For a few years now, digital transformation has been challenging the way law firms have traditionally been working. The legal profession has had to evolve and adjust to new tech innovations, whether internally– such as with the expansion of remote working, the use of organization and management software– or externally, to respond to clients’ new needs and expectations. In particular, one way of responding to some of these new expectations has been to encourage the use of so-called “Legal Tech”, such as the use of bots to automate legal documents.
The problem of analog legal services
Legal smart bots are a Legal Tech tool which arose from the fact that many businesses, of all shapes and sizes, are often reluctant to seek legal advice before a dispute arises. Most notably, there has traditionally been a trend that businesses are discouraged to interact with their legal advisers, whether it is because of the cost of legal advice or because of a tendency to prioritize the operational side of the business’ expansion over the legal aspects. Thus, many businesses don’t require assistance to draft their legal documents and instead choose to “borrow” contracts from other big industry actors or to follow industry trends and templates, in the hope that it will be secure enough.
However, such practices present disadvantages for businesses – the greatest one being the risk that a cookie-cutter agreement does not fit the individual requirements of the business using it. Indeed, terms of such documents may not cover all needs in terms of obligations, risk, liability, protection of confidential information and intellectual property. Moreover, resorting such practices can lead to reputational risk, for instance if the terms are clearly not adapted to the business model or even refer to another company. This could result in a loss of credibility and professionalism in the eyes of competitors or partners – and more importantly, clients.
So how can Legal Tech be the solution?
Sound, bespoke legal documents are an important asset to any business. So how can law firms use Legal Tech to help businesses prioritize legal projection and expansion without sacrificing or inhibiting the firm’s goals?
The numbers show that businesses are increasingly open to new solutions and especially to those offered by Legal Tech providers. Indeed, the use of online legal services is predicted to increase from 28% to 37% over the next 3 years[1]and 40% of consumers of legal services are interested in the convenience and low cost of online legal services[2].
Accordingly, suites of documents drafted for individual sectors of the economy (such as for SaaS providers, the HealthTech space or the recruitment industry) could seem like the solution for businesses looking to bridge the gap between fully bespoke legal documents and copy-and-pasted, one-size-fits-all contracts – all whilst respecting costs concerns.
However, smart contracts are not always a fool-proof solution to avoid all the risks set out above. Indeed, whilst in theory, a large portion of many agreements can be standardized to fit the industry in which they are used, each and every business is different. These specificities may not be captured by such standardized contracts.
Legal Automation combined with Human Intervention
Thus, the alternative could consist in the marriage of automation and human intelligence – resulting in contract automation bots, supplemented with human intervention. Available 24/7, supported by industry-specific lines of code which have each been written and curated by experienced lawyers, and powered by the interactions between the bot and the end-user, bespoke contract automation bots could become a landmark of the future legal landscape.
Indeed, such contract automation bots could meet the ease and flexibility requirements of businesses when conducting their daily business operations, without the associated costs which usually serve as an obstacle to businesses seeking professional legal advice. Moreover, bots that have been created by experienced lawyers, with human lawyer always on hand for additional advice and intervention can help automate provisions which reflect the parties’ appetites for risk and reward, the baseline mutual expectations and timelines regarding the services to be provided.
In conclusion, while in certain situations – such as low-risk negotiations requiring only light-touch legal involvement or renewals of a long-term and established contractual relationship – a contract automation bot (along with all the appropriately embedded information aids and human lawyers on hand) is enough to protect a business’ bases or support a founder as they venture into their latest business deal.
However, where such technology is not enough – for example where a high-stakes contractual negotiation requires the expert advice, or where a business’ line of work, operations or processes display unique features, or simply where an end-user prefers human commentary and explanations – a contract automation tool can be complemented by professional, human lawyers – powered by the expertise of professionals.
Conclusion
The field of Legal Tech is as vast as the fields of law and technology themselves. This article focuses on document automation as one solution to a specific pain-point felt by businesses across the world. In our opinion, any form of Legal Tech – whether it be automated dispute resolution, online assistance with consumer rights or legal document automation, whilst technology is excellent at the letter of the law, technology alone is not able to fully deal with the grey areas that so often arise in a lawyer’s practice – namely the personal, social, economic or strategic concerns that human clients have. This is why combining Legal Tech tools with the expertise of a qualified, human lawyer is desired, and even indispensable in many cases.
[1](Solicitors Regulation Authority, ‘Research and Analysis: The changing legal services market’ (Solicitors Regulation Authority, 2016) Available at <www.sra.org.uk/ risk/resources/changing-legal-services-market. page> Accessed 22 September 2019)
[2]((11) Solicitors Regulation Authority, ‘Research and Analysis: The changing legal services market’ (Solicitors Regulation Authority, 2016) <www.sra.org.uk/risk/resources/changing-legal-services-market.page> Accessed 22 September 2019)
