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Contract Management As A Universal Discipline

April 9, 2013

Last week, IACCM held its inaugural meeting for members in Russia. More than 40 attended a half-day session in Moscow, hosted by law firm Baker & McKenzie.

Opening the presentations, Max Gutbrod – a partner with Baker & McKenzie – made some interesting observations. He started by commenting on the legal profession and its perceptions of contracts. Using Germany as a n example, Max explained that legal training since the 19th Century ¬†has focused on training people to eventually become judges. This results in the development of skills and knowledge ‘designed for the courtroom’.

While the focus of legal training in other countries may have some variations, Max’s point was that it rarely equips its graduates for the realities of business. In his opinion ‘much of the training of the future should be on contracting’ and he perceives this as a discipline that ‘finds common ground, including the need to work across legal and cultural systems – using contracting to build bridges’.

Working in a country like Russia, Max well understands the need for practical tools that can assist in generating better understanding and trust. Several speakers emphasized this point when discussing the big challenges for doing business in Russia. Not only are formal systems lacking, but trust levels are also weak and therefore there is a need to build confidence through the open conversation and methods that good contracts can bring.

Max illustrated this by pointing to some of the fundamental misunderstandings that will arise if there is not structured discussion between the parties forming a relationship. For example, a general principle in Russian law is that the user or customer has responsibility for selection and use; there is no evident liability on the supplier unless specifically stated otherwise.

He concluded with the observation that there is much to be gained by improving contractual practices in a country like Russia and using contracts as a method to raise mutual understanding and address areas that  otherwise are likely to become issues of contention at a later point.

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