Unless you’re working with microscopic font sizes, if you’re involved in a transaction of any consequence (and by that I mean consequence to you, not consequence to the national debt), I weigh in on the side of “fiction.”
Every time I’m handed a “short-form” agreement–like the eight-page partnership agreement a business owner (a lawyer!) asked me to review–I’m able to spot the glaring omissions where the business owner is vulnerable to a likely disaster. It makes me cringe. I want to be of service but, like the reaction to ancient Cassandra, entrepreneurs don’t want to hear the message.
Here’s the scoop. Short-form agreements tend to focus only on the immediate business terms: What will you pay, what will they provide, what if you need to make changes. S-o-m-e-t-i-m-e-s, agreements will add in a tidbit about where you’ll resolve disputes.
But they don’t cover the broader, harder-to-quantify issues such as confidentiality, intellectual property or indemnification (where the other side will step in to defend you if their actions embroil you in a lawsuit with others). Now I don’t have a crystal ball, so I can’t predict whether these issues will come to pass or not. No question, I’m a trained pessimist, so that’s my bias. As I allude to in my article, “No Nonsense Advice About the Perfect 1-Page Agreement,” a lawsuit over any one of these dark, swirling issues could put you out of business. Do you have the money to “self-insure”?
