Virtually Unclear: Will Legal Tech Companies Bridge Justice Gap Or Fall Into UPL Abyss?

In 1965, Norman F. Dacey published a book, How to Avoid Probate, which sold 600,000 copies in two years. [New York Cty. Lawyers' Assn. v. Dacey, 54 Misc.2d 564 (N.Y. Sup. Ct. 1967) affd. in part, modified in part, 28 A.D.2d 161 (1st Dept. 1967), revd. sub nom., 21 N.Y.2d 694 (N.Y. 1967).] The book contained information and forms that readers could use to create wills and trusts without the assistance of an attorney. [Id. at 566.] The New York County Lawyers Association sued Dacey and his publishers, claiming they were engaged in the Unauthorized Practice of Law (UPL) and seeking to enjoin publication of the book. [Id.] Although both the trial court and the Appellate Division ruled that Dacey's book constituted UPL, the Court of Appeals reversed. [See, Dacey, 21 N.Y.2d 694 (N.Y. 1967).]

In doing so, the Court relied entirely on an impassioned dissent penned by Justice Harold A. Stevens. [Id. at 694, reversing and dismissing with costs "on the dissenting opinion at the Appellate Division."] Justice Stevens drew a sharp distinction between furnishing legal services to clients and publishing a book containing legal forms and instructions. The latter, he argued, involves no "personal contact or relationship with a particular individual" nor the "relation of confidence of trust so necessary to the status of attorney and client." [Dacey, 28 A.D.2d 161, 174 (1st Dept. 1967) (Stevens, J., dissenting).] Justice Stevens also took the opportunity to lambast the legal profession for attempting to impose a monopoly on the discussion of law:

That it is not palatable to a segment of society which conceives it as an encroachment of their special rights hardly justifies banning the book. '[I]t is a prized American privilege to speak one's mind, although not always with perfect good taste, on all public institutions.' Free and open discussion or even controversy could lead to reforms, if needed, or improvement where desirable. Books purporting to give advice on the law, and books critical of law and legal institutions have been and doubtless will continue to be published. Legal forms are available for purchase at many legal stationery stores. Unless we are to extend a rule of suppression beyond the obscene, the libelous, utterances of or tending to incitement, and matters similarly characterized, there is no warrant for the action here taken. [Id. at 177 (Stevens, J., dissenting).]

The 21st century analogues to Dacey and his book of forms are legal technology (Legal Tech) companies, which offer online platforms that enable customers to create forms and legal documents by responding to a series of questions or prompts. In most cases, the end product of a Legal Tech service is a completed document populated with information provided by the customer. Legal Tech companies offer a variety of services, such as wills, leases, corporate formation documents, powers of attorney, and divorce petitions. Some examples of Legal Tech companies are LegalZoom.com, Nolo.com and The 21st century analogues to Dacey and his book of forms are legal technology (Legal Tech) companies, which offer online platforms that enable customers to create forms and legal documents by responding to a series of questions or prompts. In most cases, the end product of a Legal Tech service is a completed document populated with information provided by the customer. Legal Tech companies offer a variety of services, such as wills, leases, corporate formation documents, powers of attorney, and divorce petitions. Some examples of Legal Tech companies are LegalZoom.com, Nolo.com and RocketLawyer.com, which provide a range of legal self-help services for personal and business customers. Additionally, a quick Internet search reveals a host of smaller Legal Tech companies that provide services in specific areas (e.g., wills, incorporation, trademark applications). For the most part, these companies cater to the legal needs of a portion of society largely overlooked by the legal profession: Namely, individuals or start-ups that cannot afford to hire an attorney and, depending on the complexity of the issue, may not require formal legal advice. [See, e.g., Mathew Rotenberg, "Stifled Justice: The Unauthorized Practice of Law and Internet Legal Resources," 97 Minn. L. Rev. 709, 720 (2012).]

Like Dacey, Legal Tech companies claim they are not law firms and are not providing legal advice or representation. Yet, because they offer services that are also provided by lawyers, they can find themselves at odds with UPL laws. This article discusses how courts have applied traditional UPL restrictions to Legal Tech...