It happens quite often that lawyers are branded the “spoilers” and the “deal breakers”; that they cause business deals to be aborted by letting legal issues cloud business goals and commercial imperatives. Being your lawyer, our responsibility is to protect your legal position. When business imperatives prevent us from protecting your interests fully, we bring awareness of the risks to the forefront so that your business decisions are always INFORMED decisions; made with full knowledge of the risks involved. Our approach: Better to go in with your Eyes Wide Open, than to Plunge in Blindly, Hoping for the Best. While we cannot insure you against business risks, we always have your best interest at heart.
Here is a cautionary tale – believe us when we tell you that it happens more often than we like, to the best and worst of our clients.
Our client was very excited about the prospect of new business through a joint venture with another company. The joint venture partner was owned and operated by friends whom they knew well. Negotiations were conducted cordially over lunch and dinner. Being a lawyer (as always) looking out for our clients, we proposed to draw up a simple “joint venture contract” setting out the agreement reached by our client and their friends on the scope of each parties’ contributions, responsibilities and share of profits.
When presented with the contract, their friends were livid; they called our client to say that the contract is inaccurate and that the lawyer is misinformed, misleading and missing the point. In fact, they claimed to have been insulted that our client even consulted a lawyer for what was, essentially, a venture between good friends based on mutual trust and friendship.
They were, in short, not prepared to sign any contract.
Our client wanted the new business enough to forgo “the legalities” – which was how our efforts had been belittled by their new joint venture partners. Barely six months into the new business, our client was back in our office. Not because he wanted to sue his joint venture partners for not making good on their verbal promises (this came later), but because they were now facing a court action by third parties seeking compensation for failure to deliver on services which were the responsibility of their joint venture partners.
The information contained here is only intended to provide general information on the subject covered. Nothing in this publication should be regarded as constituting legal advice concerning any particular business, operational or other situations with which you might be faced. Further, the law may have changed since first publication and the reader is cautioned accordingly. Please seek professional advice before taking any action.
Chris Chua & Associates LLC
Chris Chua & Associates LLC is a limited liability law corporation with unique entity number: 201826324Z and regulated by the Ministry of Law, Singapore, license number: LSRA/LLC/2018/00019. Its registered office and principal place of business is at 138 Robinson Road, #10-04 Oxley Towers, Singapore 068906.
Based in Singapore, we advise both local and international clients who wish to expand and preserve their business interests and wealth. Our Firm has assisted corporations in establishing and structuring new investments and business ventures in different sectors. We think beyond obvious legal issues and come up with pragmatic solutions to challenging commercial problems.