Sent to legal review by someone who doubts it, an unwelcome proposal is left to run at the review's own pace while its window narrows.
Borderline: whether this move is justified depends on the situation, and only the person in it can judge.
An example
Four months after its first large round, the chief operating officer of a digital health startup, who had argued at the board for a direct sales team and lost, doubted the distribution deal the head of partnerships had negotiated with a regional pharmacy chain. The company's approval policy required outside counsel to review any contract above a set value, and he was the executive who routed them. He sent the contract under that policy, marked it standard priority, and passed on the pharmacy chain's spring planning date in the cover note. He answered counsel's two questions the day they came. When the head of partnerships asked him to push for a faster review, he declined, saying the policy did not call for it and that he still had concerns about the margin terms. Counsel's queue was long that quarter. The review took nine weeks, and by then the chain's buyer had stopped returning calls.
Why it works
Routing the proposal to legal is the easy course for the person who opposes it. Legal review is respected and procedurally unimpeachable, so there is no confrontation, no relationship cost, and no decision to account for. While it sits, the proposal gets worse: its window narrows, its backers lose interest, and conditions move. Pushing costs the sponsor, who spends standing just to get a status update and risks being seen as questioning legal's independence. Legal review has to be a required gate, the legal team busy or cautious enough that delay looks normal, and the proposal's window perishable.
The thinking behind it
Jonathan Baron Baron's Omission and Commission in Judgment and Choice (1991), written with colleagues, found that people judge harm caused by failing to act as less bad than the same harm caused by acting, a result a 2020 replication reproduced. Letting a legal review run its course is an omission. If the deal dies, few blame the executive who sent it, because he did nothing further; rejecting the deal outright would have been an act he had to defend.
Jeffrey Pfeffer Pfeffer's Power in Organizations (1981) locates power in control of the decision process. Under an approval policy that lets one executive decide which contracts go to outside counsel and at what priority, routing is that control. The defense works on the process too: a counterparty deadline in writing and cycle times compared across contracts make the pace of review a visible choice.
When it fits
Holders of routing authority under the company's approval policy, facing a proposal they doubt whose sponsor is on a clock. The review must be required or reasonable for this kind of contract, and legal's normal pace must be slow enough to matter.
How to use it well
Route it the standard way. Send it under the policy that requires review, with an accurate description of the deal and its terms.
- Give legal the counterparty's deadline, if you know it.
- Answer legal's questions promptly and fully, the same day where you can.
- Leave the pace to legal, and decline to expedite where the policy does not require it.
- State your own concerns about the deal directly to the sponsor and the chief executive.
The review is real, and your restraint, more than anything legal does, is what slows it.
What it costs and where it backfires
Sponsors whose deals die in legal remember who sent them there, and a chief executive who publishes cycle-time targets will expose the pattern. If the deal was good, the lost window is yours. How you route it decides whether this stays clean. Once you mark it low priority to bury it, keep the counterparty's deadline from legal, or tell the sponsor the review is moving when it is not, the review has become a silent veto by concealment.
When it is used on you
Ask legal directly who is assigned and when an output is expected, introduce the counterparty's hard deadline in writing, offer to brief the reviewer on the commercial context, and compare cycle times with other items sent the same month. Ask for a decision, even a conditional one.