A Capehart Scatchard Blog

Preventative Legal Medicine

By on January 18, 2019 in Other with 0 Comments

It is a story often heard by health care lawyers.  Clients come into the office regarding a dispute with their partners, their investors, a shareholder, or a party interested in a venture.  They tell the lawyer how they have an agreement (shareholder, operating or a partnership agreement).  The client feels like it is all “black and white” and clear as day; this is a simple matter of reviewing the rather obvious provisions of the contract, which the client believes is on terms favorable to him or her.  This is where the journey begins and not where it ends.

As the lawyer asks questions, he or she learns that the agreement was not drafted by counsel familiar with health care law.  It may also be that a prior draft of an agreement drafted by a health care attorney was “updated” or “modified” by the client or another party to the agreement.  Another possibility is that one party to the agreement uses an attorney and the other doesn’t, resulting in a very one-sided agreement which is detrimental to the client.   That agreement, upon hearing about the nature of the dispute, does not provide crystal clear guidance. Instead, several provisions are problematic, missing, arguable or worse, easily read in a fashion which is contrary to the best interests of the client or their practice.

Any doctor knows that treating a patient with preventative medicine or treating a disease in its early stages is better than waiting until the disease reaches Stage 4. Health care lawyers see the same thing.  When clients decide that they can proceed without a lawyer or use their brother-in-law who is a criminal defense attorney to draft their agreements, unintentional mistakes can be made that create real problems when there is a dispute.  Instead of paying one lawyer to draft an agreement properly, all sides must then retain counsel and drive the dispute between the parties into court, which is a far more expensive arena.  This is the legal version of Stage 4.

Everyone needs to know the limits of their own abilities.  Even an attorney without an understanding of health care law can make mistakes in documents that will create damaging repercussions for their client.  We can say, almost without exception, that every shareholder dispute we have been involved in has been caused by improperly and unclearly prepared agreements.

At the start of your New Year for 2019, do yourself a favor.  Have your shareholder, operating or partnership agreements and/or similar business documents reviewed by an experienced health care attorney.

Now is the time. Think of it as a New Year’s resolution.


About the Author

About the Author:

Vincent T. Cieslik, Esq. is Co-Chair of the firm’s Business Litigation Group and a Shareholder in the firm’s Commercial Litigation and Health Care Groups. He focuses his practice in the representation of individuals, small businesses, not-for-profits and and large corporations in complicated and often high-risk litigation. In his personal time, Vince supports the March of Dimes of South Jersey, serves as the Walk Chairman for the March of Dimes Walk for Babies and 5K Run for Babies, and serves as a member of a local school board.


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