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Why word processing has actually increased clients’ total cost of contract negotiation

Ross Reeves makes an astute observation about why contracts and other legal documents can be so long. He points out that essentially all lawyers these days use word processors and laser printers. That makes it easy for them to draft a contract by editing a prior one—or by editing a very long master form that covers every conceivable possibility, no matter how faint the relevance to the deal at hand. Drafting a document in this manner takes the lawyer less time, Reeves argues, and therefore costs the drafter’s client less money than figuring out what minimal succinct would serve the purpose. Reeves says:

Given these metrics, it is not surprising that printed pages have grown rife and our way of “producing” legal documents has changed. Any full service law firm today routinely produces 80-page wills for simple estates. Commercial deeds of trust and leases run 100 pages or more …. The list goes on …. [¶]

No development in the law during the period of this transformation requires this prolixity. It nevertheless does happen, day in and day out, simply because the technology makes it cost-efficient.

But hidden costs lurk in this approach. The more words there are in a contract:

  • the more language the other side has to review;
  • the more changes the other side is likely to request—and as Conan O’Brien’s lawyers seem to have appreciated, if you propose something but the other side says “no,” you’re in a far worse position to argue later that the contract implicitly said what you proposed; and
  • the more time you’ll likely need to get ink on the signature lines as a result.

I think many experienced practitioners would agree that any arguable cost savings from using word processors and long, form documents can easily be wiped out by these hidden costs.

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