How can you increase communication and mutual understanding between contracting parties? In a comment to this post in Tim Cummins’s Commitment Matters blog, Dick Locke of the Global Procurement Group states, “The most important method is to minimize the amount of your contract that lawyers write.”
I was stunned when I read that. If it’s true, it’s a sad commentary on the performance of commercial attorneys.
I’ve often heard complaints about lawyers slowing down deals, raising unnecessary issues, and using hard-to-read legalese, but Locke’s observation strikes me as a whole new class of complaint. Does the involvement of a lawyer actually reduce communication and mutual understanding?
The theme of the post where Locke’s comment appears is the importance of agility in business relationships. Agility—the ability to change and adapt—is important because it facilitates innovation. Cummins writes, “Today’s contracts are not agile; they tend to stifle agility and flexibility, because we try to create precision in situations where there is great uncertainty. Contracts must first be vehicles for mutual understanding and communication, a record of our expectations, promises and responsibilities, and an understanding of what happens when circumstances change and how we will deal with those changes.”
Contracts should memorialize business relationships. Working out the details of the clauses should help the parties consider aspects of the deal that they otherwise wouldn’t. The language itself should be clear and unambiguous. But does a lawyer’s involvement in this process harm the relationship? Is “thinking like a lawyer” bad for business?
What do you think?
Interesting article. I struggle internally with these concerns quite a bit, especially in drafting contracts for music industry and other creative professionals who generally want (and expect) things to be as simple as possible. As lawyers, though, we are trained to think up, raise and address issues that businesspeople ordinarily don’t consider–and while these issues may weigh the deal down, if helping the parties understand the full ramifications of their relationship prevents the relationship from going forward, I’m not sure that is necessarily a bad thing. However, that’s not to say that I don’t always do my best to limit the “unnecessary” issues to help see the deal through. I don’t think “thinking like a lawyer” is bad for business–I think the issue is inefficiency and lack of creativity in the lawyering process.
Jeff: I’ve always thought that being responsive and having a sense of proportionality (i.e., focusing on the stuff that matters to the particular deal and not getting bogged down by unimportant issues) were the keys to being an asset–rather than a necessary evil–to business clients. But Locke’s comments suggest something more fundamental. It’s definitely got me thinking.
Brian: Dick Locke might be questioning having lawyers involved, period. But if you take his comment at face value, he’s just referring to who puts the deal on paper. That something I discussed briefly in this 2009 AdamsDrafting blog post.
I’m certainly sympathetic to the notion that lawyers can clog up the works with provisions that are unduly risk averse. And the language of mainstream contract drafting is dysfunctional. So depending on the circumstances (that’s a function of, among other things, the deal’s complexity, value, and risk), it might make sense for a businessperson to take a crack at it, particularly if he or she has hashed out the issues with a lawyer.
But it all comes down to the aptitude and experience of the drafter. If a businessperson has little or no training in clear and modern contract drafting and instead simply tries to cobble together a contract by copying and pasting from precedent contracts of questionable quality and relevance, the result might well be a mess.
Ken