For Change in Contract Drafting, You Need Supply and Demand

This post is my response to @ronfriedmann‘s tweet below.

If you want clearer, more effective contracts, you need two things: supply and demand.

Supply

By “supply,” I mean that you have to provide lawyers with suitable materials. The foundation is a set of guidelines for the building blocks of contract language; that’s what I’ve attempted to provide with A Manual of Style for Contract Drafting.

But that’s nowhere near enough. Contracts are fiendishly complicated. They require subject-matter expertise and writerly chops. They involve endless decisions. And the stakes are high. So most lawyers, if left to their own devices, will produce contracts that are less than optimal.

Progress requires putting as many people as possible out of the business of drafting contracts. You do that by giving people quality templates instead of expecting them to create their own—endlessly reinventing a wobbly wheel is not a good use of anyone’s time. Ideally, the templates would be automated, so instead of copy-and-pasting, you create contracts by answering an online questionnaire.

What’s now on offer is inadequate. Instead of rummaging through contracts filed by public companies on the SEC’s EDGAR system, you could subscribe to a service that makes what’s on EDGAR more accessible. That would tell you exactly what’s out there, but it wouldn’t tell you what’s any good or what suits your needs.

You could subscribe to a service that offers purpose-built templates. But what you would get is templates drafted by BigLaw veterans who give BigLaw what they expect. It reminds me of the practice, in the bad old days, of feeding slaughterhouse scraps to livestock.

I remain of the view that without strong editorial guidelines and real subject-matter expertise, quality templates are an illusion. This week I revived what remains my sole attempt at that sort of quality, namely my confidentiality-agreement template, automated using Contract Express. For more about that, see this post.

Demand

It would be a straightforward matter to build a library of further such templates, but now we get to the tricky part: demand.

Individual lawyers at law firms might be models of efficiency, but I’ve seen no sign that BigLaw generally is willing or able to shift from dysfunctional copy-and-pasting. As regards companies, there’s a lot of talk about making the contract process more efficient, and conference sessions on contract drafting are always a popular draw. But based on the little I’ve seen, it’s rare for companies to bring real change to bear.

Is that because templates are good enough? Well, there’s loads of room for improvement. For more about that, go here for @DCaseyF‘s take on some critiques I’ve offered. Instead, I suggest that the culprit is inertia. Go here for a bunch of my posts about inertia.

Building a rational contract process requires standards, a clear vision, teamwork, stamina, and a fierce commitment to orderliness. Perhaps those are qualities that aren’t as abundant as they should be.

But the saving grace of contract drafting is that unlike, say, electoral democracy, you don’t have to follow the herd off the cliff. If you want real quality, it’s there for the taking.

 

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.