Yes, Contracts Are a Mess. So What Are We Going to Do About It?

A blog post by Tim Cummins of IACCM entitled “Contract Drafting, Communications & Risk” (here) met with quite a bit of approval on Twitter. So I looked at it, then looked at it again. Tim, I hope you’ll permit me some comments from the peanut gallery.

Of course I agree entirely with the premise of Tim’s post:

Contracts that fail to operate as efficient and effective tools for communication add to the likelihood of expensive mistakes and oversights.

I have only a couple of points to add. First, consider the following:

Many contracts remain unintelligible to anyone who is not a trained professional. Often this appears to be a deliberate strategy – let’s make reading and analysing this so hard that no one will want to do it.

… This means that [contracts] are intelligible to judges and lawyers and unintelligible to most others.

I think it’s generous to assume that those who draft contracts using traditional contract language know what they’re doing. Most of them don’t. They’ve learned drafting by regurgitating. They’ve had no guidelines to follow. They’ve received little or no training. So they might think they know what they’re doing, but so much of it is based on misconceived conventional wisdom.

And whether lawyers are at a law firm or at a company, the dynamics are such that most probably don’t have the luxury of dismantling the machinery and rebuilding it. Instead, they’re on a train barreling down the track, and they have to keep churning out deficient contracts the traditional way.

It follows that I don’t think that the incoherence of traditional contract language is deliberate. Instead, it’s the logical result of an incoherent system.

And second, Tim closes his post as follows:

So this brings me to the key concern, which is that there is so little focus or training on the sort of design and drafting skills needed to support contracts that are fit for purpose. …

It is time for all those who are involved with drafting contracts to stand back and question why we are doing things the way we are and what negative consequences flow from it. Our documents should be clear, easy to understand, simple to interpret and implement. Sustaining approaches that undermine these principles may be good for job protection, but should not be a source of pride.

Yes, not enough attention is paid to training and optimal language and substance, but on the positive side, we now have a comprehensive set of guidelines for contract language, and it has sold tens of thousands of copies. We’re increasingly relying on research instead of conventional wisdom. And document-assembly technology can be used to scale quality contract language.

So instead of asking people to think their way out of the morass of traditional contract language and the traditional contract process, let’s propose specific alternatives. The cultural obstacles to change remain daunting, but offering specific solutions would increase the odds of change happening. In the coming months, I’ll try to do my bit in that regard.

Posted in Process | 2 Comments

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  • Chris Lemens

    Ken:

    “Many contracts remain unintelligible to anyone who is not a trained professional.” I disagree. Many contracts remain unintelligible to everyone, even to trained professionals. When the contract is unintelligible, more training in the reader doesn’t help. In some cases, the more training you have, the more you realize that the contract is unintelligible.

    “This means that [contracts] are intelligible to judges and lawyers and unintelligible to most others.” Yes, we lawyers need to get our stuff together. But the worst contracts I have ever read were prepared by contract management or procurement departments. The lawyers on both sides couldn’t make heads or tails of them and ended up deleting huge chunks. Traditional, precedent-bound, dysfunctional contract drafting is nowhere as common as in contract management and procurement departments.

    Chris