Not long ago, I attended a course on a specialist area of commercial law that I was keen to extend my knowledge in. The tutor was well respected in his field and I looked forward to the session. However, what I ‘learned’ horrified me.
Throughout his talk, the tutor explained – with relish – how various clauses could be ‘slipped in’ to contracts in the certainty that the other party would not understand them. He went on to explain how these clauses could then be used to ‘squeeze the other party out’ of the arrangements over a period of time. He also explained how certain pricing mechanisms could be used to extract much more for his clients than both parties originally intended – something which would not become apparent to the other party for some considerable time.
My question – and one which I was too dumbstruck to ask at the time – is “Does this lawyer really think that he is doing his clients any favours with these ‘clever’ clauses?”
The answer, I suppose, depends upon your point of view.
Contracts are often called Agreements – and for good reason. The whole basis of a contract is that it represents the agreement which has been reached between the parties, and good contracts can lead to profitable long-term relationships as many of our long-term clients know. However, if you were the ‘victim’ of one of this chap’s contracts, would you want to do business with his client again? I doubt it.
In reality, (leaving aside the minority of clients who are greedily looking for short-term gain over long-term relationships,) I think it probable that most of the clients don’t actually understand the complexities of these ‘clever’ clauses, and actually operate their relationships under their own unwritten rules – which makes the whole exercise a waste of vast sums of time and money, and could lead to various problems if a dispute ever does arise.
So, if you want to ‘get one over’ on the other party in your negotiations, we won’t be best placed to help. On the other hand, we find that our clients want us to approach things differently - to concisely and accurately record the details of the agreement which they have reached, and to start from a position of trust and reasonableness.
Two different approaches with two different outcomes. Are you looking for a short-term solution or a long-term relationship?
If you have any thoughts on the above, please either leave a comment or get in touch. You might also want to check out our earlier blog post ‘Word Association’, which is all about combative v collaborative agreements .
Tags: client relationships, contract, disputes, reasonableness, trust