I spent the better part of the day yesterday working on a legal brief (at my full hourly rate) on the issue of the meaning of the phrase “The State” in a business contract. Soon, there will be a hearing in the local Circuit Court in which three highly paid attorneys will spend several billable hours arguing the meaning of “The State” before a judge who will be charged with deciding which of us is correct. As we stand there, each of us attorneys and the judge will all know that, whatever the judge’s decision is, the matter will probably come up again before the Virginia Supreme Court. The total cost of this argument could run close to six figures by the time we are done.
On the bright side, however, the parties saved themselves a few hundred dollars in legal costs by downloading a contract form from a popular do-it-yourself legal website.
The law is a structure made out of words. Those words are not meaningless. There is no such thing as “boilerplate” or “standard” language in the law. There are no “fill in the blank” forms. The words selected for use in a legal setting are selected not because they are “standard” or interchangeable, they are selected because they have very specific meanings. When a lawyer is constructing a contract, an estate plan or a other legal document, the lawyer is choosing words and phrases with skill and precision to achieve a very specific end.
Obviously, one cannot “speak” French just by saying a lot of French and French-sounding words, yet I repeatedly see clients who think that they can speak “legalese” by downloading a form with a bunch of legal sounding words and phrases in it. When a client tells me that they used a form because they just wanted a “standard” agreement, I like to ask them if they understand what it is they are agreeing to; whether they comprehend the meaning of all of those “standard” clauses and what will happen under various circumstances.
Of course, understanding the words used in a legal document requires understanding the words NOT used in the legal document. When a lawyer drafts a legal document, he or she makes choices about what to include and what not to include, because not including something in a legal document has as much significance as what is included. We make such choices after a careful discussion with the client to ascertain the client’s needs; negotiations with an opposing counsel, if any; and a review of the alternatives. Only then do we put pen to paper.
The most frustrating examples always seem to come from small businesses. In an effort to avoid up-front legal costs, small business owners download “standard” contracts and corporate documents, like the one I am dealing with today. Such documents are often little more than a parroting of what is already set forth in the state’s legal code, except that the state code has opt-out provisions and qualifiers that allow most small businesses to operate without the need for cumbersome operating documents that the downloadable forms don’t and can’t explain to the user.
In my case, we are arguing over whether a clause that sets forth which jurisdiction the parties may litigate disputes in refers to the state of incorporation, the state in which the principal place of business is located, or the state in which the company’s investment real estate is located. Instead of spending tens of thousands of dollars arguing over the meaning of the word “The State,” someone should have asked why they needed to have a forum selection clause in the first place? That’s not a “standard,” “boilerplate” clause. It is something I might add to a contract if there is a possibility of confusion over the matter later on or if my client is worried that they could be dragged into costly litigation in some remote jurisdiction. If I DID add a forum selection clause, I’d make certain that it was clear and unambiguous, not just to other lawyers fluent in legalese, but to the parties to the agreement.
The best compliment I have received in a long while came from a client who called me up to ask if I could scale back some provisions in a contract because he was trying to land a new customer and they were complaining that the document I drafted was too harsh and overprotective of my client. He told me that the customer promised never to cross him as long as he had me for a lawyer, but could I please tone it down a little. You can't download that from the internet.
When someone engages in do-it-yourself lawyering, they aren’t saving any money at all; they’re just buying a very expensive legal headache later on.