The American legal system is founded on precedent. The Latin version of this term is stare decisis which translates to “to stand by things decided.” The idea is to promote the evenhanded, predictable, and consistent development of legal principles, foster reliance on judicial decisions, and contribute to the actual and perceived integrity of the judicial process.
The frequency with which we used to throw around the word “unprecedented” is likely to diminish following the distant but inevitable conclusion of the COVID-19 global pandemic. While its colloquial use typically would apply to individuals’ ready recollection, we have come to understand the true depth and terror of the word – meaning that there is literally no previous instance or anything even close, not only in our lifetimes, but in any modern history. As humans, we have been recording our histories, both small and large, to avoid the need to solve unprecedented problems. And we’re all familiar with George Santayana’s old saw about those “who cannot remember the past” being “condemned to repeat it.” For lawyers, however, the lack of precedent is far more chilling and important.
Even if we could take a detailed look back to 1918 for guidance (notwithstanding the material differences between that pandemic and the present one) the legal system in the early 20th century bears scant resemblance to today’s, particularly when it comes to the complexity of contracts and corporate governance, not to mention that it pre-dates the development of the limited liability company by almost sixty (60) years.
When faced with an “unprecedented” situation, transactional attorneys are forced to “scratch draft” or to create new structures, language and provisions to accommodate the new circumstance(s). This incredibly challenging skill has fallen out of favor and few modern attorneys are capable, and even fewer are comfortable with, the development of new language. For those that are, they are able (and commonly prefer) to take on truly new challenges. The COVID-19 pandemic presents just such a situation and challenge.
While the business end of much of the modern commercial economy begins its slow and long recovery, the behind-the-scenes work has continued nearly unabated. As time passes, contracts toll, payments lapse, and interest accrues, and all of it must be dealt with, even if that’s sometime in the future. However, accounts payable do not age like wine, and the businesses that successfully navigate this pandemic and the resultant economic shutdown will be the ones who actively sought solutions to these issues during the pandemic and not those who simply “wait it out” at home.
NOTE: To be clear, taking action during this time does not mean violating government shelter-in-place orders or social distancing guidance – both for which we are strong advocates.
Of course, creativity, on its own, does little to inspire confidence during times of crisis, and while creativity is uncommon in professionals, there is no guaranty that it coincides with expertise and experience, which it must for efficacy during times like these. The combination of experience and expertise with a creative approach to problem solving is precisely what is needed for businesses to adapt and succeed during this extraordinary time. Anyone promoting solutions before they have heard your problems is likely not someone that you should be listening to. Unprecedented problems call for new solutions, and a new approach to solving those problems. When you work with a creative and experienced team of professionals, you can expect the first and most important step of their process is to listen to you and make certain they understand your problems. Otherwise, you may be paying modern day prices for a 1918 solution.