Corporate & Securities Law

Investing in Your Templates

By Ken Adams

A few months ago someone at a public company mentioned to me that her department was about to embark on a redraft of their templates. I was familiar with the subject matter, so I knew that the templates must be complex.

I recently checked in with her to see how the process was going. In her reply, she mentioned in passing that due to cost controls they were handling the process internally. That wasn’t really why I had contacted her?honest!?but it brought to mind the following:

I understand that these are drastically cost-conscious times for law departments. But when it comes to templates, it’s possible to be penny-wise, pound-foolish.

A company’s lifeblood is its sales, so the contracts used in the sales process are vitally important. If they contain any glitches, are bloated with redundant and archaic language, or are structured in a confusing way, those deficiencies will manifest themselves every time a template is used, and they’ll act as a constant drag on the process.

If you’re a substantial public company and you’ve decided to redraft your templates, it would make sense for you to retain an expert to help out. Your lawyers know your business better than anyone, but face it?they aren’t experts in contract drafting. At best, they’ll produce contracts that are representative of mainstream contract drafting; in other words, they’ll be a long way from optimal.

Furthermore, your lawyers probably already have too much on their plate, so it’s uncertain that they’ll be able to devote sufficient time to any redrafting project.

So using the services of an outside expert could help you prepare, much more quickly than you could otherwise, a set of state-of-the-art templates that would yield dividends, in terms of reduced time-to-sale and reduced risk, every time they’re used. And the cost involved would be minimal?trivial even, when compared with the amounts at stake in the sales process.

Perhaps your problem isn’t being too tight with the pursestrings, but rather directing money to the wrong place. Law firms are great at getting the deal done, with all the expediency that entails, but I’m not sure it’s realistic to expect them to produce state-of-the-art drafting. At best, you’ll get mainstream contract drafting. And it might well be expensive.

Obviously, I’m not saying this as a disinterested bystander?I redraft contracts for clients, and I honestly can’t think of anyone else I’d trust with that task. But how you handle redrafting is an imporant enough issue that I’m willing to offer my thoughts on the subject, even at the risk of seeming self-serving.

Full post as published by AdamsDrafting on February 04, 2008 (boomark / email).