The Power of the Pen

There’s a concept in contracting called the Power of the Pen. What it means is that there’s an advantage to have your counsel prepare the document because little nuances can make big differences.

When I draft a contract, I can insert all the key provisions that are vital to the transaction. On the other hand, when I review an agreement that I didn’t draft, it limits my comments to some degree.

Recently after I was very thorough in my review, my client balked at the extent of the redline. He thought that I “took them to the cleaners” and was afraid the whole deal would fall apart. It didn’t, but my client was stressed out about it until it got smoothed over. That wouldn't happen had we done the first draft.

It's totally understandable to be both thrilled and nervous about an upcoming deal. But if the other side is trying to control the process, it may be because being first in line is an advantage.