Are there any do-overs in corporate law?
Professor Jeswald Salacuse writes in Harvard Working Knowledge on the subject of renegotiation–needed perhaps because an agreement could be improved or circumstances that have changed.
Any lawyer with an active transactional practice can tell you 3 things that would be different today if there could be another kick at that contract finalized yesterday.
The good professor offers 4 things to do before the deal breaks down and a healthy 7 things to consider after. One of my favorites in the post-break down phase is number 1–avoiding hostility. Is there any among us who hasn’t had a client who wants to “teach them a lesson” or “fight to the last” or the one I fear most–“this thing is a matter of principle.” Clients who think they want to fight over principle feel a bit different the day before their deposition is taken. They start to feel way different the day before they are to testify at trial.
For large disputes, I like to let a law firm involved in the transaction know that they will likely not be the firm involved in the litigation.
What this issue ultimately comes down to on mission-critical agreements is that you have to choose counterparties partly on integrity–are they in it for a long-term relationship or a short-term win? The former become valued business partners, the latter become plaintiffs.