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Legal Advantage, Ll Cs Latest Legal Research Services Legal Advantage, Ll Cs Latest Legal Research Services Document Transcript

  • Beat Lawyers At Their Own Game Deaver Brown, Author Brown co-founded the Umbroller stroller company, American Power (APCC), and Simply Media. He published The Entrepreneurs Guide with Macmillan in hardcover and Ballantine in mass market paperback. He published a business series of CD-ROM’s with Macmillan and another series with Simply Media. Brown graduated from Harvard College and Harvard Business School. He has published numerous articles in trade journals and business magazines. Copyright 2001 Simply Media, Inc. Lincoln, MA 01773-0481 www.simplymedia.com
  • About the Survival Kit Series Our Survival Kits are designed to be quick, concise, and much easier to read than most reference books. As in true wilderness survival kits, the key to success is limiting your materials to the least amount of weight necessary. This provides users with fast, light, yet complete packs, and ensures easy travel without excess baggage. At Simply Media our hardest task is eliminating materials that are not absolutely necessary for traversing the subject’s territory. We take the time to make each of our Survival Kits as short and concise as possible so you can learn the most important facts with a fast cover-to-cover read. About the Legal Survival Kit The Legal Survival Kit pares down the huge amount of legal information available, and provides you with the essentials for your legal protection and planning. In the spirit of “less is more,” the contents are concise and divid- ed into small individual categories for faster reading and better comprehension. 2 www.simplymedia.com Legal Survival Kit
  • Background How We Got to Where We Are These two rules have led to an explosion in American litigation. Well-financed lawyers can fund clients to prosecute. If the funded client loses, there is no financial consequence for the plaintiff in all but the rarest of cases. Is it any wonder, then, with these rules, that we have so much litigation in the US and other industrial countries so little? Other countries have these guys under control. These are the facts of life in the American legal world. The American Trial Lawyers Association is alive, well, and vigorously pro- tects its privileges. It is the largest political PAC, with all the implications of that powerful position, protecting the interests of litigators and defenders. Remember that for every liti- American lawyers used to belong to an elite gator there must be at least one legal defend- club that “did the right thing,” or so we er, usually another lawyer. thought. There have always been bad lawyers, ambulance chasers, and the like. Even Your Role in the Legal World: Shakespeare said, “First, kill all the lawyers.” Winner or Loser Of the major industrial countries, only the In the current legal environment, you will United States permits: either be the winner or loser in your legal affairs. As with most of us, you will sometimes (1) Contingency law suits. That is, the win and other times lose. The objective of this plaintiffs do not have to bear any costs other CD-ROM is to keep you out of litigation and than a potential percentage award to the help improve the odds you will win if you lawyer. become engaged in what has become a wide- (2) The loser does not have to pay the legal spread American activity. costs of the winner. 3 www.simplymedia.com Legal Survival Kit
  • You cannot opt out since anyone can sue you dren’s information, and so on and so on. for anything, and these days, they often do. At 2. Set up a word document file where you save work or at play, at home or on the road, you are this information plus each form you create for always vulnerable to legal attack. Our efforts later reference. If you wish to also keep this are devoted to provide you the best advice and record elsewhere, do so too (duplication will tools to avoid litigation and prevail if it should only help you). You should also keep a hard occur. copy file of signed documents and your key fact documents. Insurance: Umbrella Liability Coverage to protect you from 3. If you do not have a fire proof safe, get one the lawyers on the prowl and put these documents into them. The office supply stores (e.g., Staples, Office Max, You should consider adding an umbrella liabili- and Office Depot, and their on line affiliates) ty policy to your homeowner’s policy immedi- have them and will usually deliver at no ately to protect you from unforeseen lawsuits. charge, so you don’t break your back carrying An annual additional liability policy of up to $1 your safe home. They cost about $150 each. million often costs no more than $100 per year. You can get them cemented into your base- This not only protects you from additional ment or into your floor for extra protection. losses should they occur, it also usually pro- Do this too, if you can. vides for the insurance company to cover and manage all legal costs and activities—so you 4. Review these forms and consider doing well can get on with your life in relative peace and care for yourself legally in advance of any quiet. Do it! prospective problems. This means doing proactive things you may not need immediate- This Guide With Step-by-Step ly (important but not urgent, a category we all Advice Per Form tend to ignore at our peril), such as wills, pow- ers of attorney, trusts, medical instructions, We have provided you with this Guide in addi- and the like. If you don’t do them immediate- tion to step-by-step advice for each legal form. ly, write out a schedule in which you will do After each document, we have provided specif- them—and then do them. ic advice for that form or letter in a “review list”. This way, that advice is specific to the 5. Encourage other members of your immedi- form and not over generalized here. ate and extended family to do the same kinds Notwithstanding that, the following is general- of things. You will give them a great gift by ly useful when filling out the forms and letters. doing so. 1. Prepare and keep a separate document with Action items: the key facts pertaining to each individual 1. Get additional umbrella liability and/or corporation and/or other entity you insurance policy coverage. enter into these documents. For individuals, 2. Get a home safe. this should include their legal name, address, social security number, passport number, other pertinent numbers (such as Medicare or Health Plan number), date of birth, date of marriage, date of divorce if applicable, chil- 4 www.simplymedia.com Legal Survival Kit
  • Introduction “You Have To Know The Law Well To Make It Work For You.” boldly than nonlawyers because they have been trained in the law, have experience and feedback from their prior activities, and there- fore have a better sense of how to use these tools (i.e. the forms) to expedite and formu- late agreements for themselves and their clients. If you are not a lawyer, you should restrict yourself to the simpler forms or fill out a form you need and then request a lawyer to review it on your behalf. Your very act of selecting and completing certain documentation in advance Clarence Darrow, the great trial lawyer, said of turning the matter over to an attorney will this long ago. Justice Oliver Wendell Holmes save them time and therefore save you money. admonished a participant in a particularly ugly case, “Do not make the mistake of confusing justice with the law.” Finally, one can com- plete that thought with Winston Churchill’s repeated comment, said in various contexts, Audio One: Introduction that democracy, and the rule of law, although messy, is the fairest system people have yet invented. Our primary objective in this Guide, with illus- Tip: If you ever feel “concerned,” trative audios, is to provide you with a broad “worried,” or “uncertain” about any- background of the legal system and suggest thing discussed or presented in a legal the appropriate tools to use when dealing with form, that is your tip-off to contact a the legal system in general and lawyers in par- lawyer for clarification and implementation. ticular. Our 600-form section is used by many Self-help forms should never be used unless practicing lawyers who, like you, can benefit you are entirely confident of your actions. We from prepackaged forms that can be edited do not offer legal advice. We offer personal and upon demand. Lawyers can do this more business advice about how to interface with 5 www.simplymedia.com Legal Survival Kit
  • the legal system and the lawyers within it. This Guide or Survival Kit is intended to guide you through the legal thicket. The primary Our business advice to you is to select the form purpose is to inform you of your options, sug- suitable to your needs. Then fill in the blanks, gest pitfalls to avoid and opportunities to seek, as you believe appropriate; and then have a as well as make you better informed when dis- lawyer review it. This approach will save you cussing these matters with an attorney when time, money, and permit the lawyer to focus on you believe it necessary. the legal issues, not the paperwork. If your lawyer advises against the form, take his or her advice. Simply Media’s role is similar to Stanley or Black & Decker in the tool business. We all make great tools, but we can only provide you with a limited amount of teaching instruction, and that is limited to business and personal advice. As in a construction project, the tools are usually better used by a professional, in this case a lawyer, especially if a complicated project is at hand. Our purpose in this disc is not to give you “legal” advice. The legal trade union, led by the Trial Lawyers Association, has prohibited us from doing so in any event. If you think the Teamsters are tough at guarding their turf, you have seen nothing like the Trial Lawyers Association. They are the largest political action group (PAC) and reportedly can intimidate even the President of the United States. So, they have effectively intimidated us, and we only give Did You Know? business and personal advice in this CD-ROM. Not withstanding this restriction, we believe Japan, unlike the US, graduates the most important part of the law relates to more engineers each year than how individuals and corporations use the tools lawyers. of the legal trade. The law is a means to an end. It is not the end in itself, except for the lawyers themselves who practice the trade. 6 www.simplymedia.com Legal Survival Kit
  • Written Agreements Their Purpose such as a loan to a family member, or property, such as the use of a piece of equipment. In fact, in personal situations, just the request for a written agreement often dissuades other people from “borrowing” your money or prop- erty. Once they realize the activity will be doc- umented, they realize they have undertaken obligations of repayment or return of property that they never really intended to execute. Written agreements are especially important among friends, family, or close associates because one of the best ways to lose a friend or The most significant thing about a written other close associate is to loan him or her agreement is that it clarifies what “you get” money or property. A written agreement at and what “they get”. The most practical ben- least allows you, them, and the world to see efit of a written agreement is that, unlike an what the actual agreement was. In summary, oral contract, memory cannot alter the facts. then, written agreements are just as useful in On the simplest of levels, an agreement personal as in professional or outside circum- reminds us of what we agreed to in order to get stances. what we wanted. It also, of course, should serve to remind the other party of what they agreed to in order to receive what they want- ed. This may sound overly simplistic; but, in fact, most of us have wavering memories that Audio Two: The Purpose of favor our point of view; with the lapse of time Written Agreement it is much easier to forget our obligations to others. Written agreements identify these issues and can help resolve these problems. Your Responsibilities To Furthermore, written agreements are often Others: What You Owe Them especially useful in personal situations because they clarify the terms of an exchange of money, The leading cause of legal conflict is people 7 www.simplymedia.com Legal Survival Kit
  • and companies on one side of the issue or the es and overreach on behalf of their clients. other not recognizing their responsibilities This stems from both their training to be vig- under their agreement or agreements to the orous advocates and their compensation meth- other party or parties. In simple terms, they ods which relate to billable hours, the more the did not understand or did not properly review merrier for them but not for you. Therefore, what they had to pay or do to satisfy the other you are advised to seek out the other party party. Often, once the bickering begins, both independently and try to negotiate a revised parties begin to point fingers at the other party approach to your dealings first. If a lawsuit and overlook their own responsibilities. breaks out, there will be time enough for the lawyers to try to settle the matter at a later This difficulty usually arises because one or date. Even after litigation has commenced, both parties ignore the reason the other party the best hopes for a negotiated settlement signed the agreement in the first place. This remain with the parties who have the most to reason is of “little” interest to the other party gain from prompt resolution prior to extended because this is not why “they” signed the litigation and trial. agreement. However, if you wish to avoid legal problems, it is always imperative you When conflict arises over an agreement, it is understand the motivation of the other party important to try to openly discuss this point as so you can prevent legal conflict from arising. if it is a common problem without assigning blame to the other party. Many times a frank, non-judgmental conversation can put the agreement back on track. Bite your tongue and stay calm. Try this approach if you can Audio Three: What You bring yourself to do so emotionally. Owe Them Above all, try to keep in mind that it is usually in both party’s interests to resolve a conflict early. Even when litigation is undertaken, the Recommended approach: When conflict vast majority of cases are settled prior to trial. develops, identify what the other party wants. Why? Because the litigation process usually- This often changes due to circumstances relat- consumes more time, emotions, and money ed to the parties or the environment as a than the case is worth. Therefore, you are well whole. For example, in a poor economy, people advised to seek out advice about how to and institutions get more desperate to get resolve these issues, such as we offer in our what they want; this often serves to inflame Negotiations Handbook and Conflict Resolution problems. Then determine if you can provide discs. what they want in full or in part. At a mini- mum, discuss with the other party their inter- ests in the contract. As you do this, they will usually become more amenable to discussing the issues you have with regard to the agree- ment. If you approach this matter patiently, you should be able to alter the odds in favor of a negotiated compromise satisfactory to you. Lawyers tend to stir the pot when conflict aris- 8 www.simplymedia.com Legal Survival Kit
  • reassuring feeling if you are “relying” on a pre- dictable outcome. You Don’t Say On rare occasions, such as note collections, the results are indeed generally certain and you The essence of freedom “ is the legal right to be left alone ” can proceed with relative certainty that you will get judgment. However, judgment is not collection. If you are pursuing collection against an insolvent, or financially shaky, Justice William O. Douglas defendant, you are usually better off with a 1961 negotiated settlement they are comfortable with to assure eventual collection. So once again, what seems certain in the law may not be enforceable in reality (i.e., they can’t or won’t pay and bankruptcy or other approaches Justifications For Why You Will will prevent you from collection). Win The Dispute Tip:: Court is a poor place to win back Very rarely does anyone “win” a legal dispute. points you could not obtain in initial Both sides must hire and pay lawyers, who are contract negotiations. Interestingly, the ones who win because they get paid. Most Court often works very well for a defen- suits are settled for a walk a way (no one gets dant trying to get out of a “gotcha” clause. anything) or considerably less than they would “Intent” or what the parties “meant” is very have gotten if they had settled early in the dis- important as a mitigating factor. Tricks and pute. In some plaintiff cases, against insurance gotchas don’t help the plaintiff or stronger companies for example, some legal positioning party in these matters as much as you might can be useful to establish the value of the case. think; sometimes they do, of course. Better to Aside from this kind of suit, most legal suits use a “gotcha” clause as leverage to settle such as in divorce, collection, or other contract other issues. matters, the parties would have been prudent to seek negotiating assistance instead of legal “They Have The Money And More At Stake; counsel. So They Must Settle On My Terms.” “My Lawyer-Friend-Associate Told Me We Those with the money are more apt to stand Would Win” and fight than ever before. The days of insur- ance companies rolling over, for example, are People often “take away” this thought from long gone. The increase in litigation has discussions with various people. The more reduced organizations and individuals’ fear of likely truth is that you were advised that you the process. In fact, the new conventional wis- “could,” not “will,” win. Once the people in dom is if you don’t stand and fight, more peo- black robes (judges) get a hold of a case, you ple will attack you because of your own per- are in the legal gristmill and most results are ceived weakness. uncertain. If you want proof of that uncertain- ty, remember how often cases are overturned Plaintiff lawyers went to the well once too on appeal. This means that another set of often: individuals and companies have judges disagreed with the first group. Not a 9 www.simplymedia.com Legal Survival Kit
  • learned. In a football analogy, the quarterback often the case in disputes. Payment terms are called this play once too often and now the examples of such clauses. You may have defense is all over it! agreed to pay them in 60 days, but wanted to pay in 90 days. What’s the big deal, you may Tip: Since you know settlements values have thought, if you pay just thirty days late? are down, consider taking less. Splitting Well, in fact, their entire banking relationship the difference is usually the best may be in jeopardy if you do not pay within 60 approach since neither side loses face. days. Or, they may have been only able to set This is not legal advice; this is a quick practi- up their payment plans to their own vendors cal approach. strictly based on their securing your firm writ- ten commitment to pay in 60 days, promptly. Common Complaints In Disputes That Relate To The Note: This also may be part of the “gotcha” Problem Of Responsibility school of negotiating. One side tries to bludg- eon the other into agreement on points they This section is about how you got into trouble. really do not want to accept or cannot live up Understanding how you got there should help to. You are much better off openly discussing you get out this time and hopefully not fall these issues early and ensuring that the other into the same trap next time. This section party can live up to this part of the contract. It describes the personal and business reasons is one thing to get commitment on something why you got to where you are in a dispute. It they do not want to do, but can do. It is quite is not about what the legal ramifications of another to secure agreement on something your case or potential case are. Lawyers are they really cannot do. If this is understood paid, and paid well, to unscramble these mess- early, you can often work around it. If you can- es. Our purpose here is to advise and forewarn not work around it, you may be better off not you in advance of ways to avoid these conflicts, making the agreement since it cannot be lived and their ultimate resolution through negotia- up to later. tion or the use of lawyers. “But They Agreed To Do It!” “That Wasn’t Why I Signed The Agreement.” They may have agreed to do it. But, if you When a dispute arises, many people say, “That forced them into a corner, and they felt they wasn’t why I signed the Agreement.” They had no other option, they may have signed the continue by saying, “That point isn’t impor- deal and hoped to renegotiate out of this point tant” or some other such comment. This may later. well be true for them. But the point that you consider obscure or unimportant may be the very reason they did sign the agreement in the first place. Without your having given in on that point in the initial negotiations, they may well not have signed the contract in question at all. In other words, what may seem trivial to you may have been critical to them. In fact, this is 10 www.simplymedia.com Legal Survival Kit
  • Warning sign: You pressed hard on certain What The Agreement Should Say For Your points and got their commitment. They told Benefit you “we are going to have a hard time with that” but you pressed forward anyway, disre- In adjudicating (deciding) a case, the Court garding the flashing yellow lights. first looks at exactly what the agreement states. The Court tries to interpret the agree- It is a lot harder to get out of an agreement ment “strictly”, or according to what it actual- than into one. Do not rely on a legal document ly says. Ambiguity is what the potential to trap or compel the other party to live up to “loser” tends to emphasize. The potential terms they have warned you are burdensome. winner focuses on the actual words, written You may eventually prevail in court. But you terms, and conduct, and thereby seeks “strict undoubtedly will have a lot of costs and heart- construction” of the language. burn along the way to this resolution, even if you achieve it. And, in the end, you may not Short, to-the-point contracts help here. Well collect on your judgment, even if you get it, known “boiler plate” or standard language due to defendant insolvency, being overruled helps your case because the Court “knows” on appeal, or for a host of other reasons. what it means. The longer the contract, the better the chance to find a loophole. So, why In fact, this uncovers a major weakness most do lawyers write long contracts? Because they lawyers have. They focus almost exclusively are paid by the hour and keep thinking they on a court victory, or a “judgment,” without will “help” their client by piling on more lan- giving proper weight to the probability of col- guage. Usually longer contracts tend to lection of an award, if granted. As a civilian, or obscure the core agreement and, worse yet, nonlawyer, you should use your business skills often introduce contradictory language that to determine whether the defendant can in defendant lawyers love to jump on and use fact pay; has a habit or ability of wiggling out of against the plaintiff. judgments; and the like. In sum, a lot more judgments are granted than collections made. As a defendant, pray for long contracts and as a Before becoming a plaintiff, be sure you have a plaintiff, fear them! solvent defendant with a habit of paying when they lose. Reconsider Your Position Common Approaches in Rarely does anything work as well to calm ten- Disputes: Negotiations to sions and set the tone for a solution than an Hardball tactics apology and offer to the other side to reconsid- er your position. Your next step is to suggest a time out, just as schools do, while the parties rethink their positions and try to understand the other side’s position. Audio Four: Common Approaches Start with reconsidering your objectives. If That Can Help you want to keep doing business together, and/or keep the relationship in tact, then hard- ball legal tactics rarely work well. In addition, consider whether the legal effort is worth the 11 www.simplymedia.com Legal Survival Kit
  • cost. Conflict is more easily enflamed than not as “cute” or “subtle” as they think and extinguished. Effort to extinguish conflict often telegraph their intentions early on. If early can produce surprisingly good results for the other side starts out reasonably, you can both parties. often resolve the matter easily. If they start out tough, of the “hard ball” school of negotia- tions, you know that you have to prepare for If You Think Litigation is Inevitable, Get litigation. Advice Promptly Interesting point: Very few negotiations fall It is under this circumstance that lawyers are into the middle ground of balanced discussions the most useful. Your first step should be to and approaches. So, your challenge is to figure consult your lawyer vigorously about options. out whether you are dealing with reasonable or Often the best solution is to file suit, or answer hardball people. Then you can proceed their complaint, and then, with both sides’ accordingly. stakes in the ground, quickly move for a nego- tiation session to see if a resolution can be Just because you are right or wrong up to this reached. Why? Because you have both proven point, does not mean the trend will continue. how tough you are. Now you can see what can You can make up a lot of lost ground by acting be done. Early compromise to avoid litigation properly with regard to the agreement in dis- is often seen as “weakness.” So, seeking a ses- pute and noting how your opponent is not. sion after complaints, answers, and counter- The worse your case, the more important it is claims have been filed, takes you out of this to mitigate your damages to minimize the ulti- arena of perceived weakness. mate negative result. It is no different than in sports situations. When your opponent gets ahead, they tend to get confident, forgetful, If Inevitable, Invest In Your Initial Answer And and lazy. In fact, the potential loser can use Counterclaims this human tendency to sit on the lead and be sloppy to reduce their ultimate damages and Now is the time to plan your defense and even pull out a victory in the end—just like a counter-attack. Contrary to what come behind win in sports! many lawyers think, they are Defensive Actions This section deals with such actions as inter- You Don’t Say preting agreements and defending your inter- ests with the most appropriate methods. This part also suggests ways for you to minimize and The shortest distance “ between two points is rarely a straight line in ” avoid expense, conflict, dissension, and trou- ble. the law. Much Trouble Can Be Avoided Difficult neighbors, relatives, employees, boss- Deaver Brown, Author es, subordinates, town boards, hazardous con- ditions, barking dogs, dangerous equipment, 12 www.simplymedia.com Legal Survival Kit
  • teenagers on the loose, contracts, agreements, tion agency, they are usually empowered to inheritances, or other relationships are every- settle claims for at least 33% off the face value. where in most of our lives. The best single Keep this in mind if you can settle the matter piece of advice is given under the section in with cash. If not, keep reading. the text entitled your inalienable right to back up and away from problems. In many situations, you cannot simply run out Audio Five: So You Got a the door or leave town. But you can reduce or Legal Letter mitigate your damages or problems by decou- pling, stepping back, or simply getting out of the way. The most difficult issues relate to events that cannot seemingly be changed: boundary lines, divorce settlements, work rela- If the letter is from a lawyer, it is usually from tionships, teenagers, or agreements. Over a collection lawyer who is also usually empow- time, though, you can substantially adjust your ered to settle a claim for something less than activities and, essentially, duck. face value. Good lawyers do not generally involve themselves in collection matters you Small appeasements can go a long way. Turn would be involved in other than large corpo- down the radio or chain your dog for the neigh- rate matters. So, you usually are not dealing bor. Praise the difficult relative to others so it with the A team here. gets back to them. Maneuver around to get a new boss or subordinate. Ease out the difficult If the letter is about anything but straightfor- employee. Resign from a troublesome town or ward collections, and is not a simple request nonprofit board or appease them. Give the big for information, or forbearance, such as keep- dog away or don’t get a new one. Make con- ing your dog chained up or quiet, complying tingency plans for poor, weak, or onerous with a zoning law, or other straightforward agreements, contracts, or settlements. Work matters that you can promptly comply with if on these issues continuously and you will be you so chose, then you need to consult a lawyer surprised at how they ease away or at least the promptly for advice as to how to proceed. decibel level is reduced. The Tough Guy Letter. Visualize a simple image: It is a lot easier to dam up the Mississippi at the headwaters in This kind of letter details how bad it is going Minnesota than when it is a mile wide in to be for you if you do not do everything they Missouri. Head off trouble early and you will want you to immediately. This is a standard benefit handsomely at a much lower cost. off-tackle play these days. It is well known. Even most lawyers don’t expect it to work very When Trouble Calls In The Form Of A Legal well since it has become so common and famil- Letter iar. So this circumstance gives you one key advantage: the other side knows they are Recognize and internalize immediately that “lying” by saying it is worse than they will set- you have already “lost” something because you tle for. Therefore, you have the moral high are involved and were not able to head off the ground and can use it to settle for less. problem earlier. If the letter is from a collec- 13 www.simplymedia.com Legal Survival Kit
  • Collection Letter—Asset With a Lien Such As cussing with them what you “can” do, remind a Mortgage or Car Financing them of this problem of potential broken promises—and you do not want to go down If it is about an asset they have a lien on such that road nor do they want you to do so. That as your car or house, they have all the leverage may help. If not, go back to the lawyer option and all the advantages. If you truly cannot pay, again. work out the best payment plan you can and contact them to see if it will be acceptable to Collection Letter—Unsecured Debt them. If so, live up to it and try to regain your financial footing. If it is not acceptable to You have most of the advantages in this cir- them, explain that you must now see a lawyer cumstance. They have no lien or asset to about how to deal with the problem. Ask them repossess. They must first use the court again, if they won’t reconsider their position. process to get a judgment that they can later If so, wonderful; if not, get a lawyer. convert into a lien. Then they can apply the lien to something you own. This is a long Remember that if you can pay, consider care- expensive process that no collection agent or fully exactly what you can pay and when you lawyer wants to undertake. This is especially can do it. Virtually all of us “know” when we true since most of them are on contingency, are late on a mortgage or car payment. You which means they only get paid a percentage “know” the problem. Only you can determine of what they collect. These circumstances whether you can get current, or up to date provide you with substantial leverage to rene- again, or not. If you can, or have a good chance gotiate your debt. If you haggle a bit, you can of it, OK; deal. If not, see the lawyer. If in often reduce the face value of your debt, with- doubt, see a lawyer. At this stage, you do not out accrued interest or fees, to 50% or less. want to commit to an unrealistic payment plan. If you do, and you break the plan, it will Collection agencies generally get 25% to 50% count against you with the collection agency or of what they collect. So the firm that “owns” lawyer and they will only attack more vigorous- your debt has already given up to some extent. ly on their next contact with you. When dis- As a result, they are usually vulnerable to giv- ing up more, especially if convinced to do so by the collection agent or attorney who, in this circumstance, is your ally because they benefit from a quick settlement—which gets them a quick commission. You Don’t Say Tip: If you are having trouble with an unsecured debt such as a local contrac- You can discover what “ your enemy fears most by observing the means ” tor or a credit card bill, and believe a col- lection agent is in your future, consider a set- tlement for a partial payment with no bad he uses to frighten you. impact on your credit history with the compa- ny in question. 50% to 75% will generally do it. Sometimes you can even set up a payment Eric Hoffer, Philosopher and plan. If you don’t feel comfortable doing this Longshoreman yourself, see a lawyer. But, generally, if you see 14 www.simplymedia.com Legal Survival Kit
  • a lawyer you have to pay more than the value of you can usually get a broad release—for even the bill. Pay the bill if you feel nervous. broader than the single claim—especially if Otherwise, negotiate or see a lawyer. you bring the check. The presence of a check will usually encourage the other side to take a Collection Call lesser amount. Use this advice prudently and you should be able to save yourself some Same situation as described in the collection money in Small Claims court. They will usual- letter sections above. ly let you try to work out the matter with an arbiter first, with you using the advice above. When You Are Sued If that does not work out, you will be forced to present your case to the judge sitting in court Get a lawyer—except for small claims court that day and he or she will determine the out- where you will usually do better answering come. complaints yourself. There are upper limits on the claims that can be brought against you in How Courts Approach And Small Claims court. These claims usually can- Interpret Agreements not exceed $2000. Therefore, the expense of hiring a lawyer usually exceeds the amount of Courts check out two things prior to applying the claim itself, making it more productive to the laws to your case: do the claim yourself. Notwithstanding that fact, you can often do well to run your What did the agreement state? “defense” and potential “counterclaim” by What did the parties mean or intend? your attorney to get their quick read on the matter. This small investment can often pay a substantial dividend for you in either negotiat- ing your claim with an arbiter at small claims Audio Seven: The Court’s court or with the judge. Approach And Interpretation Occasionally, Courts will decide to intervene Audio Six: PMI Thinking promptly by providing an injunction or restraining order in the case of extreme behav- ior such as egregious conduct, over-reaching, or lawless activity. Although most litigants pray for relief (i.e. in layperson’s language, “ask for Before you see a lawyer regarding litigation, help and enforcement”) on these grounds, write down the issues—their pluses, minuses, Courts are reluctant to enter into these types and interesting points. Be sure to line up the of immediate enforcement activities and gen- counter claims. erally do not act until a trial is conducted (or, as in most cases, the parties reach a settle- Small Claims Court ment). They will encourage you to negotiate. Take a Venue, or place of the lawsuit, can be very check with you. No matter what the claim, important for these purposes. Law is politics, 15 www.simplymedia.com Legal Survival Kit
  • of course, as one can tell by a casual reading of on this approach the most. Why? Because newspapers. Just two examples: in a heavily “What the Agreement Says” works against Democratic state like Massachusetts, liberal them. The best way to beat this approach is to causes such as those of tenants (the disadvan- use a short agreement with the Entirety of the taged) will usually be heard with more favor Agreement clause; in layperson’s language this than in a Republican state. In a Republican means, “If it isn’t written down here, it doesn’t state, judges would be more likely to uphold apply, unless it is written down later and the landlord (property rights). So, the court is signed by both parties.” more apt to make a finding in favor of a tenant in Massachusetts and a landlord in a The recommended language for your agree- Republican state. ments to cover these two issues (venue and intent) is: Action Item: In your agreement, be sure to establish the venue, or place for resolution, in “This Agreement embodies and sets forth the the jurisdiction apt to be most favorable for full understanding and agreement between your cause. In our case at Simply Media, we the parties. No change can be made except in have locations in both Massachusetts and New writing and signed by both parties. Any dis- Hampshire. For issues that the Democrats putes must be brought in__________city, in favor, we write in the venue as Massachusetts. ________ county, ___________ state and in no For those that Republicans are apt to favor, we other venue.” write in New Hampshire. Dealing with intent of the parties is a more complex task. The best antidote is to write in a clause commonly referred to as “Entirety of Agreement.” This clause typically states that the Agreement embodies and sets forth the full understanding and agreement between the parties and nothing can be changed except in writing. This is not a perfect solution since lawyers often are able to persuade judges to “go behind” the written agreement; but it is generally the best you can do. 90% of discovery and the associated costs prior to trials relate to discovering what the intent was and what every one “meant.” In simple terms it means “what did you really mean” when you signed the agreement. Clearly this is a murky area subject to much conjecture and questioning. The weaker party in a conflict generally relies 16 www.simplymedia.com Legal Survival Kit
  • Agreements between Friends or Relatives have the ability to decide when, where, and if they will make any repayment of any kind. This attitude usually comes about because the potential recipient is used to receiving “gifts” or their equivalent from the grantor. This is quite clear in the case of children and poor rel- atives. It is not as obvious in the case of friends, business associates, and younger peo- ple without longer business and/or life experi- ence. In these cases, it is even more important for the parties to have what they term in the law, “a meeting of the minds,” about repayment or return of rental property. The very process of discussion can flush out intent and usually lead Audio Eight: Agreements to a productive solution. Between Friends Commonly asked questions are: “Why do we need an agreement? Financial and legal agreements between “Don’t you trust me?” friends and relatives are the most challenging ones to discuss, create, and enforce. In your These lines tend to back us off. The natural discussion of these subjects, you should use response is to say, “No, I do trust you and....” the document creation process as a means to flush out what the parties really mean. For The best answer is, “It has nothing to do with example, a request for a loan or a rental is often trust; it has to do with clarity. If we write it just a plea for a gift. The requesting party may down, we will remember it clearly. Memories think that somehow, some day they will repay serve to change events; or, like the old game of the grantor; but, in fact, they intend to receive whispering around the table, once a line is the money or property and then unilaterally repeated several times it loses its original 17 www.simplymedia.com Legal Survival Kit
  • meaning. And, of course, one of us might not selves so they “own” the agreement and its even be around to explain the matter.” repayment and collection terms. If they make a silly recommendation on a specific term or Often this kind of discussion causes the poten- terms, usually just a lifted eyebrow will get the tial recipient to drop their demand entirely. terms into the right “ballpark.” These Since they never really intended to repay the arrangements are never easy and certainly wor- loan they have requested nor pay for the rental risome. To minimize your potential financial they wanted, they do not want to enter into a and emotional losses in the matter, let the formal agreement so will often walk away from potential recipient set the terms initially so it entirely when confronted with your require- you have the least to haggle about. Then gird ment to sign a formal agreement. Your best your loins as you go into battle to hammer out move is to give them room to retreat and avoid the most reasonable and prudent terms you moral spin so they do not feel belittled and can, always keeping in mind that if they “walk humiliated by the process and their own away” from the entire matter that is usually retreat. the best result. If the demand is not dropped, then you can put the request into standard promissory note Stock Investments with family, or rental agreement format with the appropri- friends, and business associ- ate interest rates, repayment dates, collection ates expense recovery clauses, collateral backup, and the like. Under either alternative, you will As with family, friend, and business associate be well ahead of the game. loans and rental agreements, businesses involving these kinds of parties should be for- Our final suggestion, if you get to the point of malized and stock certificates issued. It is negotiating this kind of agreement, is to especially important that stock agreements request them to lay out all of the terms them- include the Entirety of the Agreement clause, referred to earlier, so that if the parties later dispute the division of the stock and roles within the company the resolution process can be as straightforward as possible. Memorializing the agreement compels all of the parties to set forth their purpose, expected compensation, and anticipated payments in You Don’t Say the situation. The risks in family/friend/business associate loans and rentals, as well as stock Never make the mistake investments, are due to the fact cir- “ of confusing justice and the law. ” cumstances change (e.g., a sharehold- er wants his son or daughter to be employed by the company on the sole basis that they are a stockholder). Justice Oliver Wendell Holmes, Jr. Sometimes the party investing the initial or 1906 follow on money has financial setbacks and “needs” the money back. At other times, a death, liquidation, or sale occurs and “other” 18 www.simplymedia.com Legal Survival Kit
  • parties, such as heirs, trustees, or administra- ified conditions take place such as no clear tors are involved. majority being in accord on a course of action. A second approach is to provide for an orderly In one such case involving a family loan to my sale process of the enterprise with the funds to first company, a written promissory note docu- be received divided up among the sharehold- mented in corporate records resulted in the ers, if contention breaks out. Just the process loan being promptly repaid by the new owners of offering a company for sale often makes all right on schedule without intervention by any of the parties more realistic if the offers lawyer. This is just one example of how the received are far less than the insiders believe written agreement can assist all parties with- the company is “worth.” Buy sell agreements out being abusive of any of them. usually require this approach to establish fair market value, or what the company is “worth.” One of the most contentious areas in family At that point, you should be able to negotiate businesses relates to whom or which “side” a reasonably satisfactory buy/sell solution, as will get plum corporate jobs and the accompa- long as you had it in place to start with. nying pay scales. It is our experience and rec- ommendation that initial stock agreements Tip: This kind of stockholder agree- should expressly state that stock ownership is ment requires the use of the best attor- separate from corporate management. ney you can afford to extract the facts, Dividends should be paid in cash not corporate set up a suitable agreement, and provide jobs or, as is referred to in government perks, a solid and agreeable exit position should the in pork. stockholders descend into contention. Since circumstances change rapidly these days, you Finally, the stock agreements should provide are well advised to update your stockholder for a straightforward exit position if contention agreement and buy sell agreement on a regular breaks out and no one party has clear majority basis. You should try to do this at least once control. A buy sell agreement works well to every five years, if not more frequently. establish a clear exit path should certain spec- 19 www.simplymedia.com Legal Survival Kit
  • Business Agreements Lending institutions are always cramming these documents down borrowers’ throats. Yet, they rarely help them speed up the collec- tion process if something goes wrong. The best deal for the institution is really a note, a lien, and a simple agreement. More docu- ments than that usually results in it appearing that the lending institution had an unreason- able amount of power and “forced” the agree- ment. This does not mean a Court will “let you out of it.” It merely means that lots of documents do not help the stronger party. If a lender or powerful party goes after you, watch your lawyer use the length of the agree- ment against them. Institutions never seem to learn this lesson. So, when someone owes you Audio Nine: Business money, get a note, a lien (if possible), and a Agreements simple agreement. Again: Business advice. Unrealistic expectations lead to many prob- lems. This is why many large companies Before drafting an Agreement, you should first refuse to deal with very small companies or establish a term sheet. Term sheets are an individuals in many areas. They are rightfully outline of a proposed agreement. These are fearful of the “intent of the parties” conse- useful to prepare before entering a negotiation quences of their actions or other extreme posi- so you know what you want, what you will tions that the weaker party might charge them accept, and what is your walk away position. with and might just stick in Court. The problem with contracts is they draw you into liabilities. The risk is primarily to the Term sheets tend to eliminate many of these stronger party; and yet, interestingly, it is the problems by allowing you to work out carefully stronger party that usually demands the agree- your options and then having a reference point ment. Counter-intuitive but true. when you get into the heat of negotiations. 20 www.simplymedia.com Legal Survival Kit
  • The simpler the contract, the less likely a envelopes to give you the appearance of corpo- Court will ascribe “broad” relationships to it. rate respectability to go along with your formal On the other hand, long contracts suggest a incorporation. You can click here to order your substantial relationship and open you up new stationery at an affordable price (the same potentially to very intrusive and expensive company does checks and stationery). You investigations in many Court encounters. should set up a separate phone and fax line, as well as email address (under AOL it can just Tip: Every business agreement should be another screen name), to give you the aura have a well-defined exit position. You of being a going concern. In the corporate and should aggressively seek a “give up” legal world, appearance counts. So do it! clause so you can get out (other than with mortgages, notes, and other simple financial instruments reflecting actual indebtedness). This back door lets you at least cut your losses should conflict arise. Incorporation Incorporation protects you personally from lit- igation. As long as you observe the proper cor- porate formalities, you can rarely be sued suc- cessfully on a personal basis. If you are named individually in such a suit, your lawyer can gen- erally get you removed in a quite straightfor- ward way. As with all layers of protection, no single approach is perfect, but they all help, as this one does. Tip: The best way to incorporate is through the Company Corporation that does 1 out every 7 incorporations in the US. They are specialists in the field so offer the best service at the lowest price. Click “Incorporate Your Business” on the main screen to get the forms to make this happen. Once you do this, you must call to get your Federal ID number by filling out that form. You can get the latest form off the IRS site at irs.gov. In addition, you should then set up a Business Checking account. You can order the checks by filling out the attached forms. You should also order business cards, stationery, and 21 www.simplymedia.com Legal Survival Kit
  • Personal Litigation as possible after the rupture. At a minimum, this approach serves to contain the problem so things are less explosive and you don’t create the family situation where no one is speaking to one another. One great litigation lawyer pointed out to me though, “I never have a suit that isn’t person- al.” So beware of contributing to the problem yourself. Try to remove the personalities from the set- tlement or litigation process as soon as possi- ble. A little humility here can go a long way. You can say such things as, “I am too personal- ly involved in this as you may be too. Why don’t we get a different person on each side to Audio Ten: Personal deal with this.” Litigation Warning: We have observed that lawyers are beginning to take their cases more personally too. At a mini- Personal litigation can be particularly nasty mum, do not let your lawyer do this. If the because it involves things and people so close other lawyer does this, actual litigation will to you. Boundary lines, wills, and divorces are tend to uncover it and the Court may well see infamous for their ugliness. You rarely hear the bias that led the matter not to settle. about a nasty trademark or promissory note dispute. However, recently, more people have Boundary Line; Neighbor been taking these “personally” too. These Disputes only get “nasty”, in our experience, when the parties get personal. Business advice suggests selling and moving. No one wins these. They can be very bitter, Tip: Try to keep conflicts as impersonal debilitating, and linger for decades. Legal as possible so you can heal the rift as soon advice says you may win. Personal advice says 22 www.simplymedia.com Legal Survival Kit
  • what they are thinking about, and indirectly You Don’t Say about how you are doing with them. You may be surprised by what you hear. Try to correct The law cannot make a “ man love me, but it can keep him from lynching ” what you can—which will lighten your load if a legal problem arises later. me, and I think that’s Wills pretty important. Martin Luther King, 1962 Audio Eleven: Wills that at a minimum, try to get out of the “way,” and find a way to soften the situation. Part of the solution is to care less about what the other side thinks, about who is tougher- Even lawyers avoid making wills for them- stronger-righter, and move on to other issues in selves. Superstition is the major problem for your life. As one old time lawyer told me, most of us. We all need to get over it. Make “The worst legal problems are boundary lines the will. It may save people close to you tons and wills.” At least with wills, you have finali- of trouble later. ty in that some conclusion will result and, to a large extent, you “know” your family. With Every family has stories about the great pro- neighbor problems, things can rapidly escalate bate fight that centered on the piano stool, out of control due to differing value systems summer cottage, or other item loaded with and a lack of family bonds to cover over some personal memories and feelings. of the bad feelings and disputes. Tip: In this age of divorce and remar- Having said this, there are many things you can riage, give your spouse half (usually do to limit your exposure and upset. First, be legally required), set up trusts for your polite and conciliatory without being a door- children for up to the other half (if the mat. If a neighbor asks for something above surviving spouse remarries your children the normal or outside of the context of your become “step-children” and Cinderella told us relationship, suggest that they reciprocate in all about how that works out) with the execu- some way so you can keep the relationship bal- tor being a banker or third party. This is not anced. Tell them that you “are sure they want about “trust.” This is business advice about to keep balance in the relationship as well.” human nature. Secondly, keep your children, pets, friends, Also, do not put too much pressure on the and cars off their property. This is an obvious process of drawing up a will by trying to antic- point but many people just slough it off saying, ipate all of the events for the rest of your life. “They don’t mind.” They may well be boiling In this fast changing world, drawing up a will inside and when the pot boils over you will not every three to five years makes perfectly good be happy. Third, engage and talk to them sense. Most of the changes will be minor occasionally to calibrate what they are up to, adjustments. A good way to remember to do 23 www.simplymedia.com Legal Survival Kit
  • this is to do it every time you get a new license Divorce or on every 5th reunion of a high school or col- lege class. A more modest approach towards the scope of the will, just the next five years, will give you more courage to get it done and then revise it periodically. Audio Twelve: Divorce Use a form such as ours to draft your intent; give it to a lawyer to memorialize. It is impor- tant. Do it now, if you have not done it already. Bookshelves would collapse if all the books Tip: Provide for an auction of all ques- published on divorce in just one year were tionable value items. This is especially stacked on them. Without taking sides, our true for sentimental items. Everyone may business advice is to take note of the following: “want” the piano stool Mom sat on. But no one may be willing to pay $10 for it out of his Winners in Divorce or her proceeds from the auction. The mech- anism is to provide a final percentage division The only definite winners are some female for all of these objects. Then each party can members of the upper middle class and upper use their “percentage currency” to acquire class. They can make out well. Everyone else what they want or bid above the limits with loses, especially lower and middle class their own cash. This process usually works to women. Most divorces squabble about the turn down the heat and get the Estate liquida- kids. But, the kids become like Korea, and get tion process moving. It worked splendidly in battered and scarred, and 50 years later the my family to ward off battles over the silver- Koreas are still not reunited. ware, furniture, and similar items. It only takes one person to start a fight, as Real Estate Trusts Ogden Nash once said. So, above all, remem- ber that you are entering treacherous territory Real Estate trusts for your private residence or here and must therefore be doubly cautious, residences are a good idea in this litigious age. vigilant, and careful. It means that litigants in other matters cannot “attach” a lien or prejudgment attachment Tips to the Losers (Except For against your property. It also tends to discour- Husbands Of The Winners) age plaintiff lawyers because it prevents the quick kill of an attachment against your prop- Go easy on each other. Otherwise the lawyers erty that they might be able to use to make will get what little there is. Both sides may you settle up on another matter entirely. As benefit from Court enforced child support. with estates or wills, fill out the forms but be That way, the benefits both increase and sure to use a lawyer. These areas require in- decrease according to the actual received depth thought and experience to determine income of the parties. Split the property and the best ways to proceed. Again, an ounce of move on, if you can. This is easier said than prevention here can save you having to pay a done because of all the emotion attached to pound in cure later. the children, the property, and the old rela- tionship itself. 24 www.simplymedia.com Legal Survival Kit
  • children under 18, there is rarely a problem. Advice to the Former Courts are tough on making people go back to Husbands of Winners work and “try” to earn a living (i.e. the poten- tial winner). So the potential winners usually Understand you are going to lose. Do not only score big-time when minor children are make the mistake that many men do in this involved. If you have children near 18, consid- situation and be tempted to hold on to the soft er long and hard whether you don’t want to assets and hard debts while giving up the hard wait until they are 18 before you start a divorce assets and soft debts. You are better off selling proceeding if you are one of these husbands. and splitting most assets, especially the mari- tal home. Then nothing lingers as long. If Tips For the Winners more husbands of winners forced the sale of the marital home, they would force the poten- This is one area lawyers perform magnificent- tial winner out of the old emotional zone and ly. You need no advice from us other than to get them moving towards a new life. decide how much pain you wish to inflict. The power is yours. Make child support dependent on your annu- ally earned actual income. Otherwise, if you Joan Lunden had this happen to her. It lose your job, off to jail you may go—and this changed her mind about this stuff after she isn’t Monopoly, there is no $50 card here to was attacked—and got whacked. Before get you out of jail. Some winners love to hear launching into such an attack yourself, you the jail door slam on their ex-husbands despite should read up on the Joan Lunden story. It the consequences to the children and their might just get you to holster your weapons. relationship with their children. Try to limit child support to the shortest peri- od possible. Try to get physical custody for some period of time or you may never get it at all. Consider this like a 5 on 3 penalty in hock- ey. They will score many points if given enough time. The only question is, how many times? If you don’t know hockey, ask about the 5 on 3 penalty situation. Ouch. You Don’t Say This is also good business advice for any case The law is only one of where you are the potential big time loser. Always work to minimize the amount of the damage award and the time period you must “ several imperfect ways of defending what is ” keep paying. Try to keep your cool and better in life against remember that owing the money may be out- what is worse. rageous, but every little discount helps. Vaclav Havel, Child (Mother) support is where the real Prime Minister and Playwright potential problem is, not the division of com- munity property. So if there are no minor 25 www.simplymedia.com Legal Survival Kit
  • Three Steps To Take To protect yourself activities do you or your spouse participate in; your minor children; or items relating to your property. Examples include being a human helper to others: all kinds of risk exposure for you here. This is not just as a doctor or lawyer, but as a business advisor, coach, teacher, town board member, volunteer driver, and various other related activities. Think hard and make an exhaustive list of all such activities in which you participate. Do it. It is important. Property issues relate to hazards, attractive nuisances, animals, trees, and any other risks to others, including, believe it or not, a slip and fall accident to a door to door salesperson). Audio Thirteen: Review Your Be sure to set up the basic protections such as Exposure a will, real estate trust (s) for your property (ies), business agreements, and other agree- ments related to your situation (e.g., health care stipulations). Be sure to get the home You can do a lot to protect yourself. The fact safe and umbrella liability policy referred to in you are reading this is a major step forward. the Background section. Let’s go over some things to help you. Insurance Review Your Areas Of Exposure The best rule for insurance is to insure for what you cannot afford to lose. Pay directly Exposure relates to what you or your spouse yourself what you can afford to lose—it is do. What your minor children do. Or what much cheaper in the long run. So, with car happens on, to, or with your property. Make a insurance, you are better off with a high colli- list relating to these three categories: what sion deductible but spending the savings on 26 www.simplymedia.com Legal Survival Kit
  • effort will produce most of the results. After that you will have to work harder to bring the remainder in. But, at least you know what you You Don’t Say have to work at, and that is usually half the battle. The defendant wants to “ hide the truth because he is generally guilty. ” Make a date with yourself to do this once a year. Choose an anniversary date such as New Year’s, your birthday, or some other such day. Put the date on your calendar and stick to it. If you do this now, in a year or so you will have Alan Dershowitz, Trial Lawyer, 1982 eliminated, or at least limited, most of your lia- bility. getting large umbrella liability policies to cover extraordinary damages. In homeowners insur- ance, the same rules apply. In business and your personal life, be cautious about all of your business activities but be sure to have a large product or service and employee liability poli- cy or policies. Get A Legal Check Up Get a legal check up with a good lawyer. Give them a list of the areas of exposure you worked on earlier. Figure out which areas are most liable to be attacked. Perhaps you should reconsider serving on town boards, being a coach, taking your children’s friends on trips, and so forth. At a minimum, you should review your activities, and those of your family, to determine which ones, if any, should be modi- fied or eliminated. Be sure to memorialize your outstanding “oral” agreements that could use certification. You may not be able to get the other party to sign up. This is a warning sign itself. Think of yourself as the proverbial librarian calling in all of your overdue books. The first round of 27 www.simplymedia.com Legal Survival Kit
  • You Can Walk Away Your Inalienable Right To Retreat he is a pussycat. Think older. It is OK to give up. A few exam- ples that have worked for me: You are a volunteer coach on a team; you have two or three children with difficult, interfer- ing, and critical parents. You can give up and say, “Look, you have your points; I am no pro at this. Good luck.” If you select this option, be sure to do it when provoked, in front of wit- nesses, and give them the “ball.” Don’t back down once you start. Don’t be talked back or they may wait their turn to whack you for it One reason many people become more suc- harder the next time. cessful in business as they get older is they learn to give up, walk away, retreat, and not Result: You have one less problem in your life. fight on most issues. If it is too hard to bust They may just think twice before doing it through the wall, they learn to walk around or again, especially if you do this in your home away from it. If people are too difficult, they community. don’t work with them. What they do emotion- ally is distance themselves from trouble and You are a boss and have a troublesome employ- troublesome situations. I have found this hap- ee reporting to you. You can suggest giving up pening to me, as I get older. It is one of the and say to your boss, “Look I can’t manage enormous advantages of age. them; I don’t want to make it worse. Why don’t we move Sally-Billy before we have a real A question: If Stalin, Lenin, Hitler, Saddam, problem.” In business, bosses are terrified of and various terrorists had been in their 70’s, do being sued by employees. So, your humility you think they would have done it to start should impress your boss and include him or with? Chinese leaders have been older. So far her in the decision to take conservative action. they haven’t attacked anyone except for Tibet Now, to whack the nail a little harder, you can in their own borders. Castro became pretty say, “Look boss, let’s be smart. None of us is tame once he reached 65. Now that he is 75 perfect. What if we really do blow it some day. 28 www.simplymedia.com Legal Survival Kit
  • Do we want them around to crow about it or All of this is easier said than done. However, it worse yet rat us out?” is good, solid business advice as to how to reduce future problems that could well turn Result: You are on record about the problem. into litigation. Remember: you have the If anything comes up later, you put everyone inalienable right to retreat honorably and with on notice. You have taken the heat off your- all due haste. self no matter what the outcome. We strongly recommend you incorporate uni- Interesting Point: None of these actions lateral “give up” or exit clauses in all of your resolves the problem. That is a much more contracts, with or without cause. Consider challenging enterprise and not the subject of putting in clauses, which we do, to give you this CD. Our Conflict Resolution and Negotiations the right to “quit” or “stop” without giving Handbook discs address that process. In this reasons. In retail they have a marvelous phrase case, you have merely mitigated the damages. for it, “Your first loss is your best loss.” As you get older, most people learn it is far more productive to mitigate damages than try In summary, when a situation is not working to eliminate them. As Mark Twain said, “You out well, one of your best options is an orderly can’t throw a bad habit out the window. You retreat so you can focus your energies on a pro- must coax it down the stairs.” ductive situation. It is all too easy to get caught up in the emotion of conflict. Better to You have a contract with a difficult person- move on to opportunity—unless, of course, company-type. “I am sorry X, we just aren’t up you are a lawyer and then you get rewarded by to your standards. We need to move on.” more billable hours. However, you, as a civilian Customers for Life by Carl Sewell describes “fir- and nonlawyer, don’t want to be caught footing ing customers.” Organizations cannot with- the bill for those billable hours. stand harsh treatment by the outside world. You must first protect people within the com- pany or organization if you want them to treat outsiders well. If people make your company’s environment miserable, you have to get them out or the whole place can become surly. Again, you are not resolving the issue; you are mitigating the damages. As Herb Kelleher of Southwest Airlines says, “Employees first; customers second,” in order to keep the employees morale up to deal with the customers. To underscore this, Southwest permits its employees to fire customers by telling them, “We don’t do what you want; x airlines does; please use them and not us next time so you won’t be disappointed.” This is a perfect “give up” strategy without offending the other party but getting yourself and/or your organization off the hook. 29 www.simplymedia.com Legal Survival Kit
  • Summary Don’t Just Blame The Lawyers! Individually we must learn to deal with the consequences of society’s trying to “right all wrongs” and get “compensation” broadly. Some of the results are positive; many are not. Keep in mind that it is very expensive in time, money, and emotional resources “to prove” anything through the court system. The best way to turn away a lawsuit is to try to settle it out promptly, recognizing the increasing ten- dency for people and organizations to sue each other. If you cannot settle an actual or poten- tial lawsuit, be alert to your options to improve your position through “good faith dealings,” being vigilant about identifying their weak- Audio Fourteen: Don’t Just nesses, and get good legal help early. As the Blame the old saying goes, “An ounce of prevention is Lawyers worth a pound of cure.” That is exactly why we wrote this CD-ROM and we hope you have benefited from it. Lawyers may have started the trend to increased litigation. We as a society are per- petuating it. As we gradually take less person- al responsibility for our actions, and discipline being admired less and feared more, more and more people are seeking to blame others for their problems—and seeking monetary com- pensation for them through the legal system. The courts have always been an accurate reflection of our country’s beliefs. They are no exception in this instance. 30 www.simplymedia.com Legal Survival Kit
  • Appendix I Clickable List of Audio Clips Audio One: Introduction Audio Two: The Purpose of Written Agreement Audio Three: What You Owe Them Audio Four: Common Approaches That Can Help Audio Five: So You Got A Legal Letter Audio Six: PMI Thinking Audio Seven: The Court’s Approach and Interpretation Audio Eight: Agreements Between Friends Audio Nine: Business Agreements Audio Ten: Personal Litigation Audio Eleven: Wills Audio Twelve: Divorce Audio Thirteen: Review Your Exposure Audio Fourteen: Don’t Just Blame The Lawyers 31 www.simplymedia.com Legal Survival Kit