As a professional, you know the importance of understanding contracts quickly and accurately. Whether you're a lawyer reviewing a client agreement or a business executive assessing a vendor contract, having a clear and concise summary of the key terms can save you time and mitigate risks.
At ContractKen, we understand the value of contract summaries, which is why we've doubled down on deploying best in class AI technology to help our customers generate various types of contract summaries out of the box.
This is a follow up to our earlier article on this topic: https://www.contractken.com/post/contract-summaries
In this comprehensive guide, we'll explore everything you need to know about contract summaries -
Lets dive into each question in detail
A contract summary is a condensed overview that captures the essential elements and key terms of a legally binding agreement between two or more parties. It serves as a concise representation of the contract, highlighting the most critical provisions, obligations, and rights governed by the contractual arrangement.
An effective contract summary enables stakeholders to grasp the contractual essence without delving into the intricate legal details. It facilitates a clear understanding of the agreement's scope, objectives, and implications, empowering decision-makers to make informed choices based on the summarized information.
A well-crafted contract summary should possess the following key features:
Lets talk about the process of summarizing text. Fundamentally, there are two types of tasks in condensing a large document(s) into small summary:
At ContractKen, we combine the strengths of abstractive and extractive approaches to produce comprehensive and reliable contract summaries tailored to your specific needs.
In order to decide what to include in your contract summaries, first consider its purpose - is it for a specific contractual query or a routine overview of key terms? This will guide which clauses to highlight. Also consider the intended audience - if external, more detail may be needed in a particular format; if internal, focus on essential terms.
For a general contract summary, the most critical clauses to include are:
After covering these, summarize the main risks, data protection, and intellectual property terms. Next, include indemnity clauses, warranties, and limitations of liability. Finally, address confidentiality obligations, rights for contract variation or assignment, and the governing law and jurisdiction. The core components are payment obligations, commercial protections, risks, and key legal terms like indemnities and limitations. Customize the summary's scope and detail based on the specific purpose and audience. Leveraging past summaries or templates can provide an efficient model.
Depending on the intended audience and purpose, contract summaries can take various forms:
A contract abstract is a summary of specific key information from a contract, presented in a designed format. It is useful for consolidating contractual rights, obligations and liability triggers across many contracts, such as during M&A due diligence. In contrast, a contract summary is a concise overview of all the major provisions within a single contract. An abstract extracts and aggregates particular data points of interest across multiple contracts, while a summary condenses the overall content of an individual contract. Abstracts facilitate efficient review of contract populations by capturing targeted metadata. Summaries provide a time-saving synopsis for quickly understanding the substance of a given contract document. Both abstracts and summaries are tools for digesting contract information more efficiently, but serve distinct purposes based on whether reviewing individual contracts or a portfolio of agreements.
At ContractKen, we harness the power of Generative AI to assist in the creation of accurate and insightful contract summaries. Our AI models can generate both abstractive and extractive summaries.
Customers of ContractKen can generate the following types of summary for every contract, right out of the box:
Evaluation of quality of text summaries is a well researched topic in the field of NLP (Natural Language Processing). There are broadly two ways:
An excellent analysis of evaluation of text summarization techniques is contained at: https://eugeneyan.com/writing/abstractive/
At ContractKen, we evaluate the quality of our AI-generated summaries using the following criteria:
By adhering to these criteria, we ensure that our contract summaries are accurate, concise, and easy to understand, enabling legal professionals and business stakeholders to make informed decisions with confidence.
While AI-powered contract summaries offer significant benefits, it's important to be aware of potential risks and limitations. Here are some key considerations:
At ContractKen, we prioritize security and data privacy, implementing robust measures to safeguard our clients' information and maintain compliance with industry standards. We have deployed an industry leading “Moderation Layer” to preserve the privacy and confidentiality of contract data.
In conclusion, AI copilot from ContractKen simplifies the process of generating different types of contract summaries, at the click of a button, inside Microsoft Word. It leverages human expertise and AI to automatically extract and abstract important information from contracts based on user-defined parameters, across all contract types. These smart summaries enable legal and business teams to quickly address contractual questions and accelerate revenue flows.
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