Contract Review, Meet Contract Drafting.
Updated: Sep 24, 2019
By Ken Adams
After almost a year working on the factory floor at LegalSifter, it has become clear to me that contract review and contract drafting are closely allied functions.
Consider an issue I had occasion to look at recently, provisions saying that the U.N. Convention on Contracts for the International Sale of Goods (known to its friends as CISG) doesn’t apply to a contract.
We had to build a “sifter”—a piece of software—to look for that issue. So I dutifully trawled through various resources, looking for how people express this issue. Of course I found all sorts of variety. Here are four examples:
Notwithstanding the foregoing, pursuant to Article 6 of the United Nations Convention on Contracts for the International Sales of Goods (CISG), the parties expressly exclude application of the CISG in its entirety to this Agreement.
The sale of goods hereunder shall be governed, interpreted and construed by and in accordance with the internal substantive laws of the Republic of Italy, without regard to the conflict of laws provisions thereof, and expressly excluding the United Nations Convention on Contracts for the International Sale of Goods.
The United Nations Convention on Contracts for the International Sale of Goods will not apply to the Agreement.
The provisions of the United Nations Convention on Contracts for the International Sale of Goods are hereby excluded and will not apply to this Agreement .
The verb you see most often is exclude, which isn’t surprising, as article 6 of the convention uses that verb (as well as the dreaded derogate) to express this concept:
The parties may exclude the application of this Convention or, subject to article 12, derogate from or vary the effect of any of its provisions.
In my world, there’s always a best way to say something, so I decided to come up with my version of this provision.
The first issue I faced, of course, was which category of contract language I should use. The first and fourth examples above use language of performance, but that’s unnecessary. It’s like using language of performance to specify the governing law: “The parties hereby accept application of New York law to this agreement.” Instead, it makes sense to use language of policy, which is used to state the ground rules of a contract. And if you use language of policy, you won’t want to use exclude. It’s a dynamic verb, so it’s suited to language of performance but not language of policy.
Other than that, creating my version primarily involved getting rid of clutter. Here’s what I came up with:
The United Nations Convention on Contracts for the International Sale of Goods does not apply to this agreement.
That’s hardly rocket science, but it’s the sort of clearing of the undergrowth that’s required if we’re going to create order in commercial contracts.
But what does this have to do with the relationship between contract review and contract drafting? Imagine that a LegalSifter user “sifts” a contract for the international sale of goods. The CISG sifter flags that it doesn’t contain a provision saying that the CISG doesn’t apply. Or it spots such a provision, but it’s a clunker. In both those scenarios, the user would benefit from having access to an optimal version of the provision.
As things stand, LegalSifter help text includes sample or recommended provisions, but they’re necessarily rudimentary. It would be great if instead, the user could click on a link and be taken to the contract-drafting analogue of that sifter—either a static provision (as in the CISG case) or a document-assembly engine that allows the user to create a customized version of a more complex provision by completing a short annotated questionnaire.
All it would take to achieve this symbiotic arrangement would be some resources and a lot of drive and ambition.