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-all too often a negotiator is told, by a risk controller, well I won't die in a ditch about it, but at least [[let's give it a try]].
+All too often a [[negotiator]] is told, by a risk controller who is seeking a preposterous term, well [[I'm not going to die in a ditch about it]], but at least [[let's give it a try]].
-Stop. The trade-off is between “give it a try” and “will anyone object?”:
+I mean, why not?
-“Will anyone object?” has an ascertainable, certain, upfront cost: the time and devotion of negotiation and, via escalation, risk management resources to clear the objection (whether the point is dropped or kept).
+Let’s take an example:
+{{box|You have asked your client to [[indemnify]] you for losses you suffer performing the {{tag|contract}}. But what standard of conduct must you display before claiming on the indemnity?
-“Give it a try” has a delayed, remote and contingent benefit:
+Your risk officer suggests exclude liability under the Indemnity where the loss arises as a result of our [[grossly negligent|''gross'' negligence]].
--	delayed because the right will only ever have any value upon a close out;
--	remote because any close-out, at any time, is extremely unlikely (<1% of counterparties would ever be closed out);
--	contingent because
-o	it only has any value at all if we can persuade the counterparty to accept it
-o	even if we can, we don’t know
-	whether we’d ever try in practice to exercise such a setoff,
-	whether, if we did, it would be enforceable and
-	whether, if we did and it was, there would be anything meaningful to set off against in the first place.
-By my calculation, the present value of “give it a try” is close to zero. If the present value of “will anyone object?” is not zero, I wouldn’t even give it a try.
+“'[Gross negligence|''gross'' negligence]]? But surely no sensible client will accept that?” you say.<ref>Conventional wisdom in the US has it that clients will unthinkingly accept it in that market. Which makes you wonder about conventional wisdom amongst US attorney]]s. But anyway.</ref>
-OB
+Your risk officer shrugs. “Perhaps so”. But why don’t we [[give it a try]]?
+Let me tell you why.
+===The trade-off between “give it a try” and “will anyone object?”===
+Because putting it in has a potential cost.
+*“'''Will anyone object?'''” has an ascertainable, certain, upfront cost: the time and devotion of negotiation and, via the [[circle of escalation]], [[risk management]] resources to clear the client objection. You incur this expense even if the point is immediately dropped - clearly the longer you argue about it, the more expensive the cost.
+*“'''[[Give it a try]]'''” has a delayed, remote and contingent benefit:
+:*'''Delayed''', because the right, if you manage to get it, will only ever have any value at some point in the future (that is, when you get to exercise the right);
+:*'''Remote''', because it is extremely unlikely, at any time, that circumstnaces arise whereby you would be entitled to exercise that right; (<1% of counterparties would ever be closed out);
+:*'''Contingent''', because:
+::*it only has any value at all if we can persuade the counterparty to accept it
+::*even if we can, we don’t know
+:::*whether we’d ever try in practice to exercise such a setoff,
+:::*whether, if we did, it would be enforceable and
+:::*whether, if we did and it was, there would be anything meaningful to set off against in the first place.
+Where, as is usualty the case, the [[present value]] of “give it a try” is close to zero, then if the present value of “will anyone object?” is not zero, ten even giving it a try is not a rational move.<ref>Who said [[Mediocre lawyer|lawyers]] were ''rational''?</ref>
+{{seealso}}
+*[[Circle of escalation]]
+*[[Gross negligence]]
+{{ref}}