Saintly Thoughts

Technology and the Risk of Meaningless Contracts

In another life I worked primarily in the realm of real estate title.  In this most arcane of legal endeavors, I often found cause to review legal documents dating all the way back to the nation's founding.  One thing that struck me was just how simple and straight forward many of these documents tended to be.  It was rare that a contract, lease, mortgage, or conveyance of title was much more than two pages in length.  The migration to more complex and cumbersome legal documents did not occur until well into the 20th century, in the 1970's, 1980's, and especially the 1990's.  Granted there has always been, and always will be, cause for large an unwieldy contracts, especially when reflecting the agreements of complex corporate and governmental entities.  Still I have to wonder, what had occurred which caused the proliferation of paper over the course of the last few decades?  Is it that our contracts and agreements are somehow better structured and more sufficient than they once were, or has something else changed?

Granted, the reasons are undoubtedly numerous and complex.  The proliferation of regulations, the greater sophistication of contracting parties, and the rise of a global economy have all played a substantial role in this development.  And yet, if I were to make a wager, the single greatest factor in the ballooning of standard legal documents is the rise of computers as a means of contract construction coupled with the migration from what were primarily paper instruments to electronic documents.  For these dramatic impacts began to appear most especially in the early nineties, at the very moment when the personal computer revolution was reaching its apex.  To give but one example, your average mineral lease for purposes or coal or oil and gas exploration, jumped from a meager two or three page document in the late 1980's, to nearly twenty pages by the end of the millennia.  I have not done an exhaustive study on the proliferation of all forms of legal paper, but a cursory analysis seems to indicate that this trend has been mimicked more or less across the board.

In other words, legal documents have grown in size and complexity in response not so much due to pressure internal to the developmental process of good contract drafting standards, but in response to the increased capacity that these new computerized technologies unleashed.  The question that we must ask, as interested legal practitioners, is whether this technological innovation has made contracts better, or at least, has it made them better in proportion to the increased size and complexity of the agreements?  

My answer is no, that most contracts and legal documents need not be so long as they now are.   It is true that the world has undoubtedly grown more complex than it once was, especially in relation to the complexity of corporate and governmental entities that have been most instrumental in this process.  But human beings have not grown any more or less complex than they ever were, and the result is that as these documents have blossomed in size, their true masters (that is, the individual human men and women who are ostensibly the ultimate beneficiaries of legal process) have found themselves further and further sundered from the paper which so governs their existence.  For our society is a minefield of paper, with every action taken online subject to the whims of an unread click-wrap agreement, with every object purchased coming invariably tied to an agreement incomprehensible to all but the drafting lawyers.  

Is there a cost to this proliferation?  Obviously the transactional costs rise as more and more human actions are put on hold subject to the time-consuming and expensive process of legal review and negotiation.  And when we are dealing with the actions of large-scale entities doing business with one another where much is at stake, this is largely as it should be.  But when we talk about the individual humans caught in this web of electronically coded text, what effect does it have on their conceptualization of the laws and contracts which govern their existence if they become so burdensome and big that they are not even worth the trouble of reading and comprehending?  Eventually, might not this bring the very process of contract drafting, negotiation, and agreement into disrepute?  And as contracts come to be seen as ever more meaningless, might this not bring the very concept of law and law making into disrepute?

I ask this as an honest question, one to which I do not know the answer.  It seems to me that we are already well on our way down the road to contractual obsolescence as more and more people are called to adhere to more and more contracts which they will never read and never take the time to understand.  We have always been a legalistic society and have been willing to farm out many of these tasks to lawyers and courts.  That is appropriate insofar as it goes.  But complexity cannot accrue forever, and the further sundered from the realm of common sense and human scale our processes become, the greater (and perhaps sooner) will be the reckoning when and if the edifice of the whole system comes crashing down.