When people ask me my thoughts about online legal service providers such as LegalZoom, I get a big smile and simply tell them that LegalZoom is my best client. While these online legal service providers are very exciting and they tell you things like they can “get your new business up and running in minutes” at extremely low prices (and who doesn't like a good deal, right?) – it's what they don't tell you that will hurt you.
Time and time again I end up with people in my office who find out they had set up their businesses incorrectly through these services, and more importantly, find out too late that key and essential provisions were not included in the “form” documents that were given to them by these legal service companies. For instance, these companies do not tell you anything about needing a well-worded and well-constructed Buy-Sell Agreement between business partners. Such agreements provide for what happens when a business does not go as planned or a partner actually wants to leave the business. I've seen bad break ups in business that easily cost tens of thousands of dollars in litigation fees to resolve, and often could have been avoided by a well-worded Buy-Sell Agreement. This is just one of several examples of the costs that could have easily been avoided, and makes sense to anyone who has ever had a business partner and tried to sell their interest in the business.
Perhaps most telling is that all of these sites include multiple levels of disclaimers to protect themselves, stating “We are not attorneys and we cannot provide you with legal advice.” Most importantly, they state in the fine print that you should “be sure to consult with an attorney regarding the use of these documents.”
The trouble is that if there is any area that requires legal advice, these online service providers simply leave it out of the document and don't tell you what is missing. I think most people would be surprised how comparable in price and helpful business attorneys are in helping you avoid major and unforeseen issues down the road.
John W. Schuster, JD MBA is the owner of and an attorney at Caliber Law, S.C., a law firm located in Oshkosh, which specializes in helping business owners start, protect, buy, sell, and grow their businesses. To learn more about John and his practice, click here.