Legal Contract Assembly: Advocating for Automation
Contracts are everywhere. From straightforward mobile phone agreements and facility use waivers to more in-depth arrangements that cover everything from large investments, parental custody, and long-term employment. As noted by Queen’s University Law, the ubiquity of contracts means they’re often entered and agreed to without so much as a second thought by citizens and consumers.
But these contracts don’t exist in isolation. For every contract created and agreement drafted, there’s a legal contract specialist responsible for ensuring its accuracy, reliability, and relevance. Given both the increasing volume and complexity of these documents, more companies are advocating for a new advantage, contract automation. Here’s how it can help.
Identifying Key Issues
According to legal firm UpCounsel, it’s critical to identify potential contract issues before agreeing to any terms — no matter how favorable they appear. The same advice applies to contract creators, who can save time and money by ensuring agreements are accurate and complete before sending them to clients for review.
There are three key issues that automation can help address:
- Confidentiality — Secure handling of confidential information is critical in contract negotiation. By leveraging automation and editing solutions that keep contract negotiations in-browser and behind corporate firewalls, legal teams can ensure confidential information is not compromised so no significant and/or long-term harm is brought to the institution’s and/or individual’s data.
- Sensitive Information — Many contracts contain sensitive information that require limited dissemination. Here, legal teams need permission-based tools that empower them to track changes across contracts and create an end-to-end chain of custody to ensure information is viewed only by those who have permission to do so.
- Human Error — Errors happen, even in straightforward contract creation. Contract automation tools can help catch these common errors before they reach clients.
Lightening the Contract Load
The workload of legal contract managers is rapidly increasing. As noted by Law Technology Today, managers are often responsible for 20,000 to 40,000 contracts at any given time.
Automation can help lighten the contract assembly load by empowering staff to easily insert common text strings or contract formats. Using advanced APIs that integrate with existing legal applications, teams get full control over contract generation and deployment at scale, in turn giving them more time to refine contract processes and tighten legal language.
Managing Force Majeure
One emerging challenge for legal contract negotiation centers around the concept of force majeure. Merriam Webster defines force majeure as “those uncontrollable events (such as war, labor stoppages, or extreme weather) that are not the fault of any party and that make it difficult or impossible to carry out normal business.”
As noted by Law 360, the evolving Coronavirus pandemic means that many organizations will be examining their contracts to determine if force majeure clauses exist and apply, effectively allowing them to suspend or terminate agreements. The Law 360 piece points out that in most cases, force majeure is defined narrowly “to avoid undercutting the stability and predictability of commercial transactions.”
The increasing scope of global health challenges, however, may require a reexamination of contracts at scale. Manually attempting this task could take weeks if not months for smaller firms. Here, contract automation tools that deliver straightforward, keyword-based search tools can help streamline the ability of contract specialists to find relevant clauses and determine their applicability, if any.
Contracts are everywhere — but they’re not effortless. Improve contract security, assembly, and search with advanced automation tools.