ABA Section of Business Law
Business Law Today
March/April 1999
A new dimension
Preventive law: An idea whose time has come
By ED DIETEL and DICK LYNCH
Dietel, former deputy general counsel of the CIA, now serves as an independent consultant in Bethesda, Md. Lynch recently retired as the director of the ABA’s Government and Public Sector Lawyers Division and was the author of an ABA-wide study on the practice of preventive law. He’s now in Shepherdstown, W.V.
If your practice is only one of meeting a client’s needs after something bad has happened, maybe you and your client need to rethink things a bit.
Preventive law is practicing in a way designed to anticipate — and hence avoid — legal problems. It is something more lawyers should explore. As Yogi Berra said, "Predictions are difficult, especially about the future." But for lawyers, we submit that certain predictions — even those about the future — are not difficult at all. Indeed, whether we practice as corporate, government, private or sole practitioners, we know that certain things are inevitable. Sooner or later corporations will merge or reorganize; sooner or later disasters or crises will strike most communities; and, sooner or later individual clients will die or become incapacitated. What kind of lawyer would devote thought to those events only after the fact? The answer should be obvious: not a very smart lawyer.
In contrast, a smart government lawyer in South Florida, for example, would make certain that his office had a hurricane disaster plan. A smart corporate lawyer in Southern California would do all possible to have an earthquake disaster plan covering the foreseeable corporate consequences of such a disaster — including scenarios regarding liquidation of assets, acquisition of other companies and so forth. And a smart solo or small firm practitioner in any part of the country would go out of her way to see that her clients had wills, executed medical powers of attorney, and so forth. Call that, if you will, crisis planning and management, continuous improvement, total quality management, reengineering, due diligence, or scenario analysis. Call it one of those fancy terms if you wish. We call it preventive law — common legal sense for the end of this century and the start of the next.
As lawyers, most of us were trained to be backwards analyzers. That is, when a client comes to our office or when a case lands on our desk, it is generally fair to assume that something — and frequently something bad — has already happened. And that is why the client is sitting there or why the case file is lying there. We then work backwards in time to determine who did what to whom — and when. Assume for the sake of this exercise that you, the reader, are a city attorney and that what has struck your office and your community is a full blown, major earthquake, a flood, a major series of chemical explosions, a bombing incident like the one in Oklahoma City or a pandemic caused by toxins in the air or water.
After assuming that one of these disasters has befallen your community, also assume for whatever reason that neither your office nor your city government has a disaster response plan. Phone lines are out; major roads have been cut off; bridges are down; and the hospital’s auxiliary generators have been destroyed. Just begin to contemplate — if you can — what you should do first.
Had you made that up-front investment of time and thought, you could consult your disaster response plan and know exactly what you should do first now that a catastrophe has hit your community. At the very least, you would have a plan that had been developed under calmer conditions. You wouldn’t have to try to think while turmoil swirls around you. An appropriate disaster response plan would have collected the individual insights of its architects and translated them into institutional action. As you imagine the situation, we will wager that you wish now that your office had developed a disaster response plan.
Basically, practicing what one might call "preventive law" requires the lawyer to engage in anticipatory thinking. What will the future hold? More important, what will the future hold that one’s clients would like to avoid? In the insurance field, we would probably call this risk analysis and management. And it is really no different in our field. Many lawyers have practices in estate and tax planning and become experts in anticipating certain legal consequences of commercial transactions and natural phenomena. Similarly, family lawyers know that their clients, and their clients’ families, will generally benefit from having wills and living wills. Corporate lawyers anticipate the consequences of mergers and other forms of corporate reorganization. City attorneys, in concert with other planners, help develop disaster or crisis response plans. In brief, lawyers do not need to be "lucky," or to possess extra-sensory perception in order to offer "anticipatory protections" to their clients.
The first rule for practicing more preventively is to affirmatively and actively assess your practice to evaluate where you might productively increase this portion of your practice. Practicing preventively is not particularly difficult, but it does not just naturally happen. Affirmative attention to this way of practicing is a necessity. For example, a day or two out of the office devoted to a detailed annual preventive law audit and review of your practice can be enormously productive.
In order for lawyers to appreciate the extent to which risk management should be part of most law practices, we should spend a few moments considering how risk management (a.k.a. "preventive law") masquerades under other names. Here are a few:
Crisis planning and management. Crisis planning lowers organizational stress and allows rational consensus building regarding the best means for responding to crisis situations. The process enables people to think about catastrophic situations. Good crisis planning may actually lead to crisis avoidance or, at least, to minimizing the effect of crises.
Reengineering. An in-vogue term connoting internal organizational efforts to improve products or services, reduce costs, heighten efficiency and better serve an institution’s constituents or customers.
Total quality management. Like continuous improvement, this focuses on how our products and services should and can be made better, or of higher quality. The goal of zero defects is a cornerstone of the TQM concept.
Continuous improvement. Continuous improvement includes the concept of quality improvement, but also looks at what we should be making or providing instead of what we are making or providing today. For example, if our corporation’s state-of-the art "X5C302 Radial Hydrographic Spectrometer" now has a monopoly position in the market, what happens when someone invents the "Digital Oscillating Spectrometer" that performs 20 critical needed functions that the X5C302 doesn’t?
The process of continuous improvement avoids the negative and reactive problem-solving mentality and substitutes the positive practice approach of improving processes continuously, through assertive leadership and quality improvement efforts. As in all these management areas, risk management (a.k.a. preventive law) addresses issues before they become problems. It is not being willing to be satisfied with any success that might be achieved because any success is merely momentary. Success should be appreciated and rewarding, but it should not blind us to the fact that greater achievement and even greater rewards are possible.
The second rule of practicing more preventively is to review these risk-management concepts that are masked as preventive law when you are delivering legal services that a client needs on a particular matter. Also this review process can be useful in reviewing closed client files to determine how these concepts might even now be used to better a client’s position even after a particular matter has been completed or concluded.
The point is that any lawyer can supplement and improve his or her practice with preventive techniques that have been traditionally thought of as other management processes. But no matter what label we may put on it, practicing law as if one were a risk manager requires plenty of forethought and creativity. None of us has a crystal ball, but we can all learn to anticipate future events. Practicing preventively to avoid — or at least to minimize — damage, instead of reacting to catastrophic events once they have occurred, represent polar extremes. We can liken those extremes to the differences between leadership and management. Managing an organization is problem solving and managers often spend considerable time just trying to "make things go away." In contrast, leadership requires creativity and leaders spend a good deal of time bringing something new into existence.
Exploring the subject of how to expand a practice by practicing more preventive law can be done by integrating into a practice the mindset of practicing preventively. Nathaniel Branden, Taking Responsibility (Simon & Schuster, 1996), says that leaders inspire self-responsibility in others by:
- being proactive rather than reactive;
- manifesting a high level of consciousness, focus and purpose;
- taking responsibility for every choice, decision and action without blaming or finding alibis;
- being fully accountable for all promises and commitments made;
- being clear on what is and is not within his or her power;
- being task-focused rather than focused on self-aggrandizement;
- being results-focused rather than turf-protecting;
- being able to bounce back from defeat, setbacks or adversity and continue moving toward goals, rather than surrendering to despair; and
- demonstrating an unmistakable commitment to facing reality, whether pleasant or unpleasant.
These nine qualities represent an excellent description of the mindset needed to successfully practice preventive law. And each quality can lead a lawyer to discover any number of specific improvements that he or she can make to their practice where problems are better anticipated and either solved in advance or completely avoided.
Bringing these generalities down to specifics leads to the third and fourth rules of practicing more preventively. Lawyers should regularly think about where changes in the law may affect the business of their clients, particularly with respect to the legal services previously rendered. Where have these changes in the law affected how the client now operates? And where do changes in the client’s operating environment affect the legality of those operations?
Many firms are heavily engaged in marketing their legal services. Some of the creative marketing efforts used involve research designed to analyze business data to determine new areas where legal services may be needed. These in-depth market analyses aimed at uncovering future legal problem areas are — in fact — examples of preventive law analysis. Firms as well as government and public sector law offices can, and should, use this kind of forward-looking analysis on an annual "legal health checkup" basis. During this century — and especially the latter half of the century — Americans have benefited greatly from the practice of preventive medicine. Most Americans — managers and workers alike — have become accustomed to an annual physical checkup. It is during those annual examinations that many problems are detected by doctors. Most of us know that early detection greatly increases the chances of a cure or at least of successful treatment that minimizes the effects of disease or defect.
The same, we submit, applies to the legal field. Like an annual physical, an annual "legal audit" can detect problems before those problems become major impediments that threaten the livelihood of one’s client whether that client be a corporation, a small business, a government entity or — indeed — a family.
The fifth rule of practicing more preventively is for a lawyer to ask himself or herself what is the rational or "common sense" solution to the client’s problem or potential problem. As lawyers, we need to look more broadly and not be trapped by the "green eye-shade" mentality of our profession, but also look for and try to apply the solution that seems rationally "right" and fair for the situation.
There shouldn’t be much doubt as we head into the 21st century that preventing lawsuits is going to be big business. In our opinion, the practice of preventive law applies to virtually every legal specialty. Practicing preventively means that we, as counselors and advisers, ask "what can we do today as lawyers to prevent problems from ensnaring our clients tomorrow." And that is what much, if not most, of the practice of law should be about.
Getting specific
Here are some specific steps you can take to implement a preventive law approach in your practice:- At least once a year, review your legal work to determine what you could have -- should have -- done in a preventive capacity;
- Review client files to assess what you could have done to avoid or prevent the reactive, defensive work done for those clients;
- Review changes in the law that will require preventive actions for your clients;
- Review all previous preventive law work to determine which portions, if any, need to be changed or updated; and,
- Take off your lawyer’s hat and try to think in broad terms as you anticipate societal changes that may affect your clients. Such changes may require new preventive measures.
