Simply entering into a contract requires courage and commitment. You have to put yourself in the customer`s shoes. And it takes patience. In the end, it`s worth it. As a first step, the legal team organized a multi-day off-site with the new plain text team – a group that included people from sales, technical and product support as well as the legal department. The objective was twofold: (1) to gain a thorough understanding of the services offered and (2) to identify their operational risks. The legal team knew that assumptions were often made about what should be included in contracts without ever considering whether the services covered justified these passages. In order to avoid unnecessary text in the new contract, the Klartext team deliberately decided to postpone the development to another day. While Burton led the legal team for the division`s new digital services unit, he and his colleagues noticed that contract negotiations with clients dragged on for months, hampering growth. So they set out to replace the unit`s seven horribly complicated contracts with one that even a high school student could understand. In this article, Burton describes how the team achieved this goal and what lessons learned along the way. He also shares the results: customers were enthusiastic about the new contract, some even signed it without a single change. The time it takes to negotiate contracts has dropped by 60%.
And now, contracts are starting to spread within GE in plain language. (The Enduring Power of Attorney (APA) was replaced by the Enduring Power of Attorney (APA) on October 1, 2007. An EPA created before this date is still legal and can still be registered with the Office of the Public Guardian. After this date, you must create an LPA instead.) The legal team supporting the newly formed company realized it had to act. The team proposed converting the seven contract formats into a single contract in plain language. As long as or so long, it also means “supplied”, “provided that” or “provided that”: The compliance clause now reads: “During the term of the contract, we will comply with all our legal obligations”. A sentence with 13 very understandable words. The previous version of this clause consisted of five different subsections, nine sentences, 417 words, and (believe it or not) a reference to the President of the United States. The limitation of liability clause has been reduced from more than 140 words in capital letters to only 66 words of plain text. The indemnity clause now consists of a sentence of 41 words, instead of more than 150. The word “compensation” – which is itself legal in German – is not even used. To be clear, I`m not talking about “simplified” agreements with fewer words, better titles, and cleaner fonts.
I am talking about a contract that a high school student could understand without context or explanation. As Robert Eagleson, an expert on the subject, put it, plain language “gets the message across with the greatest ease.” The results speak for themselves. In plain language, GE Aviation`s digital services business has saved a lot of time and money. And customers love it. One client told us, “The contract worked very well; I prefer a simpler approach and contracts written in a way I can understand. Another said: “It was reasonable to work with the agreement, as you saw in our extremely limited redlining required to get to execution. Language-only contracts are beginning to spread within GE. GE Healthcare has launched an initiative in plain language. GE`s additive manufacturing business implemented its first plaintext contract in 2017.
The initial response from clients has been positive, and the general counsel and unit leadership are eager to make plain language the standard approach. “Authorized Privileges” means all of the following: . easements, zoning restrictions, rights of way and similar encumbrances on real property that are prescribed by law or that arise in the ordinary course of business, provided that they do not materially affect the value or negotiability of the property in question. The off-site was a success; The plaintext team went with an accurate overview of the offerings and associated operational risks. Then the legal team started drafting contracts and started from scratch. No models. No “model” clauses. No use or reference to existing contracts. We just started tapping on a blank sheet of paper, focusing only on the services covered and the risks we had identified. Throughout the process, we applied our litmus test: Can a high school student understand this? Legal jargon; lengthy explanations of the reasons for the transactions; pages with definitions; synonym chains; sections in capital letters, italics, bold; and cumbersome sentences filled with semicolons.