Corporate & Securities Law

Having Your Contracts Drafted Offshore-Do You Really Want to Do That?

By Ken Adams

I’ve recently seen and heard references to companies offshoring the task of drafting contracts. For example, this article in today’s London Times says that Rio Tinto has hired a team of Indian lawyers “to work for it on tasks such as reviewing documents and drafting contracts.”

If that means having your offshore lawyers handle hundreds of equipment-lease deals by revising an approved set of templates, that makes sense. But I wouldn’t really call that contract drafting-contract tweaking, more like.

To my mind, contracting drafting entails coming up with contract language that reflects all or a large part of a transaction. And I’m not crazy about the idea of outsourcing that task, at least when it comes to a company’s template commercial contracts. They’re sufficiently important that I’d have thought quality, rather than price, should determine who drafts them.

In that regard, here’s what I said in my April 2007 article in the New York Law Journal:

I wouldn’t want to treat an offshore [knowledge-process-outsourcing] organization, whether a captive or a vendor, as an offshore law firm. For example, having an offshoring organization draft a template contract wouldn’t play to its strengths, as offshoring organizations would most likely be subject to the problems of quality and process that generally arise when law firms serve this function.

My complaint isn’t that Indian lawyers wouldn’t do as good a job as a law firm in the home jurisdiction, wherever that might be-it’s that they, like any law firm, likely would produce work that reflects the shortcomings of mainstream contract drafting.

If you want quality, go to whoever has demonstrated a commitment to clear and rigorous contract language, as opposed to recycling traditional verbiage and perpetuating contract-drafting urban legends. That might be someone at a law firm, someone at your company, or some lone-wolf consultant.

Full post as published by AdamsDrafting on June 18, 2009 (boomark / email).