I hate long and complex agreements. I have neither the patience nor the time to read all the very small print, and even with my glasses on and a magnifying glass I struggle to actually see.
As a result I admit I have signed more than one contract that I simply have taken on good faith as being acceptable. I get the odd surprise, such as recently on a storage agreement where I have been caught with a year’s notice when I decided I wanted to exit!
Because of my abhorrence of complex contacts, I had kept my own client engagement terms very simple. For 24 years and on 300 plus transactions I have never had a problem, so I guess I have been fortunate. However last year I had my very first and, I hope, very last contractual dispute.
It was very unpleasant all round emotionally and financially. As a result I spent several thousand pounds having a lawyer rewrite my T’s & C’s which now have lots of small print (although the type face is point 12!).
This has meant far more negotiation with clients on these finer points that, by and large, are hugely unlikely to ever materialise, at least if my historical experience is anything to go by. Sadly last year’s litigation was the catalyst for this change.
When we start our businesses we are usually not thinking particularly about dispute resolution! In fact I never expect anything to go wrong and I am frankly surprised when stuff does go wrong.
A positive attitude is a good thing and in any case I can’t change who I am BUT business and self-preservation has meant I now have more robust contacts than ever before. Do I feel “safer”? Honestly I feel the same, but what I do believe is that I have perhaps got a tighter control on the very unlikely possibility that something may go wrong in the future.
Contractual litigation is, of course ,not uncommon so maybe I have just been lucky historically. The fact is most people don’t want things to go wrong from either side of the table so it’s therefore sensible to get agreement correct from the start.
You can of course create these agreements yourself even, dare I say it plagiarise others but I think its money well spent to get a professional to write your contractual terms and T’s & C’s.
Personally I believe in KISS (keep it simple, stupid) but an expert eye is still necessary.
Jo Haigh is head of FDS corporate finance services and the author of ‘The Financial Times Guide to Finance for Non Financial Managers’.
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