Report on the IMKR Lecture “Legal Tech – A Workshop Report from the Perspective of the Founder of Smartlaw” by Attorney Dr. Biene
On May 19, 2021, attorney Dr. Daniel Biene, LL.M. (New York), presented a workshop report titled “Legal Tech” on Smartlaw, the company he founded. After being welcomed by Prof. Rösler, Dr. Biene began by presenting Smartlaw’s innovation. Through the website, users can digitally and automatically create customized contracts and legal documents. Among the various types of documents, advance directives and wills – in addition to lease agreements – have proven particularly popular. The idea for the company came to Dr. Biene during his time at a traditional media conglomerate, where drafting simple legal documents took a surprisingly long time. He recognized the potential to accelerate these processes through standardization and digital support. In 2012, he founded Smartlaw together with two other lawyers.
Smartlaw guides users through a question-and-answer catalog, which is used to generate the desired legal document. One of the challenges for the founders was translating legal knowledge into a decision tree to serve as the basis for the question-and-answer catalog. In addition, the legal background knowledge required to answer the catalog questions had to be presented in a way that was understandable to users. To this end, the three lawyers also sought input from external attorneys, who are also listed on the Smartlaw website. Dr. Biene also reported on the complex collaboration with the programmers. In this process, only a tentative – and at times experimental – approach proved effective. As early as the company’s founding, Dr. Biene and his co-founders commissioned several legal opinions on the admissibility of the business model. All of these opinions unequivocally concluded that Smartlaw does not provide any legal services reserved for attorneys (see §§ 2, 3 of the Legal Services Act, RDG). Rather, it provides a publishing service that does not fall under the Legal Services Act.
Against this backdrop, Dr. Biene expressed surprise at the lawsuit filed by the Hamburg Bar Association against Smartlaw, which is now pending before the Federal Court of Justice (Case No. I ZR 113/20). However, the lower court had already ruled in favor of Smartlaw (Higher Regional Court of Cologne, NJW 2020, 2734). Furthermore, the legislature intends to pass the “Act on the Promotion of Consumer-Friendly Offers in the Legal Services Market” (“Legal Tech Debt Collection Act” for short) before the federal election in September 2021. This is intended to establish a level playing field between attorneys subject to the Federal Lawyers’ Act (BRAO) and the Lawyers’ Remuneration Act (RVG) and legal-tech providers operating on the basis of a debt collection license pursuant to §§ 2, 10 et seq. RDG. The fact that lawyers are to be permitted to agree to contingency fees, at least in cases where they offer debt collection services, is also the subject of intense debate within the legal profession (Anwaltsblatt). Beyond the RDG amendment, a comprehensive reform of the relationship between legal tech providers and the legal profession is even expected for the coming legislative period. Dr. Biene emphasized, however, that Smartlaw, as a publishing service, is not subject to attorney liability but, like a publisher, is liable for any errors in the generated legal documents. The liability risk is therefore manageable.
Finally, a discussion ensued regarding the impact of artificial intelligence (AI) on the future of legal tech. Dr. Biene explained that current legal tech applications generally do not constitute “true” AI but rather function on the basis of algorithms. In his assessment, this would not change in the foreseeable future. It is not to be expected that complex legal work would be replaced by legal tech. Rather, lawyers would benefit from the automation of simple legal processes, as this would leave them with more time for more complex and exciting legal issues.
The lecture was part of the series “Business Law in Corporate Practice” (WIR-UP).
