“You can't make a good deal with a bad person.”

This statement emphasizes that no amount of favorable terms or legal protection can compensate for a partner who lacks integrity and character. It offers a psychological warning that the fundamental nature of a person will eventually undermine any agreement if that nature is dishonest or self-serving. In contemporary business and law, this highlights the critical importance of due diligence on a person’s reputation and ethics before entering into any partnership. People relate to this because it validates the experience of being burned by "bad actors" despite having a seemingly perfect contract. Buffett consistently prioritizes the character of the managers he works with, believing that trust is the ultimate lubricant of a successful business relationship. The practical lesson is to walk away from any opportunity where you have doubts about the other party's integrity, regardless of how profitable the deal looks on paper.