Talking ‘Bout Commercial Transactional Agreements

No, it is hardly the most glamorous topic.  Indeed, not many lawyers would actually recognize the challenges involved in the accurate, intensive, scrutiny of preexisting and newly-drafted agreements.  I did not begin reviewing such documents — normally, in a commercial or Internet-based context — until 2005.  Before then, I was exclusively a litigator.  I remain, to great degree a litigator.  However, I believe that my litigation background actually complements the ability to carefully review documents, and identify aspects that could prove later problematic, setting up the potential for litigation.

One thing that I have noted over the past decade is (1) the failure of transactional lawyers to understand documents in a comprehensive fashion — both within a single documents, as well as the relationship of that one document with other related documents.  A contract is a jigsaw puzzle: without the perspective of seeing the impact of certain provisions or language on other provisions and documents and relationships, then the transactional lawyer could very well be setting up the client for later courtroom action.  Hopefully, lawyers possess the necessary critical thinking skills, and attention for detail required to maximize avoidance of such pitfalls.

In modern society, written contracts should be deemed mandatory by any serious business owner.  The days of the contract off a handshake are long gone — if a potential business partner, contractor, etc., takes offence to putting the terms of an agreement in writing, then I would suggest becoming more suspect of having any such relationship.  The contract is designed to safeguard the interests of both parties and, hopefully, with each side is negotiating from a roughly equal position.

I have found that I actually enjoy reviewing, commenting upon, negotiating and drafting transactional agreements.  Perhaps, it is simply my analytical nature; perhaps, it is simply my lifelong enjoy of complex challenges.  This enjoyment seems to transcend the type of document, whether a shareholder agreement, a joint venture contract, a website’s terms of service, an affiliate or franchise agreement, commercial leases, etc.  Akin to complex motion practice in litigation, I find that I easily fall into ‘the zone.’

Closing comment:  I am not the type of lawyer to automatically blurt out that everyone needs to retain a lawyer for anything.  However, in a commercial/business context, I believe it critical to retain effective counsel —  to work alongside the client;  to expose issues; to mitigate potential harm; and to strengthen contractual protections.