The Grave Risks of Using DIY Legal Documents
Need instructions for replacing your car’s spark plugs?
Want to learn HTML?
Looking to find the route home with the least traffic?
You can find all of that—and just about anything else—with a quick Google search. Indeed, the amount of information you can gain from the Internet is staggering. But just because you can find something online doesn’t mean you should trust it. This caveat is especially true when it comes to legal documents for your business. While you’ll find tons of websites offering click-and-print legal forms for dirt cheap, these do-it-yourself (DIY) documents can put your business in serious peril.
You get what you pay for
With so many important items needed to run a business, it’s easy to give less priority to what seem like cut-and-dry legal documents. To the layperson, many standard business agreements appear basically identical, only with different names and numbers depending on whom you’re dealing with. But when it comes to legally binding contracts, the details of each agreement are of paramount importance. Even the smallest mistake or omission can make the contract invalid or seriously affect its enforcement. What’s more, without a legal background, you’ll have no idea what to look for to catch and correct such errors. Sure, such forms are often less expensive than hiring a lawyer in the short run. But is saving a few hundred dollars actually worth the very real potential that down the road you’ll get stuck paying tens of thousands of dollars in attorney’s fees, fines, and court costs—or even going out of business?
In their own words
If you want to see how truly ineffective DIY legal documents can be, look no further than the fine print found in the document websites themselves. These companies flat out tell you that at best, their products are inferior to the advice of a lawyer, and at worst, completely ineffective.
For example, here are some terms-of-service disclaimers from two popular online document companies, LegalZoom® and Rocket Lawyer®:
LegalZoom®, its services, and its forms or templates are not a substitute for the advice or services of an attorney.
Neither Rocket Lawyer® nor any legal information provided by Rocket Lawyer® is a substitute for legal advice from a qualified attorney licensed to practice in an appropriate jurisdiction.
The LegalZoom® disclaimer goes on to note that it can’t even guarantee its own documents are accurate or current: The legal information contained on the Site and Applications is not legal advice and is not guaranteed to be correct, complete, or up-to-date.
The Rocket Lawyer® disclaimer casts similar doubt on the reliability of its products:
The information, software, products, and services made available through Rocket Lawyer® may include inaccuracies or typographical errors. Information received via Rocket Lawyer® should not be relied upon for personal, medical, legal, or financial decisions. When even the companies themselves admit that you can’t trust their products to be accurate, effective, or reliable, that should be a huge red flag. After all, isn’t getting accurate, effective, and reliable legal documents the whole reason you’re doing business with them in the first place?
A false sense of security
These online document companies are counting on you to believe that technology has reached a point where consulting with a live lawyer is no longer a necessity. Yet their own terms and conditions totally dispel this dangerous assumption. And this leads to perhaps the most egregious thing about online legal document services—they provide business owners with a false sense of security. Thinking that DIY forms provide your business with a solid legal foundation can be tremendously dangerous, especially if they prevent—or delay—you from consulting with a real lawyer. While you may be able to cut corners in other areas of your business, not having effective legal systems is a disaster waiting to happen. If you purchase a cut-rate computer printer, for example, and it misprints some of your office memos, that’s problematic, but not exactly devastating. But if the legal agreements you rely on are incorrect, outdated, or faulty in any way, it can put your entire company in jeopardy. Legal documents are designed to protect some of your business’ most essential elements: your personal liability, intellectual property, trade secrets, and tax obligations to name just a few. Are you really going to trust generic, fill-in-the-blank forms you found online to protect such vital components of your business?
Don’t do it yourself
Just as you would never try to wire your office’s electrical systems yourself if you weren’t an experienced electrician, you shouldn’t try to do the same with your company’s legal systems. When it comes to implementing such a critically important element of your business, you should always consult with a licensed and experienced professional like us.
As your Family Business LawyerTM, our mission is to guide you through the complexities of the law and legal processes to ensure your company has the most robust legal protections possible. Whether you have legal documents in place that need reviewing, or you need to create your foundational legal systems from scratch, we can offer trusted guidance and advice.
Contact us today to learn how we can support you in establishing truly trustworthy legal documents and systems for your business.
This article is a service of New Vision Law and Gregory A. Gordillo, Family Business LawyerTM. We offer a wide array of business legal services and can help you make the wisest business choices throughout life and in the event of your death. We also offer a LIFT Building Session™ for your start-up business, or a LIFT Review Session for your ongoing business, which includes a review of all the legal, financial, and tax systems you need for your business. Call us today to schedule.