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The use of legal software by non-lawyers and the perils of unauthorised practice of law charges in the United States: a review of Jayson Reynoso decision

Abstract

This paper critically reviews the judgment of the United States Court of Appeals for the Ninth Circuit In re: Jayson Reynoso: Frankfort Digital Services et al., v. Sara L. Kistler, United States Trustee et al. (2007) 447 F.3d 1117. The appellants, who were non-lawyers, were indicted with unauthorised practice of law for offering bankruptcy petition services via online legal software or expert systems in law configured for filing bankruptcy petition forms. The United States Court of Appeals for the Ninth Circuit found inter alia that appellants were bankruptcy petition preparers, and not being lawyers, had exceeded their clerical remit by offering legal advice and legal services in contravention of California law regulating legal practice and 11 U.S.C. Sect. 110 of the Bankruptcy Code (2002). While examining the legal ramifications of the use of legal software by non-lawyers in the preparation of legal documents, the paper critically reviews the factual circumstances of the Reynoso decision in the context of juridical and statutory constructs of unauthorised practice of law in the United States. The paper poses the question whether Reynoso should be viewed as a one-off decision bound by its peculiar facts, or good law for the broad proposition that non-lawyers cannot use legal software in legal documents preparation. The paper also notes the possible legal barriers to an unconditional ban on the design, sale, distribution, and uses of legal software by non-lawyers. These range from the First Amendment right to free speech, constitutional right to pro se legal representation, interstate commerce doctrine, to antitrust provisions of the Sherman Act. A regime of best practices for the use of legal software or expert systems in law by non-lawyers is proffered.

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Notes

  1. 1.

    In Britain, the deregulation of conveyancing services in 1987 by the Thatcher government opened legal services market to licensed conveyancers who were not members of the legal profession, with dramatic decrease in conveyancing fees. See Leef (1997) (Winter 1997), at http://www.cato.org/pubs/regulation/regv20n1/reg20n1c.html (last accessed on 2 August 2010). However, while laypersons are not expressly prohibited from giving legal advice, they cannot misrepresent themselves as legal specialists. See Messina (2000), at 327.

  2. 2.

    Fischer (2000–2001); Ohio State Bar Association v. Newburn (2008) 119 Ohio St.3d 96, where Ohio Supreme Court held inter alia that “Our jurisdiction thus extends to regulating unauthorized practice of law, which we do to protect the public from agents who have not been qualified to practice law and who are not amenable to the general discipline of the court.” Ibid., at 97.

  3. 3.

    Online and offline documents on offer vary from wills, divorce, employment contract to agency contract. See www.desktoplawyer.co.uk (accessed on 2 August 2010).

  4. 4.

    See http://www.legalzoom.com/disclaimer-popup.html (accessed on 2 August 2010).

  5. 5.

    Gibeaut (1998), at 42 and 47.

  6. 6.

    Ibid.

  7. 7.

    Fischer (2000–2001), supra, note 3, at 138–139.

  8. 8.

    Leef (1997), supra, note 1.

  9. 9.

    Ibid.

  10. 10.

    Messina (2000), supra, note 1, 367, at 372. As noted above, this probably explains why the British firm, Desktop Lawyer, would not assume responsibilities inherent in lawyer-client relationships. See notes 4 and 5, supra.

  11. 11.

    Justice (1991, 179), Rentz (2005, Fall), Schwab (2000), Palomar (1991). However, for most, the unauthorised practice of law huddle remains an implacable barrier. This is exemplified by the 2008 Ohio Supreme Court decision, which found a professional surveyor whose work involved incidental preparation of conveyances, liable for unauthorised practice of law. The Court had held that the “… practice of law embraces the preparation of legal documents on another’s behalf, including deeds which convey real property.” See Ohio State Bar Association v. Newburn, supra, note 3, at 97.

  12. 12.

    For example, in New York County Lawyers’ Association v. Dacey, 283 N.Y.S. 2d 984, at 990, (App. Div.), Revised 234 N.E.2d 459 (N.Y. 1967). It was held inter alia that “[t]he copying or completion of a form may consist merely of clerical work but the selecting of the proper form and telling a clerk what to copy and how to fill in the blanks is lawyers’ work.” Also in Ohio State Bar Association v. Newburn, supra, note 3, at 97, the Ohio Supreme Court noted that the practice of law embraced the preparation of legal document.

  13. 13.

    The ubiquitous cash dispenser machines are an example of expert systems. For discussion, see Susskind (2000), at 162–176.

  14. 14.

    See Susskind (1987) at 3.

  15. 15.

    For example, legal information retrieval systems such as WESTLAW and LEXIS are crucial expert systems for legal academia and the legal profession. For discussion, see Susskind (2000), supra, note 14 at 221–222.

  16. 16.

    Oskamp and Lauritsen (2002), Susskind (1987), supra, note 15 at 3.

  17. 17.

    For discussion, see Lanctot 2002, supra, note 2, at 811–854.

  18. 18.

    Susskind suggested that legal advisers could most certainly be held liable for resultant losses from negligent advice proffered using expert systems in law. See Susskind (1996). See also Morrison (1989). The author opined that concerns for potential malpractice liability risks were a major obstacle to widespread adoption of rule-based expert systems by lawyers. Ibid; at 34.

  19. 19.

    The American Bar Association, Report of the Commission on Multi-jurisdictional Practice defines the term as “…the legal work of a lawyer in a jurisdiction in which the lawyer is not admitted to practice law.” See American Bar Association Centre for Professional Responsibility, Client Representation in the 21st Century: Report of the Commission of Multi-jurisdictional Practice (August, 2002), at http://www.judiciary.state.nj.us/notices/reports/abareport.pdf (assessed on 2 August 2010). The inherent multi-jurisdictional nature of online practice of law by lawyers is a concomitant externality to the increasing use of modern telecommunication technologies in legal practice. See for example the California Supreme Court dicta in Birbrower, Montalbano, Condon & Frank, P.C., v. Superior Court of Santa Clara County. 949 P.2d. at 4. The Birbrower court opined that a lawyer not physically present in California could still be deemed to practice law in contravention of California law forbidding out-of-state practice of law, if he advised a California resident client via telephone, fax, computer, or other modern technological means. Ibid. For discussion, see Glass and Jackson 2000–2001.

  20. 20.

    This is exemplified by the case of In re: Jayson Reynoso, Debtor, Frankfort Digital Services, LTD.; Henry Ihejirika, Appellants, v. Sara L. Kistler, United States Trustee, Appellee, and Executive Office of United States Trustee, Trustee. (2007) 477 F.3d 1117.

  21. 21.

    Lanctot (2002), supra, note 2 at 811–822, Glass and Jackson 2000–2001, supra, note 21 at 1195.

  22. 22.

    Ibid, at 1117–1126.

  23. 23.

    The facts of the Reynoso decision as restated here are drawn from the decision of the United States Bankruptcy Appellate Panel for the Ninth Circuit in re: Jayson Reynoso, Debtor. Frankfort Digital Services, LTD.; Henry Ihejirika, Appellants, v. William T. Neary, United States Trustee, Appellee. (2004) 315 B.R. 544, at 547–554.

  24. 24.

    Ibid.

  25. 25.

    Ibid.

  26. 26.

    Ibid.

  27. 27.

    Ibid.

  28. 28.

    Ibid.

  29. 29.

    Ibid.

  30. 30.

    Ibid.

  31. 31.

    Ibid.

  32. 32.

    Ibid.

  33. 33.

    Ibid.

  34. 34.

    Ibid.

  35. 35.

    Ibid.

  36. 36.

    Ibid.

  37. 37.

    Ibid.

  38. 38.

    Ibid.

  39. 39.

    The Bankruptcy Court for the Northern District of California’s ruling restated here, is as gleaned from the ruling of the United States Bankruptcy Appellate Panel for the Ninth Circuit in re: Reynoso, Jayson, (Debtor) Frankfort Digital Services, Ltd.; Henry Ihejirika (Appellants) v. William T. Neary, United States Trustee, (Appellee) supra, note 24. There is no recorded opinion of the Bankruptcy Court for the Northern District of California in the Reynoso case. However, a related proceeding (with identical facts involving a different debtor but same appellants Frankfort Digital Services et al.,) was heard by the United States Bankruptcy Court for the Central District of California, Los Angeles Division, and reported in re: Christiana Pillot, 2002 Bankr. LEXIS 1334.

  40. 40.

    Excerpted from the Bankruptcy Court for Northern District of California’s Transcript, 44:3–8, and cited in re: Reynoso, supra, note 24, at 552.

  41. 41.

    Ibid.

  42. 42.

    Ibid.

  43. 43.

    Ibid.

  44. 44.

    Ibid.

  45. 45.

    Ibid.

  46. 46.

    Ibid.

  47. 47.

    Ibid.

  48. 48.

    Ibid; at 553.

  49. 49.

    In re: Jayson Reynoso, (Debtor), Frankfort Digital Services, Ltd.; Henry Ihejirika, (Appellants), v. Sara L. Kistler, United States Trustee, (Appellee), and Executive Office of United States Trustee, (Trustee).Supra, note 21 at 1119–1126.

  50. 50.

    Ibid; at 1123.

  51. 51.

    Ibid.

  52. 52.

    Ibid.

  53. 53.

    Ibid., at 1125. At the commencement of the trial section 110(k) of Chapter 11 of the U.S. Bankruptcy Code (2002) did not specifically prohibit unauthorised legal practice. It provided that “Nothing in this section shall be construed to permit activities that are otherwise prohibited by law, including rules and laws that prohibit the unauthorized practice of law”. However, an amendment to the Bankruptcy Code via the Bankruptcy Abuse Prevention and Consumer Protection Act 2005 (BAP-CPA), Pub. L. No. 109-8, 119 Stat. 23, specifically barred bankruptcy petition preparers from providing legal advice. See Sect. 110(e) (2) of the Bankruptcy Abuse Prevention and Consumer Protection Act, ibid.

  54. 54.

    In re: Jayson Reynoso, supra, note 21 at 1125.

  55. 55.

    Ibid.

  56. 56.

    Emphasis is mine. Ibid.

  57. 57.

    469 P. 2d 353 (1970).

  58. 58.

    In re Jayson Reynoso, supra, note 21 at 1125.

  59. 59.

    Ibid.

  60. 60.

    Ibid.

  61. 61.

    Ibid.

  62. 62.

    Ibid., at 1117–1126.

  63. 63.

    Ibid., at 1126.

  64. 64.

    Ibid., at 1125.

  65. 65.

    Ibid., at 1125–1126.

  66. 66.

    Clerical work is generally perceived as limited to typing of information provided by the consumer without alteration, advice, or proffering of any opinion on the information. For discussion, see Lanctot (2002), supra, note 2, at 833–836.

  67. 67.

    Ohio State Bar Association v. Newburn, supra, note 3, at 97. The Ohio Supreme Court noted that the practice of law embraced the preparation of legal document. Ibid.

  68. 68.

    Lanctot (2002), supra, note 2, at 834.

  69. 69.

    Susskind (2000), supra note 14, at 162–176.

  70. 70.

    In re: Jayson Reynoso, supra, note 21 at 1125.

  71. 71.

    For discussion, see Rhode (1981).

  72. 72.

    15 U.S.C. Sects. 1–7 (2004) as amended.

  73. 73.

    Ibid., sections 1–2.

  74. 74.

    317 U.S. 341 (1943).

  75. 75.

    Trujillo 2006, supra, note 75, at 352.

  76. 76.

    Parkers v. Brown, supra, note 76, at 345–346.

  77. 77.

    Ibid.

  78. 78.

    Ibid., at 346.

  79. 79.

    Ibid., at 348–349.

  80. 80.

    Ibid., 350–351.

  81. 81.

    Ibid., at 314.

  82. 82.

    Ibid., 351–352.

  83. 83.

    Ibid., at 352.

  84. 84.

    445 U.S. 97 (1980).

  85. 85.

    Ibid., at 103.

  86. 86.

    Ibid.

  87. 87.

    Ibid., at 150.

  88. 88.

    Fischer (2000–2001), supra, note 3, at 138–139; Ohio State Bar Association v. Newburn, supra, note 2, at 97.

  89. 89.

    431 F. Supp. 298 (E.D. Va. 1977), vacated and remanded, 571 F.2d 205 (4th Cir.), cert. denied, 436 U.S. 941 (1978) (Hereinafter referred to as Surety Title Insurance Agency).

  90. 90.

    Ibid.

  91. 91.

    Ibid.

  92. 92.

    Supra, note 76, at 341–368.

  93. 93.

    Surety Title Insurance Agency v. Virginia State Bar, supra, note 92 at 308.

  94. 94.

    Supra, note 76, at 341; Elizabeth Trujillo, supra, note 75, at 352.

  95. 95.

    The emphasis is mine and intended to make a distinction between a restrictive use of legal software as demonstrated by Reynoso and a total non-conditional prohibition of the use of legal software by non-lawyers.

  96. 96.

    In re: Jayson Reynoso, supra, note 21, at 1117.

  97. 97.

    In the United States, all States regulate the practice of law via States unauthorised practice of law legislations and committees that operate under the auspices of States’ Supreme Courts. In the State of Ohio for example, Sect. 2(B)(1)(g), Article IV, Ohio Constitution, confers on the Supreme Court of Ohio, original jurisdiction over the “[a]dmission to the practice of law, the discipline of persons so admitted, and all other matters relating to the practice of law.” See Ohio State Bar Association v. Newburn, supra, note 2, at 97. For discussion, see Marie A. Vida, supra, note 91, 231 at 235.

  98. 98.

    421 U.S. 773, (1975).

  99. 99.

    Ibid., at 792.

  100. 100.

    Ibid., at 791.

  101. 101.

    Article 1, Sect. 8, Clause 3 of the United States Constitution.

  102. 102.

    491 U.S. 324, 326 n.1 (1989).

  103. 103.

    Supra, note 76, at 341.

  104. 104.

    Ibid, at 318.

  105. 105.

    Oriola (2005), 113–166, at 134–135.

  106. 106.

    CTS Corp. v. Dynamics Corp. of America, 481 U.S. 69, 87 (1987).

  107. 107.

    Oriola 2005, supra, note 108, at 135.

  108. 108.

    Parker v. Brown, supra, note 76 at 341.

  109. 109.

    Ibid., at 360–367.

  110. 110.

    Ibid., at 360.

  111. 111.

    For discussion, see generally Oriola 2005, supra, note 108, at 134–140.

  112. 112.

    Software programs are protectable by patents and copyright laws in the United States. See Adelman (1998), at 105.

  113. 113.

    Faretta v. California, 422 U.S. 806, 807, (1975). Note however the qualification to the Faretta ruling by the U.S. Supreme Court in Godinez v. Moran, 509 U.S. 389 (1993), where the Court held inter alia that the constitutional right to self-representation in courts could be denied in a criminal case, if the accused was perceived as incompetent or unfit to represent themselves. Also the right to Pro se legal representation does not apply to appellate courts. See the Supreme Court decision in Martinez v. California Court of Appeals, 528 U.S. 152, (2000).

  114. 114.

    See for example Article 1, Sect. 10 of the Constitution of the State of Alabama 1901, (as amended) which provides: “That no person shall be barred from prosecuting or defending before any tribunal in this state by himself or counsel, any civil cause to which he is a party.”

  115. 115.

    Bankruptcy Code (2002) as amended, supra, note 55.

  116. 116.

    In re: Jayson Reynoso, supra, note 21, at 1123.

  117. 117.

    Ibid., at 1125.

  118. 118.

    For discussion see, Vincenti 1988, at 205.

  119. 119.

    Due to the fact that wills do create legal rights upon which courts may be called upon to interpret, and that wills making require a certain degree of confidentiality which legal attorneys are obliged to provide, courts often regard wills making as the exclusive preserve of lawyers. For discussion, see Palmer v. Unauthorized Practice Committee of the State of Texas, 438 S.W.2d 374 (Tex. Civ. App. 1969), at 377.

  120. 120.

    In re: Jayson Reynoso, supra, note 21, at 1123.

  121. 121.

    Ibid, at 1125.

  122. 122.

    Unauthorized Practice of Law Committee v. Parsons Technology, Inc 1999 WL 47235.

  123. 123.

    Ibid.

  124. 124.

    Tex. Govt. Code Ann. Section 81.101 (West 1998) (amended in 1999).

  125. 125.

    Supra, note 125.

  126. 126.

    Tex. Govt. Code Ann. Section 81.101 (Supp. 2000).

  127. 127.

    Unauthorized Practice of Law Committee v. Parsons Technology Inc., 179 F.3d 956 (5th Cir. 1999).

  128. 128.

    The First Amendment to the United States Constitution provides that: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.” For discussion, see Fischer (2000–2001), supra, note 3, at 136–137.

  129. 129.

    Treece (1999), 971, at 972.

  130. 130.

    283 N.Y.S. 2d 984, 996 (N.Y. App. Div. 1967), revised on the dissenting opinion, 234 in N.E. 2d 459 (N.Y. 1967).

  131. 131.

    Ibid., at 1000-01.

  132. 132.

    Ibid.

  133. 133.

    Ibid., at 1000.

  134. 134.

    492 U.S. 469 (1989).

  135. 135.

    Ibid., 471–472.

  136. 136.

    Ibid., at 482.

  137. 137.

    Rose (2002), at 585.

  138. 138.

    See Lanctot (2002), supra note 2 at 811–812.

  139. 139.

    For discussion, see Podgers 1980.

  140. 140.

    See Lanctot 2002, supra note 2 at 820–821.

  141. 141.

    Ibid., at 812.

  142. 142.

    In re: Jayson Reynoso, supra, note 21, at 1125.

  143. 143.

    Ibid.

  144. 144.

    Supra, note 58, at 353.

  145. 145.

    In re: Jayson Reynoso, supra, note 21, at 1125.

  146. 146.

    See for example, New York County Lawyers’ Association. v. Dacey, supra, note 133 at 996.

  147. 147.

    See Centre for Professional Responsibility, ABA, Task Force on the Model Definition of the Practice of Law, at http://www.abanet.org/cpr/model_def_home.html (last accessed on 2 August 2010).

  148. 148.

    Ibid.

  149. 149.

    Ibid.

  150. 150.

    Ibid.

  151. 151.

    Ibid.

  152. 152.

    Ibid.

  153. 153.

    Ibid.

  154. 154.

    Ibid.

  155. 155.

    See American Bar Association, Task Force on the Model Definition of the Practice of Law, Standing Committee On Client Protection, Washington State Bar Association, Report To The House Of Delegates, Recommendation, at http://www.abanet.org/cpr/model-def/recomm.pdf (last accessed on 2 August 2010).

  156. 156.

    Ibid.

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Oriola, T.A. The use of legal software by non-lawyers and the perils of unauthorised practice of law charges in the United States: a review of Jayson Reynoso decision. Artif Intell Law 18, 285–309 (2010). https://doi.org/10.1007/s10506-010-9103-y

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Keywords

  • Legal software
  • Expert systems in law
  • Non-lawyer use of legal software
  • Unauthorised practice of law charges