The Essential Guide to Legal Document Preparation: Tips and Tools

All About Legal Document Preparation

Legal document preparation refers to the process of organizing and drafting the numerous legal documents that businesses are required to have in order to sufficiently service their clients and customers. Your business’s needs will determine the types of legal documents you need to prepare. For example, if you’re starting a business, proper formation of the business entity and Articles of Organization could be needed. If you are an entrepreneur, you may need waivers and releases for clients. If you are a fashion designer, non-disclosure agreements could be necessary for your new designs.
While some people may have the time and knowledge required to prepare their necessary legal documents, many do not. This is where the option of Legal Document Preparation comes into play. Much like drafting a Will or Trust, a legal document preparer can take your information and prepare the legal documents you need. In many states, a legal document preparer must be certified, bonded, and trained. Many reputable legal document preparers have extensive experience in business formation, real estate, family law, and estate planning .
When a document preparer prepares legal documents for you, they don’t provide full-fledged legal services. Instead, a legal document preparer will go over your situation with you and talk through what types of documents you would need to sufficiently address your legal needs. If you are preparing for a divorce, for instance, the preparer can discuss with you whether you have children, what your goals going through the divorce are, whether it is likely that you have family assets, etc. Based on the answers to these questions, they can help you to determine what your needs are and what you must do in order to fulfill those needs.
The beauty of having a legal document preparer do this for you is that you won’t be charged both for someone to learn your situation as well as to prepare legal documents—it will all be combined into one streamlined process.
When you are in need of legal assistance, hiring an attorney is certainly a possibility. However, keep in mind that there are very few instances when it is necessary for you to hire an attorney. The majority of legal needs that people have can be satisfied through a legal document preparer.

Legal Documents You Can Prepare

A. Wills: A will can be prepared by a person of sound mind and age who is not under duress to make a will. Typical uses of a will are to name an executor or personal representative, to name a guardian, to dispose of specific items of property, and to make general bequests of property. However, the most important term of any will is the disposition of the residuary estate. The residuary estate is that property which is not disposed of by a specific devise or bequest and which is not the subject of a general bequest. Items of property such as savings and checking accounts that refer to the depositor on the face thereof, life insurance policies, retirement accounts, and investment accounts that are payable on death or transfer on death generally are part of the residuary estate. The residuary estate becomes very important if you have minor children and need to designate a guardian or if you believe that there is a risk that either of your children would be unable to manage his or her own funds upon receipt of an inheritance. In Pennsylvania, if you die without a will and are survived by a spouse and issue (children), then one-half of your estate will pass to your spouse and the remaining one-half will pass to your children equally. However, if you do not have a Will, then none of your estate will be left to a sibling or a parent upon your death. Furthermore, if you did not get married until you had children from a prior relationship, then your children will receive nothing from your estate.
B. Power of Attorney: A power of attorney is a document authorizing someone to act on your behalf. A power of attorney must be in writing and signed by you in the presence of two witnesses and acknowledged before a notary (in Pennsylvania). It is a very important document because it designates a person to manage your financial affairs in the event that you become incompetent. In Pennsylvania, there is an amendment to the Probate Code which requires that the Agent designated by the power of attorney to accept the power of attorney complete a one-page form acknowledging the authority granted by the power of attorney. This form is usually attached to the power of attorney as an exhibit. If you are elderly and are moving into a retirement or nursing home, it is wise to have a power of attorney executed at that time.
C. Living Trust: A living trust is a document whereby the legal title to property which passes to the trust is held by trustees for the benefit of certain beneficiaries. Living trusts sometimes are used to avoid the necessity of probate and the preparation of an inheritance tax return at death. There can be substantial costs involved in creating a living trust and there can be substantial costs if the trust is changed from time to time. The most important thing in establishing a living trust is proper funding during your life. Proper funding usually means that the legal title to property should be transferred to the trust and the beneficiaries of the trust should be named. If the future beneficiaries of the trust are not named, then the trust will not work as intended.

Do-It-Yourself Legal Document Preparation Vs. Professional Services

When it comes to legal document preparation, one of the most common questions is should I do it myself or hire a professional? The answer isn’t always clear-cut. For some, going the DIY route can be a cost-effective solution to a simple problem, while others might need the guidance that only a professional service can offer.
If you’re tech-savvy and are comfortable navigating through various legal jargon and paperwork, then you might find it more beneficial to opt for the DIY route. Technology has made it possible to custom-create legal documents with only a few clicks; these "DIY" packages typically include templates and templates that simply require you to fill in the blanks. Because nothing could be easier than that, right?
While this might be a simple, even foolproof task for some, others may find themselves overwhelmed or unsure of how to navigate through all the complex tasks and terms involved in completing these types of documents. For them, hiring a professional service can provide peace of mind that their documents are being handled correctly, without any unnecessary errors or complications down the road.
By the end of the day, whether you should handle the legal document preparation on your own or seek out professional help depends on your own set of skills, available time, and the nature of the documents you’re looking to create.

How to Choose a Legal Document Preparation Service

When choosing the right legal document preparation service, the most important consideration is whether the one you are considering is a registered and bonded legal document preparation service. This is a requirement in many states to help consumers feel secure that the preparer is legitimate. It also gives you recourse because the bond can pay for damages related to the preparation of your legal documents if there is a breach of duty or negligence. After verifying that the legal document preparation service is registered and bonded, consider the following factors when making a selection:
Cost
The cost to hire a legal document preparation service is going to vary based on many factors including your location. You can expect to pay somewhere between $70 and $100 dollars per hour for legal document preparation services. At a minimum, you should hire a service that has set fees because it helps you avoid the problem of related or hidden costs. Some services do charge for storage and other items related to your case, so make sure you ask about how your preparation fees are structured.
Expertise
Most legal document preparation services offer basic services; however, there are some who specialize in specific areas such as family law. Due to the nature of the work, it is essential that the legal document preparation service has proper training and on-the-job experience. One way you can find out how a third party legal document preparation service stacks up is to read client reviews and ask relevant questions. Talk to staff about certifications and benchmarks they have met, and ask if they are up-to-date on legal formalities because the law is always changing.
Customer Reviews
Reading reviews are one of the first things you can do to see how others view the work of a service. Some people have had problems with hiring a legal document preparation service without knowing anything about them. Comments left by past clients can help you avoid these pitfalls and select a service that has a good track record.

Tools and Software for Legal Document Preparation

A variety of software programs and online tools are available to assist in legal document preparation. Some are checklist-based, while others offer templates and explanations as you go. There are free Legal Zoom forms that can be purchased and completed online for those representing themselves, as well as many other options for those who have attorneys preparing forms on their behalf. These programs often include the ability to insert appropriate information into a form (with or without the use of a template) and to save in Word or a similar format for future use. Most such programs permit a user to run conflict checks before committing any information, a valuable and, for many, irreplaceable habit.
Many bar associations provide sample forms for members. Some such as the Cal Bar and ABA even provide a database for comparing options and finding the right form software. ABA Tech show has also been known to provide good information on these products.
Some lawyers may choose to create a complete bank of forms, built in to the program, as part of a client’s matter. Such a program also permits one to try out some more recent, techy approaches to collaboration, such as posting "homework" for your clients to accomplish before a meeting or between meetings, so that you can use time with them productively. These methods, sometimes known as "collaborative law" or "cooperative law" methods, attempt to reduce costs by encouraging your clients to come to meetings prepared to accomplish the tasks at hand .
The New Jersey Supreme Court recently issued a 65-page report identifying best practices for collaborative law, although it recognized its limitations. Since that court has only recently approved collaborative divorces, it is unclear how widely these practices will be adopted, but there is every indication that their use will spread. We may anticipate that such approaches (or legal project management) will decrease the importance of form writing as a skill demanded from new lawyers. The use of programs to complete forms may actually fine-tune certain valuable skills over time, however, since completing forms by hand requires a level of focus, familiarity with the forms, and knowledge of typographic conventions that is not always as present in documents completed by a great many other methods. At the same time, because these forms are often provided to clients, the use of such programs may reduce prediction of outcomes by lawyers. That may make it more difficult for new lawyers to understand how courts behave, since they will not spend much time poring over so many examples of the same form in different cases.
In the end, though, the chief utility of such programs is to save time and reduce errors in typing. If they create the opportunity to lower bills for clients while increasing lawyers’ income, we probably should all be improving our typing skills.

Mistakes to Avoid When Preparing Legal Documents

While professionals understand the nuances and pitfalls of legal document preparation, the average individual does not have the same level of experience to avoid common mistakes. Unfortunately, making the wrong error can have lasting consequences on an individual’s rights or obligations, leaving them at the mercy of the system to rectify a poorly drafted document. Understanding how to avoid these errors is the first step to avoiding potential problems.
One of the most common errors is failing to be specific regarding your request. If the Request for Orders seeks, for example, a child support increase, the comments section should state whether there is a needed increase in the amount, a need for a deviation from guideline support based on increased expenses or other issues, and exactly what is being requested. Taking the time to plead your case in the comments section will help to ensure that you are receiving all that you are entitled to.
Another common error is the failure to provide information that has been specifically requested in a judicial council form. If the Request for Orders seeking modification is missing the Petition (fl-300), for example, the request will be dismissed until the appropriate packet is filed. A party has a statutory right to respond to these requests, so there is no way to avoid a delay in the proceedings if the proper documents are not completed and submitted.
There are many "check-box" type forms included in the Judicial Council form packets. While these forms provide guidance as to the type of information a court will need in order to rule on your Request for Order, they are not really necessary to a standard hearing. The issue is, if a specific box is NOT checked on one of the forms, a party may later attempt to assert that the issue is not before the Court, or that the Court does not have the authority to address the issue. With a very broad stroke, a form is provided that asks if a specific issue is being requested. When seeking a child support increase, for example, it is common on the FL-300 to check the box indicating that the request is for child support, medical support, and other issues. A very broad request, which covers the entire page.
Parties are often confused about the extensive declaration memorandums that are required. Financial issues often require both a personal net worth declaration (Financial Statement FL-150) and (Schedule of Assets and Debts, FL-142). While there is some overlap in the information, both forms should be completed to fully disclose your financial picture. Failing to fully disclose information on these forms can have devastating consequences down the road. For example, when dividing community property assets and debts, California Courts rely heavily on the numbers reported on the Schedule of Assets and Debts, which is presented to the Court as a "snapshot" of the parties’ assets and debts as of date of separation. If the values are incorrect, or one party has intentionally hidden or failed to disclose assets or debts on this form, litigants are often trying to "undo" agreements long after the division has apparently been made final. Often times, attorneys resolve these issues with prior property division agreements, requiring additional discovery and potentially years of litigation to determine its validity and enforceability.

Trends in Legal Document Preparation

Technological advancements such as artificial intelligence (AI) and the availability of cloud-based solutions that offer online access to document templates are changing the way legal documents are prepared and even utilized. Once considered a tedious prerequisite to litigation or other legal action, the creation of legal documents is increasingly connected to other processes, from tax preparation to public record requests. This means that the future of legal document preparation is one of greater integration; this also denotes a shift towards global standardization.
New regulatory regimes are also impacting legal drafting. Their requirements differ from that of the common law systems in place throughout the North America and Western Europe. These differences have implications for the way that upcoming generations of global and national businesses approach their legal matters; navigation of legally binding documents can be risky if it is not clear where the additional emerging requirements are coming from. Fortunately , through the use of document assembly and business workflow software, the process of creating fully compliant legal documents can be safe and efficient.
As regulatory requirements shift and new economies arise, the legal sector will continue to adapt and evolve. With these changes come greater expectations, rewards, and challenges. The localization of legal document preparation was an early precursor to the anticipated localization of law firms and other legal service providers. For most individuals and businesses, however, the anticipated impact from the aforementioned technological advancements and increased globalization will be beneficial. Overall, the future of legal document preparation will be one characterized by greater ease of access, flexibility, accuracy, and convenience.