The Quest for a Contract

Blue Moon Aurora, LLC is three weeks old, things are moving forward, and we’re learning lessons as we go along. Honestly, a lot of what we have done has been tedious but rather easy like setting the company up as an LLC and registering for an EIN.  Reworking the website, setting up email addresses for the company, organizing our computers, and setting up a box for files are all disgustingly easy but time consuming. Unquestionably, the biggest challenge we have faced thus far is developing the contract we are using for our various art needs.

I attended law school and like all future lawyers muddled through classes on contracts and legal drafting, but that was six years ago, and the lawyerliest thing I have done since then was a summons for jury duty, which resulted in nothing more than sitting in a lobby reading a book as I was never called for jury selection.  However, when faced with the prospect of writing a contract, I did what all lawyers do when drafting documents – they begin by copying the work someone else has done.  So a search of the Internet turned up lots of appropriate contracts and I muddled through a number to work up a rough draft, which I turned over to Michelle who is in all things a writing goddess. We finished our draft and sent it off to our lawyer to review.

Now there is a divide among lawyers over legal drafting and that is the divide between plain language and legalese. We are fanatical believers that legal writing should be plain language, as understandable as possible. This is also the standard they teach you in law school.  However, in practice most lawyers embrace legalese. The plain language versus legalese is the conflict between ideal and reality.

In law school, there are a few things you learn quickly enough.  First, that whenever you answer a question from a professor you must begin with: “It all depends, (insert your argument).” Second, the law of the land is mostly forged from judges grappling with those cases involving the most outrageous, moronic, or nuanced fact patterns you could imagine.  Yes, we are a litigious society, but easily 90% of all civil suits are settled long before they go to trial as the parties find some equitable resolution.  The remaining cases are the wacko ones, people trying to change the law, people out for ‘justice’ (i.e. make the bastards pay), or perhaps both parties are just too stubborn for their own good.  Thus it is these cases that end up making the law of the land, yes, this is one reason why judges try to decide cases on as narrow of grounds as possible, but generally bad cases make bad law.

So imagine a case where two parties are arguing about the meaning of a contract, let’s say a section detailing which jurisdiction covers the contract, and that section is drafted about as well as writing on the wall of a bathroom stall.  However, the court finds that section actually does what it’s supposed to and upholds the contract.

Now stop for a second.  You’re a lawyer.  Your job is to protect your client from all manner of legal problems and to draft contracts that will hold up in court.  So our previous case is the law of the land in your jurisdiction. You could write a clear, simple section on jurisdiction, or you could use the crappy version the courts have upheld as valid.  It’s not an easy choice.  Do you go with the sure win that is horrifically written or the elegant version that you think is clear, but what if you’re wrong?  Your answer should begin with, “it all depends.”

This right here is the conflict between ideal and reality.  If a contract, no matter how poorly written, is held up to do what it was intended to do then if you use that contract language you’re good to go in the eyes of the courts. Let’s go the other way.  Imagine a case with a crisp, short contract that “assigns all rights” for a work of art to the person commissioning the work of art.  Reading that you might take “all” to mean “all”, well, what if there is a case out there were “all” wasn’t held to mean “all” but instead was held to mean “really just a couple”. Ridiculous? Maybe, but what words mean in a contract depends upon the contract and the industry covered by the contract.

Now we sent off a 2 ½ page contract to our lawyer and got a lot of comments and concerns, which we incorporated into the current 5 page contract we are using.  It’s now legally sufficient but not nearly as plain language as we would like and we’ll have to deal with that at some point.  The point of a contract is not to screw the other guy.  The point of a contract is to set up rules for what is hoped to be a mutually beneficial arrangement.  If things go poorly in the arrangement then the contract is there to help protect you.  But you have to know what you want more: a clear contract to promote a positive working relationship or a contract that ensures you can safely get through troubled times.  Ideally, you try to do both, but this is a fundamental business philosophy you have to decide.

Captain Malcolm Reynolds summed up the basics of contracts: “I do the job…and then I get paid.” At the end of the day, that’s all there is to it.

Thanks for reading,

Kirk

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