Create “Horizontal Consistency” Amongst Your Documents
One common problem with precedent initiatives is the failure to plan for maintaining the collection, once created. The most obvious aspect of this is the failure to address how the language in your agreements, once published, will evolve with changing practices so they remain “green.” Another, more insidious aspect, which raises its head as soon as you are ready to publish the second document in your collection, is failing to ensure what I refer to as the ”horizontal consistency” of your documents.
In my experience, precedents are generally prepared as standalone documents, without reference to other documents in the collection. This may reflect that the various documents are prepared by practitioners in different subject areas, so that M&A and real estate lawyers, for example, will not consider the parts of their agreements that may be similar but instead focus on the uniqueness of their agreements.
Our analysis of large numbers of documents discloses that there are many common elements that exist, even within documents from divergent practice areas, even leaving aside the “boilerplate” clauses. Many agreements, for example, may include confidentiality obligations. How those clauses are drafted, and what elements they contain, may, however, vary wildly.
It is important for you to ensure that similar clauses that address similar issues are drafted, if not in an identical manner, then in a consistent manner across your document collection. This is what I refer to as “horizontal consistency.”
This is a problem that does not admit of a single solution. There are several steps necessary to address it.
Standardize boilerplate clauses
First, it is important to establish the consistency of your “boilerplate” clauses. These are the clauses that appear in most every document, usually near the end. They cover issues such as assignment, amendment, and governing law. To ensure the consistency of these clauses, establish a Base Agreement that contains the standard language for each of them. Each time you draft a new agreement, you adopt the language of the applicable boilerplate clauses from the Base Agreement.
Next, you need to identify the standard variations that arise in your boilerplate clauses. There are, for example, variations in approaches to an arbitration clause. You may find four or five variations. Once you have identified each of them, standardize the language. In doing so, guide yourself by the “80/20 rule. Many precedent projects use the “kitchen sink” approach to including clause variations, to the detriment of the user and the collection. Then include the variations with the standard clause in your Base Agreement.
Appoint a general editor
Early on in your process, you will need to identify a general editor, whose responsibility it is to oversee the entire project. One of his or her main tasks will be to review each precedent upon completion to ensure its consistency with both your style guide and your other agreements. This individual must have the final say on how the language in your agreements will appear. In the absence of such an editor, your agreements will grow piecemeal, without any guarantee of consistency.
As you start building a library, your general editor will be able to identify modules” that appear in various documents. By this, I mean not a single clause, such as Amendment or Assignment, but a cluster of related clauses that address a particular issue. One instance would be confidentiality obligations. Identify these modules, determine the significant variations, and standardize the language.
Create a central repository of clauses
As you identify various modules, you will need somewhere to store them. These are clause types with more variations than those in the Base Agreement, and do not appear in most agreements, so you will need some other place to keep them. How you choose to store them will reflect your particular needs, but it must be a location that users can access easily. You will need an index, ideally hyerlinked, and perhaps differing types of indices that reflect the different ways that users may use your system.
The above assumes that you are carrying out these various tasks entirely in-house, relying exclusively on your internal resources. Until quite recently, that was the only way to proceed. There is, however, now a technological alternative, namely kResolve, which enables you to manage all the above tasks within a single application. Using this tool will enable you to manage your processes much more effectively and efficiently.
Once you have put in place the appropriate processes, whether manual or assisted by a technological platform, to address these issues, you can be much more confident in the horizontal consistency of your collection.