Did you know, lawyers spend roughly 40-60% of their time on drafting and reviewing contracts?
Contract review is important, but tedious work. It requires the unique combination of legal expertise and the ability to interpret legal language that only lawyers possess. But reviewing many, often similar, contracts as part of a large transaction can be mind-numbing. Paragraphs written differently may mean the same thing. But similarly written paragraphs with a single word change can flip the meaning. Keeping it all straight is a challenge.
But the review isn’t the end goal. Your clients want you to interpret and explain what these contracts mean to them. That means translating legal language into business language and assessing risk – a largely subjective task. This kind of interpretation is precisely why the world needs lawyers and requires a significant amount of human expertise. Legal technology using machine learning and artificial intelligence (AI) can help automate some of the tedious parts of the process.
|How do you use AI for contract review?
|The benefits of contract review software
|Mistakes organizations make with contract reivew software
|Getting started with contract review software
How do you use AI for contract review?
Machine learning is a subset of artificial intelligence, that uses algorithms to “teach” software to learn from a data set and perform certain tasks. In contract review, this means using a set of hundreds or thousands of real contracts to teach the software to identify pieces of information.
For instance, Document Intelligence can identify pertinent information from hundreds or thousands of documents in minutes. Thomson Reuters Practical Law attorney editors train Document Intelligence to identify contract types, contract provisions, and terms. It can also extract key figures like payments and dates for obligation data you can trust. Go beyond keyword search and tap into truly accurate results based on the context and intent of the text itself. With answers delivered almost instantly, users have accelerated information retrieval and review by more than 50%.
Once the tool has extracted this data, it can use it in several helpful ways. You might want to see analytics or data visualization for a large group of contracts. Or you might simply want to see clauses side by side for comparison. Perhaps you’d like to get drafting guidance delivered right in Microsoft Word based on your organization’s contract playbook. With a tool like Document Intelligence, that’s easy.
Document Intelligence delivers structured contract data for analysis, confirmation, drafting, negotiation, and visualization. Data can also trigger workflows. You might want to route a particular contract to a specialist for additional review. So, when the tool identifies a contract as pertaining to property leases, for instance, it can automatically route it to your real estate team.
The benefits of contract review software
Contract review software is best suited for triage and data extraction from legal contracts at volume. It eases the burden of keeping track of similar pieces of information across documents – something human brains aren’t very good at, but at which computers excel. We might call this the administrative work of contract review.
But as we discussed, the real value lawyers offer their clients is the human interpretation and analysis that turns legal language into valuable business insight. If machine learning can take on more of this “administrative” work, it frees lawyers up to focus on the valuable human work clients care about. This might mean faster reviews or a higher possible volume, but it will certainly mean happier clients.
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Mistakes organizations make with contract review software
When companies rely on their legal team or domain experts to independently train AI models to align with their organizational needs, it often leads to a delayed realization of value and less precise outcomes. Consequently, initial high expectations may turn into disappointment. The reason for this is two-fold:
- AI requires a substantial amount of data, and that large volume of data also must be diverse to build scalable and accurate models.
- Most legal teams aren’t experts in training AI models and have a never-ending, growing to-do list. While the desire to innovate is strong, it becomes challenging to invest significant time in training AI when the business demands our utmost attention to fulfill our legal duties.
Document Intelligence is trained by Practical Law attorney editors and experienced subject-matter experts to work on day one. Models are robust and continuously improved, at no additional cost to the customer.
Getting started with contract review software
It’s remarkably easy to get started with contract review software. You can be up and running in a matter of days – not weeks or months – thanks to pre-trained models from Practical Law attorney editors. Imagine the time savings (and money saved on headache medicine) of a contract review tool that can help you identify and organize your contracts, freeing you up to do legal work – not paperwork.