Why Credit Repair work is, by its nature, legal work (and thereby reserved for lawyers)

By claiming expertise in Credit Repair and offering to help with a specific client’s needs, Credit Repair businesses offer legal services. Whether they are legally allowed to is another question.

By Patrick Earl & Graham Doessel
(See HERE for Fines & Penalties in other cases)

There are indicators as to what constitutes “legal Work”

  1. Expertise/ knowledge in legal matters

The person offering to perform the service must either claim or be assumed to have a superior level of knowledge about legal matters than the ordinary person would have.

There are no clear-cut definitions of what constitutes legal work but the more it relates to issues arising out of legal entitlements or the application of laws to a particular set of circumstances the more it would be considered to be legal work.

It is not necessary that the person providing the advice be considered an expert in their field nor that they have legal qualifications. It is enough that they say that they have a greater understanding than the everyday person would of legal matters and they are going to apply that knowledge to this particular set of circumstances.

It doesn’t matter what you call it

We must look to see what is the sort of work that is being offered and whether this would fall within the examples of legal work the court has found.

If the work is, in fact, the provision of legal services, it doesn’t matter that it is described as something different by the person advertising to do it. If the person performing the work calls it something different, that label will not change the actual character of the work.

Some of the people who have been found to have held themselves out as solicitors have said that they were in fact lawyers, or that they had studied law, or had overseas legal qualifications. The comments were made in a context of trying to create a market for their services. The persons in question were always trying to paint their experience and knowledge in the best possible light.

There was often also an element of trying to avoid the suggestion that they were, in fact, performing legal services by adding some form of restriction to the service they offered. So, for example,  Ric van der Feltz said that he was an overseas qualified lawyer but, because he was not qualified in Australia, he was not going to go to court for you but would help you prepare to go to court yourself.

The court invariably looks to the nature of the work performed and if it falls within the broad definition of what constitutes providing legal services that will suffice. It does not have to be shown that anyone in the public thought the person was a lawyer. The person does not have to suggest or imply that they are a lawyer, it is enough that they offer services of the sort that lawyers do.

It is, therefore, no defence to simply add a disclaimer saying that the work performed is not legal services if, on analysis, the work is legal in nature.

The sort of work that has been found to be legal in nature is very broad. The sort of work that solicitors and barristers provide can cover a range of possibilities. The first thing that needs to be demonstrated is the suggestion or claim that somebody has a greater level of knowledge and skill than would be found in the ordinary person.

  1. Applying expertise and skill to a particular matter

Simple clerical work such as filling out a form does not constitute legal work. Anyone could fill out a form and presumably anyone could advise someone how to fill out a form. The question becomes how much help is needed and how much given.

Legal advice seems to begin once the expertise of the person with a greater than ordinary understanding of the law is brought to bear on the issues. Once someone is advising how to answer a question, what to say, what not to say, how to structure the contents of the document so as to put you in the best possible light or to achieve a specific game, you have gone beyond simple clerical assistance.

If we use the analogy of a text book or a self-help book or similar guide there are limited possibilities to provide a personalised guidance. A self-help book may tell you the general nature of the information to be included in a form but it cannot set out in detail how to structure the facts of a particular circumstance to the particular needs of that matter.

The more specific the advice that is being given the more it is going to constitute legal advice.

The work itself can range from attending a Court or tribunal, drafting court documents, drafting correspondence, advising on steps to take in Court, advising on strategies to take in a legal dispute, and providing advice on legal matters or legal rights generally.

Credit Repair – Is it legal work?

If we look at the credit repair industry we need to look at the expertise claimed and the work being offered.

The more specific the advice for a person the more it will be seen as providing legal advice.

If the author offers personal assistance then that help may well be legal work as it will be specific to the person concerned.

Legal Expertise claimed? Yes

Credit repair seeks to remove entries in a person’s credit history ( which are reported by Credit Reporting Bodies). The recording, retention and reporting of credit information are regulated by the Privacy Act and its Australian Privacy Principles. Any advice on the correction or possible removal of credit information from the records of a credit reporting body must address the matters set out in the Legislation.

Whether they say so or not, any credit repair business must deal with the application of the Privacy Act and therefore must assert that it has a greater than usual knowledge of the legislation and how it applies. Any expertise claimed in Credit repair is a claim to expertise in the legislation and its application.

Do credit repairers apply expertise and skill to a particular matter? Yes

They offer to

  • review credit histories from credit reporting bodies;
  • obtain and assess documents from creditors with a view to determining whether the creditor has complied with legislative requirements;
  • advise the client whether, in their circumstances, they may benefit from credit repair work by the credit repairer;
  • correspond with creditors asserting that the legal process has not been followed in the client’s matter;
  • negotiate with creditors;
  • correspond with judgement creditors about removing judgments from court files;
  • negotiate with judgment creditors about removing judgments from Court files;
  • negotiate to pay less to a creditor than the creditor claims is outstanding;
  • prepare court documentation to remove judgments; and
  • advocate on behalf of clients with creditors, ombudsman services and possibly the courts.

Does the sort of work being performed fall within the examples of other legal work? Yes

Lawyers routinely prepare correspondence for clients to other parties and negotiate on behalf of their clients. Any such work would easily fall within the sort of work lawyers traditionally do.

Advising on the law applicable to a particular circumstance is a very specific sort of work performed by lawyers.

A disclaimer that says “we are not acting on your behalf in a legal capacity, but merely assisting you with any court paperwork needed” would not change how a court would otherwise define the service offered.

Click HERE to go to:
(Do Credit Repair Businesses Offer To Provide Legal Services?)

Click HERE to learn more.
(Why Credit Repair work is, by its nature, legal work (and thereby reserved for lawyers))

Click HERE to learn more.
(‘I Am Not A Lawyer And [I] Do Not Give Legal Advice’ said the ad – OH YES YOU DO, said the Court)

Click HERE to learn more.
(Unqualified Legal Work Finished – Now To Just Refund All The Fees Charged And Pay All The Fines Imposed By The Court)

Click HERE to learn more.
(What Sort Of Work Constitutes “Legal Work”?)

Click HERE to learn more.
(What Constitutes “Legal Work”? (EXPANDED CASE NOTES))

About The Authors:

Graham Doessel CEO of Legal Practice Holdings & MyCRA Lawyers in conjunction with Patrick Earl, Senior Solicitor of Armstrong Doessel Stevenson Lawyers, a division of Legal Practice Holdings