Smart legal contracts

All posts tagged Smart legal contracts

A story about brown M&M`s, trust, and smart legal contract framework

on February 17, 2022

As declared many times, our objective is to diffuse a Smart Legal Contract framework to facilitate compliance and control with less overhead. Smart legal contract are automating controls and increase the efficiency of companies.

As we know contracts often include collateral or penalties for non-compliance. The purpose is to make the possibility of fulfillment of the contract more likely. Sometimes the lawyer’s creativity in securing the other party’s compliance is noteworthy!

I was so impressed and amused to discover how a rock band (Van Halen, to be precise) used candy to show whether a contract had been carefully read and, therefore, whether the band’s complex, and potentially dangerous, technical requirements were likely to have been met!

Reading time: 5 minutes.

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Smart contract vs smart legal contract

on February 15, 2022

The concept of a ‘smart legal contract’ is an inseparable part of discussions about the future of legal practice. The offerings that technology can provide to streamline legal services for businesses are truly invaluable. 

The obvious question must be, what is the difference between a smart contract VS smart legal contract?

We will look into various aspects of smart contracts and smart legal contracts and try to reach a conclusion and hopefully, you would understand what the major differences are.

Exactly what a smart legal contract looks like, the nature of its capabilities and potential applications in practice have remained relatively obscure.  This article will revisit basic concepts of smart legal contracts, explore a current case study, acknowledge hurdles to wider use and address future possibilities.

Smart contract vs Smart legal contract

Smart legal contracts are different from the so-called “smart contracts”, which are self-executing scripts that necessarily operate on a blockchain system. Smart contracts may form part of a smart legal contract or smart document but do not represent the agreement in its entirety.

Fundamental to the concept of a smart contract, and the main driver of efficiency through faster processing times is the automatic performance of aspects of the contract without the need for human action or verification.  A foreseeable outcome of this is lower transaction and operating costs compared to traditional contracts.

However, it is not just about efficiency. Smart legal contracts can also provide greater certainty and trust between the parties, particularly when incorporating blockchain or other distributed ledger elements which ensure the immutability of input data.

Smart legal contracts contain natural language text with relevant provisions of the document drafted in machine-executable components, that is, programmable code. The programmable elements interface with external sources of data (so-called “oracles”) (such as Internet of Things device data) or other software systems.  The oracles drive the real-time status of the contract, for example, by enabling clauses to self-execute if the external data shows that specified contract conditions are met.  The contract sits in a real-time digital environment – a website, platform or app – that each party can log in to and view the current status of any relevant terms. 

The creation of smart legal contracts also requires a multi-disciplinary approach. Both lawyers and coders must understand and respect the other’s role and work collaboratively to achieve an effective design. 

Standards can also play an important role in promoting the uptake of innovative technologies and have a role to play with the adoption of smart legal contracts.

“Standards and other publications…can improve the reputation of innovative technologies and lead the way in describing best practice. Developing and setting standards requires consensus, which encourages an international community of experts to share, collaborate and agree.”

If we want to see wider adoption of smart contracts and smart legal contracts, we need an effective governance framework via the further development of international standards. Governments and companies have significant potential to grow awareness about, confidence in and legitimacy of smart contracts in both the public and private sectors. This is particularly the case given the cross border nature of smart legal contracts, which can make it difficult for sovereign legislators to regulate them.

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A Beginner’s Guide on How Smart Legal Contracts Work

on February 4, 2022

Smart contacts are a great way of helping you exchange property, money, and shares without the fees, hassle, and services that come along with them. For example, when you go up to a vending machine, all you need to do is drop the money in and the snack or drink comes out. Same with the smart contracts.

A smart contract works the same way – all your need is to have the required token into the wallet and whatever you have paid for automatically gets deposited into the recipient account, making it so much easier and more efficient than a traditional contract.

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Increase sales compliance through contract automation

on December 3, 2021

Blockchain has the potential to fundamentally change the way organizations do business.

In the retail sector, blockchain is finding a lot of applications: from revolutionising loyalty programs and digitising product warranties to potentially allowing for the development of peer-to-peer marketplaces that could compete with the likes of eBay or Airbnb. 

Let’s see how increase sales compliance through contract automation …

Reading time: 4 minutes. Photo by Cam Bradford on Unsplash

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Innovating Contracting in Real Estate

on October 28, 2021

Real estate, as in all commercial fields, has been a victim of the great uncertainty that the pandemic has brought to most industries.

There has been a drop in the number of contracts that have been signed. And the investment risk in real estate has grown, especially in the commercial sector.

Many people were not ready to manage negotiations through digital systems and didn’t have the tools to rent out apartments or commercial properties during a lockdown.

So how to implement contract innovation in real estate? Keep reading to find out 😉

Photo by Aleksandar Pasaric from Pexels

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How smart legal contracts can improve sales

on August 24, 2021

Ask anyone in the business world about their pain points and you’ll likely hear: sales and signatory management. Updating, monitoring, and managing lists is currently a time-consuming, inefficient, and error-prone activity for suppliers and buyers alike. At the same time, the painstaking process of proper signatory management is essential for establishing and maintaining business relationships, not to mention for ensuring compliance.

Reading time: 4 minutes.

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The right cost of legal tech

on July 30, 2021

The business world has deep roots in technical innovation – a rich tradition that now translates into blockchain adoption and the implementation of smart contracts. From a legal operations perspective, success is supported by adopting legal tech in a company.  Corporate legal counsels are able to perform at great speeds. They are able to pay close attention to a great many details.

Nevertheless, companies required a significant change to their legal operations. Or to put it differently – the right cost of legal tech is crucial to improving operations. As legal teams become overwhelmed, stressed and understaffed, automating outdated manual processes for contract drafting and contract management is the first step.

So how do you increase productivity and efficiency for your legal teams via smart contracts?

Reading time: 3 minutes

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