That is like arguing "why bother to put a security system in, if they really want it they will find a way to get it". And contracts are not just for lawyers, a good contract is an indispensable aid to clarifying an agreement between and protecting the interests of BOTH parties.

That is exactly one of the many things a good contract can help to do, on many different levels. On the most basic level a contract can have a clause that requires both parties to attend mediation before resorting to a lawsuit. Furthermore, the purpose of a contract is NOT merely to protect oneself in/from a legal "showdown". Contracts can address everything from job quality to warranty terms to client confidentiality to project scheduling. And on many jobs a thorough contract is not only expected, it is required.

Of course you should offer great customer service and of course if you do your job right you are less likely to have unhappy customers and get involved in lawsuits. That does not mean you shouldn't have the best contract possible. It is the very ESSENCE of GREAT CUSTOMER SERVICE to offer your clients a well written, thorough and easy to understand contract.

Most of the time you WILL recognize him/her in the first meeting and if you do I agree that you should pass on the job. But if you think you will ALWAYS recognize them, then you belong on a Pshycic Friends Network because you WON'T. Not to mention the instances where you start out working with one person on a job and end up working with a completly different person (Russ Hershelmann often tells a story about starting a project with a very sweet woman who's highly litigous boyfriend later ended up taking over the project).