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Theron emphasizes the necessity of having legal templates and clear contracts to manage client relationships and disputes. He discusses the challenges of dealing with difficult clients, often referred to as "Karens," who may be unsatisfied until they achieve their desired outcome. For instance, if a client cancels at the last minute without a cancellation policy in place, they may refuse to pay, leading to conflict. However, having established agreements sets clear guidelines for cancellations, ensuring that clients are aware of the policies they agreed to. These agreements not only protect against difficult clients but also provide clarity for all clients regarding expectations and procedures.