The dangers of using “standard” or template legal documents

This post is a part of a series based on my Law for Startups workshop at MaGIC in September 2015. It’s a basic introduction to legalities for startup founders. You can access the slides here.

Read the earlier posts for context:

  1. Law for startups in Malaysia — building on the best foundations.
  2. The legal landscape in Malaysia for startups — a hybrid of traditional corporate practices and Silicon Valley models.
  3. Choosing the right business vehicle for your startup or small business in Malaysia.
  4. When should a startup hire a lawyer?
  5. Oversights which could destroy your startup or small business.

Template and automated legal documents are increasing in popularity.

For years there have been many websites offering standard contracts for download. Most of these have a US/European law focus, but the past couple of years have seen some similar services launched in Asia.

Some of these websites offer a very comprehensive collection of legal documents which address the needs of startups and small businesses in particular — everything from NDAs to equity investment agreements are available for download, usually with a fee.

Say no to cookie-cutter contracts.
Say no to cookie-cutter contracts.

My cover slide for this part of the workshop reads: “Be very very very very careful when using standard contracts” — I’m not sure whether I should have added a few more ‘very’s to statement.

Business owners should be extremely cautious when using these legal documents.

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The complete series: DIY legal documents for conveyancing transactions — the end of lawyers?

We’ve come to the end of the series of posts based on my presentation at The End of Lawyers, the Future of Law, which was the launch event for the Collective of Applied Law and Legal Realism.

Those who think you can complete a conveyancing transaction without a lawyer please raise your hands.
Those who think you can complete a conveyancing transaction without a lawyer please raise your hands.

My overall conclusion is that obviously conveyancing lawyers aren’t going to be redundant anytime soon, but I’m hopeful for changes which will make the conveyancing process less of a maze. Certainty and clarity will be good for everyone (including lawyers).

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Ideating the future — how DIY legal documents for conveyancing transactions can become the new reality

This post is the final post in the series.

Please read the following earlier posts for context:

  1. DIY legal documents for conveyancing transactions — can we really do it without lawyers?
  2. DIY legal documents for conveyancing transactions — why some people think you don’t need lawyers in a sale and purchase of property.
  3. DIY legal documents for conveyancing transactions — understanding the basics of a sale and purchase property.
  4. DIY legal documents for conveyancing transactions — sale and purchase and loan agreements.
  5. DIY legal documents for conveyancing transactions — time for a reality check.

From what we’ve discussed so far, it’s obvious that currently the ideal is very far from reality.

The conveyancing ecosystem in Malaysia means that a non-lawyer intending to complete a sale and purchase agreement without a lawyer will end up entering a maze. It’s dangerous, it’s complicated, and it’s impossible.

Ideating the future of a conveyancing transaction.
Ideating the future of a conveyancing transaction.

I’m sure that the organisers know this — that “DIY conveyancing” isn’t possible now. But the purpose of the project is to ideate solutions for the future.

What needs to change for DIY conveyancing to be possible? Hopefully CALR and others can come up with some solutions. Here are my quick thoughts before everyone gets to ideating.

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Oversights which could destroy your startup or small business

This post is a part of a series based on my Law for Startups workshop at MaGIC in September 2015. It’s a basic introduction to legalities for startup founders. You can access the slides here.

Read the earlier posts for context:

  1. Law for startups in Malaysia — building on the best foundations.
  2. The legal landscape in Malaysia for startups — a hybrid of traditional corporate practices and Silicon Valley models.
  3. Choosing the right business vehicle for your startup or small business in Malaysia.
  4. When should a startup hire a lawyer?

The opening slide for this part of the workshop reads — “Don’t let your business end up like the Titanic”.

Not something your startup wants to see in its journey.
Not something your startup wants to see in its journey.

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DIY legal documents for conveyancing transactions — time for a reality check

This post is part of an on-going series. Please read the following earlier posts for context:

  1. DIY legal documents for conveyancing transactions — can we really do it without lawyers?
  2. DIY legal documents for conveyancing transactions — why some people think you don’t need lawyers in a sale and purchase of property.
  3. DIY legal documents for conveyancing transactions — understanding the basics of a sale and purchase property.
  4. DIY legal documents for conveyancing transactions — sale and purchase and loan agreements.

The earlier posts provided a very quick tour of what’s involved in a basic sale and purchase of property.

We had an ideal earlier about conveyancing being essentially about swapping the keys for money — but what is the reality?

The ideal from an earlier post:
The ideal from an earlier post: “Let’s swap! Who needs lawyers anyway?”

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When should a startup hire a lawyer?

This post is a part of a series based on my Law for Startups workshop at MaGIC in September 2015. It’s a basic introduction to legalities for startup founders. You can access the slides here.

Read the earlier posts for context:

  1. Law for startups in Malaysia — building on the best foundations.
  2. The legal landscape in Malaysia for startups — a hybrid of traditional corporate practices and Silicon Valley models.
  3. Choosing the right business vehicle for your startup or small business in Malaysia.

As with any business venture, startups need to get good professional advice from experts. Typically these advisors will cover legal, financial, and tax advice.

Time to lawyer up!
Time to lawyer up!

Lawyers have a bad reputation

Most people would prefer if they could avoid dealing with lawyers. When there’s a negotiation or discussion and people say get the lawyers involved, suddenly everyone gets a bit more serious and defensive.

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Bank Negara’s Possible Actions against 1MDB

Through two Press Statements (see here and here), Bank Negara had firstly, concluded that 1MDB had essentially acted in breach of some of the relevant exchange control laws. Bank Negara issued a direction to 1MDB to repatriate the USD 1.83 billion to Malaysia and to submit a plan to Bank Negara for this purpose. The Attorney General had declined to initiate criminal prosecution based on Bank Negara’s investigations.

Secondly, but without expressly mentioning 1MDB, Bank Negara emphasised its powers to take administrative actions against parties who acted in breach of the laws. These administrative actions are separate and distinct from any criminal proceedings.

Pic: The Malaysian Times

Let us delve deeper into the types of actions that Bank Negara may take under the Financial Services Act 2013 (FSA) against a company such as 1MDB.

To give bite to Bank Negara’s administrative actions, the law allows Bank Negara to file a civil action to ensure compliance of the steps ordered in such administrative actions. In this civil action, the court can make a wide range of orders, for instance for recovery of monies,  and to compel compliance with orders made by Bank Negara. The failure to comply with the court order can then result in contempt of court proceedings.

It is also important to emphasise that such court orders need not solely be against a company. The court order can be made against a person who is the director, controller, officer or partner (or who was purporting to act in any such capacity) or anyone who is concerned in the management of the affairs of that company. That widens the net of possible defendants to any such court action.

I will elaborate on these points below.

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