Contracts, In-House Counsel

Moonlighting: What’s the Big Deal?

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Lawyers are great at thinking small — small picture, that is. We’re awesome at details, however painstakingly minor. We sport the “grammar police” badge proudly, even though we know that it’s the dorkiest one out there (wait, except for the “I memorized all of the two-letter words in Scrabble” badge — that one’s slightly dorkier). We find nit-picky, meaningless, hypothetical debates to be “intellectually stimulating,” while the rest of the world sees them as a complete and utter waste of time. And it’s all good. Details are essential to the practice of law. But so is seeing the big picture.

A law firm associate friend once represented a bank on a loan in which the borrower later ended up missing a payment date. Upon learning of the missed payment, he promptly drafted a default notice. When he presented the default notice to the law firm partner, the partner’s reaction was, “Whoa, Nelly… hold on there — no way are we sending any default notice.”

The associate was thinking small picture — how dare the borrower miss a payment to his client! In full gunner mode, he proceeded to take steps to ensure that the bank was paid the monies due (and, by the way, now at a default interest rate — haha!). He was only trying to zealously represent his client, right? Right? The partner, on the other hand, was thinking big picture….

The partner knew that sending the borrower a default notice could automatically trigger cross-defaults in the borrower’s contracts with other parties. Depending on what provisions were in these other agreements, it was possible that sending a default notice could actually make it more difficult for the bank to get repaid. So yeah, that would be the opposite of good for the client.

The partner also understood that business is about relationships, not contracts. Protective contractual provisions aren’t there as a first line of defense. They’re there as a last resort to be used to lord over the other party in case the business relationship sours. They’re also there for leverage, meaning that the parties understand during the relationship who has the upper hand, for what, and when.

Let’s try following out the default notice scenario. Default notices don’t just get sent to some faceless employee in Accounting who’s responsible for sending out the checks or wires. They get forwarded to the general counsel, and often as high up as the president of the company, who then gets really ticked off at being interrupted from his office mini-putting green practice. There’s a flurry of fire-drill activity by many minions to assess the broader implications of the one-page scrap of paper. The president finally ends up phoning the executive at the bank to ask why in God’s name he sent a default notice instead of just calling him to have a conversation like a decent twin brother should.

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Once you’re in-house, learning to see the bigger picture is absolutely critical. You’ll basically want to retain that detail-oriented dorkiness, but balance it with a sophisticated sense of understanding that business people will try to work things out when problems arise, and would rather auction off their second nephew than read a contract again once it’s been executed.

One way to gain a bigger picture perspective at work is simple: ask questions. In the next installment of Moonlighting, we’ll take a look at some questions which help lawyers to see the bigger picture. What better way to learn how to handle a situation than by checking with those who have many more years of experience, expertise, and talent with such situations — with attorneys who have time and again proven themselves as true business-minded folks who think out of the box and solve problems? Or you could also just check with someone in your legal group — that works, too. However you choose to approach the situation, try to broaden your perspective with each issue you work on. This is true zealous representation of your client.

Susan Moon is an in-house attorney at a travel and hospitality company. Her opinions are her own and not those of her company. Also, the experiences Susan shares may include others’ experiences (many in-house friends insist on offering ideas for the blog). You can reach her at SusanMoonATL@gmail.com and follow her on Twitter at @SusanMoon.

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