A few weeks ago I wrote about Dennis Kennedy's feature on Thinking Smartly About Smart Contracts. My link to his blog post had an additional link to his useful discussion of Smart contracts blockchain. It seems to me that smart contracts will catch on relatively quickly, especially with big multinational corporations doing business in many countries.

Ken Grady has written something about a vision of future of the law and legal services that merits your attention. Stagnation And The Legal Industry (Part 2) What Real Transformative Change Could Look Like contains one vision of what the law and legal services delivery could become. It is the "if I had a magic wand" scenario. He outlines some changes that are worth consideration. The challenge I see is that some of these ideas require not just changes in the legal profession's method of doing business, but in some of our current laws and practices.

Many lawyers scratch their heads when phrases like "computational law" are tossed around. Here is Ken's great explanation of this concept and the vision:

"Computational law. Documents have become computational instruments. Whether a contract, a plan, policy, memo, or other instrument, documents are written so that computers can execute them. This doesn’t mean that all lawyers must become programmers. Lawyers will work with experts in coding documents. It does mean that documents serve two purposes. First, as computational instruments, they remove from humans the need to interpret every provision of the document. Whenever possible, the document is “self-executing” removing humans from the loop. The computer can “read” and execute provisions within the document. Second, human-readable versions of the document are available (assembled by the computer) on screen for those times when humans need to be in the loop. Computational does not imply entirely removing humans; it does mean removing humans when they are not necessary.

"As computational documents, payment, terms, and default triggers are all built into the document in a way that a computer can “read” and execute the provisions. Documents use XML (eXtensible Markup Language) coding as the standard for tagging language within the document. A computer can execute the code and generate an exception report if needed. All documents are written in the same standard code (XML, in my version of the future), so documents can be read and executed regardless of the computer platform used by a party or third-party. This interoperability is important. Legal materials can’t become isolated islands.

"The same coding and interoperability concepts extend to laws. They are written (or re-written) using standard formats and XML tagging. This way, a computer can assess performance under a statute by comparing data to the statute’s requirements."

He also notes civil tort law as an example. "With modern vehicles producing gigabytes of data per second, proving liability in a simple tort case will become an exercise in big data." Privacy advocates might object that this would not be a good thing, but it is hard to argue against the idea that a data dump of an automobile version of a flight data recorder from not only the automobiles involved in an accident, but those nearby would establish fault in 99% of the wrecks.

Smart contracts are the low-hanging fruit in this discussion in my view because few to no statutory changes would be required.

Sometimes the law must be complex, but as we look at possible changes and access to justice for all as a goal, simplification is a worthy consideration. Ken's quoted language above might sound complex to some. But if he was able to wave a wand and create a universe of interoperable legal documents and contracts as code, few would ever want to go back to the old methods of operation.

When setting up technology tools, we often use the analogy of getting devices to "talk to each other." If every legal document talked to other legal documents, the results would be amazing. A client wants to expand business operations to Montana. The lawyer opens up the operating agreement that the client used last time and changes the state to Montana. The agreement reaches out to the state of Montana's machine-coded laws and provides the lawyer with a list of six instances where the differences in Montana law might impact either the agreement or this client's type of business. Acting on those six points is where the lawyer's skills and judgment come into play. The fact that what used to be a few hours of legal research has been automatically done saves the client money. The law firm still has important and strategic work to be done that requires a lawyer.