On my way to the courthouse the other day I answered a referral to a new client who had a disagreement with another party about their failure to honor a contract. The potential client filled me in on the details and then left me with this statement: “I just want to be clear that I will work this case out under no circumstances. I want every penny, but it’s not about the money … It’s a matter of principle.”
I’m sure you’ve had those conversations where someone says a certain word and the alarm bells go off in your head. For me, one of those words is “principle.” In 24 years of negotiating and litigating commercial disputes, I hardly believe the cry of “principle” any more.
Usually, it is about the money; or about something else that the party isn’t revealing at the time. Whatever the reasons may be, I get nervous when I hear about principle. I’m not so sure people understand when to legitimately stand on principle. Here’s my take on when you should:
Stand on principle when you’re asked to violate your morals, conscience or values to gain an advantage.
You should never violate your conscience to somehow prevail in a legal case. But most of the cases I've seen have nothing to do with this. In a fairly long legal career in which I’ve handled thousands of business disputes, I can only think of a few instances where a party was called upon to trash their personal values, and had to take the high ground, as a matter of principle.
Mostly what I encounter is anger, frustration or vengefulness disguised as principle. “He did this to me, so I’m going to do it back. Double!” I learned a long time ago, that parties are rarely 100% right. Even if it’s 99% that means there’s 1% common ground to work with. It’s a start.
Stand on principle when you have to break the law to win.
I’ve seen parties make this foolish decision. You should always say a resounding “No” to breaking the law. You may “win” your case, but lose everything else. Don’t get me wrong. I don’t mean “breaking the law” like Rosa Parks did. She truly stood on principle! She broke an unjust law. I mean breaking the law for your personal gain. This is when you should stand on principle.
Stand on principle when your actions will promote fairness and justice for others.
I’ve often reflected that one of the true blessings of our great country can be twisted into what seems like a curse: Open access to the courts. On the bright side, all Americans have an open forum for redress of legal grievances. On the dark side, all Americans (including the abusers) have an open forum for redress of legal grievances.
Thus, our legal system has the inherent capability to be used by some as a weapon, not as a shield. There are times when we must stand on principle, and not cave under any circumstances, to make sure wrongs are righted, justice prevails and positive precedent is set for future generations.
The issues that I encounter in a commercial context rarely fit any of these categories. They are usually legal disputes that should be assessed with a few mitigating factors in mind:
Legal costs and expenses. How much will proving you are “right” cost? Absent one of the reasons above, is it worth it? I’ve seen many come up empty.
Opportunity costs. What is the true cost of litigation, in terms of time, money and human capital? Is 50% today better than 25% three years from now? How about zero %?
Finality. How do you measure the value of having a disruptive controversy removed from your life? What is the cost of that? A heart attack …?
Well, you probably guessed that I didn’t take the case. I realized that my potential client was just angry, not principled.
I’m sure that I’ll see him some day down at the courthouse; a place where guys like him spend a lot of time.
Precious time that will never be recouped.
The Gill Law Firm focuses its practice on commercial debt recovery, small business and nonprofit startups. Contact us at 561-454-0301 or email@example.com.