Jusletter IT

Designing Readable Contracts: Goodbye to Legal Writing – Welcome to Information Design and Visualization

  • Author: Helena Haapio
  • Category: Articles
  • Region: Finland
  • Field of law: Legal Visualisation
  • Collection: Tagungsband-IRIS-2013
  • Citation: Helena Haapio, Designing Readable Contracts: Goodbye to Legal Writing – Welcome to Information Design and Visualization, in: Jusletter IT 20 February 2013
While readability, user-centeredness and simplification have influenced many fields, they have hardly caught the attention of the legal or contracting community. The focus of contract drafters has been predominantly on the needs of lawyers: litigants, judges, and arbitrators. The needs of clients have been to a great extent neglected. For clients, most contracts look like legal documents that only experts can decode. If we prioritize the needs of clients, legal writing is not the way to go. Changing the way contracts are written, moving from legalese to plain language, certainly helps. Yet this paper argues that a more profound change is required. While contracts need to be legally sound, their design should be driven by what clients want and deserve: readable contracts that they can easily understand and act upon. This paper presents samples of contract prototypes produced using information design and visualization. User test results and research work in progress indicate that these approaches have the potential to fundamentally change the way contracts are designed, communicated and perceived, offering unexplored opportunities for both research and practice.

Inhaltsverzeichnis

  • 1. Introduction: What
  • 2. Clients Need (and Deserve) Better, Readable Contracts
  • 3. Readability through Information Design and Visualization
  • 4. Examples of Using Information Design and Visualization in Contracts
  • 5. Conclusion
  • 6. References

1.

Introduction: What ^

 

«There are two things wrong with almost all legal writing. One is its style. The other is its content.» Fred Rodell, Professor of Law, Yale University.

 

[1]
These comments were made by Fred Rodell in «Goodbye to Law Reviews», an article published in Virginia Law Review in 1936.1 Although expressed more than 75 years ago, this criticism still applies to today’s legal writing. Sadly, it also applies to contract drafting.
[2]
While some people see contract drafting as a subset of legal writing, there are quite significant differences between the two. Companies do not make contracts just for the legal department or future litigation; they make contracts to reach business objectives. Apart from being legal tools, contracts are management tools.2 Their addressees are seldom judges or arbitrators, and the vast majority of their readers do not have law degrees. Despite all this, legal writing seems to dominate in contracts. From lawyer-crafted forms and templates it has spread widely into the contracting community. New people entering the community may at first question the style, but then adopt it as part of the culture. Newcomers, too, want to make their contracts look «professional» and «legal».
[3]

As regards style, most contracts resemble laws, with all their dense text, paragraphs, and internal references. They are structured in a peculiar way and use language that non-experts often find overly complicated and hard to understand. Contract drafters tend to copy-paste clauses and prefer «tested language» in widely used clauses. Such language is presumed to have a clearly established and «settled» meaning. The result is often a writing style that has, according to one critic, four outstanding characteristics. It is «(1) wordy, (2) unclear, (3) pompous, and (4) dull».3 «Tested language» and «settled» meanings are in fact language that has been the subject of litigation. Which raises the question: why rely on language that resulted in litigation? While such language may help to win a battle in court, it does not help those who want to avoid such conflict.

[4]

As regards content, current contracts tend to focus on worst case scenarios rather than on how the parties will work together to secure business success. Year after year, limitations of liabilities and indemnities top the list of most frequently negotiated contract terms.4 While the terms dealing with consequences of failure, claims, and disputes are important, contract drafters should not overlook the fact that a large part of contracts – and the information needs of everyday contract users – are about business and financial terms, such as statements of work, specifications, and service levels.5

[5]
This paper argues that all good writing – legal or otherwise – begins with an understanding of what the audience needs and expects, and adapting one’s message accordingly. Even the best legal writing is misplaced if it does not serve the needs of clients. Contracts are too often designed not for clients who want to succeed in business – they are designed for lawyers who seek to protect their clients in case of a dispute. Well-meaning lawyers may in fact be doing their clients a disservice by drafting contracts that their clients find non-readable or only lawyer-readable.
[6]
Do lawyers purposely ignore the needs and wishes of their clients and communicate in ways that hinder communication? If the answer is no, what is to be done? After looking into clients’ needs, this paper proposes information design and visualization as the way forward.

2.

Clients Need (and Deserve) Better, Readable Contracts ^

[7]

In order for contracts to work effectively as both business tools and legal tools, they need to communicate information effectively to both business and legal audiences. So far, the focus of contract drafters has been predominantly on the needs of the latter. Generations of law teachers have equated contracts with contract litigation, the subject of their courses.6 Most of the discussion about using contracts has been about applying them in court, reactively, ex post, after a dispute has arisen. Business people – clients – as users and readers of contracts have been neglected to a great extent. Contract readability is seldom even discussed. If it is, this happens in the context of ambiguity, vagueness, loopholes and other legal problems encountered when interpreting contracts in court or in the shadow of a dispute. While these discussions remain important, readability in clients’ commercial contexts is a different issue.7

[8]
In the words of Professor Thomas D. Barton, one recurring barrier to successful contracting is the «exaggerated and largely unnecessary separation between the business goals that clients seek to achieve, and the legal methods by which contractual relationships are created and managed.»8 Irene Etzkorn, a simplification expert, put it more bluntly: «The most common mistake I encounter is major companies allowing the Legal department to tyrannize the rest of the company.»9
[9]
For a long time, business decision makers have complained about contracts being overly legalistic and difficult to work with. There is often a wide gap between deal-making and deal-drafting; managers drive the former, while lawyers drive the latter. Lawyers’ drafting easily alienates clients, including the executives and domain experts whose contributions would be crucial to the success of those contracts. If clients disengage too much from the process, there is a danger that, echoing the title of a book chapter by Professor Deepak Malhotra, a great deal ends up with a terrible contract: «Great Deal, Terrible Contract».10
[10]
It seems as if there were two separate worlds: business and law, and a tension between the two. Yet most contract-related issues do not fall neatly into either a purely legal or a purely business domain, and any gap between them needs to be bridged. After all, deal-drafting is (or should be) directed by deal-making: business decisions shaping the relationship to be formed along with its expected scope, duration and other terms. Contract contents reflect (or should reflect) business decisions such as risk tolerance and the underlying business terms.
[11]
Adding to the challenges are the issues that can arise from a disconnect between the pre-contract and post-contract processes. After negotiating and signing, the parties should follow the plan embodied in their contract. Contracts do not make things happen – people do. Even the best contracts in the world do not work if they are not read and understood. Once a commercial contract is made, its implementation is normally entrusted to project and operational teams. Most of the team members are not lawyers. Instead of empowering them and telling them what to do, current contracts intimidate and confuse them. Major contract risks are in fact caused by the gaps when information and responsibility are transferred from one team to the other.11
[12]
In many contexts, usability and user-experience are considered important dimensions of quality. Not so in contract drafting. Up until recently, if quality issues have been addressed in this context at all, the focus has been on «legal quality». Lawyers are trained to look at contracts through the eyes of a judge who might eventually have to rule on a contract dispute. Thus a good quality contract, from the lawyers’ perspective, is one that is enforceable. While clients want their agreements to be enforceable, they also want contracts that enable them to achieve their business goals. As law professors Ian Macneil and Paul Gudel note in their book Contracts: Exchange Transactions and Relations, «[o]nly lawyers and other trouble-oriented folk look on contracts primarily as a source of trouble and disputation, rather than a way of getting things done.»12
[13]
For successful contracting, coordination between the managerial and legal perspectives is needed. When translating the deal into a contract and then again translating the contract into action, managerial-legal communication must succeed. Lawyers, too, need to understand the parties’ business deal and relationship. This requires close collaboration and dialogue with management and subject matter experts.13 Experienced contracts professionals know this and the importance of management involvement, both at the contract planning and implementation stage, yet they often lack the appropriate tools and training to engage management. This is where information design and visualization enter the picture.

3.

Readability through Information Design and Visualization ^

[14]
Information design can be defined in many ways. One way is to say that it applies graphic design principles to information in order to communicate the information more effectively. Another is to say that it is the process of identifying, selecting, organizing, composing, and presenting information to an audience so that it can be used efficiently and effectively by that audience to achieve a specific purpose.14 Visualization – adding charts and images to supplement text – is a core part of information design.
[15]
The ultimate goal of information design is clear communication and enabling users to interact with the information. The selection of methods used is based on what is suited to express the particular information at hand, to the particular user group, in a particular context. For easier reading, more prominence needs to be given to what is more relevant to the user.15 Text alone can seldom provide prominence or salience to a piece of information. Visualizations can be used to do this, to make sure that the most important points are not lost.
[16]
This paper makes the obvious yet often forgotten point that contract information is hardly ever intended for lawyers alone. Contract information is intended also – and predominantly – for business people, such as people in sales and procurement who need to capture and articulate crucial contract requirements and other data, and people in project, delivery and operational teams who are in charge of implementing the contracts and translating them into desired action.
[17]
Information design has a lot to offer to contract drafting. It puts the user, in our case, the business people and the client, in the center. Here, readability comes to the fore. While every MS Word user has access to tools that help measure the likely reading ease – or difficulty – of a contract (or any text), those tools are seldom used in this context.16 Instead of readability, most lawyer-drafters still focus on drafting contracts that are binding, enforceable, unambiguous, and provide solutions for all imaginable contingencies.17 For clients, however, readability matters. And for clients, the core of contract design should be securing the performance the parties expect, not just a contract.18
[18]
The proponents of plain language19, simplification20, minimalism21 and lean contracting22 have suggested major changes in document design and drafting along the way, but not much seems to have happened in the field of contracting. Instead, the trend seems to be towards more complex contracts. The increase in the length of documents «appears to be blindly accepted as a necessary improvement over the quaint, brief ... documents of simpler times.»23
[19]
Information design and visualization may start to change the picture, by offering contract drafters new and better methods to truly serve their clients. It is not enough to know how to write well; one should also learn to engage others in the process, elicit information, and communicate the core message effectively to the different readers. If we take the goal of readable contracts seriously, the contract drafter’s job changes from merely drafting a clear, enforceable contract (along with appendices) to designing communication with multiple user groups and varying information needs.

4.

Examples of Using Information Design and Visualization in Contracts ^

[20]
At the Aalto University, a multi-disciplinary research project was started in 2011 seeking to develop and apply new, easier methods for cooperation, co-creation, contracting, and interaction.24 Drawing on research in Proactive Law,25 information design, user-centeredness, and other fields, the aim is to develop, prototype, and test new approaches to commercial contracts in order to increase their understandability and usability and to enhance companies’ ease of doing business.
[21]
Figure 1 shows an example of two clauses in a contract prototype, a Framework Agreement for the procurement of certain industrial services, produced using information design and visualization.

Figure 1: Examples of visualized clauses in a Framework Agreement: validity (top) and storage conditions (bottom). (© 2012. Aalto University / Stefania Passera. Used with permission.)

[22]
More examples of this prototype can be found in recent publications by Stefania Passera and the Author26 and also at http://www.shok.fi/public/files/smedlund.pdf (accessed 24.1.2013). The samples show «Before» and «After» depictions of some pages of the Framework Agreement, first in their original, text-only fashion, and then after information design and visualization have been used. In the redesigned Table of Contents, recurring topics are color-coded, showing how the various clauses of the contract are related to the various Appendices, making the logic and structure more visible. In the other redesigned pages, the color-coding and layout highlight the core contents of the clauses, giving both an overview and insight into certain abbreviations, terms, and processes.
[23]

In these examples, the text of the contract has remained the same. Here, visuals are not intended to substitute text; they are used to clarify it. The sample contract prototype produced using information design and visualization in this case study incorporates

  • document design principles that make them easier to read and to use
  • images and summaries that show the big picture framework
  • icons and graphics that provide an overview and emphasize key points
  • visual cues that provide prominence to certain pieces of information
  • a layout and colors that engage readers and help them navigate the materials
[24]
The usability and user-experience of this contract prototype are in the process of being evaluated. From a theory-construction viewpoint, the results of the early case studies are preliminary but encouraging: they clearly indicate positive results and a strong user preference for a visualized contract as opposed to a text-only version.27 The new approach obviously involves risks, and questions such as potential conflicts between text and images need to be resolved. Some of these questions can be resolved contractually, others require further research. More prototypes, user tests and research are also required to suggest, for example, which methods work best for which users or contexts. In any case, the early results point to the direction that the benefits outweigh the risks and that much can be gained by merging contract design with information design and visualization.
[25]

In addition to the obvious benefits this merger can bring to clients, it offers benefits to lawyers as well. For instance, a visualization of the scope, delivery limits, or technical aspects of a product or system can help lawyers elicit information about and understand the core issues involved. Process maps and swim lanes can be used to visualize business processes that involve more than one department (for example, customer, sales, contracts, legal, and fulfillment) to clarify the sequence of events, how information or material passes between sub-processes, and how various parties’ actions depend on one another. Swim lanes can also be used to illustrate the steps and who is responsible for each one, as well as how delays and mistakes are most likely to occur.28 Timelines can be used to clarify contract duration and help the parties articulate tacit assumptions and clarify and align expectations.29 And the list goes on.

[26]
Experience and research show that the same issues repeat themselves and create problems in similar contracting situations. For instance, if technical specifications, work scope definitions, or task allocations are unclear, problems are likely to follow during implementation. Focusing business, technical and legal resources on such issues and developing visualized solutions to resolve them is well worth the effort. Taking time at the beginning to work out a truly shared understanding of the core points is equally important to both sides of the deal. It is also important to lawyers who aim at helping their clients reach their business objectives.

5.

Conclusion ^

[27]
Lawyers in charge of contract drafting seldom view themselves as information designers. Their attention is normally focused on matters other than contracts’ readability or «look and feel». In complex multi-million deals, these may seem trivial for lawyers. Yet for clients whose rights and responsibilities depend on those contracts, these things count, too. Overly complex contracts are easily misunderstood, and their implementation may fail. Such contracts are of little or no value for clients. In fact, their value may be negative.
[28]
If we prioritize the needs of clients, legal writing is not the way to go about contract drafting. We need to expand beyond legal concerns and focus more on how we can support clients in succeeding in contract implementation. While protecting clients in a dispute is important, it should not be the primary goal of contract drafting. The primary goal should be articulating the terms of the deal and presenting information so that it can be used by clients to deliver on the promises made, foster good business relationships, and reduce the risk of future litigation.
[29]
This paper proposes information design and visualization as the way forward. Using these approaches at the contract planning and preparation stage, the drafter can engage domain experts and management in the process and collaborate with them to translate goals, expectations and promises into contracts that are understood in the way intended. Embedded into contract design, information design and visualization can facilitate cross-professional communication and help produce readable contracts: contracts that clients can easily understand and act upon.

6.

References ^

Albers, Michael J., Information Salience and Interpreting Information. In: SIGDOC ‘07 Proceedings of the 25th annual ACM international conference on Design of communication, 22–24 October, El Paso, Texas. ACM, New York, NY, pp. 80–86. (2007).

Barton, Thomas D., Collaborative Contracting as Preventive/Proactive Law. In: Berger-Walliser, Gerlinde & Østergaard, Kim (eds.), Proactive Law in a Business Environment. DJOF Publishing, Copenhagen, pp. 107–127 (2012).

Cummins, Tim, Contracting as a Strategic Competence. International Association for Contract and Commercial Management IACCM. http://www.iaccm.com/library/nonphp/contracting.pdf last accessed 11.12.2012 (2003).

DiMatteo, Larry, Siedel, George & Haapio, Helena, Strategic Contracting: Examining the Business-Legal Interface. In: Berger-Walliser, Gerlinde & Østergaard, Kim (eds.), Proactive Law in a Business Environment. DJOF Publishing, Copenhagen, pp. 59–106 (2012).

Etzkorn, Irene A., Ten Commandments of Simplification. http://centerforplainlanguage.org/about-plain-language/ten-commandments-of-simplification/ last accessed 24.12.2012 (n.d.).

Evans, Martin, Criteria for Clear Documents: a Survey. Technical paper 8. Simplification Centre, University of Reading. http://www.simplificationcentre.org.uk/downloads/papers/SC8CriteriaSurvey.pdf last accessed 11.12.2012 (2011).

Haapio, Helena, A Proactive Approach to Law. In: Schweighofer, Erich, Geist, Anton & Staufer, Ines (eds.), Globale Sicherhet und proaktiver Staat – Die Rolle der Rechtsinformatik. Tagungsband des 13. Internationalen Rechtsinfromatik Symposions IRIS 2010. 2nd edition. Österreichische Computer Gesellschaft, Wien, pp. 625–628 (2010).

Haapio, Helena, A Visual Approach to Commercial Contracts. In: Schweighofer, Erich & Kummer, Franz (eds.), Europäische Projektkultur als Beitrag zur Rationalisierung des Rechts. Tagungsband des 14. Internationalen Rechtsinformatik Symposions IRIS 2011. Österreichische Computer Gesellschaft, Wien, pp. 559–566 (2011).

Haapio, Helena, Making Contracts Work for Clients: towards Greater Clarity and Usability. In: Schweighofer, Erich, Kummer, Franz & Hötzendorfer, Walter (eds.), Transformation juristischer Sprachen.Tagungsband des 15. Internationalen Rechtsinformatik Symposions IRIS 2012. Österreichische Computer Gesellschaft, Wien, pp. 389–396 (2012).

Haapio, Helena, Contract Pictures: A Means to Prevent Misunderstandings and Unnecessary Disputes. Paper accepted for presentation at the 16th International Legal Informatics Symposium IRIS 2013, Salzburg, Austria 21–23 February 2013. (2013).

Haapio, Helena & Siedel, George, A Short Guide to Contract Risk. Gower Publishing, Farnham (2013).

Hayhoe, George F., Telling the Future of Information Design. Communication Design Quarterly Review, Vol. 1, Issue 1, Fall. http://sigdoc.acm.org/wp-content/uploads/2012/09/CDQR_1-1_Fall2012.pdf last accessed 11.12.2012 (2012)

Hetrick, Patrick K., Drafting Common Interest Community Documents: Minimalism in an Era of Micromanagement. Campbell Law Review, Vol. 30, Issue 3, Spring, pp. 409–435. http://scholarship.law.campbell.edu/cgi/viewcontent.cgi?article=1472&context=clr last accessed 11.12.2012 (2008).

IACCM, 2011 Top Terms in Negotiation. International Association for Contract and Commercial Management IACCM. https://www.iaccm.com/members/library/files/top_terms_2011_1.pdf last accessed 11.12.2012 (2011).

Kimble, Joseph, Lifting the Fog of Legalese. Carolina Academic Press, Durham, NC (2006).

Kimble, Joseph, Writing for Dollars, Writing to Please. The Case for Plain Language in Business, Government, and Law. Carolina Academic Press, Durham, NC (2012).

Macneil, Ian R. & Gudel, Paul J., Contracts – Exchange Transactions and Relations. Cases and Materials. 3rd edition. Foundation Press, New York, NY (2001).

Malhotra, Deepak, Great Deal, Terrible Contract: The Case for Negotiator Involvement in the Contracting Phase. In: Goldman, Barry M. & Shapiro, Debra. L. (eds.), The Psychology of Negotiations in the 21st Century Workplace. New Challenges and New Solutions. Routledge, New York, NY, pp. 363–398 (2012).

Mellinkoff, David, The Language of the Law. Little, Brown & Co., Boston, MA (1963).

Passera, Stefania, Enhancing Contract Usability and User Experience through Visualization – An Experimental Evaluation. In: Banissi, Ebad et al. (eds.), 16th International Conference on Information Visualisation, IV2012, 11–13 July 2012, Montpellier, France. IEEE Computer Society, Los Alamitos, CA, pp. 376–382 (2012).

Passera, Stefania & Haapio, Helena, The Quest for Clarity – How Visualization Improves the Usability and User Experience of Contracts. Manuscript submitted for publication in Huang, Maolin & Huang, Weidong (eds.), Innovative Approaches of Data Visualization and Visual Analytics (DVVA 2013). IGI Global (forthcoming)

Pohjonen, Soile & Visuri, Kerttuli, Proactive Approach in Project Management and Contracting. In: Haapio, Helena (ed.), A Proactive Approach to Contracting and Law. International Association for Contract and Commercial Management & Turku University of Applied Sciences, Turku, pp. 75–95 (2008).

Readability scores. Microsoft Office Word Help (2003).

Rodell, Fred, Goodbye to Law Reviews. Virginia Law Review, Vol. 23, November, pp. 38–45 (1936).

Siedel, George J. & Haapio, Helena, Using Proactive Law for Competitive Advantage. American Business Law Journal, Vol. 47, Issue 4, Winter, pp. 641–686 (2010).

Siedel, George & Haapio, Helena, Proactive Law for Managers: A Hidden Source of Competitive Advantage. Gower Publishing, Farnham (2011).

Waller, Rob, Information Design: How the Disciplines Work Together. Technical paper 14. Simplification Centre, University of Reading. http://www.simplificationcentre.org.uk/downloads/papers/SC14DisciplinesTogether.pdf last accessed 11.12.2012. (2011a).

Waller, Rob, What Makes a Good Document? The Criteria We Use. Technical paper 2. Simplification Centre, University of Reading. http://www.simplificationcentre.org.uk/downloads/papers/SC2CriteriaGoodDoc_v2.pdf last accessed 11.12.2012 (2011b).

Weatherley, Steven, Pathclearer: A More Commercial Approach to Drafting Commercial Contracts. Law Department Quarterly, October–December, pp. 39–46. http://www.iaccm.com/members/library/files/pathclearer%20article%20pdf.pdf last accessed 11.12.2012 (2005).

 

 

Helena Haapio, Business Law Teacher & Researcher, University of Vaasa / International Contract Counsel, Lexpert Ltd.

 

Acknowledgments

Part of the work presented in this paper was carried out in the FIMECC research program User Experience & Usability in Complex Systems (UXUS) financed by Tekes, the Finnish Funding Agency for Technology and Innovation, and participating companies.

 

 

  1. 1 Rodell 1936, 38.
  2. 2 Haapio/Siedel 2013, 11.
  3. 3 Mellinkoff 1963, 24.
  4. 4 IACCM 2011.
  5. 5 Nearly 80 per cent, according to Cummins 2003, 4.
  6. 6 Macneil/Gudel 2001, 2.
  7. 7 Readability can be defined in many ways and various readability formulas exist. This paper uses readability as an umbrella term for clarity along with functionality, usability, user-experience, and other (good) qualities of contracts that clients can easily understand and act upon. – For making contracts work for clients, see Haapio 2012. For what makes a good document more generally, see Waller 2011b. For differing approaches and criteria used to evaluate the clarity of documents, see also Evans 2011.
  8. 8 Barton 2012, 108.
  9. 9 Etzkorn n.d.
  10. 10 Malhotra 2012.
  11. 11 Haapio/Siedel 2013, 44–46, 147–149 and Haapio 2012.
  12. 12 Macneil/Gudel 2001, vii–viii.
  13. 13 See, e.g., Haapio 2011, with references.
  14. 14 Hayhoe 2012, 23. – The author calls the first the ornamental approach and the second the holistic approach.
  15. 15 Albers 2007.
  16. 16 Two readability formulas, Flesch and Flesch Kincaid, are built into MS Word, as part of Tools / Spelling and Grammar. See Readability scores. Microsoft Office Word Help 2003. The scores MS Word gives for these formulas reflect readability in the narrow meaning of the word, rather than readability as used in this paper: see FN 7 above.
  17. 17 Pohjonen/Visuri 2008, 82–84.
  18. 18 Haapio 2011 and 2012.
  19. 19 Kimble 2006 and 2012.
  20. 20 Waller 2011a and 2011b and Etzkorn n.d.
  21. 21 Hetrick 2008.
  22. 22 Weatherley 2005 and Siedel/Haapio 2010 and 2011.
  23. 23 Hetrick 2008.
  24. 24 The project looks into contracting in the Finnish Metals and Engineering Competence Cluster (FIMECC) as part of User Experience & Usability in Complex Systems (UXUS), a five-year research program financed by participating companies and Tekes, the Finnish Funding Agency for Technology and Innovation. See also Haapio 2012.
  25. 25 See, e.g., Haapio 2010, Siedel/Haapio 2011, and DiMatteo et al. 2012.
  26. 26 See, e.g., Passera 2012 and Passera/Haapio (forthcoming). The examples are part of a case study carried out in a Finnish company operating in the metals and engineering sector. More prototypes and case studies are underway.
  27. 27 Passera 2012 and Passera/Haapio (forthcoming).
  28. 28 For an example, see, e.g., the Wikipedia entry Swim lane, available at http://en.wikipedia.org/wiki/Swim_lane accessed 24.1.2013.
  29. 29 Haapio 2013 and DiMatteo et al. 2012.

Lawjobs

        There are currently no records for specified RSS feed.

News@Weblaw

Per§onalia