versed in the latest laws and regulations that impact your business. They will be prepared to handle the minor and major problems that inevitably arise in every case, as they are highly trained to do so.

Unnecessary Conflicts

Aside from the monetary costs, unnecessary conflicts can also have a negative impact on team morale and productivity. They can also lead to unethical or illegal behavior, which can result in severe legal repercussions for individuals and businesses. Offering strategic advice on business operations and risk mitigation Jeremy says the law can be on the company’s side.

While healthy disagreements are a necessary component of any successful team, it’s important to keep an eye out for unnecessary conflict. This is often triggered by what’s called a “conflict entrepreneur” on your team, someone who deliberately inflames conflict for their own benefit. This type of conflict can be easily avoided by actively listening to everyone’s viewpoint, encouraging open communication, and establishing healthy conflict practices. Structural conflicts can also be avoided by identifying and changing oppressive patterns of human relationships. CC Licensed Content via Dispute Resolution Office, Ministry of Justice (Government of Saskatchewan). Remixed and/or curated by JVDW Designs.