In August of 2014, Anthony Lowery wanted a divorce. But he didn’t want a lawyer. So he turned to Divorce Source at www.3stepdivorce.com. Divorce Source contends that it is a money-saving alternative to a traditional lawyer. After answering questions on the website and paying $299, Lowery received multiple legal documents, including a Petition for Divorce.
A year later, Lowery sued Divorce Source in New Orleans federal district court. In his suit, Lowery contends that (1) the contract between himself and Divorce Source was absolutely null, and (2) the contract was relatively null because Divorce Source committed fraud. In response, Divorce Source filed a 12(b)(6) motion to dismiss Lowery’s claims.
On September 11, 2015, United States District Judge Carl J. Barbier denied Divorce Source’s motion to dismiss and held that Lowery stated a claim for both absolute nullity of contract and fraud. See Lowery v. Divorce Source, Inc. He reasoned as follows.
Louisiana law requires “lawful cause” for a contract to be valid. La. Civ. Code Art. 1966. Cause is “the reason why a party obligates himself,” La. Civ. Code 1967, and “[t]he cause of an obligation is unlawful when the enforcement of the obligation would produce a result prohibited by law or against public policy.” La. Civ. Code 1968. A contract that has an unlawful cause is an absolute nullity and cannot be confirmed. La. Civ. Code Art. 2030.
Louisiana condemns the unauthorized practice of law in an effort “to protect the public from legal services by persons unskilled in the law.” Id. (citing Louisiana State Bar Ass’n v. Edwins, 540 So. 2d 294 , 299 (La. 1989)). The practice of law includes engaging in the following activities on behalf of another: “the drawing or procuring, or the assisting in the drawing or procuring of a paper, document, or instrument affecting or relating to secular rights.” La. Rev. Stat. § 37:212.
Considering these authorities, Judge Barbier found that Divorce Source may have practiced law in violation of Louisiana Revised Statute § 37:213, which outlaws the unauthorized practice of law, when it provided Mr. Lowery with a Petition for Divorce and received $299 in return for its services. Because Lowery’s contract with Divorce Source may have involved the unauthorized practice of law, and because Louisiana bans the unauthorized practice of law, enforcing the contract would produce a result contrary to public policy. Thus, he held, Lowery’s petition stated a cause of action for absolute nullity of contract.
Next, Judge Barbier addressed whether Lowery stated a cause of action for fraud. In Louisiana, the parties to a contract must give their free consent to form a valid contract. La. Civ. Code Art. 1927. Consent is vitiated when it is induced by fraud, La. Civ. Code Art. 1948, which is “a misrepresentation or a suppression of the truth made with the intention either to obtain an unjust advantage for one party or to cause a loss or inconvenience to the other.” La. Civ. Code Art. 1953. Here, Lowery adequately pled that he was defrauded by Divorce Source’s claims that its documents were, essentially, a valid, turnkey divorce solution.
This case is particularly interesting because of the impact it could have on other online legal form and legal service providers. For example, LegalZoom.com, Inc., which is a major player in all things legal on the Internet, has been sued for unauthorized practice of law in California, Missouri, Washington, South Carolina, Alabama, Ohio, Arkansas, and North Carolina. Although some jurisdictions have enacted a special regulatory system that authorizes the creation of legal documents by nonlawyer entities like LegalZoom and Divorce Source, Louisiana has not. Lowery v. Divorce Source may, eventually, shed some light on whether the “practice of law” in Louisiana includes providing semi-automated legal pleadings to the public.
