Category: Substantive Legal Content

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Substantive Legal Content

The End of Days

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Photo by Pixabay at Pexels.

“Review this agreement and provide me with your comments” is usually the first introduction that young business lawyers are given to the topic of reviewing contracts and the sum total of the training that they receive about how to do it. So off we go and comment on the scourge of typographical errors, the horror of undefined terms, the frightening absence of the word “reasonable,” and of course, unforgivably sloppy cross-references.

Actually, there are a multitude of more important things to think about when you are reviewing contracts. One of them is how long the agreement is going to last, and that actually depends on three things. These are: (i) term; (ii) termination rights; and (iii) renewal rights.

read more about the length of contracts “The End of Days”
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Substantive Legal Content

Introducing The Dumbies

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Photo by Anna Shvets at Pexels.

Lawyers are avid fans of awards, so much so that they sometimes even pay to get them, which is a topic for another day.

I was thinking (because I have time to do that now that I am retired) that perhaps we should create a new award program which we could call the “Dumbies.”  We can award a prize for the dumbest clauses that lawyers regularly insert into commercial agreements.

read more to find out what the dumbest clause is “Introducing The Dumbies”
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Substantive Legal Content

Murray’s Rant About Rights of First Refusal

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Bob, Ted, Carol, and Alice own a company. They have a shareholder’s agreement. The only divorce mechanism is a right of first refusal (“ROFR”).

Bob wants out. He goes to Ted, Carol and Alice and asks them to buy his shares. They refuse. They tell him to use the ROFR.

read more about why rights of first refusal are useless “Murray’s Rant About Rights of First Refusal”
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Substantive Legal Content

Family Law and Family Business

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Photo by Avonne Stalling on Pixels.

Spouses often both own shares in a corporation that operates a family business, sometimes because they are both active participants in the business, and sometimes as part of an income splitting or creditor protection plan.

read more about shareholders agreements for family business “Family Law and Family Business”
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Substantive Legal Content

Danger Lurks in Dark Places and Purchase Orders

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Photo by Eva Elijas at Pexels

Here are some of the provisions which I have found lurking in purchase orders (a “PO”):

1.            The P.O. replaces every provision in the vendor’s quotation and invoice.

2.            The provisions of the P.O. include terms set out on the purchaser’s website, which the purchaser may change at any time. All changes will be binding on the vendor. It is the vendor’s responsibility to monitor the purchaser’s website to see which new terms have been imposed on it.

read more about purchase orders “Danger Lurks in Dark Places and Purchase Orders”
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Substantive Legal Content

More of Murray’s Musings on Family Business Succession

A large family.
Photo by Craig Adderley at Pexels

Leo Tolstoy said, “happy families are all alike; every unhappy family is unhappy in its own way.”

Mary Karr wrote: “a dysfunctional family is any family with more than one person in it.”

read more about unhappy families and business succession “More of Murray’s Musings on Family Business Succession”
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Substantive Legal Content

Murray’s Musings About Family Business Succession

A large family.
Photo by Craig Adderley at Pexels

I have many thoughts about family business succession. Here are a few of them:

read more about issues in family business succession “Murray’s Musings About Family Business Succession”
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Substantive Legal Content

Landlord Waivers

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Photo by Kaique Rocha at Pexels

Banks financing a borrower operating from leased premises typically ask for a waiver from the borrower’s landlord of certain rights under the borrower’s lease. Landlords typically either refuse to give the waiver, resulting in a reduction of the credit available from the bank, or negotiate the terms of the waiver, driving up legal costs for the borrower, who will usually pay the legal fees for three sets of lawyers – the borrower’s, the bank’s and the landlord’s.

Although very few borrowers do it, the best time for you to deal with this issue is when you sign or renew your lease. When the landlord wants your signature, ask the Landlord to agree to provide a waiver to your bank on reasonable terms whenever you are putting new credit arrangements in place.

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Substantive Legal Content

Yet Another Way for Business Lawyers to be Negligent

Mannequins with discount signs in a store window.
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Let’s say that you represent a 40% shareholder in a corporation. You are reviewing a shareholder’s agreement which says that in certain circumstances (death, disability, termination of employment) your client is required to sell his or her shares at fair market value. So far, so good.

read more about minority discounts “Yet Another Way for Business Lawyers to be Negligent”
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Substantive Legal Content

A Few Interesting (Sort of) Things About Interest

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Here is a conversation that I had with lawyers from time to time. I would provide in a contract that interest would be payable at 18% if my client was not paid on time.

read more about interest “A Few Interesting (Sort of) Things About Interest”