Steven Sholk, that bloodhound, let me know about an article in the current issue of the Journal of Legal Education. It’s by Robert C. Illig, associate professor at the University of Oregon School of Law, and it’s entitled A Business Lawyer’s Bibliography: Books Every Dealmaker Should Read. (Go here for a PDF copy.) Here’s its stated purpose:
This article briefly surveys the ever-expanding literature on business and finance with the goal of helping you discover those books that best provide an awareness and familiarity with those aspects of the business world most relevant to your future (or current) practice.
The article is in five parts. In the last segment, part V, he suggests “several skills-oriented books on negotiation and drafting.” Let’s now look at that discussion. (I omitted the citations.) The numbers in brackets refer to my annotations, which follow the extract.
In terms of contract drafting, I am sad to report that there is nothing on the market that is remotely equivalent in quality or general relevance to the literature on negotiation. Probably, this is because the real art of contract drafting lies not in word choice or sentence structure, but in issue spotting and risk allocation. No matter how well an agreement is crafted in terms of language and clarity, it is worse than useless if it omits treatment of critical issues. Moreover, careful writing can even be counterproductive if the result is to re-draft language that has been previously interpreted by a court as having a particular meaning. Ironically, in such a case, changing the words—even for the better—can only increase uncertainty.
Treating contracting as a language art also misses the essential element of plagiarism inherent in the drafting process. Once a contract drafter has identified the issues to be addressed, her next step is commonly to search her own files, or possibly her firm’s files, for sample language that has been used successfully in the past to address similar issues. Even better, she may peruse the catalogue of “material contracts” that all public companies must file with the SEC and that is available via its online EDGAR database. By taking the latter route, she can access the latest industry-specific and market-tested responses to common issues.
Given the nature of drafting, then, the best books for the drafter are probably those that are specific to particular areas of law. For example, famed deal lawyer James Freund’s Anatomy of a Merger describes each major provision of an acquisition agreement, line-by-line, presenting not only the issues raised but the common positions taken by both buyer and seller. Though dated, this volume remains essential reading for any serious M&A attorney.
Meanwhile, the American Bar Association has taken Freund’s approach one step further by institutionalizing it in a committee. The forerunner of the Committee on Mergers and Acquisitions has begun publishing excellent model merger, stock purchase, asset purchase and other agreements. Each not only identifies sample language and the issues such language is intended to address, but how each provision in the contract can be tailored to the interests of the buyer or seller. As a result of their provenance, these model agreements have the potential to define “standard” contract terms and so serve as the starting point for many future negotiations.
I think Professor Illig’s gloom-and-doom is unwarranted. Has he heard of A Manual of Style for Contract Drafting? And doesn’t the valuable Negotiating and Drafting Contract Boilerplate merit a mention?
If I were paranoid, I’d assume that he is aware of MSCD and that these two sentences are his way of saying, “Ken, with your word-choice prissiness and your endless bleating about language and clarity, you don’t come close to the ‘real art’ of contract drafting.” My response would be as follows: “Rob, contract content consists of what you say and how you say it, with the two overlapping. (How you say something has a funny way of changing unexpectedly what you say.) Sure, getting the terms of the deal right is essential, but if any drafter thinks that rigorous command of the building blocks of contract language is beneath them, they and their clients are in for a world of hurt. My writings provide extensive evidence on that score.”
Ah, that canard, the notion of “tested” contract language. It sounds plausible in the abstract, but I recall only a couple of instances of my having to recommend that you stick with suboptimal language so as to avoid confusing the courts. Otherwise, I have no trouble achieving my goal—recommending usages that are clearer than traditional usages while allowing you to avoid dispute. And there’s something paradoxical about sticking with language that was so unclear that the courts had to step in to say what it means.
Plagiarism has no bearing on copying contract language—no one would ever suggest you have to give proper credit when you use copied contract language. But copyright is an issue; go here for my article on the subject.
The quality and relevance of contracts on EDGAR is, to put it politely, mixed. Browsing on EDGAR is like roaming a giant flea market. Anything useful I’ve found on EDGAR has needed significant surgery.
I think there’s room for a more critical assessment of the ABA model contracts than that offered by Professor Illig. For a different approach to M&A drafting, he could check out my book The Structure of M&A Contracts.