Ask the Experts!
The professionals at Advanced Underwriting Consultants (AUC) answer the tax questions posed by producers. Here’s the question of the day.
Question: My client is one of the two owners of a closely held business. The business owners are interested in drafting a buy-sell agreement on their own. Would you recommend that they use an outfit like legalzoom.com?
Do-it-yourself legal software and online services can work for people when they have the very simplest of legal needs. However, any fact or circumstance that is not generic may cause the legal document to be invalid, or—worse—lead to a result that is unintended.
Here’s a link to attorney Gweyn Thomas’s blog about how using a do-it-yourself online estate planning document service ended up depriving a widow of a substantial portion of her inheritance.
Legalzoom.com has been sued by dissatisfied customers over the failure of the website to provide needed legal guidance, and for the failure of their documents to pass legal muster. Here’s an excerpt from one client’s civil complaint, filed after she had problems with a LEGALZOOM living trust:
LEGALZOOM’s business is premised on a false sense of security that people do not need to hire a traditional attorney because LEGALZOOM can assure through development of its materials by top attorneys, its customer service reps, and its peace-of-mind review that all work done will be legally binding and reliable. These statements are misleading and untrue, and intentionally made by defendants…to induce Plaintiffs to rely on the stated quality…of (LEGALZOOM’s) work.
A buy-sell agreement is a moderately complex legal document, and it’s drafting should be left to a competent local attorney.
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