Natural Language Processing (NLP): How You Can Leverage NLP for Contracts

NLP for contracts

Contracts are vital for all transactional operations, but reviewing and negotiating them can burden even seasoned attorneys. Moreover, bias and ambiguity are still perennial concerns for contract reviews.

Fortunately, attorneys and corporate legal departments can now apply natural language processing (NLP) to review legal documents, including contracts. This revolutionary approach can hasten contract review and contract negotiations while reducing ambiguity, disregarding human prejudice, and completing more enforceable contracts.

What Is Natural Language Processing?

Ambiguity is the greatest challenge of human language. Idioms, sentence structure, and grammatical norms can lead to confusion over intent. But people can use context to infer significant meaning, beating obscurities.

Consider this simple statement: “I’ve not slept for two days.”

The speaker could have had insomnia for two days, or they may be saying they stayed awake for two consecutive days. Most listeners would infer the first meaning due to bias. But a machine wouldn’t grasp the required context to make the determination. Still, both statements could be equally valid.

Natural Language Processing (NLP) combines AI, machine learning, and linguistics to teach your computer how to process natural languages and beat ambiguity.

In previous versions of NLP, someone had to guide the machine by including common standards and rules in the data set. But NLP’s ability to generate precise inferences using raw data came as a breakthrough for this technology. Machines can now make inferences based on the fluid nature of human communication.

This innovation makes it possible for you to apply natural language processing when reviewing legal contracts.

How to Use NLP for Contract Review

Ambiguity can limit intended protections, confuse parties involved, and change terms. Some legal department members and attorneys overlook the limitations because they don’t recognize ambiguity in their contract language.

Just like a human reviewer might assume that someone who hasn’t slept for two days has insomnia, an attorney may assume the meaning of their amendment or clause is clear to the reader and has only one reasonable meaning.

This is possible if the lawyer has to review a contract with hundreds of pages and complex arrangements and terms. The technology can aid this assessment by detecting ambiguities and providing revision suggestions.

For instance, your warranty clause states that the vendor agrees to offer comprehensive landscaping services for the life of the agreement.

A human reviewer may believe that the meaning of “comprehensive” is obvious. But AI contract review software comprising NLP technology can highlight the term and offer suggestions so that the third party doesn’t become responsible for issues not related to their service.

Innovative NLP tools can review and guide the reader in way less time than an attorney would spend reviewing contracts. In some instances, top-shelf AI contract review and negotiation software like BlackBoiler take only a few minutes to return a marked-up contract. This will ensure all the terms in your agreement are clear and lack ambiguity.  

Get Yourself the Best AI Contract Review Solution

Only a reliable contract review tool with the NLP capability can align with your needs. Fortunately, you’re on the right site.

BlackBoiler stands out as the only patented AI and NLP automation and review tool for legal documents that can review and redline your contract in minutes. Check out our demo to learn more about the experience.

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