See Presentation on this topic here.

The legal document preparation industry has been around since the early 1990’s and has remained essentially the same, except a significant portion has moved online. It is a fast growing industry.

What is the “legal document preparation industry”? The industry is composed of non-lawyers who assist consumers and small business in preparing legal forms, but without providing any legal advice or doing any custom drafting.

The “Scrivener Exception” to Unauthorized Practice of Law.

Legal document preparation by non-lawyers is not considered to be the “practice of law” as it falls within the “scrivener exception” to the definition of the practice of law in almost all states. The “scrivener exception” enables non-lawyers to assist parties in typing their legal forms and they can provide “legal information” but not legal advice. This exception has been codified by statute in some states such as California, Arizona, Florida, and North Carolina, and recognized by case law in other states. All states recognize the “scrivener” exception.

Some states, such as South Carolina, consider interactive legal software for consumers to be an extension of the scrivener exception. One state, North Carolina, considers the selection of alternative text paragraphs based on user input to be within the definition of legal advice and the practice of law and concludes that the sale or distribution of self-help legal software is beyond the scrivener exception. Today there are several thousand legal document preparers, mostly in the states of California, Arizona, Nevada, Florida, Texas, and Utah. These legal document preparation businesses, often from a retail location. In the late 1990s a national franchise operation emerged called We The People emerged which sought to expand nationwide. It failed, but some individual store owners still exist today.

Online Legal Document Preparation

Since the advent of the Internet, the legal document preparation business has been automated and have moved online. It includes companies such as LegalZoom, RocketLawyer, SmartLegalForms, Willing, USLEGALFORMS, and many other online document preparation companies. Some commentators believe that the industry now accounts for hundreds of millions of dollars in annual revenue. It has become a big business, although, until recently, under the radar screen of the organized legal profession.

American Bar Association Guidelines

To bring some order to this industry, the American Bar Association saw fit to pass a resolution at their 2019 Annual Meeting that established Best Practices Guidelines for Online Legal Document Providers. These Guidelines do not have the force of law and are not binding on the states, but it demonstrates the significance of the role that non-lawyers now play in helping consumers create and file their own legal documents. [ See previous blog post on these Guidelines here and the final version as passed by the ABA House of Delegates here. ]

Legal aid agencies, with the support of the National Legal Services Program, provide online legal documents directly to consumers. Last year over 1,000,000 documents were generated for consumers for free. State courts are also providing interactive legal documents directly to consumers.

The Future

The idea that non-lawyers can provide services that can help consumers and small business solve their legal problems at an affordable cost is a wedge in the lawyer’s monopoly over the delivery of legal services. This wedge will widen as web-enabled applications powered by artificial intelligence, for example – automated legal advice bots, become more widespread and in use. To paraphrase Sir Winston Churchill, we are still at the beginning of the beginning. The lawyer’s monopoly over the delivery of legal services will eventually crack.