When It Comes to Contracts, Don’t Believe the Innovative-General-Counsel Hype

I recently saw this article by Fred Krebs suggesting, very sensibly, that “general counsel have a significant opportunity to help lead corporate innovation.”

I used to think that although a company’s rank and file might be wedded to turgid traditional contract language and a ponderous copy-and-paste contract process, the odds of change would greatly improve if I were able to get the attention of the general counsel. After all, the general counsel is the one with the perspective, the one who is accountable—surely they would bring to bear the necessary cold-blooded scrutiny!

But after two attempts to engage with “innovative” general counsel from big companies, I’m not so sanguine.

Because the first general counsel I attempted to contact has a reputation for being innovative, and because I had occasion to speak with briefly with him, I went online and copied a PDF of his company’s standard terms of sale. I then spent a couple of hours of airplane time adding dozens of comments to the first page and a half. I didn’t go any further, because that was enough to show me that as a piece of contract drafting, it was embarrassingly bad. And this was the company’s terms of sale! Perhaps their most important contract!

I then sent the general counsel an unsolicited email explaining why I was contacting him and describing my analysis. But I didn’t hear back from him. (Because I never assume that my emails reach their intended destination, I also mailed him a printed copy.)

If I had been in his shoes, I would have asked to see my analysis, just for the sheer heck of it. Or I would have politely said thanks but no thanks. In any event, I can only conclude that his zeal for innovation apparently doesn’t extend to his company’s contracts.

My second attempt consisted of another unsolicited email to a general counsel with a reputation for innovation. Here’s part of my email:

I’ve always thought that compared with law firms, it should be a straightforward matter for company law departments to implement and maintain a rigorous contract process. (Using a limited number of templates many times permits economies of scale.) Nevertheless, I’ve been astonished at the inertia I’ve encountered. I’ve repeatedly shown major companies that their templates are deficient. They not only decline to do anything about it, they simply refuse to discuss the matter.

So why am I contacting you? Simply because I’d relish the opportunity to engage in a candid discussion with [company name redacted] about contract quality. I think my readers and students would find it instructive, and you might too.

I heard back from the general counsel, who thanked me for reaching out to them and asked me to contact someone whom he cc’ed on his response. I then emailed that person. No reply. I emailed the general counsel again to say that I hadn’t heard from that person. No reply. So their response ultimately exhibited the tendency I noted in my email.

I’m not delusional enough to assume that busy people have any obligation to give me the time of day. But when people appear to go a little out of their way to ignore me, that suggests to me that we’re dealing, yet again, with inertia and fear of change. If someone bears a message that’s inconsistent with an image of innovation, ignore the messenger.

What explains this? If a general counsel has a background in contracts, it’s likely that they’ll be wedded to the traditional way of doing things. If they don’t have a background in contracts, it’s likely that they’ll defer to people who do.

So I’ve learned to accept that just because a general counsel has a reputation for innovation, that doesn’t mean that they have any interest in bringing that innovation to bear on their company’s contract process.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.