One missing or wrong word in any communications could be the difference between smooth sailing for business owners and expensive litigation.
New York property mogul
Do you ever read the full terms and conditions of something?
I’m sure I’m not alone when I click “yes, I accept the terms and conditions” prior to completing a purchase of something.
The terms and conditions are often enormous. It would take a good 10+ minutes to read them all, and they’re not exactly light reading.
Each word is carefully constructed so there are no loopholes, accidents and so on.
There’s a good reason companies engage professionals to write these clauses for them. For many companies it could mean the difference between being protected against a risk and being exposed.
But even the most expensive and watertight policies aren’t always foolproof. That brings us to Larry Silverstein.
Mr Silverstein was a property mogul who, in July 2001, along with several minority investors, won the contract for a 99 year lease on the World Trade Center twin towers for $3.2 billion (including debt) in New York City.
Unless you’ve been living under the biggest rock in the history of the universe, you’d be familiar with the fact that, six weeks later, two planes flew into the towers in 2001 causing them both to collapse.
But read that sentence again.
the New York City skyline
Did I mean that two planes flew into each of the towers (meaning 4 planes)? Or did I mean that one plane hit one building and a second plane hit the other? Words, clearly, are very important and often open to misinterpretation.
That brings us back to Silverstein. You see, Mr Silverstein had insurance on the towers protecting his investment in the event of a terrorist attack. He was insured for around $3.5Bn USD. The point of contention came from Silverstein’s claim that the two planes that struck the Twin Towers constituted two separate insurance events, entitling him to twice the payout.
This set off nearly six years of litigation between Silverstein and a number of insurers including some of the biggest names in the business: Allianz, Employers Insurance Co. of Wausau, Royal Indemnity Co., Swiss Re and its Industrial Risk Insurers affiliate, The Travelers Cos. Inc. and Zurich Financial Services AG.
I’m not sure what fees Silverstein had paid to have his insurance contracts drawn up or what the premiums on his insurance were, but I’m guessing it wasn’t cheap. Yet despite these huge investments, the precise terms of the policies were open to debate.
Eventually the seven insurers agreed to pay an extra $2Bn USD to Silverstein which allowed rebuilding work on the site to get underway, but you have to wonder whether an extra word here or there could’ve made a $2Bn difference?
So, what’s the lesson here? I argue there’s a lesson not just for insurers but for anyone who engages in corporate communications: how careful are you with your words?
If you’re writing an all staff email advising them of changes due to Covid-19, is any word open to interpretation? Is there a sentence capable of being misinterpreted?
One missing or wrong word in any communications could be the difference between smooth sailing and litigation. It’s worth not only seeking good professional advice from a legal/compliance perspective, but a good communications professional might end up being the one to save your bacon… or even $2 Billion.
