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Contract analysis: Difference between revisions
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====The problem to be solved==== | ====The problem to be solved==== | ||
Confidentiality agreements are fiddly, low-risk agreements that everyone wants to get through as quickly as possible to get to the fruitier deal negotiations. But they have buried risks if you don’t watch them. So, your legal eagles need to be on their game to keep the stupid out. And be assured, counterparties will throw lots of stupid at you. Let’s face facts: the fellow in charge of the NDA templates is going to be a Golgafrinchan, not a Top Gun Lawyer. | Confidentiality agreements are fiddly, low-risk agreements that everyone wants to get through as quickly as possible to get to the fruitier deal negotiations. But they have buried risks if you don’t watch them. So, your legal eagles need to be on their game to keep the stupid out. And be assured, counterparties will throw lots of stupid at you. Let’s face facts: the fellow in charge of the NDA templates is going to be a [[Golgafrinchan]], not a [[Top Gun Lawyer]]. | ||
But it ''is'' a faff — an excruciatingly written [[NDA]] might take an hour to review, and return. This is not exactly glamorous work, though once in a while it is strangely satisfying. But by reference to the prism of “notional person-hours” through which a [[chief operating officer]] | But it ''is'' a faff — an excruciatingly written [[NDA]] might take an hour to review, and return. This is not exactly glamorous work, though once in a while it is strangely satisfying. But by reference to the prism of “notional person-hours” through which a [[chief operating officer]] views the world, NDA review ''costs money''. | ||
[[Automated contract review]] promises to save some of that cost. It checks against pre-defined [[playbook]] of [[walk-away point]]s, like a triage unit at a military hospital, breaking the back of the most tiresome work, then handing over to you for a quick once-over before it goes out the door. | [[Automated contract review]] promises to save some of that cost. It checks against pre-defined [[playbook]] of [[walk-away point]]s, like a triage unit at a military hospital, breaking the back of the most tiresome work, then handing over to you for a quick once-over before it goes out the door. | ||
====But it isn’t as simple as that==== | ====But it isn’t as simple as that==== | ||
But it turns out unseen text isn’t as easy to review as all that. Even boring syntactical things like plurals, irregular verbs and parentheticals (we lawyers ''love'' parentheticals)<ref>See what I did there?</ref> are hard to code for. In time the machine will get better, but the universe of possible ways of articulating a single idea remains infinite and, while [[legal eagles]] are stunted in many aspects of their creativity, when devising ways in which they may torture prose they are not. Along that axis, they are extemporisational geniuses. | But it turns out unseen text isn’t as easy to review as all that. Even boring syntactical things like plurals, irregular verbs and parentheticals (we lawyers ''love'' parentheticals)<ref>See what I did there?</ref> are hard to code for. In time the machine will get better, but the universe of possible ways of articulating a single idea remains infinite and, while [[legal eagles]] are stunted in many aspects of their creativity, when devising ways in which they may torture prose they are not. Along that axis, they are extemporisational geniuses. Thus, most commercial [[contract review tool]]s hire [[Paralegal|paralegals]], in low-cost jurisdictions, to check the machine’s output before sending anything back. | ||
This has three consequences: | This has three consequences: | ||
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Firstly, it slows down the output. Instead of getting your mark-up immediately, you get it three-quarters of an hour or more later — this is enough time to become comprehensively distracted by something else and, for that matter, to have reviewed the NDA yourself. | Firstly, it slows down the output. Instead of getting your mark-up immediately, you get it three-quarters of an hour or more later — this is enough time to become comprehensively distracted by something else and, for that matter, to have reviewed the NDA yourself. | ||
Secondly, it adds to the cost. Now, to be sure, [[reg tech]] providers are master [[rent-seeker|rent-seekers]], but here, in their bench of [[paralegal]] sense-checkers, they have direct out-of-pocket costs. Thus, their application must carry a heavy per document charge. Some charge less than a hundred bucks for a document. Some charge three times that much. ''But automated review shouldn’t cost anything''. | Secondly, it adds to the cost. Now, to be sure, [[reg tech]] providers are master [[rent-seeker|rent-seekers]], but here, in their bench of [[paralegal]] sense-checkers, they have direct out-of-pocket costs. Thus, their application ''must'' carry a heavy per document charge. Some charge less than a hundred bucks for a document. Some charge three times that much. ''But automated review shouldn’t cost anything''. | ||
The point was to save an hour of [[Legal]]’s time. But that is a ''nominal'' cost. It is ''sunk''. Your [[legal eagle]] doesn’t work to rule. She doesn’t sit on a production line. She’ll just fit the review in, along with all the other random things that hit her desk in a day. So, an incoming NDA doesn’t ''generate'' a specific cost and firing it out to for automated contract review doesn’t ''save'' it. Unless you can demonstrate that your contract review tool will make some of your lawyers ''[[redundant]]'' – good luck with that one – it is not saving you ''any'' money. It is ''costing'' real money. | The point was to save an hour of [[Legal]]’s time. But that is a ''nominal'' cost. It is ''sunk''. Your [[legal eagle]] doesn’t work to rule. She doesn’t sit on a production line. She’ll just fit the review in, along with all the other random things that hit her desk in a day. So, an incoming NDA doesn’t ''generate'' a specific cost and firing it out to for automated contract review doesn’t ''save'' it. Unless you can demonstrate that your contract review tool will make some of your lawyers ''[[redundant]]'' – good luck with that one – it is not saving you ''any'' money. It is ''costing'' real money. | ||