The Legal Memorandum

The legal memorandum is a perfect topic for BizB4Law.  Remember my central theme – business issues are more important than legal ones, and the legal strategy and approach, therefore, must always follow from the business objectives and realities.  So where does that leave the legal memorandum?

The legal memorandum has its proper purpose, although it sometimes gets lost.  The purpose is not to protect the lawyer from the client or allow the lawyer to avoid providing real legal advice and recommendations.  In fact, although it happens all too often, there’s almost no business value in a legal memorandum that states something like:  “Given our limited understanding of the facts as you’ve explained them, and in light of the substantial uncertainty as to how the project will proceed and how a court might analyze this particular situation, we believe it is more likely than not that your proposed legal structure will be found to be permissible.  However, we must qualify our opinion by . . .”

The purpose of a legal memorandum is to provide necessary analysis so that an informed decision can be made by the client in light of specific and complex legal issues or challenges impacting the business objectives.  In other words, the process starts with the specific business goal and the existing facts and circumstances – if, based on those, there are complicated legal issues that must be addressed, a memorandum may be appropriate.  If not, you don’t need one.  Then, the research should specifically analyze how the law impacts this situation (not some abstract or unlikely situation in the land of make-believe).  And more importantly, the memorandum should provide actual advice and recommendations as to how the business objectives can be met even in a challenging environment, and even when the client’s desired approach may need to be modified.

The next time you read a memorandum from your lawyer, I hope it’s consistent with this article – if not, you may have detailed legal analysis but still be left questioning the business value and purpose.

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