Because it was a third party that two people who want to communicate through the internet could agree to trust as an intermediary. There could never be a guarantee that Lavabit was trustworthy, but the site claimed up front that everything was encrypted so that intruders wouldn't be able to steal anything.
Compare to something such as sending email from a gmail account to a hotmail account. You have no promises that the email on either end is encrypted (and in fact those messages are completely unencrypted and are data mined as a matter of habit), and unless the connection between gmail and hotmail is encrypted, anyone sitting on the wire between the two sites could capture it as well.
End result: Lavabit was a "least bad" option for sending communication over the internet. For anything truly important it's still not secure enough, say for a cache of classified NSA documents. But for organizing an in-person meeting to discuss those documents it's a lot better than many other methods.