How Many Years of Education Does It Take to Understand the Average Business Contract? (Trick Question!)

I noticed that WorldCC and Deloitte Legal have produced a report entitled The ROI of Contracting Excellence 2023. (Go here to ask for a copy.)

It’s mostly unrelated to what I do, but I noticed this passage on page 11 of the report:

In consumer markets, many organizations (and regulators) have grasped the importance of greater balance and of simplifying the wording and structure of agreements, so that confusion and ambiguity are reduced. Similar trends are under way in the business-to-business and business-to-government markets – and these can have massive benefits in the speed of reaching agreement and reducing performance risks.

I suggest that the authors are burying the lede. The dysfunction of traditional contract language, in terms of what they say and how they say it, means that most contracting is to some extent an exercise in garbage in, garbage out. It’s hard to create a coherent process out of dysfunctional contracts.

I don’t think WorldCC or Deloitte Legal has fully internalized that. For example, consider the following graphic on the same page of the report:

I assume the authors ran one or more contracts through readability software that measures readability by years of education, or they’re relying on someone who did. This report was produced in England. By my reckoning, anyone who graduates from university in England will have gone through 16 years of education, so I guess the 17th year is a postgraduate year of some sort. This is meant to be scary. The intended message is that understanding contracts requires a big brain.

But that doesn’t make sense.

Contracts are a specialized kind of writing. 17 years of education culminating in, say, a master’s degree in fine arts from the Courtauld Institute won’t equip you to understand business contracts.

But beyond that, even the education required to become a lawyer is unlikely to equip you to understand business contracts. In fact, most who work with contracts aren’t informed consumers of contract language. Instead, they copy, on faith, from contracts of questionable quality and relevance, and in doing so they rely on flimsy conventional wisdom. It requires self-study to elucidate the mysteries of traditional contract language and come up with workable alternatives. For example, what are the implications of excluding consequential damages? What are the implications of different efforts standards? What is the function of the “successors and assigns” provision? I could go on and on and on.

In other words, having a big brain isn’t enough to allow you to understand contract language. Instead, you have to be a pathologist willing to explore the diseases that afflict traditional contract language. Most of us don’t have the time, inclination, or expertise to do that, so we copy-and-paste. And the dysfunction persists.

Until we wise up to the dysfunction and do something about it, the contract process will remain inefficient.

In closing, regarding years of schooling, I’m fine with saying that to work with contracts, it’s best to have a college education. In other words, 16 years of education—only one year off the report’s scarifying 17 years. I say that without expecting any of those 16 years to be devoted to business contracts. Instead, the idea is that without a college education, it’s less likely you’ll have the literacy and semantic acuity that you need to look after yourself when producing or consuming contract language. (As I explain in this 2017 blog post, I’m not of the view that if a high-school student can’t understand a business contract, something’s wrong.)

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.

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