Lawyers as deadweight loss, Part I
Lawyers, like everyone else working for a business, need to add value. I see so much legal work, however, that adds no value whatsoever. The economics term for it is “deadweight loss.” The client might as well just take out a few hundred-dollar bills and burn them.
This blog post is the first of what is sure to be a long series, shining light on things lawyers do, large and small, that are a complete waste of time.
Lawyers as a group too often ignore common sense, focus on form over substance, and fail to weigh the costs of an activity against its benefits. We have to get back to using good judgment, focusing on what’s really important, and abandoning the false idea that there is no risk too small to beat to death.
In any event, everyone should be able to agree that if language in a contract is meaningless, then it shouldn’t be there. With this idea in mind, here’s a section of an agreement that I just reviewed for a client:
The Parties further agree that the provisions of HIPAA and the HITECH Act that apply to Business Associates and that are required to be incorporated by reference in a Business Associate agreement are incorporated into this Agreement between the Parties as if set forth in this Agreement in their entirety and are effective as of the Applicable Effective Date.
I hardly know where to start. The drafter is saying that there are sections of HIPAA and the HITECH Act (federal laws) that are required to be incorporated by reference into this agreement. But rather than actually making the specific reference to those provisions (i.e., by citing the appropriate sections of the Federal Register), the drafter writes, in effect, “We agree to pretend that those provisions that are supposed to be cited here are actually cited here.” Clearly, however, if the law requires you to reference to certain provisions, then to comply with the law, you have to do that.
This is mindless, lazy lawyering. The words may as well not be there, because they don’t mean anything. They add no value. No lawyer should have been paid a dime to write them.