March 17, 2010 – As joblessness and lack of new opportunities continues to hit the legal profession hard, many lawyers are now considering hanging out a virtual shingle by opening up a virtual law office, or VLO. Some traditional law firms also are establishing VLOs to offer unbundled legal services to clients who may not typically be able to afford, or need, their full-service offerings.
The VLO, as discussed in Virtual Law Office – An Option for Lawyers in Transition, involves web-based portal software that provides for the complete attorney-client interaction, from establishment of the client relationship, to the delivery of documents and advice, to invoicing and bill payment, online.
VLO software is typically provided on a subscription basis, with no setup costs and low monthly fees, so that lawyers can establish “offices” anywhere, with minimal overhead. These VLOs offer a level of online security that is not typically found in a typical law firm environment.
“Attorneys must do what they can to protect a client’s confidential information,” said Stephanie Kimbro, “and email, since it is not secure, is not the best way to communicate with clients.” Kimbro is co-owner of Virtual Law Office Technology, LLC and owner of Kimbro Legal Services, LLC.
Ethical considerations for VLOs
The risks of a VLO are similar to the ethics and malpractice risks of a traditional law practice, but it may actually be easier to protect yourself against those risks with the technology provide by a VLO, according to Kimbro.
Because potential clients must typically complete a registration form, the attorney is able to immediately determine if the client is located in a state in which they practice, thereby avoiding issues related to the unauthorized practice of law.
“Once the client fills out the form, we then run a conflict and jurisdictional check before taking the engagement,” said Richard Granat, CEO of DirectLaw, Inc. Granat also co-chairs the American Bar Association Law Practice Management Section’s eLawyering Task Force. Key is the engagement or representation letter that clients must review and agree to in order to send their initial request to the lawyer, says Granat.
It’s important also to establish the online attorney/client relationship and define the scope of representation very clearly, particularly as it relates to VLOs that offer unbundled legal services, where the lawyer is only providing documents and legal consultation, and the client is responsible for all the footwork related to getting documents signed, notarized, and filed appropriately.
According to the ABA’s eLawyering Task Force, a terms and conditions statement should precisely describe the limitations on services, the requirements to establish a lawyer-client relationship, and disclaimers related to the creation of the lawyer-client relationship.
The issue of managing the client’s expectations and the scope of services is critical with unbundled legal services, according to Kimbro.
“You have to be sure you are providing adequate notice to the client, and that you are doing so repeatedly, about the exact scope of the services,” Kimbro said.
Protecting the confidentiality of client data is generally very straightforward with VLO software packages, as they are going to have security and redundancy built into them. In many instances, the security provided by companies such as Virtual Law Office Technology LLC, DirectLaw Inc., and other Software as a Service providers may actually be better and more current than what the typical law firm has in place or can easily afford, according to Nerino Petro, State Bar of Wisconsin practice management advisor.
“It’s interesting because some states, like Massachusetts, are requiring that certain business transactions be encrypted, but attorneys are exempt from that requirement,” Kimbro added. “But if other industries are requiring that level of protection, you can see it is only a matter of time before legal services have to meet that same standard.”
The benefit of communicating with the client within the VLO portal is that the communication is secured, without the client or lawyer having to deal with email encryption software. In addition, there is a record of the communication and correspondence created all in one place.
What do clients think?
Clients seem to have an overwhelmingly positive reaction to VLOs as an option for obtaining legal services.
“My clients are appreciative, even grateful, because they are able to budget easier for what they need as it is typically a flat fee, they can pay online with a credit card, and they don’t get the sticker shock of a billable-hour invoice,” Kimbro said. “Plus it’s also a lot more efficient.”
“It provides clients a safer way to get legal documents than just using an online document service like LegalZoom, but not as expensive as a full-service law firm,” Kimbro added.
In general, clients are very comfortable with dealing with the lawyer through this technology, according to Granat. “It’s rare to find someone who can’t deal with me though the portal or telephone,” he added. “They like it because with the technology, I can respond to them in 5 to 10 minutes on a question.”
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