The need for comprehensive contract

There can sometimes be resistance to having a comprehensive contract on the grounds* that it is unnecessary or too time-consuming* or that the negotiation of it creates bad feeling between the parties.

However, the reasons for having a properly drafted contract* include the following:

1. In changed economic circumstances, a company may be desperate*
to escape from a contract it made which is proving unprofitable — it may
instruct a lawyer to review the contract to find ambiguities* or "holes" in
the contract to enable it to renege* legally on its moral obligations;

2. A change in management of the other side may mean that a new manager
is in charge of the relationship — and he may be less inclined to deal with us
on a personal basis — he may become more legalistic* and start to look closely
at the words of the contract in order to exploit ambiguities, etc;

3. On a liquidation and winding-up* of the company, a liquidator has a
fiduciary duty* to the creditors of the company with which we concluded a
contract to make as large a recovery for them as possible. Therefore, he has a
positive obligation to exploit ambiguities in the contract made with our client
to reduce the insolvent* company's exposure to us and to sue us for any
technical breaches of the contract* even if we never anticipated that our actions
would be regarded as actionable at the time of signing, regardless of any¹
personal relationships, understanding between the businessmen, which are
now completely irrelevant* following the appointment of the liquidator, etc.

4. Businessmen by nature are not usually as cautious as lawyers, and
may be distracted by the effort of putting together the basis framework of
the deal*, and caught up in the general optimism which exists at the time of
signing, and so may not have given much thought to the problems which
may arise

Notes

on the grounds — на основании time-consuming — поглощающий время draft a contract — составлять контракт be desperate — отчаянно желать ambiguities — двусмысленности renege — отрекаться, изменять своему слову

legalistic — зд. более приверженный закону

winding up of the company - ликвидация компании

fiduciary duty — обязанности доверенного лица

insolvent — несостоятельный

breaches of the contract — нарушения контракта

irrelevant — не относящийся к делу

deal — сделка