Deconstructing Contracts: A Look at Universal Data Models
"The Golden Age of Contractual Insight and Innovation is Near: But First, You Need a Universal Data Model" panel at Legalweek explored some of the challenges lawyers face with regard to maintaining their contract databases.
January 30, 2019 at 10:13 AM
3 minute read
The original version of this story was published on Legal Tech News
Reading may be fundamental, but it certainly isn't cost-efficient. That was the upshot of Legalweek 2019′s "The Golden Age of Contractual Insight and Innovation is Near: But First, You Need a Universal Data Model" panel on Tuesday.
Moderated by Jamie Wodetzki, chief product officer and co-founder of Exari, the panel explored the challenges lawyers face in trying to quickly review or retrieve key pieces of data from existing contracts. Joining Wodetzki were Oliver Round, counsel and vice president of BNY Mellon, and Michael Willis, director of forensic technology solutions at PricewaterhouseCoopers.
The first half of the panel focused on how some of the traditional methods of reviewing contracts—i.e., keyword searches or reading—are both time-consuming and nonconducive to times of regulatory change.
Willis used Brexit as an example of a development that is forcing clients to reevaluate and in some cases update contracts en mass as they prepare for the possible legal or regulatory changes that could accompany the United Kingdom's withdraw from the European Union.
"It's just a huge, huge headache," Willis said.
Round argued that "good" is a temporal condition, at least when it applies to contracts. Sooner or later regulations will change—think along the lines of the European Union's General Data Protection Regulation—or a client will wake up in the middle of the night with a burning question about a clause buried deep into the body of the document.
"All these issues that you're pointing out, they're also magnified by volume," Round said.
While businesses tend to be interested in commercial and operational contract data, lawyers are drawn to clauses associated with risk. But finding all of the needles in the haystack and putting them in the correct order may just be a matter of putting the right data in the right places.
The panelists argued in favor of utilizing contracts based on a universal data models, which establish how different pieces of information are connected to one another as well as processed and stored within a system.
In the body of a contract, the various data points might be organized in terms of the parties involved or the terms of the arrangement. Utilizing a model could make it easier to compare different contracts or perform overall maintenance.
According to Willis, universal contract models create efficiency and robustness. But the panel also noted that there are some of potential downsides to such models as well, including upfront effort involved and the general unfamiliarity associated with any new system.
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