Trust, Verify and Warranties?

They seem like a lawyers’ nightmare version of the Three Graces. Not Charm, Beauty and Creativity, but Trust, Verify and Warranties.

When you are entering into a contract with someone, to what extent do you rely on trusting that person or organisation? Do you do any due diligence or ask the person to supply information? Do you rely on contractual promises that give you a remedy in the courts if the promises are not met?

In one-off transactions such as buying a house or business, due diligence (searches and enquiries) and warranties may be more important than trust. In relational contracts, such as R&D collaboration agreements, trust may be a greater priority.

A similar, but different, set of questions seems to operate when hiring a law firm. You may want competence, a good working relationship and to trust the lawyers (to act in your interests, charge a fair price, etc) but which of these qualities is most important to you? For bet-the-company transactions, the relationship may be less important than reliability and reputation. Or so it seems, if the culture of some large, commercial law firms is a reliable guide.

In the past, clients have complimented IP Draughts on his ‘personal’ approach; by implication, other lawyers and firms that those clients have used have had a different approach. But perhaps his approach is more suited to the type of work that he does – mostly relational contracts for long-term clients.

In passing, IP Draughts can’t resist mentioning one of his bugbears: the procurement process when applied to legal services. In IP Draughts’ experience, the process typically fails to tackle the important issues of competence and relationships, and its approach to trust is essentially one of replacing it with tough contract terms.

These thoughts are prompted by two recent events. Today, he came across a TED talk that someone he knows (and trusts) recommended. The talk is by a Harvard professor, Frances Frei, and is on the subject: How to Build (and Rebuild) Trust. She recounts her experience of working with Uber, and  considers their corporate culture. She breaks the subject of trust down into three components: logic, empathy and authenticity. The presence or absence of all of these elements affects whether you are trusted.

This is not dissimilar to another formula that IP Draughts has heard in the past, that you trust someone (e.g. a chair of a meeting) if they demonstrate both competence and warmth.

Yet another formulation comes from a 5-day course on mediation skills that IP Draughts attended a week ago. The course was run by the Centre for Effective Dispute Resolution (CEDR), the leading provider of mediation services in the UK. During the final two days of the course, IP Draughts and his fellow students were assessed against six ‘competencies’, during role-play exercises. It was all very intensive!

More on the course itself in future blog postings. For now, IP Draughts wants to focus on the six areas of competence, which came under three themes: rapport, process and content.

The competencies involve a mixture of hard (analytical, process-driven) and soft (human interaction) skills. Building rapport and trust requires empathy and authenticity. The process element seems more like the ‘logic’ discussed in the TED talk. The content element is really a mixture – as a mediator you should be helping the parties to find their own solution rather than finding or advocating one yourself, and this involves both soft and hard skills. During the role play, IP Draughts subconsciously fell into the trap of steering the parties towards his solution. He will watch out for this, in future.

Ultimately, mediation is probably more soft than hard skills, whereas the practice of law is probably more hard than soft skills. More than one person on the course used the term ‘touchy-feely’, usually when he was – how can we put this non-judgmentally – developing his skills on the relational aspect of a mediator’s role.

Legal training emphasises the hard skills, and of course these are important. But the really good lawyer will have a mixture of hard and soft skills. The latter are mostly learnt by experience, and occasionally in training, such as on negotiation skills courses. IP Draughts is coming to the conclusion that there should be more training for lawyers in soft skills, which could be through attending a mediation skills course.



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Filed under Commercial negotiation, Legal practice

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