Thursday, February 3, 2011

Fences Make Good Neighbors (Or Do They?)


"Fences make good neighbors," came from the book, A Day No Pigs Would Die. Have you read it? I believe it was the writer's dad who said it to him. Just a bit of wisdom from a pig farmer.

I've been thinking lately about contracts--probably because I'm reading Mikael's blog every day as she tells us, post by post, the story behind what we know will eventually become a lawsuit, but the details of which are only now being filled in. People who seem nice may turn out to be dishonest and even manipulative and, since it's a true story, we also have a sense of connection and sadness for Mikael who is telling the story from hindsight...not an easy thing to do, especially since it's about people she thought were friends. (I encourage you to check out her blog and follow along.)

Because of her story, I've been thinking about contracts I've made or wanted to make or should have made. I sign online contracts and software contracts that I don't even read. I signed one yesterday, in fact, at ancestry.com, by clicking on the "I agree" button. I don't know what that means for me and my VISA next month, but I figure it's worth finding out. (I mean, how bad can it be, it's Ancestry.com??)

But when it comes to friends and family, asking for a contract can seem like an insult--as if you're saying, I don't trust you.

I borrowed a horse from a friend once and I really, really wanted her to make a contract, but she would have none of it. It made me uneasy because I did not want to risk something bad happening and then coming between us later on. I kept hinting I wanted one. She kept saying no. It bugged me so much, I returned the horse to her before a week was up. There's a good chance it all would have been fine, but the worst-case-scenario kept going through my head.

Whenever we hosted events for our non-profit horse group, fundays, ribbon rides...we always had participants sign multiple waivers. It seemed like over-kill at the time, but who knows? Maybe not. Nothing ever happened, so we didn't find out.

But where do you draw the line with contracts with family and friends? Basically, when is a contract a bad thing? Can asking for one hurt a relationship? A prenup? Yuk--might kill the romance. A loan to your kids? Contract? Hmmmm...could be insulting. Loaning out a tractor or a riding lawn mower? We do that with our neighbors all the time and they to us, they also let our horses graze their pasture. Contracts....fences? What do you think?

12 comments:

  1. In a long ago past life, I was a lawyer and did a lot of contract work. I always used to tell clients that the purpose of a contract was in the process before it was signed - to be sure that the parties had a clear understanding of what they'd agreed to - you'd be surprised how many people reach what they think is an agreement and then when they try to express it in words, it turns out there are lots of things where misunderstandings needed to be clarified. Once a good contract, where everyone understands what they're agreeing to, is signed, the contract should never need to be looked at again. Usually, either verbal or poorly negotiated/written contracts are ever the subject of litigation.

    I'm a believer in not doing business with family or friends - too much potential for hurt feelings there.

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  2. Interesting perspective, and I'm sure, a wise one.

    We pretty much have that philosophy of not doing business with family and friends, but not entirely. We've tried to have a policy of no loans with our kids--even little ones. We want them to learn to postpone their "wants" and save, but we have been known to break with that here and there for future "stall cleanings." Generally, not a good thing to do. Cleaning stalls is not nearly as fun when you already purchased what you wanted and it turned out to not really be so great and stall cleaning is very hard.

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  3. I've never really had a reason with family or friends to make a contract. But if there's something of special value involved to either party, like that horse you borrowed, or if either party shows an inclination to have a contract, I'd say do it. If someone resists, maybe that's not a person you should be getting into a situation with, either.

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  4. I thought it was "Good fences make good neighbors." My neighbor has something that he calls a fence. It doesn't keep his calves in. Or his horses, sometimes. I can't plant trees in some areas because of it. But Idaho is a free range state so we're supposed to fence them out, he doesn't have to fence them in. Actually, in this case I don't mind too much, it gives me an excuse to chat with my neighbor every now and then. I just wish I could plant trees on this side of his fenceline.

    I like Kate's comment on contracts. It's good to have everyone's expectations spelled out. I also agree that doing business with family is a bad idea - been there, done that.

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  5. I generally try not to do business with friends, but occasionally someone I am doing business with becomes a friend after the fact. I always remember that I cannot expect to be treated differently from any other client when it involves their business. I think a contract is a good idea because as Kate said, it helps to clarify what is expected.

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  6. After my experience, I not only will have contracts but I have a much better idea of what should be in them. Like Kate said you think you both know what the other means until you start getting into writing it down. It's then that the true details emerge.

    After this experience I also know the dangers in helping friends and having something go south. If you can afford that, go ahead and loan out that lawn mower but I've come to learn how people's attitude can change once they see the possibility of money on the line. It's really a sobering thought.

    I am redoing all the paperwork I've previously used to reflect my new found knowledge and you can bet I won't be completing any transactions without proper paperwork.

    As for your friend that wouldn't hear of a contract, good for you getting yourself out of the situation. Contracts are there to protect both parties. If she couldn't hear your need to protect both of you, then she was probably a good person to not be in that situation with.

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  7. Andrea--you're right--good fences. Interesting about the cows. I don't have that issue around here. We don't get too many stray animals--the occasional horse...dog..nothing much though.

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  8. Wilson--I'm like you, I have made friends with people after I started to do business with them--but I always hold to the same standards of business when business is being done, and I don't expect any favors.

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  9. Mikael--It's starting to look like you're going to be the expert on contractual language by the time this story is finished. You're doing a wonderful job telling your story!!

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  10. Thanks, Linda, I worry that I'm boring readers with all those details but all those odd things had solutions in points of law that helped build my case even though it was pretty much a he said/she said thing. Even if I'd had a written contract it would not have been adequate and I would not have been protected from these people.

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  11. i believe in being well prepared and a contract is a must. it is business that is all. and in this day and age especially in our litigious state it is just good common sense to protect yourself. and yes, fences are excellent if you can afford them. i put one up when a new person moved into my old friends home. that new person had a friend who hunted and at least my signs and fencing allowed the complete knowledge that i wanted no one on our farm.

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  12. I can see where it would be expensive if you had a large area to fence off...that's probably why so many people use (or used to use) barbed wire. Here in the West, you have to be very careful when you ride off the trail because of old, downed barbed wire fencing.

    That's interesting about the hunting--we have that issue, too, even though we're on small acreages.

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Please feel welcome to join our discussion--tell us about your own thoughts and experiences.