Your business has been jilted…by a vendor, or a customer, or a competitor, or a government agency. Somebody has not fulfilled his, her or its obligations to you. Dammit, your rights have been violated, and you want your lawyer to DO something about. Not file a lawsuit – that’s too expensive. Write them a letter. That will show them. And surely upon receiving that letter your adversary will see the light and do just what you want.
Don’t get me wrong – a letter setting forth the parties’ rights and obligations can have value and help resolve issues. If you are the recipient of such a letter, it probably gets your attention in a way that communications from the other business itself do not. You will probably (and you should) call your own lawyer to help you assess the situation.
If the recipient is in the wrong, the letter from your lawyer may cause your adversary to call her lawyer, which can sometimes work to your benefit. For example, if you have a strong position under a written contract, the other lawyer may actually explain that to your adversary and help her recognize her risks in not complying with the contract.
Even aside from that best case scenario, the letter from your lawyer documents that you have communicated in a clear and timely way about your position with the other party and put them on notice of your position. (Under some business contracts, you may actually have an obligation to provide such written notice.) If the situation later becomes a dispute, this documentation will help your lawyer tell your story in that dispute.
So, I am certainly not suggesting that such letters should not be sent. Rather, just be sure to think before sending the letter what you are going to do if – and, in truth, it is usually when – the letter does not conclusively achieve the desired result. Make the initial letter part of that broader strategy and not just a venting exercise. Because rarely will the letter by itself solve the problem. (And by the way, almost never will a second letter solve the problem if the first letter was disregarded.)
Before you send the letter, you and your lawyer should anticipate the following negative impacts the letter can have and craft the letter with them in mind:
1). It may cause a more aggressive response than you care to deal with. I have seen plenty of situations where the nasty letter causes the recipient to go so far as to file a lawsuit because the letter caused them to think that was going to be necessary, when it was probably wasn’t to resolve the issue. Always consider this expensive possibility before you send the letter. That may be a scenario you are quite willing to invite, but make sure you have thought that through.
2). If the letter makes threats on which you do not intend to follow through, it can damage your credibility – with your adversary, with potential future adversaries who hear about it (and yes, they will), on your own team, and even with courts if a dispute gets to that point. Certainly there is a chance that you scare somebody into doing what you want with the most threatening possible letter but, again, be sure you are factoring in the cost of an idle threat before you send the letter.
3). Remember that the letter will shape decisionmakers’ views of your business if the matter does become a dispute before a judge, jury, government agency or other third party. The letter can help make you look like the reasonable party to them, or not. Always write with potential future audiences in mind.
In short, letters from your lawyer have their place and can be valued and even necessary tools for protecting your business. Rarely, however, will they accomplish your goals by themselves. Make sure you and your lawyer are viewing them in this broader context and making strategic decisions that will serve your best interests in the longer run.