05/05/2010 11:29:00 AM EST
On Adam Smith Esq. and “Good Enough”
A recent Adam Smith, Esq. column raises the critical question around "good enough" cost-limited legal work: What happens when something goes wrong?
He titles it The Coming Debate Over Defining "Quality." I think it's a debate the industry needs to have, and isn't having yet. Indeed, we discussed this question in my recent Master Class on Legal Project Management; I expect it to come up more often.
I started to comment on his post, and then ran into a technical glitch. Thus I'll comment over here instead.
Any business decision contains risk, and good decision-makers build risk premiums into the overall cost analysis. Why is it not reasonable to sign a work agreement in the legal arena recognizing and accepting risk? We do it everywhere else.
The Earthquake Model
For example, my home insurance excludes earthquake damage. Both the insurer and I recognize the limits of the coverage. Because I live in an earthquake zone, I can - and do - choose to purchase separate earthquake coverage.
Earthquake coverage in Seattle is seemingly expensive, even with a big deductible. To me, that makes sense; we don't know enough about earthquakes in Seattle to establish probabilities of occurrence and of damage.*
Translating Business Experience to the Legal World
Agreements to engage legal services are negotiations between two highly competent and knowledgeable parties. Why can't they include a definition of "good enough" that makes clear the quid pro quo of less money/less depth?
Is there enough legal history to establish probabilities of damage? I don't know; it likely depends on the area under consideration. That said, every business deals with unpredictable risks all the time; they make reasonable assumptions, usually with a lot of input and varied thinking, and then move forward. They're not paralyzed by risk, nor do they ignore it.
Read more on the Lexician Blog.