Legal Guide

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 divided 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.

American lawyers used to belong to an elite club that “did the right thing,” or so we thought. There have always been bad lawyers, ambulance chasers, and the like. Even Shakespeare said, “First, kill all the lawyers.” Of the major industrial countries, only the United States permits: (1) Contingency law suits. That is, the plaintiffs do not have to bear any costs other than a potential percentage award to the lawyer. (2) The loser does not have to pay the legal costs of the winner.

These are the facts of life in the American legal world. The American Trial Lawyers Association is alive, well, and vigorously protects 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 litigator there must be at least one legal defender, usually another lawyer.

Your Role in the Legal World: Winner or Loser In the current legal environment, you will either be the winner or loser in your legal affairs. As with most of us, you will sometimes win and other times lose. The objective of this CD-ROM is to keep you out of litigation and help improve the odds you will win if you become engaged in what has become a widespread American activity. 3

www.simplymedia.com

Legal Survival Kit

You cannot opt out since anyone can sue you for anything, and these days, they often do. At work or at play, at home or on the road, you are always vulnerable to legal attack. Our efforts are devoted to provide you the best advice and tools to avoid litigation and prevail if it should occur.

Insurance: Umbrella Liability Coverage to protect you from the lawyers on the prowl You should consider adding an umbrella liability policy to your homeowner’s policy immediately to protect you from unforeseen lawsuits. An annual additional liability policy of up to $1 million often costs no more than $100 per year. This not only protects you from additional losses should they occur, it also usually provides for the insurance company to cover and manage all legal costs and activities—so you can get on with your life in relative peace and quiet. Do it!

This Guide With Step-by-Step Advice Per Form We have provided you with this Guide in addition to step-by-step advice for each legal form. After each document, we have provided specific advice for that form or letter in a “review list”. This way, that advice is specific to the form and not over generalized here. Notwithstanding that, the following is generally useful when filling out the forms and letters. 1. Prepare and keep a separate document with the key facts pertaining to each individual and/or corporation and/or other entity you enter into these documents. For individuals, 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-

dren’s information, and so on and so on. 2. Set up a word document file where you save this information plus each form you create for later reference. If you wish to also keep this record elsewhere, do so too (duplication will only help you). You should also keep a hard copy file of signed documents and your key fact documents. 3. If you do not have a fire proof safe, get one and put these documents into them. The office supply stores (e.g., Staples, Office Max, and Office Depot, and their on line affiliates) have them and will usually deliver at no charge, so you don’t break your back carrying your safe home. They cost about $150 each. You can get them cemented into your basement or into your floor for extra protection. Do this too, if you can. 4. Review these forms and consider doing well care for yourself legally in advance of any prospective problems. This means doing proactive things you may not need immediately (important but not urgent, a category we all tend to ignore at our peril), such as wills, powers of attorney, trusts, medical instructions, and the like. If you don’t do them immediately, write out a schedule in which you will do them—and then do them. 5. Encourage other members of your immediate and extended family to do the same kinds of things. You will give them a great gift by doing so.

Action items: 1. Get additional umbrella liability insurance policy coverage. 2. Get a home safe.

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 therefore have a better sense of how to use these tools (i.e. the forms) to expedite and formulate agreements for themselves and their clients.

Clarence Darrow, the great trial lawyer, said this long ago. Justice Oliver Wendell Holmes admonished a participant in a particularly ugly case, “Do not make the mistake of confusing justice with the law.” Finally, one can complete that thought with Winston Churchill’s repeated comment, said in various contexts, that democracy, and the rule of law, although messy, is the fairest system people have yet invented. Our primary objective in this Guide, with illustrative audios, is to provide you with a broad background of the legal system and suggest the appropriate tools to use when dealing with the legal system in general and lawyers in particular. Our 600-form section is used by many practicing lawyers who, like you, can benefit from prepackaged forms that can be edited upon demand. Lawyers can do this more

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 of turning the matter over to an attorney will save them time and therefore save you money.

Audio One: Introduction

Tip: If you ever feel “concerned,” “worried,” or “uncertain” about anything discussed or presented in a legal form, that is your tip-off to contact a lawyer for clarification and implementation. Self-help forms should never be used unless you are entirely confident of your actions. We do not offer legal advice. We offer personal and business advice about how to interface with 5

www.simplymedia.com

Legal Survival Kit

the legal system and the lawyers within it. Our business advice to you is to select the form suitable to your needs. Then fill in the blanks, as you believe appropriate; and then have a lawyer review it. This approach will save you time, money, and permit the lawyer to focus on the legal issues, not the paperwork. If your lawyer advises against the form, take his or her advice.

This Guide or Survival Kit is intended to guide you through the legal thicket. The primary purpose is to inform you of your options, suggest pitfalls to avoid and opportunities to seek, as well as make you better informed when discussing these matters with an attorney when you believe it necessary.

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 business and personal advice in this CD-ROM. Not withstanding this restriction, we believe the most important part of the law relates to how individuals and corporations use the tools 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.

Did You Know? Japan, unlike the US, graduates more engineers each year than lawyers.

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 property. Once they realize the activity will be documented, they realize they have undertaken obligations of repayment or return of property that they never really intended to execute.

The most significant thing about a written agreement is that it clarifies what “you get” and what “they get”. The most practical benefit of a written agreement is that, unlike an oral contract, memory cannot alter the facts. On the simplest of levels, an agreement reminds us of what we agreed to in order to get 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 wanted. This may sound overly simplistic; but, in fact, most of us have wavering memories that favor our point of view; with the lapse of time it is much easier to forget our obligations to others. Written agreements identify these issues and can help resolve these problems. Furthermore, written agreements are often especially useful in personal situations because they clarify the terms of an exchange of money,

Written agreements are especially important among friends, family, or close associates because one of the best ways to lose a friend or other close associate is to loan him or her money or property. A written agreement at least allows you, them, and the world to see what the actual agreement was. In summary, then, written agreements are just as useful in personal as in professional or outside circumstances.

Audio Two: The Purpose of Written Agreement

Your Responsibilities To Others: What You Owe Them 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 other not recognizing their responsibilities under their agreement or agreements to the other party or parties. In simple terms, they did not understand or did not properly review what they had to pay or do to satisfy the other party. Often, once the bickering begins, both parties begin to point fingers at the other party and overlook their own responsibilities. This difficulty usually arises because one or both parties ignore the reason the other party signed the agreement in the first place. This reason is of “little” interest to the other party because this is not why “they” signed the agreement. However, if you wish to avoid legal problems, it is always imperative you understand the motivation of the other party so you can prevent legal conflict from arising.

Audio Three: What You Owe Them

Recommended approach: When conflict develops, identify what the other party wants. This often changes due to circumstances related to the parties or the environment as a whole. For example, in a poor economy, people and institutions get more desperate to get what they want; this often serves to inflame problems. Then determine if you can provide what they want in full or in part. At a minimum, discuss with the other party their interests in the contract. As you do this, they will usually become more amenable to discussing the issues you have with regard to the agreement. 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-

es and overreach on behalf of their clients. This stems from both their training to be vigorous advocates and their compensation methods which relate to billable hours, the more the merrier for them but not for you. Therefore, you are advised to seek out the other party independently and try to negotiate a revised approach to your dealings first. If a lawsuit breaks out, there will be time enough for the lawyers to try to settle the matter at a later date. Even after litigation has commenced, the best hopes for a negotiated settlement remain with the parties who have the most to gain from prompt resolution prior to extended litigation and trial. When conflict arises over an agreement, it is important to try to openly discuss this point as 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 bring yourself to do so emotionally. 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 vast majority of cases are settled prior to trial. Why? Because the litigation process usuallyconsumes more time, emotions, and money than the case is worth. Therefore, you are well advised to seek out advice about how to resolve these issues, such as we offer in our Negotiations Handbook and Conflict Resolution discs.

8 www.simplymedia.com

Legal Survival Kit

reassuring feeling if you are “relying” on a predictable outcome.

You Don’t Say

“

The essence of freedom is the legal right to be left alone

”

Justice William O. Douglas 1961

Justifications For Why You Will Win The Dispute Very rarely does anyone “win” a legal dispute. Both sides must hire and pay lawyers, who are the ones who win because they get paid. Most suits are settled for a walk a way (no one gets anything) or considerably less than they would have gotten if they had settled early in the dispute. In some plaintiff cases, against insurance companies for example, some legal positioning can be useful to establish the value of the case. Aside from this kind of suit, most legal suits such as in divorce, collection, or other contract matters, the parties would have been prudent to seek negotiating assistance instead of legal counsel. “My Lawyer-Friend-Associate Told Me We Would Win” People often “take away” this thought from discussions with various people. The more likely truth is that you were advised that you “could,” not “will,” win. Once the people in black robes (judges) get a hold of a case, you are in the legal gristmill and most results are uncertain. If you want proof of that uncertainty, remember how often cases are overturned on appeal. This means that another set of judges disagreed with the first group. Not a

On rare occasions, such as note collections, the results are indeed generally certain and you 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, defendant, you are usually better off with a 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 will prevent you from collection).

Tip:: Court is a poor place to win back points you could not obtain in initial contract negotiations. Interestingly, Court often works very well for a defendant trying to get out of a “gotcha” clause. “Intent” or what the parties “meant” is very important as a mitigating factor. Tricks and gotchas don’t help the plaintiff or stronger party in these matters as much as you might think; sometimes they do, of course. Better to use a “gotcha” clause as leverage to settle other issues. “They Have The Money And More At Stake; So They Must Settle On My Terms.” Those with the money are more apt to stand and fight than ever before. The days of insurance companies rolling over, for example, are long gone. The increase in litigation has reduced organizations and individuals’ fear of the process. In fact, the new conventional wisdom is if you don’t stand and fight, more people will attack you because of your own perceived weakness. Plaintiff lawyers went to the well once too often: individuals and companies have 9

www.simplymedia.com

Legal Survival Kit

learned. In a football analogy, the quarterback called this play once too often and now the defense is all over it!

Tip: Since you know settlements values are down, consider taking less. Splitting the difference is usually the best approach since neither side loses face. This is not legal advice; this is a quick practical approach.

Common Complaints In Disputes That Relate To The Problem Of Responsibility This section is about how you got into trouble. Understanding how you got there should help you get out this time and hopefully not fall into the same trap next time. This section describes the personal and business reasons why you got to where you are in a dispute. It is not about what the legal ramifications of your case or potential case are. Lawyers are paid, and paid well, to unscramble these messes. Our purpose here is to advise and forewarn you in advance of ways to avoid these conflicts, and their ultimate resolution through negotiation or the use of lawyers.

often the case in disputes. Payment terms are examples of such clauses. You may have agreed to pay them in 60 days, but wanted to pay in 90 days. What’s the big deal, you may have thought, if you pay just thirty days late? Well, in fact, their entire banking relationship may be in jeopardy if you do not pay within 60 days. Or, they may have been only able to set up their payment plans to their own vendors strictly based on their securing your firm written commitment to pay in 60 days, promptly. Note: This also may be part of the “gotcha” school of negotiating. One side tries to bludgeon the other into agreement on points they really do not want to accept or cannot live up to. You are much better off openly discussing these issues early and ensuring that the other party can live up to this part of the contract. It is one thing to get commitment on something they do not want to do, but can do. It is quite another to secure agreement on something they really cannot do. If this is understood early, you can often work around it. If you cannot work around it, you may be better off not making the agreement since it cannot be lived up to later. “But They Agreed To Do It!”

“That Wasn’t Why I Signed The Agreement.” When a dispute arises, many people say, “That wasn’t why I signed the Agreement.” They continue by saying, “That point isn’t important” or some other such comment. This may 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.

They may have agreed to do it. But, if you forced them into a corner, and they felt they had no other option, they may have signed the deal and hoped to renegotiate out of this point later.

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 points and got their commitment. They told you “we are going to have a hard time with that” but you pressed forward anyway, disregarding the flashing yellow lights. It is a lot harder to get out of an agreement than into one. Do not rely on a legal document to trap or compel the other party to live up to terms they have warned you are burdensome. You may eventually prevail in court. But you undoubtedly will have a lot of costs and heartburn along the way to this resolution, even if you achieve it. And, in the end, you may not collect on your judgment, even if you get it, due to defendant insolvency, being overruled on appeal, or for a host of other reasons. In fact, this uncovers a major weakness most lawyers have. They focus almost exclusively on a court victory, or a “judgment,” without giving proper weight to the probability of collection of an award, if granted. As a civilian, or nonlawyer, you should use your business skills to determine whether the defendant can in fact pay; has a habit or ability of wiggling out of judgments; and the like. In sum, a lot more judgments are granted than collections made. Before becoming a plaintiff, be sure you have a solvent defendant with a habit of paying when they lose.

Common Approaches in Disputes: Negotiations to Hardball tactics

Audio Four: Common Approaches That Can Help

What The Agreement Should Say For Your Benefit In adjudicating (deciding) a case, the Court first looks at exactly what the agreement states. The Court tries to interpret the agreement “strictly”, or according to what it actually says. Ambiguity is what the potential “loser” tends to emphasize. The potential winner focuses on the actual words, written terms, and conduct, and thereby seeks “strict construction” of the language. Short, to-the-point contracts help here. Well known “boiler plate” or standard language helps your case because the Court “knows” what it means. The longer the contract, the better the chance to find a loophole. So, why do lawyers write long contracts? Because they are paid by the hour and keep thinking they will “help” their client by piling on more language. Usually longer contracts tend to obscure the core agreement and, worse yet, often introduce contradictory language that defendant lawyers love to jump on and use against the plaintiff. As a defendant, pray for long contracts and as a plaintiff, fear them! Reconsider Your Position Rarely does anything work as well to calm tensions and set the tone for a solution than an apology and offer to the other side to reconsider 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. Start with reconsidering your objectives. If you want to keep doing business together, and/or keep the relationship in tact, then hardball 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 extinguished. Effort to extinguish conflict early can produce surprisingly good results for both parties.

If You Think Litigation is Inevitable, Get Advice Promptly It is under this circumstance that lawyers are the most useful. Your first step should be to consult your lawyer vigorously about options. Often the best solution is to file suit, or answer their complaint, and then, with both sides’ stakes in the ground, quickly move for a negotiation session to see if a resolution can be reached. Why? Because you have both proven how tough you are. Now you can see what can be done. Early compromise to avoid litigation is often seen as “weakness.” So, seeking a session after complaints, answers, and counterclaims have been filed, takes you out of this arena of perceived weakness.

If Inevitable, Invest In Your Initial Answer And Counterclaims Now is the time to plan your defense and counter-attack. Contrary to what many lawyers think, they are

not as “cute” or “subtle” as they think and often telegraph their intentions early on. If the other side starts out reasonably, you can often resolve the matter easily. If they start out tough, of the “hard ball” school of negotiations, you know that you have to prepare for litigation. Interesting point: Very few negotiations fall into the middle ground of balanced discussions and approaches. So, your challenge is to figure out whether you are dealing with reasonable or hardball people. Then you can proceed accordingly. Just because you are right or wrong up to this point, does not mean the trend will continue. You can make up a lot of lost ground by acting properly with regard to the agreement in dispute and noting how your opponent is not. The worse your case, the more important it is to mitigate your damages to minimize the ultimate negative result. It is no different than in sports situations. When your opponent gets ahead, they tend to get confident, forgetful, and lazy. In fact, the potential loser can use this human tendency to sit on the lead and be sloppy to reduce their ultimate damages and even pull out a victory in the end—just like a come behind win in sports!

Defensive Actions

You Don’t Say

“

The shortest distance between two points is rarely a straight line in the law. Deaver Brown, Author

”

This section deals with such actions as interpreting agreements and defending your interests with the most appropriate methods. This part also suggests ways for you to minimize and avoid expense, conflict, dissension, and trouble. Much Trouble Can Be Avoided Difficult neighbors, relatives, employees, bosses, subordinates, town boards, hazardous conditions, barking dogs, dangerous equipment, 12

www.simplymedia.com

Legal Survival Kit

teenagers on the loose, contracts, agreements, inheritances, or other relationships are everywhere in most of our lives. The best single piece of advice is given under the section in the text entitled your inalienable right to back up and away from problems. In many situations, you cannot simply run out the door or leave town. But you can reduce or mitigate your damages or problems by decoupling, 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 relationships, teenagers, or agreements. Over time, though, you can substantially adjust your activities and, essentially, duck. Small appeasements can go a long way. Turn down the radio or chain your dog for the neighbor. Praise the difficult relative to others so it gets back to them. Maneuver around to get a new boss or subordinate. Ease out the difficult employee. Resign from a troublesome town or nonprofit board or appease them. Give the big dog away or don’t get a new one. Make contingency plans for poor, weak, or onerous agreements, contracts, or settlements. Work on these issues continuously and you will be surprised at how they ease away or at least the decibel level is reduced.

tion agency, they are usually empowered to settle claims for at least 33% off the face value. Keep this in mind if you can settle the matter with cash. If not, keep reading.

Audio Five: So You Got a Legal Letter

If the letter is from a lawyer, it is usually from a collection lawyer who is also usually empowered to settle a claim for something less than face value. Good lawyers do not generally involve themselves in collection matters you would be involved in other than large corporate matters. So, you usually are not dealing with the A team here. If the letter is about anything but straightforward collections, and is not a simple request for information, or forbearance, such as keeping your dog chained up or quiet, complying with a zoning law, or other straightforward matters that you can promptly comply with if you so chose, then you need to consult a lawyer promptly for advice as to how to proceed. The Tough Guy Letter.

Visualize a simple image: It is a lot easier to dam up the Mississippi at the headwaters in Minnesota than when it is a mile wide in Missouri. Head off trouble early and you will benefit handsomely at a much lower cost. When Trouble Calls In The Form Of A Legal Letter Recognize and internalize immediately that you have already “lost” something because you are involved and were not able to head off the problem earlier. If the letter is from a collec-

This kind of letter details how bad it is going to be for you if you do not do everything they want you to immediately. This is a standard off-tackle play these days. It is well known. Even most lawyers don’t expect it to work very well since it has become so common and familiar. So this circumstance gives you one key advantage: the other side knows they are “lying” by saying it is worse than they will settle for. Therefore, you have the moral high ground and can use it to settle for less. 13

www.simplymedia.com

Legal Survival Kit

Collection Letter—Asset With a Lien Such As a Mortgage or Car Financing If it is about an asset they have a lien on such as your car or house, they have all the leverage and all the advantages. If you truly cannot pay, work out the best payment plan you can and contact them to see if it will be acceptable to them. If so, live up to it and try to regain your financial footing. If it is not acceptable to them, explain that you must now see a lawyer about how to deal with the problem. Ask them again, if they won’t reconsider their position. If so, wonderful; if not, get a lawyer. Remember that if you can pay, consider carefully exactly what you can pay and when you can do it. Virtually all of us “know” when we are late on a mortgage or car payment. You “know” the problem. Only you can determine whether you can get current, or up to date again, or not. If you can, or have a good chance of it, OK; deal. If not, see the lawyer. If in doubt, see a lawyer. At this stage, you do not want to commit to an unrealistic payment plan. If you do, and you break the plan, it will count against you with the collection agency or lawyer and they will only attack more vigorously on their next contact with you. When dis-

You Don’t Say

“

You can discover what your enemy fears most by observing the means he uses to frighten you. Eric Hoffer, Philosopher and Longshoreman

”

cussing with them what you “can” do, remind them of this problem of potential broken promises—and you do not want to go down that road nor do they want you to do so. That may help. If not, go back to the lawyer option again. Collection Letter—Unsecured Debt You have most of the advantages in this circumstance. They have no lien or asset to repossess. They must first use the court process to get a judgment that they can later convert into a lien. Then they can apply the lien to something you own. This is a long expensive process that no collection agent or lawyer wants to undertake. This is especially true since most of them are on contingency, which means they only get paid a percentage of what they collect. These circumstances provide you with substantial leverage to renegotiate your debt. If you haggle a bit, you can often reduce the face value of your debt, without accrued interest or fees, to 50% or less. Collection agencies generally get 25% to 50% of what they collect. So the firm that “owns” your debt has already given up to some extent. As a result, they are usually vulnerable to giving 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.

Tip: If you are having trouble with an unsecured debt such as a local contractor or a credit card bill, and believe a collection agent is in your future, consider a settlement for a partial payment with no bad impact on your credit history with the company in question. 50% to 75% will generally do it. Sometimes you can even set up a payment plan. If you don’t feel comfortable doing this 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 the bill. Pay the bill if you feel nervous. Otherwise, negotiate or see a lawyer. Collection Call Same situation as described in the collection letter sections above. When You Are Sued Get a lawyer—except for small claims court where you will usually do better answering complaints yourself. There are upper limits on the claims that can be brought against you in Small Claims court. These claims usually cannot exceed $2000. Therefore, the expense of hiring a lawyer usually exceeds the amount of the claim itself, making it more productive to do the claim yourself. Notwithstanding that fact, you can often do well to run your “defense” and potential “counterclaim” by your attorney to get their quick read on the matter. This small investment can often pay a substantial dividend for you in either negotiating your claim with an arbiter at small claims court or with the judge.

you can usually get a broad release—for even broader than the single claim—especially if you bring the check. The presence of a check will usually encourage the other side to take a lesser amount. Use this advice prudently and you should be able to save yourself some money in Small Claims court. They will usually let you try to work out the matter with an arbiter first, with you using the advice above. If that does not work out, you will be forced to present your case to the judge sitting in court that day and he or she will determine the outcome.

How Courts Approach And Interpret Agreements Courts check out two things prior to applying the laws to your case: What did the agreement state? What did the parties mean or intend?

Audio Seven: The Court’s Approach And Interpretation

Small Claims Court

Occasionally, Courts will decide to intervene promptly by providing an injunction or restraining order in the case of extreme behavior such as egregious conduct, over-reaching, or lawless activity. Although most litigants pray for relief (i.e. in layperson’s language, “ask for help and enforcement”) on these grounds, Courts are reluctant to enter into these types of immediate enforcement activities and generally do not act until a trial is conducted (or, as in most cases, the parties reach a settlement).

They will encourage you to negotiate. Take a check with you. No matter what the claim,

Venue, or place of the lawsuit, can be very important for these purposes. Law is politics,

Audio Six: PMI Thinking

Before you see a lawyer regarding litigation, write down the issues—their pluses, minuses, and interesting points. Be sure to line up the counter claims.

15 www.simplymedia.com

Legal Survival Kit

of course, as one can tell by a casual reading of newspapers. Just two examples: in a heavily Democratic state like Massachusetts, liberal causes such as those of tenants (the disadvantaged) will usually be heard with more favor than in a Republican state. In a Republican state, judges would be more likely to uphold the landlord (property rights). So, the court is more apt to make a finding in favor of a tenant in Massachusetts and a landlord in a Republican state. Action Item: In your agreement, be sure to establish the venue, or place for resolution, in the jurisdiction apt to be most favorable for your cause. In our case at Simply Media, we have locations in both Massachusetts and New Hampshire. For issues that the Democrats favor, we write in the venue as Massachusetts. For those that Republicans are apt to favor, we write in New Hampshire.

on this approach the most. Why? Because “What the Agreement Says” works against them. The best way to beat this approach is to use a short agreement with the Entirety of the Agreement clause; in layperson’s language this means, “If it isn’t written down here, it doesn’t apply, unless it is written down later and signed by both parties.” The recommended language for your agreements to cover these two issues (venue and intent) is: “This Agreement embodies and sets forth the full understanding and agreement between the parties. No change can be made except in writing and signed by both parties. Any disputes must be brought in__________city, in ________ county, ___________ state and in no other venue.”

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 relatives. It is not as obvious in the case of friends, business associates, and younger people without longer business and/or life experience.

Audio Eight: Agreements Between Friends

Financial and legal agreements between friends and relatives are the most challenging ones to discuss, create, and enforce. In your discussion of these subjects, you should use the document creation process as a means to flush out what the parties really mean. For example, a request for a loan or a rental is often just a plea for a gift. The requesting party may think that somehow, some day they will repay the grantor; but, in fact, they intend to receive the money or property and then unilaterally

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 to a productive solution. Commonly asked questions are: “Why do we need an agreement? “Don’t you trust me?” These lines tend to back us off. The natural response is to say, “No, I do trust you and....” The best answer is, “It has nothing to do with trust; it has to do with clarity. If we write it down, we will remember it clearly. Memories serve to change events; or, like the old game of whispering around the table, once a line is repeated several times it loses its original 17

www.simplymedia.com

Legal Survival Kit

meaning. And, of course, one of us might not even be around to explain the matter.” Often this kind of discussion causes the potential recipient to drop their demand entirely. Since they never really intended to repay the loan they have requested nor pay for the rental they wanted, they do not want to enter into a formal agreement so will often walk away from it entirely when confronted with your requirement to sign a formal agreement. Your best move is to give them room to retreat and avoid moral spin so they do not feel belittled and humiliated by the process and their own retreat. If the demand is not dropped, then you can put the request into standard promissory note or rental agreement format with the appropriate interest rates, repayment dates, collection expense recovery clauses, collateral backup, and the like. Under either alternative, you will be well ahead of the game. Our final suggestion, if you get to the point of negotiating this kind of agreement, is to request them to lay out all of the terms them-

You Don’t Say

“

Never make the mistake of confusing justice and the law. Justice Oliver Wendell Holmes, Jr. 1906

”

selves so they “own” the agreement and its repayment and collection terms. If they make a silly recommendation on a specific term or terms, usually just a lifted eyebrow will get the terms into the right “ballpark.” These arrangements are never easy and certainly worrisome. To minimize your potential financial and emotional losses in the matter, let the potential recipient set the terms initially so you have the least to haggle about. Then gird your loins as you go into battle to hammer out the most reasonable and prudent terms you can, always keeping in mind that if they “walk away” from the entire matter that is usually the best result.

Stock Investments with family, friends, and business associates As with family, friend, and business associate loans and rental agreements, businesses involving these kinds of parties should be formalized and stock certificates issued. It is especially important that stock agreements 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 the situation. The risks in family/friend/business associate loans and rentals, as well as stock investments, are due to the fact circumstances change (e.g., a shareholder wants his son or daughter to be employed by the company on the sole basis that they are a stockholder). Sometimes the party investing the initial or 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 administrators are involved. In one such case involving a family loan to my first company, a written promissory note documented in corporate records resulted in the loan being promptly repaid by the new owners right on schedule without intervention by any lawyer. This is just one example of how the written agreement can assist all parties without being abusive of any of them. One of the most contentious areas in family businesses relates to whom or which “side” will get plum corporate jobs and the accompanying pay scales. It is our experience and recommendation that initial stock agreements should expressly state that stock ownership is separate from corporate management. Dividends should be paid in cash not corporate jobs or, as is referred to in government perks, in pork. Finally, the stock agreements should provide for a straightforward exit position if contention breaks out and no one party has clear majority control. A buy sell agreement works well to establish a clear exit path should certain spec-

ified conditions take place such as no clear majority being in accord on a course of action. A second approach is to provide for an orderly sale process of the enterprise with the funds to be received divided up among the shareholders, if contention breaks out. Just the process of offering a company for sale often makes all of the parties more realistic if the offers received are far less than the insiders believe the company is “worth.” Buy sell agreements usually require this approach to establish fair market value, or what the company is “worth.” At that point, you should be able to negotiate a reasonably satisfactory buy/sell solution, as long as you had it in place to start with.

Tip: This kind of stockholder agreement requires the use of the best attorney you can afford to extract the facts, set up a suitable agreement, and provide a solid and agreeable exit position should the stockholders descend into contention. Since circumstances change rapidly these days, you are well advised to update your stockholder agreement and buy sell agreement on a regular basis. You should try to do this at least once every five years, if not more frequently.

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 collection process if something goes wrong. The best deal for the institution is really a note, a lien, and a simple agreement. More documents than that usually results in it appearing that the lending institution had an unreasonable amount of power and “forced” the agreement. 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.

Audio Nine: Business Agreements

Before drafting an Agreement, you should first establish a term sheet. Term sheets are an outline of a proposed agreement. These are useful to prepare before entering a negotiation so you know what you want, what you will accept, and what is your walk away position. The problem with contracts is they draw you into liabilities. The risk is primarily to the stronger party; and yet, interestingly, it is the stronger party that usually demands the agreement. Counter-intuitive but true.

If a lender or powerful party goes after you, watch your lawyer use the length of the agreement against them. Institutions never seem to learn this lesson. So, when someone owes you money, get a note, a lien (if possible), and a simple agreement. Again: Business advice. Unrealistic expectations lead to many problems. This is why many large companies refuse to deal with very small companies or individuals in many areas. They are rightfully fearful of the “intent of the parties” consequences of their actions or other extreme positions that the weaker party might charge them with and might just stick in Court. Term sheets tend to eliminate many of these problems by allowing you to work out carefully your options and then having a reference point when you get into the heat of negotiations. 20

www.simplymedia.com

Legal Survival Kit

The simpler the contract, the less likely a Court will ascribe “broad” relationships to it. On the other hand, long contracts suggest a substantial relationship and open you up potentially to very intrusive and expensive investigations in many Court encounters.

Tip: Every business agreement should have a well-defined exit position. You should aggressively seek a “give up” 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.

envelopes to give you the appearance of corporate respectability to go along with your formal incorporation. You can click here to order your new stationery at an affordable price (the same company does checks and stationery). You should set up a separate phone and fax line, as well as email address (under AOL it can just be another screen name), to give you the aura of being a going concern. In the corporate and legal world, appearance counts. So do it!

Incorporation Incorporation protects you personally from litigation. As long as you observe the proper corporate formalities, you can rarely be sued successfully on a personal basis. If you are named individually in such a suit, your lawyer can generally get you removed in a quite straightforward 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 personal.” So beware of contributing to the problem yourself.

Audio Ten: Personal Litigation

Personal litigation can be particularly nasty because it involves things and people so close to you. Boundary lines, wills, and divorces are infamous for their ugliness. You rarely hear about a nasty trademark or promissory note dispute. However, recently, more people have been taking these “personally” too. These only get “nasty”, in our experience, when the parties get personal.

Tip: Try to keep conflicts as impersonal as possible so you can heal the rift as soon www.simplymedia.com

Try to remove the personalities from the settlement or litigation process as soon as possible. A little humility here can go a long way. You can say such things as, “I am too personally involved in this as you may be too. Why don’t we get a different person on each side to deal with this.”

Warning: We have observed that lawyers are beginning to take their cases more personally too. At a minimum, do not let your lawyer do this. If the other lawyer does this, actual litigation will tend to uncover it and the Court may well see the bias that led the matter not to settle.

Boundary Line; Neighbor Disputes Business advice suggests selling and moving. No one wins these. They can be very bitter, debilitating, and linger for decades. Legal advice says you may win. Personal advice says Legal Survival Kit

22

You Don’t Say

“

The law cannot make a man love me, but it can keep him from lynching me, and I think that’s pretty important.

”

what they are thinking about, and indirectly about how you are doing with them. You may be surprised by what you hear. Try to correct what you can—which will lighten your load if a legal problem arises later.

Wills

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 tougherstronger-righter, and move on to other issues in your life. As one old time lawyer told me, “The worst legal problems are boundary lines and wills.” At least with wills, you have finality in that some conclusion will result and, to a large extent, you “know” your family. With neighbor problems, things can rapidly escalate out of control due to differing value systems and a lack of family bonds to cover over some of the bad feelings and disputes.

Even lawyers avoid making wills for themselves. Superstition is the major problem for most of us. We all need to get over it. Make the will. It may save people close to you tons of trouble later. Every family has stories about the great probate fight that centered on the piano stool, summer cottage, or other item loaded with personal memories and feelings.

Having said this, there are many things you can do to limit your exposure and upset. First, be polite and conciliatory without being a doormat. If a neighbor asks for something above the normal or outside of the context of your relationship, suggest that they reciprocate in some way so you can keep the relationship balanced. Tell them that you “are sure they want to keep balance in the relationship as well.”

Tip: In this age of divorce and remarriage, give your spouse half (usually legally required), set up trusts for your children for up to the other half (if the surviving spouse remarries your children become “step-children” and Cinderella told us all about how that works out) with the executor being a banker or third party. This is not about “trust.” This is business advice about human nature.

Secondly, keep your children, pets, friends, and cars off their property. This is an obvious point but many people just slough it off saying, “They don’t mind.” They may well be boiling inside and when the pot boils over you will not be happy. Third, engage and talk to them occasionally to calibrate what they are up to,

Also, do not put too much pressure on the process of drawing up a will by trying to anticipate all of the events for the rest of your life. In this fast changing world, drawing up a will every three to five years makes perfectly good sense. Most of the changes will be minor 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 or on every 5th reunion of a high school or college 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.

Divorce

Audio Twelve: Divorce

Use a form such as ours to draft your intent; give it to a lawyer to memorialize. It is important. Do it now, if you have not done it already.

Tip: Provide for an auction of all questionable value items. This is especially true for sentimental items. Everyone may “want” the piano stool Mom sat on. But no one may be willing to pay $10 for it out of his or her proceeds from the auction. The mechanism is to provide a final percentage division for all of these objects. Then each party can use their “percentage currency” to acquire what they want or bid above the limits with their own cash. This process usually works to turn down the heat and get the Estate liquidation process moving. It worked splendidly in my family to ward off battles over the silverware, furniture, and similar items.

Real Estate Trusts Real Estate trusts for your private residence or residences are a good idea in this litigious age. It means that litigants in other matters cannot “attach” a lien or prejudgment attachment against your property. It also tends to discourage plaintiff lawyers because it prevents the quick kill of an attachment against your property that they might be able to use to make you settle up on another matter entirely. As with estates or wills, fill out the forms but be sure to use a lawyer. These areas require indepth thought and experience to determine the best ways to proceed. Again, an ounce of prevention here can save you having to pay a pound in cure later.

Bookshelves would collapse if all the books published on divorce in just one year were stacked on them. Without taking sides, our business advice is to take note of the following:

Winners in Divorce The only definite winners are some female members of the upper middle class and upper class. They can make out well. Everyone else loses, especially lower and middle class women. Most divorces squabble about the kids. But, the kids become like Korea, and get battered and scarred, and 50 years later the Koreas are still not reunited. It only takes one person to start a fight, as Ogden Nash once said. So, above all, remember that you are entering treacherous territory here and must therefore be doubly cautious, vigilant, and careful.

Tips to the Losers (Except For Husbands Of The Winners) Go easy on each other. Otherwise the lawyers will get what little there is. Both sides may benefit from Court enforced child support. That way, the benefits both increase and decrease according to the actual received income of the parties. Split the property and move on, if you can. This is easier said than done because of all the emotion attached to the children, the property, and the old relationship itself. 24

www.simplymedia.com

Legal Survival Kit

Advice to the Former Husbands of Winners Understand you are going to lose. Do not make the mistake that many men do in this situation and be tempted to hold on to the soft assets and hard debts while giving up the hard assets and soft debts. You are better off selling and splitting most assets, especially the marital home. Then nothing lingers as long. If more husbands of winners forced the sale of the marital home, they would force the potential winner out of the old emotional zone and get them moving towards a new life. Make child support dependent on your annually earned actual income. Otherwise, if you lose your job, off to jail you may go—and this isn’t Monopoly, there is no $50 card here to get you out of jail. Some winners love to hear the jail door slam on their ex-husbands despite the consequences to the children and their relationship with their children.

children under 18, there is rarely a problem. Courts are tough on making people go back to work and “try” to earn a living (i.e. the potential winner). So the potential winners usually only score big-time when minor children are involved. If you have children near 18, consider long and hard whether you don’t want to wait until they are 18 before you start a divorce proceeding if you are one of these husbands.

Tips For the Winners This is one area lawyers perform magnificently. You need no advice from us other than to decide how much pain you wish to inflict. The power is yours. Joan Lunden had this happen to her. It changed her mind about this stuff after she was attacked—and got whacked. Before launching into such an attack yourself, you should read up on the Joan Lunden story. It might just get you to holster your weapons.

Try to limit child support to the shortest period 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 hockey. 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. This is also good business advice for any case where you are the potential big time loser. Always work to minimize the amount of the damage award and the time period you must keep paying. Try to keep your cool and remember that owing the money may be outrageous, but every little discount helps. Child (Mother) support is where the real potential problem is, not the division of community property. So if there are no minor

You Don’t Say

“

The law is only one of several imperfect ways of defending what is better in life against what is worse.

”

Vaclav Havel, Prime Minister and Playwright

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 Exposure

You can do a lot to protect yourself. The fact you are reading this is a major step forward. Let’s go over some things to help you.

Review Your Areas Of Exposure Exposure relates to what you or your spouse do. What your minor children do. Or what happens on, to, or with your property. Make a list relating to these three categories: what

Be sure to set up the basic protections such as a will, real estate trust (s) for your property (ies), business agreements, and other agreements related to your situation (e.g., health care stipulations). Be sure to get the home safe and umbrella liability policy referred to in the Background section.

Insurance The best rule for insurance is to insure for what you cannot afford to lose. Pay directly yourself what you can afford to lose—it is much cheaper in the long run. So, with car insurance, you are better off with a high collision 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 have to work at, and that is usually half the battle.

You Don’t Say

“

The defendant wants to hide the truth because he is generally guilty.

”

Alan Dershowitz, Trial Lawyer, 1982

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 eliminated, or at least limited, most of your liability.

getting large umbrella liability policies to cover extraordinary damages. In homeowners insurance, 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 policy 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 modified 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 examples that have worked for me:

One reason many people become more successful in business as they get older is they learn to give up, walk away, retreat, and not fight on most issues. If it is too hard to bust through the wall, they learn to walk around or away from it. If people are too difficult, they don’t work with them. What they do emotionally is distance themselves from trouble and troublesome situations. I have found this happening to me, as I get older. It is one of the enormous advantages of age. A question: If Stalin, Lenin, Hitler, Saddam, and various terrorists had been in their 70’s, do you think they would have done it to start with? Chinese leaders have been older. So far they haven’t attacked anyone except for Tibet in their own borders. Castro became pretty tame once he reached 65. Now that he is 75

You are a volunteer coach on a team; you have two or three children with difficult, interfering, 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 witnesses, 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 harder the next time. Result: You have one less problem in your life. They may just think twice before doing it again, especially if you do this in your home community. You are a boss and have a troublesome employee reporting to you. You can suggest giving up and say to your boss, “Look I can’t manage them; I don’t want to make it worse. Why don’t we move Sally-Billy before we have a real problem.” In business, bosses are terrified of being sued by employees. So, your humility should impress your boss and include him or her in the decision to take conservative action. Now, to whack the nail a little harder, you can say, “Look boss, let’s be smart. None of us is 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 worse yet rat us out?” Result: You are on record about the problem. If anything comes up later, you put everyone on notice. You have taken the heat off yourself no matter what the outcome. Interesting Point: None of these actions resolves the problem. That is a much more challenging enterprise and not the subject of this CD. Our Conflict Resolution and Negotiations Handbook discs address that process. In this case, you have merely mitigated the damages. As you get older, most people learn it is far more productive to mitigate damages than try to eliminate them. As Mark Twain said, “You can’t throw a bad habit out the window. You must coax it down the stairs.” You have a contract with a difficult personcompany-type. “I am sorry X, we just aren’t up to your standards. We need to move on.” Customers for Life by Carl Sewell describes “firing customers.” Organizations cannot withstand harsh treatment by the outside world. You must first protect people within the company 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.

All of this is easier said than done. However, it is good, solid business advice as to how to reduce future problems that could well turn into litigation. Remember: you have the inalienable right to retreat honorably and with all due haste. We strongly recommend you incorporate unilateral “give up” or exit clauses in all of your contracts, with or without cause. Consider putting in clauses, which we do, to give you the right to “quit” or “stop” without giving reasons. In retail they have a marvelous phrase for it, “Your first loss is your best loss.” In summary, when a situation is not working out well, one of your best options is an orderly retreat so you can focus your energies on a productive situation. It is all too easy to get caught up in the emotion of conflict. Better to move on to opportunity—unless, of course, you are a lawyer and then you get rewarded by more billable hours. However, you, as a civilian and nonlawyer, don’t want to be caught footing the bill for those billable hours.

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.

Audio Fourteen: Don’t Just Blame the Lawyers

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 tendency for people and organizations to sue each other. If you cannot settle an actual or potential lawsuit, be alert to your options to improve your position through “good faith dealings,” being vigilant about identifying their weaknesses, and get good legal help early. As the old saying goes, “An ounce of prevention is 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 perpetuating it. As we gradually take less personal 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 compensation 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