You need to prepare a legal document for a client.
You find a polished website selling Trust Deeds, Loan Agreements, Wills and Powers of Attorney. It looks legal. It sounds legal. It even claims that a lawyer ‘signed off’ its documents.
But the website is not a law firm.
A lawyer may have prepared the template that sits behind the website. But that lawyer does not prepare your client’s finished legal document. Nor does that lawyer accept responsibility when the document fails. A law firm’s Professional Indemnity insurance does not cover a resold template.
That puts the accountant, adviser and client at risk.
Pretend law firms’ websites merely resell a lawyer’s template – dangerous
Non-law firm websites buy, beg, borrow or steal a law firm’s template.
Often, the templates are never updated or monitored by a law firm. In Australia, a law firm is not responsible for ‘resold’ templates. You, as the accountant and your client are on your own.
Worse still, the adviser and accountant are providing ‘legal advice’. This is because non-lawyers resell the template. There is no direct relationship between the lawyer who first provided the template and the end-user, who is the accountant’s client. ‘Tax agent services’ does not extend to giving legal advice: s90-5(1) TASA 2009. Non-law firm websites do not provide protection for tax agents.
ACT and South Australian tax agents using non-law firm websites breach:
- s16(1) & 21(2)(b) Legal Profession Act 2006 (ACT); and
- Legal Practitioners Act 1981 (SA)
Using a pretend law firm website breaches ‘preparing documents that create or regulate legal rights’.
Even the supply of Trust Deeds and Employment Contracts breaches the law. A tax agent building trust deeds on a non-law firm website breaches the law: Legal Practitioners Act 1981 (SA).
The Legal Profession Uniform Law Application Act 2014 (Vic) in Schedule 1, Part 2.1 states:
9 Objectives
The objectives of this Part are –
(a) to ensure, in the interests of the administration of justice, that legal work is carried out only by those who are properly qualified to do so; and
(b) to protect clients of law practices by ensuring that persons carrying out legal work are entitled to do so.
10 Prohibition on engaging in legal practice by unqualified entities
(1) An entity must not engage in legal practice in this jurisdiction, unless it is a qualified entity.
Penalty: 250 penalty units or imprisonment for 2 years, or both.
(2) An entity is not entitled to recover any amount, and must repay any amount received, in respect of anything the entity did in contravention of subsection (1). Any amount so received may be recovered as a debt by the person who paid it.
Also a non-qualified entity or person engaging in legal practice could also serve up to two years imprisonment.
Both New South Wales and Western Australia adopt the same rules.
Incorporating a company on a non-law firm website breaches the law because a company needs (or should have) a constitution. A constitution is a ‘deed’. Only lawyers can legally prepare deeds. Similarly, a POA is a deed. So an accountant or adviser building a POA on a non-law firm website, including a website provided by a State government, breaches the law.
Legal Consolidated does not resell a lawyer’s template. We are the law firm.
Before using a pretend law firm website, consider:
1. Who is drafting the legal document?
The Family Trust Deeds, Power of Attorneys, 3-Generation Testamentary Trust Wills, Loan Agreements, Leases and the 100s of other documents are drafted by the Australian law firm Legal Consolidated Barristers & Solicitors. While accountants and clients may type in answers to the questions, the law firm controls the logic flow, questions, hints, training videos and systems. We retain the copyright of our documents, and we are responsible for the legal document. The law firm is drafting the online document.
2. Who is responsible for the drafting and its legal correctness?
Legal Consolidated developed and controls the website and building system. The law firm provides locked PDF documents of the finished document, together with a cover letter on the law firm’s letterhead confirming that we prepared and drafted the legal document.
3. Where are the client’s personal information and data stored?
All information is stored on the law firm’s website. Your client retains legal professional privilege. However, Legal Consolidated does not see or retain any person’s credit card details.
4. Can non-lawyers charge to prepare legal documents?
No, they cannot. However, a professional, such as a financial adviser or accountant, can charge for the time spent providing relevant financial planning and accounting advice.
For example, much of the work in estate planning involves understanding the client’s tax position, financial planning, superannuation, insurance, and business structures. Just as you cannot give legal advice. We are unable to provide financial planning advice. For example, we can not advise on reversionary pensions. And we are not licensed tax agents.
We sign off on all documents built on Legal Consolidated’s website – the law firm
Non-qualified suppliers of legal documents claim that their Deeds are ‘signed off’ by an Australian lawyer.
This suggests that a lawyer has approved the legal document you are building online.
However, there can only be a ‘lawyer sign off’ when the legal document is prepared directly on a law firm’s website, such as Legal Consolidated Barristers & Solicitors’ website.
This is not the case with non-law firm websites.
Be cautious with websites that law firms do not operate. Ask these non-law firm websites three questions:
- Who is responsible for the legal document?
- May I please have the above answer on a law firm’s letterhead?
- Where is the cover letter, on law firm letterhead, confirming that the law firm authored and is responsible for each document I build on your website?
Is a resold lawyer template on a non-law firm website protected?
A resold lawyer template sold by a website pretending to be a law firm is:
- not from the law firm directly
- not ‘signed off‘ by a lawyer
- not protected by an Australian law firm
With all Legal Consolidated Deeds, you get a cover letter. A lawyer from our law firm signs it. It confirms that Legal Consolidated authored the legal document.
Can I buy a template over the Internet and change it in MS Word?
It is illegal for an accountant or financial planner to update or change a legal document in MS Word.
See Legal Practice Board v Computer Accounting and Tax Pty Ltd [2007] WASC 184.
In this case, the accountant purchased a trust deed template. The trust deed came from a law firm. However, the accountant populated the template in MS Word. This is with the client’s name and address.
The court held that the accounting firm was breaching the relevant legislation. It is not a law firm and cannot prepare legal documents.
Further, neither the accountant nor the client had legal professional indemnity insurance. If anything went wrong with the legal document, then there is no insurance. The accountant’s insurance does not cover the provision of legal advice.
This is why all Legal Consolidated documents are delivered to you as a PDF. We give you a voucher to update the document on our website if they need updating. We control the questions, hints, logic flow and the finished legal document. We provide a letter addressed to the client (not the accountant or financial planner) to confirm that Legal Consolidated prepared the document. Legal Consolidated is responsible for the document.
Even when the non-lawyer states that they are not lawyers, that is not good enough: Legal Services Commissioner v Raghoobar [2023] QSC 41. Only a law firm can provide legal advice and prepare deeds.
I’ve found’ a Division 7A Loan Agreement in MS Word
Division 7A is the third-highest area of negligence claims against accountants.
I am gobsmacked as to why an accounting house takes the risk of providing legal documents to clients.
If an accountant populates a Word document, then the accountant is liable for the legal document. That is breaking the law. And the accounting house has no insurance to cover problems with that legal document. See Legal Practice Board v Computer Accounting and Tax Pty Ltd [2007] WASC 184.
Instead, build a Division 7A Loan Deed on our law firm’s website. As an Australian law firm, Legal Consolidated is then responsible for the deed. All our documents are provided:
- As a PDF
- With a cover letter addressed to your client. It confirms that Legal Consolidated prepared the legal document.