Legal Tech, Smart Contracts and Blockchain

Preface

Contents

Editors and Contributors

Acronyms

Digital Technologies, Legal Design and the Future of the Legal Profession

1 Introduction

2 Blockchain and Smart Contracts

3 The Legal Design of (Smart) Contracts

4 The Future of the Legal Profession?

5 Chapters

References

Smart Contract This! An Assessment of the Contractual Landscape and the Herculean Challenges it Currently Presents for “Self-executing” Contracts

1 Introduction

2 Self-executing Contracts—How They Work

2.1 Smart Contracts

2.2 Smarter Contracts

3 Why Creating a New Book of Smarter Contracts Is Easier

4 Why Transforming an Existing Book of Contracts into Smarter Contracts Is Harder, But Still Desirable

4.1 Difficulty

4.2 Desirability

5 Cleansing the Augean Stables: The Need for Digital Contract Optimization to Prepare Existing Books of Contracts for Smarter Contracting

5.1 What Is Digital Contract Optimization?

5.2 Benefits of a Digital Contract Optimization: Resolving Inefficiencies, Eliminating Blind Spots

5.3 What a Digital Contract Optimization Might Look Like

5.4 The Potential of Semantic Computing or AI as Tools in Digital Contract Optimization

6 Twelve Herculean Challenges on the Road to Self-executing Contracts

6.1 General

6.2 External Factors

6.3 Internal Factors

6.4 Expert Mindset

7 Risks

7.1 Unravelling Existing “Agreements”/Waking Sleeping Dogs

7.2 New Black Boxes

7.3 Other Risks

8 Need for Change in the Legal Industry

8.1 Legal Education: From Fixed Mindset to Growth Mindset

8.2 Delivery Models

8.3 Resistance to Change

8.4 Renaissance Lawyers

9 Conclusion

References

Successful Contracts: Integrating Design and Technology

1 Introduction

2 Simplification, Visualization, and Codification

2.1 Contracts as Documents Written by Lawyers for Lawyers

2.2 Simplification and Visualization: Contracts as More Than Documents, Shaped by More Than Lawyers

2.3 Computer Codification and Smart Contracts: Contracts not just Written and not for Lawyers Alone

2.4 Emergent Properties of Integrating Design with Data

3 Elements of the Contracting Process: Builders, Users, Layers, and Stages

3.1 Summary of System Elements

3.2 Builders and Users

3.3 Information Layers

3.4 A “Background Repository” Layer

3.5 Stages in the Contract Process

4 Conclusion

References

Exploding the Fine Print: Designing Visual, Interactive, Consumer-Centric Contracts and Disclosures

1 Introduction

1.1 Research Question, Output, and Audience

1.2 Methodology and Initial Findings

1.3 Chapter Structure

2 Literature on User-Centered Computable Contracts

2.1 The Call for Usable, Visual Contracts

2.2 Imagining a New Generation of Tech-Enabled Consumer Contracts

2.3 Making Contracts More Modular and Machine-Readable

2.4 Behavioral Economists’ Choice Engines as One Model

3 Others’ Insights and Existing Models

4 Design Experiments to Understand Future Computable Contracts

4.1 Design Research with Privacy and Financial Terms

4.2 The Process of Design Work

4.3 The User Journey Through a Contract

4.4 Priorities, Values, and Hooks for the User

4.5 Design Models that Have Emerged

5 Survey Evaluation of Insights and Concepts

5.1 Design Insights for Future Computable Contract Tools

5.2 Do People Want Computable Contract Tools?

5.3 Guiding Principles for Computable Contract Interface Design

6 Conclusion

References

Beyond Digital Inventions—Diffusion of Technology and Organizational Capabilities to Change

1 Introduction

2 Theoretical Frame of Reference

2.1 What We Can Learn from Previous Technological Shifts

2.2 What We Can Learn from the Literature on Organizational Change

2.3 What We Know About Legal Industry Characteristics

3 Understanding the Challenges for the Legal Industry to Adapt to Digitalization

3.1 Why Law Firms Do not Change: Economic Motives and Technological Complexity

3.2 The Impact of Digitalization and the Emergence of Legal Tech

3.3 Digitalization of Intellectual Industries; Beyond Inventions

3.4 The Need for Dynamic Capabilities

3.5 Practical Implications

4 Conclusion

References

Contract Automation: Experiences from Dutch Legal Practice

1 Introduction

2 Methodology and Structure

3 Terminology, History and Digitization in Dutch Legal Practice

3.1 Terminology

3.2 History

3.3 Digitization in Dutch Legal Practice: A Brief Overview

4 Experiences with Contract Automation

4.1 Reasons for Starting with Contract Automation

4.2 Selecting the Software

4.3 Selecting the Contracts

4.4 Decomposing and Reconstructing Contracts

4.5 Personnel Implications

4.6 Challenges and Pitfalls

4.7 Future Developments

5 Conclusion

References

Legal Automation: AI and Law Revisited

1 Introduction

2 The Role of Legal Education

3 The Potential of AI Applications

3.1 Setting the Scene

3.2 The Topic in Brief

3.3 Overview of Substantive Law

3.4 Methodological Approach

4 Digital Person—A New Legal Entity?

5 Conclusion

References

Smart Contracts and Smart Disclosure: Coding a GDPR Compliance Framework

1 Introduction

2 Key Areas to Consider with Regard to the GDPR

3 Smart SLAs in the Cloud

4 Choice Architectures, Nudges and Legal Compliance

5 Smart Disclosures in Automated Smart Contracts

6 A Unified Modeling Language for Checking Legal Compliance

7 Nudging Cloud Providers Through a Pseudo-Code

8 Legal Questions for the Elaboration of a Pseudo-Code: Check Legal Compliance

9 Conclusion

References

“When People Just Click”: Addressing the Difficulties of Controller/Processor Agreements Online

1 Introduction

2 The Legal Concepts of Controllers and Processors

2.1 “Processing” and “Personal Data”

2.2 “Controller”

2.3 “Processor”

2.4 “Joint Controllers”

3 Controller/Processor Roles Online

3.1 “Classic” Dedicated Server Hosting

3.2 Distributed Computing

3.3 Listen Servers

3.4 Peer-to-Peer File Sharing

3.5 Blockchain

3.6 The Implications of Amateur Processors

4 The Contractual Approach

4.1 Entering into the Controller/Processor Agreement

4.2 Using the Controller/Processor Agreement to Promote GDPR Compliance

4.3 The Problem with the Contractual Approach

5 Beyond Conventional Contracts

5.1 Automated Measures

5.2 Other Measures for Increasing Compliance

6 The Regulatory Perspective

7 Conclusion

References

The Lawyer of the Future as “Transaction Engineer”: Digital Technologies and the Disruption of the Legal Profession

1 “Digital Revolution”

2 The Legal Profession Disrupted

2.1 “Legal Tech” and the Disruption of Legal Practice

2.2 Smart Contracts and the Disruption of Transactions and Organizations

2.3 “Net-Widening” and Expanding Transnational Legal Risk

3 The Lawyer of the Future as “Transaction Engineer”

3.1 “State-Managed” Deployment of Disruptive Technologies

3.2 The “Digital Revolution”

3.3 The Lawyer of the Future as “Transaction Engineer”

4 Conclusion

References

Index