Despite the Covid-19 pandemic, the demand for corporate and transactional lawyers in Australia has never been stronger. Australian lawyers specialising in transactional work are, according to legal recruiters, the most in-demand by overseas head-hunters looking to fill global talent shortages. The pay both domestically and overseas is high and demand for graduate jobs in top-tier commercial firms is fierce. Why don’t law schools teach more transactional lawyering?
I teach a first semester compulsory subject at Bond University. I usually start my first class with the simple question – why study law? I listen to the usual responses. There is always at least one student every semester who says ‘I want to be a corporate lawyer just like Harvey Specter’. I want desperately to say ‘he isn’t a corporate lawyer, he’s a litigator!’ But I don’t. No one wants to shatter dreams on day one.
Of course, it is just a TV show (watched, it seems, by every law student ever) but it makes me question what law students really understand about the different types of lawyering. Do law students think that it’s the norm to jump between court hearings and corporate completion meetings? That lawyers go from drafting property leases and security documents to defending a client in a criminal case? Quite honestly, I doubt anyone gives it much thought when entering law school. Most students have their heart set on being a lawyer, but have not necessarily thought about the type of lawyer they want to be. Unfortunately, some won’t have the luxury of waiting until the end of the degree to figure it out. Recruitment processes for such firms start early, often years in advance. For students in an accelerated degree programme such as the one offered by Bond, this means applications need to be finalised at the end of their first year of law school.
For me, it was only through my practical experience that I realised I was more suited to transactional work. I ended up working in the field of corporate finance and it was a good fit for me. However, I think I got lucky. I had many colleagues swap and change career paths a few years post admission because they weren’t happy being in litigation or vice-versa.
Law students should learn as much as they can about the different fields of practice before they make important career choices. Most law schools arguably teach enough about litigation practice. What about transactional practice?
What is transactional lawyering?
Whilst there is no universal term for what a transactional lawyer is, it is widely accepted that the likes of corporate finance, mergers & acquisitions, banking, tax, property lawyers, and in-house counsel all carry out transactional work for clients. Often working at the heart of the client’s business, transactional lawyers are utilised for their detailed technical knowledge and their ability to use that knowledge by providing creative solutions to complex legal issues. The role of the transactional or deal lawyer is vastly different from the work of a solicitor engaged in litigious work. Often working with the same clients recurrently and taking on more of a quasi-legal position, the transactional lawyer will usually be heavily involved in every aspect of the client’s business and often develop a set of very specific technical skills (such as technical drafting and negotiation skills) that make the transactional lawyer a valued asset to long-standing clients.
Interests and outcomes
When the curriculum focus is on case law and litigation, students are taught to predominantly focus on the parties and their relevant rights and obligations, rather than interests and outcomes. Teaching through case law places emphasis on the parties themselves and the concept that there has to be a ‘winner’ and ‘loser’ in each case. Litigation skills (including ADR) are deeply engrained in the teaching of the modern law degree. An abundance of mooting and negotiation competitions are commonplace in almost every law school today. The importance of winning and choosing a side is still heavily engrained in law students as a basic requirement in the role of lawyering.
I have always struggled with this focus. I endured countless advocacy assessments, case-based assignments, and negotiation tasks like every law student. I left law school well equipped (for litigation) but not for the type of lawyer I ended up becoming.
Legal reasoning is heavily embedded in the current curricula. Students are exposed to legal reasoning in first-semester subjects, like the subject that I teach at Bond University, Legal Foundations A. As I spend a large part of my semester teaching legal reasoning to new law students, I can’t help but wonder if we are still reinforcing the notion that there is usually some sort of dispute, uncertainty, or ambiguity to begin with.
What if there is no problem? Do our law students know how to approach a legal matter if it is not based around a problem, dispute, or uncertainty? The nature of problem-solving does not sit as comfortably within the world of transactional lawyering as it does within litigious practice. Legal reasoning is essentially a process of attempting to predict outcomes, and in the event of litigation, influence the decision of a court. According to legal scholars such as James, formalistic methods of legal problem solving such as IRAC are not consistent with commercial practice. It is ideally suited to litigious work or when outcomes may vary. Whilst the role of the transactional lawyer can become more adversarial in some cases, particularly in sophisticated transactions, the use of legal problem-solving is not as relevant to transactional practice. The overall outcome in transactional work is that the transaction is completed successfully.
This blog post is only a small snippet of my ongoing research on transactional lawyering. Here are just three suggestions for incorporating transactional work into our teaching:
1.Revise our assessment techniques
A lot of the assessments in law (including sometimes my own) are what one might call firefighting exercises. Students are presented with a problem and instructed to put out the fire (for example resolve legal issues as if they were a judge in the case). But what about preventing the fires? Students can still get exposure to the same learning experience but in a different way which also increases creative thinking.
What could a forward-thinking assessment look like? Ask students to do due diligence on a proposed purchase or contract. Ask the students to summarise the key terms and conditions of a contract and explain any risks or liabilities associated with the transaction. Perhaps use it as a tool to explain the difference between warranties and conditions or quite simply just how to navigate through a complex legal document. Students are usually taught statutory interpretation skills in their first semester and they can use those skills to approach reading and navigating through complex and lengthy documents from the early stages of the degree. It will increase confidence when going for internships or clerkships – ‘I can do this because I’ve done this before at law school.’
2. Increase our emphasis on collaboration
Transactional-based work should also make greater use of collaboration. Tasks are not adversarial, and students are not in competition. They are not currently involved in an active dispute or being asked to work as a team in a case-based problem. Students can still engage in negotiation assessments but not all negotiation exercises involve parties in dispute. All parties involved want this deal or transaction to happen, they are working toward a common goal. It teaches students that some lawyers are outcome focused rather than problem-focused. Their job is to achieve an outcome, one that serves to benefit several stakeholders.
3. Feedback Delivery
With our current approaches to delivering feedback, we could be losing an easy opportunity to expose students to the way things work in transaction practice. We rarely allow opportunities for students to respond and action feedback to written assessments appropriately, leaving it up to students to read feedback if they wish.
Law students wanting to work in transactional practice need to learn how to work with amendments to documents because they are going to work on documents every single day. They also need to learn how to work on shared documents, work with track changes and work with versions of documents just as they would in practice. Every change to a document needs to be transparent. No deletions can go unreported. Documents prepared in this way not only fairly display each student’s contribution but teach them how lawyers in a transaction work together. It could also make our life easier for spotting academic misconduct issues.
There are many types of lawyers and we can’t cater our teaching to every future career option that a law student may choose to pursue. But perhaps we could openly talk to our students about how life in practice actually looks and the types of skills they will be using in each discipline area. It may burst the bubble for Harvey Specter fans, but by exposing students to the nature of lawyering early in their studies we can help them make the right decisions about their future careers.