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Posted by on Jan 3, 2022 in Publications |

Welcoming in 2022 – COVID’s Lessons On Written Agreements

Welcoming in 2022 – COVID’s Lessons On Written Agreements

One item that is sure to be on many people’s minds as we head into 2022 with COVID still not in our rearview mirror is the concept of risk tolerance.

With COVID-19 looking like it is well on its way to becoming a permanent fixture, the notion of forever avoiding a COVID infection may soon become about as unrealistic as engaging in a lifelong effort to avoid catching a cold . This being the case, there is an increasing need for consideration of the following question: in what circumstances is the risk of being infected by COVID-19 going to be tolerable?

Much as we may have previously tried to avoid getting a cold before an important work event (that is, the timing of infection is a risk that is unacceptable to us) or kept our distance from someone coughing up a storm (that is, a specific situation is risky enough and/or the mitigating behavior is simple enough), we may eventually need to consider what activities are within our risk tolerance for COVID-19 for the rest of our lives, not just the next month. While making no attempt to opine on what those considerations should look like (we’re a law firm after all, not scientists or doctors), a similar evaluation applies to an issue much more at home in the legal field – written contracts.

Every day people choose to enter into oral agreements rather than written agreements. Sometimes it’s because the subject matter is too trivial (I’ll vacuum the house tomorrow if you do the laundry) while other times it may be a matter of practicality and timing (my kitchen just flooded, can you cover my shift and I’ll cover yours this weekend).

One situation known for creating legal issues, however, is when agreements are important enough to be put into writing but aren’t due solely to trust – e.g., trust that my friend will never cheat me or trust that my family will never be dishonest with me. The “we were partners for 25 years and I never imagined he’d cheat me so we never put an agreement in writing” scenario is unfortunately one many lawyers are familiar with and is one that often catches individuals off-guard because they never even considered there was risk involved in the first place.

But perhaps the best way to think of it is this: when it comes to business dealings, if you would require a written agreement for a stranger then you should probably require it for your friends and family precisely because for many people close friends and family aren’t even on the list of risks or threats. To analogize back to COVID, consider that the reason people were willing to visit with friends and family – but stayed miles away from strangers – during the lockdowns in 2020 was often not based on science or logic but rather the, sometimes incorrect, assumption that friends and family were safe and strangers were dangerous.

To be clear, written contracts are not magic nor are they self-enforcing. Written contracts can and are breached on a regular basis and when they are breached, the injured party will likely be required to take legal actions to enforce their rights under the contract – after all, if the party on the other side of the contract deliberately breached its contract obligations, it is unlikely to have a change of heart and volunteer to fix the damages. However, written contracts, if well-written, can better avoid the ambiguities, uncertainties, and lack of details often inherent in oral agreements.

In addition, the existence of a written contract is powerful evidence if a lawsuit becomes necessary and the power of a written contract can sometimes be enough to prevent it from being breached in the first place. More importantly, perhaps, is that the existence of a written contract can serve to protect those important friendships and familial relationships from being destroyed by business or legal fights that could have stemmed from the uncertainty of an oral agreement. And if the last two years have taught us anything, risking these crucial relationships is rarely worth it.