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From the [[Jolly Contrarian]]’s stock of old adages that might not mean very much: ''“A legal opinion is just an onion with pi in it.”'' | From the [[Jolly Contrarian]]’s stock of old adages that might not mean very much: ''“A legal opinion is just an onion with pi in it.”'' | ||
===So what are legal opinions for?=== | |||
There are certain matters that regulation, or some senior, uninformed person in credit risk management once wanted to be told in black and white, and around which a markedly formal practice has evolved: the “opinion” has long since evolved away from “legal advice” in the broad sense of — well, telling your clients what is and is not a prudent thing to do — to be a formal, limited, crafted statement that addresses a specific, purely legal, arcanity. The classics are the effectiveness of [[close-out netting]] — here Basel regulation mandates a lengthily reasoned legal opinion (in fact, several) — the effectiveness of security ([[security]] being one of those things beset with tripwires and [[magic words]]) and the effectiveness of paperwork constituting [[transferable securities]] (also something considered to have a high degree of [[muggle]]-ineffability). | |||
They will not address matters of fact — so you will find counsel drawing petulant distinctions between whether a “derivative” is a qualifying investment for a given issuer, and whether the contract you have identified, which ''calls'' itself “a derivative”, is documented under ISDA and so forth, is in fact what it says it is — nor matters of ''foreign'' law, in which the legal eagle in question has no mandate to express any opinion. | |||
{{sa}} | {{sa}} | ||