Absolute discretion: Difference between revisions

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You will hear it [[Special pleading|specially plead]] that, for all its superficial appeal, a component of “reasonableness” in a discretion invites argument about its scope, precisely at the point where you might not want any. When, for example, you are exercising a reasonable discretion to demand more [[margin]], or something like that.  
You will hear it [[Special pleading|specially plead]] that, for all its superficial appeal, a component of “reasonableness” in a discretion invites argument about its scope, precisely at the point where you might not want any. When, for example, you are exercising a reasonable discretion to demand more [[margin]], or something like that.  


But this argument has more mouth than trouser:
And here we pause to remind you that this site is here to entertain, poke fun and provide food for thought, and not to give actionable legal advice. For it seems to us this argument has more mouth than trouser:


A discretion, by its nature, is a self-help remedy. Its exercise requires no permission; no appeal to the court, no arbitral award. One may just do it, at — well — at one’s ''discretion''. Forensic examination of the ''propriety'' of the exercise of a reasonable discretion necessarily come after the fact. Yes; your counterparty might challenge it in court, but will come a lot later, and — honestly? — it will only do that ''if you were being manifestly unreasonable''. The standard of reasonableness, as we have seen,<ref>{{casenote|Barclays|Unicredit}}</ref> is subjective. The owner of the discretion gets the benefit of the doubt. It is hard for a third party to displace. Besides, you can control for this later eventuality by ''not being manifestly unreasonable in the first place''. If you ''are'' being manifestly unreasonable you are beyond help and, frankly, sympathy.  
A [[discretion]], by its nature, is a self-help remedy. Its exercise requires no permission; no appeal to the court, no arbitral award. One may just do it, at — well — at one’s ''discretion''. Forensic examination of the ''propriety'' of the exercise of a reasonable discretion necessarily come after the fact. Yes; your counterparty might challenge it in court, but will come a lot later, and — honestly? — it will only do that ''if you were being manifestly unreasonable''. The standard of reasonableness, as we have seen,<ref>{{casenote|Barclays|Unicredit}}</ref> is subjective. The owner of the discretion gets the benefit of the doubt. It is hard for a third party to displace. Besides, you can control for this later eventuality by ''not being manifestly unreasonable in the first place''. If you ''are'' being manifestly unreasonable you are beyond help and, frankly, sympathy.  


But, for the time being, if you have a reasonable discretion, you can just box on.<ref>Now, your counterparty ''could'' seek an [[injunction]] to stop you exercising your reasonable discretion. But the [[common law]] is hardly littered with injunctions against the exercise of reasonable discretion.</ref> Should you seek advice? Well, bear in mind: your [[legal eagles]] are short an option and prone to equivocation at times like this. They will fret not just about [[injunctions]], [[punitive damages]] and all kinds of like phantom tribulations, but whose fault it will be should these be visited upon you, and who said you could go ahead. They will fret less about the consequences should you ''not'' go ahead, since they will presume these would happen anyway, and are less obviously their fault.
But, for the time being, if you have a reasonable discretion, you can just box on.<ref>Now, your counterparty ''could'' seek an [[injunction]] to stop you exercising your reasonable discretion. But the [[common law]] is hardly littered with injunctions against the exercise of reasonable discretion.</ref> Should you seek advice? Well, bear in mind: your [[legal eagles]] are short an option and prone to equivocation at times like this. They will fret not just about [[injunctions]], [[punitive damages]] and all kinds of like phantom tribulations, but whose fault it will be should these be visited upon you, and who said you could go ahead. They will fret less about the consequences should you ''not'' go ahead, since they will presume these would happen anyway, and are less obviously their fault.
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For if you are staring into the abyss — if your genuinely believe your client is corkscrewing into the side of a hill — and you hesitate to exercise a discretion because it might not turn out to have been reasonable, the problem is not with your legal documents. It is with you. Your coat is on the hook.
For if you are staring into the abyss — if your genuinely believe your client is corkscrewing into the side of a hill — and you hesitate to exercise a discretion because it might not turn out to have been reasonable, the problem is not with your legal documents. It is with you. Your coat is on the hook.


Look at it this way: requiring an ''absolute'' (cough) discretion, where a ''reasonable'' one would do, will cost you time, effort and aggravation on every negotiation. This effort — ostensibly to save the aggravation of being challenged in court by your client later where, by definition, your commercial relationship has failed and either you are at war, or one of you is in administration — is about as good an example of over-production as you could ask for. {{maxim|You only need airbags if you don’t steer straight}}.
Look at it this way: requiring an ''absolute'' discretion where a ''reasonable'' one would do, will cost you time, effort and aggravation ''on every [[negotiation]]''. This effort — ostensibly to “save the aggravation of later challenge in court”; thereby addressing a scenario where, by definition, your [[Commercial imperative|commercial relationship]] has failed utterly and either you are at war, or one of you is in insolvency — is about as good an example of the [[waste]] of [[over-processing]] as you could ask for.
 
{{maxim|You only need airbags if you don’t steer straight}}.


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