In this item on his blog, the inestimable Ron Friedmann ponders the extent to which an “open source” approach to work product would save time and money for law departments.
Here’s how Ron frames his thought experiment:
So assume that confidentiality, privilege, and competitive issues matter not, that law departments contributed a significant portion of work product—generated internally or by outside counsel—to a common pool (“The Corpus”), and that lawyers had software that allowed easy and effective searches of the Corpus.
The experiment’s goal is to to learn if lawyer efficiency would increase with access to the Corpus. The metric is the time lawyers would save (the “Savings”) versus not having access to The Corpus. What are some possible findings?
After considering the possible results, Ron offers one conclusion—that “we lack sufficient data to begin to estimate the Savings,” and that that’s a problem, as “the legal market needs a better sense of how its processes work, what really drives work effort, and how to save time.”
I endorse the notion of this thought experiment, but I urge Ron to take into account one factor that he doesn’t mention—that when it comes to contract drafting, the Corpus would be a dead skunk in the middle of the road, stinkin’ to high heaven.
That’s because mainstream contract drafting is dysfunctional, in terms of both language and process. (Click here for my National Law Journal article to that effect.) The contracts in Ron’s hypothetical Corpus would be a motley assemblage exhibiting, in general, deficient and inconsistent language. Furthermore, anyone hoping to dip into the Corpus would have to determine whether a given contract was reliable, in terms of deal mechanics and the law—a time-consuming task, and often a hopeless one. And it would be similarly problematic to reverse-engineer a given contract to determine what deal points or negotiated concessions lay behind which provisions, and then adjust the contract accordingly.
But it doesn’t require much imagination to get a sense of what Ron’s Corpus would look like for purposes of contract drafting: it would presumably look something like the SEC’s EDGAR system, in all its garbage-in-garbage-out glory.
These problems of consistency and reliability are why it’s hopeless to expect a “wisdom of the crowds” approach to bring efficiency to contract drafting. The only way to dramatically reduce costs and increase quality and reliability, for both law firms and law departments, would be to outsource to a suitably authoritative vendor the process of preparing and maintaining a library of document-assembly templates of the main categories of business contracts and organizational documents. Subscribers would use the system to quickly generate first drafts of much higher quality than could be achieved by scissor-and-pasting documents of questionable quality and relevance. And economies of scale would allow a vendor to accomplish what would be beyond the reach of most organizations, even assuming they had the necessary ambition and expertise.
This isn’t a new idea, but it would be, to use Ron’s words, “one way lawyers might save time and money and deliver more value to clients.” The only obstacle is inertia. And these days, inertia ain’t what it used to be.
By the way, click here for my April 2009 conversation with Ron on bringing change to contract drafting.
[Updated April 21, 2010: Kingley Martin—he of kiiac—has waded in. But Kingsley’s notions regarding the utility of the Corpus are rather different from the use that I had in mind when I wrote my post. I was thinking in terms of lawyers retrieving documents from the Corpus to use as precedent, whereas Kingsley is thinking in terms of data mining the Corpus—presumably with kiiac—to see the spectrum of how a given deal point is treated. That sort of analysis is a useful, even essential, part of developing a new template based on a large collection of precedent, but it’s very different from fishing in the Corpus for a few relevant contracts.
And I’ve mentioned to Kingsley that even when you’re data mining a body of contracts, you’re still utterly at the mercy of the conventional wisdom. Unless you have rigorous guidelines as to language and substance developed independently of the wisdom of the crowds, you’re sunk.
Ken, your diagnosis is spot on, but your prescription has problems, I think.
1. Busy law firms and in-house departments want to know, who else like us has successfully implemented this solution,, because in their minds they don't have time to be pioneers. So we have a classic chicken-and-egg problem.
2. Another problem is that lawyers seem to put more confidence in contract-clause authors, editors, and commentators who have significant experience in the lawyers' fields, and conversely, to be just a bit wary of authors who (according to the lawyers) haven't spent enough time in the trenches in the relevant field.
3. Still another problem is the not-invented-here syndrome: Many lawyers seem to feel it's their duty, as zealous advocates, to 'improve' any language that crosses their desks, no matter how 'authoritative,' to gain even a tiny advantage for their clients (and because they feel in their bones that they know better). For younger lawyers, this can arise in part out of a desire to impress clients and earn favorable attention from partners.
I think these are going to be major impediments to the kind of standardization you call for.
D.C.: Sure there would be resistance. But if it's done well, the sort of outsourcing I have in mind would offer advantages that, for a meaningful proportion of potential users, would outweigh whatever benefits they derive from fooling themselves regarding the current dysfunction.
More to the point, I suspect that like me, most lawyers find it deeply tedious and frustrating to constantly create first drafts by scissor-and-pasting precedent contracts. If you make available to the worker bees a sophisticated and intuitive tool that saves them time, improves quality, and provides practical training that they wouldn't otherwise get, I expect they'd want to use it.
And users would have to customize any draft to reflect the minutia of the transaction in question. That ought to be enough to allow them feel useful!
Ken
I agree with you, Ken, and I believe Practical Law Company, serving the UK and US markets, is that authoritative vendor, at least for many areas of law. I'm not sure they present their templates in document assembly format, but the content is excellent, and is accompanied by practice tips, checklists, legal updates and other pertinent information.
Empirical analysis of how specific contract terms are interpreted by courts would be helpful in developing form clauses.