Review Contracts with AI

1. 1

   Set the Review Context

   Before feeding the contract to AI, provide the context that shapes what risks matter most — because the same clause is fine in one situation and dangerous in another.

   Claude ChatGPT

   I need to review a contract. Before I share the text, help me set up the review framework.
   
   **Contract type**: [e.g., 'freelance service agreement,' 'SaaS subscription contract,' 'employment offer letter,' 'commercial lease,' 'vendor agreement,' 'NDA']
   **My role in this contract**: [e.g., 'service provider,' 'client,' 'employee,' 'landlord,' 'licensor']
   **The other party**: [e.g., 'a Fortune 500 company,' 'a startup with 10 employees,' 'a contractor I've hired before']
   **Deal value / stakes**: [e.g., '$50K engagement,' '3-year lease,' 'full-time employment']
   **My primary concerns going in**: [e.g., 'payment protection,' 'IP ownership,' 'liability exposure,' 'exit rights,' 'non-compete scope']
   **Governing law**: [jurisdiction if known, e.g., 'California law,' 'UK law,' 'unclear']
   
   Based on this context:
   
   1. **Risk Priority List**: What are the 8-10 most important things to review in this type of contract for someone in my position? Rank them by how much damage a bad clause could do.
   
   2. **Standard vs. Unusual Benchmarks**: For this contract type, what is 'market standard' in the key areas? Give me benchmarks so I know when something is aggressive or unusual.
   
   3. **Red Flag Clauses**: What specific clause types or language patterns are immediate red flags for this contract type? What language should make me stop and question everything?
   
   4. **Missing Protections**: What clauses should any contract of this type include to protect someone in my position — and are often missing from first drafts sent by the other side?

   Copy

   Tip: The other party's first draft is almost always written to maximize their protections at your expense. This is normal, not adversarial. Your job in any contract review is to identify what favors them unusually and negotiate it to a more balanced position — not to refuse everything non-standard.

2. 2

   Analyze the Contract for Risk

   Feed the contract to AI section by section and get a systematic risk assessment with specific clause-level analysis.

   Claude ChatGPT

   Review the following contract section and identify issues. I'm the [your role] in this agreement.
   
   **Contract section**: [paste one section of the contract — work through sections one at a time for large contracts]
   
   **My priority concerns**: [from Step 1]
   
   For this section, provide:
   
   1. **Plain English Summary**: Translate this section into plain language. What does it actually say and obligate each party to do?
   
   2. **Risk Flags**: Identify every clause, phrase, or provision in this section that:
      - Is unusually favorable to the other party
      - Creates unlimited or unclear liability for me
      - Is vague in a way that could be interpreted against me in a dispute
      - Departs significantly from standard market terms for this contract type
      - Could cause problems in a scenario I haven't anticipated
      For each flag: quote the exact language, explain why it's risky, and rate the risk severity (Low/Medium/High/Critical).
   
   3. **Missing Protections**: Are there provisions that should be in this section to protect my interests that are absent?
   
   4. **Negotiation Priorities**: Based on your analysis, which issues in this section are worth fighting for versus acceptable to live with?
   
   5. **Suggested Edits**: For each High or Critical risk item, suggest specific replacement language that would be more balanced. Write it in contract language (formal, precise).
   
   IMPORTANT: Flag any areas where jurisdiction-specific legal advice is especially important before I accept or reject the current language.

   Copy

   Tip: Don't try to feed an entire contract into one prompt — you'll get a surface-level scan. Section by section produces much deeper analysis. Start with the sections that cover payment, liability, IP/ownership, termination rights, and dispute resolution — these are where the real risks live in most commercial contracts.

3. 3

   Identify Key Negotiation Points

   Compile the contract's issues into a prioritized negotiation strategy — what to push for, what to accept, and what to walk away from.

   Claude ChatGPT

   Based on the contract review, help me build a negotiation strategy.
   
   **Issues identified across the full contract**: [paste your compiled list of issues from Step 2 — or summarize them here]
   **My negotiating position**: [e.g., 'I need this deal — they're my biggest client' or 'I have multiple competing offers' or 'This is a take-it-or-leave-it form contract']
   **My deal-breakers**: [what you absolutely cannot accept]
   **Their likely priorities**: [what you think matters most to the other side]
   
   1. **Issues Ranked by Priority**:
      - Tier 1 (Must Fix): Issues I should refuse to sign without changing
      - Tier 2 (Should Fix): Issues worth negotiating if possible
      - Tier 3 (Nice to Fix): Improvements I'd take if offered but won't fight for
      - Acceptable as-is: Issues that seem unusual but are actually fine in context
   
   2. **Negotiation Script**: For my Tier 1 issues, write the specific language I would use to raise each concern professionally. Not 'your contract is unfair' but 'I'd like to discuss clause 8.3 — our standard practice for this type of engagement is X, and I'd like to propose Y.'
   
   3. **Trade-Off Analysis**: Are there Tier 2-3 issues I could use as trading chips? Identify concessions I could offer that cost me little but give the other side something they want, in exchange for changes on my priority items.
   
   4. **Red Lines**: Which issues are genuine deal-breakers where I should be prepared to walk away if not resolved? Why?
   
   5. **Counter-Proposal Draft**: For my 3 highest-priority changes, draft the specific revised contract language I would propose as a counter.

   Copy

   Tip: Never send a list of 15 changes. Prioritize ruthlessly before you negotiate. When you send 15 issues, the other side gets defensive and everything becomes a fight. When you send 3 prioritized issues with specific proposed language, you look like a professional and negotiations move quickly.

4. 4

   Prepare Questions for Legal Counsel

   Use AI to prepare a targeted list of questions for your lawyer — making the consultation more efficient and less expensive.

   Claude ChatGPT

   Help me prepare for a conversation with a lawyer about this contract.
   
   **Contract type**: [type]
   **My role and deal context**: [from Step 1]
   **Issues I've identified**: [summary of flags from Steps 2-3]
   **What I've already decided about**: [issues you've resolved or are comfortable with]
   
   1. **Questions for Legal Counsel**: Based on the issues I've identified, what are the 5-8 most important questions I should ask a lawyer? Prioritize questions where:
      - The risk is high and the answer depends on jurisdiction-specific law
      - I don't understand the practical implications of a clause
      - There's genuine ambiguity about what the contract language means
      - Standard practice in this industry varies and I need current market context
   
   2. **Questions I Don't Need to Pay For**: Which of my concerns can I resolve without legal advice — e.g., questions that are really about business judgment rather than legal interpretation? These save me money on the consultation.
   
   3. **Context to Brief My Lawyer**: Write a one-paragraph briefing I can send to my lawyer before the call that explains: what the contract is, my role, the deal value, and my 3 priority concerns. This saves 10-15 minutes of call time.
   
   4. **What to Watch for When Reading the Final Version**: If I successfully negotiate changes, what specific things should I verify in the redline version to confirm the changes were made correctly and no new issues were introduced?

   Copy

   Tip: Using AI for contract review cuts your lawyer's billable time by 50-70% because you arrive with specific, targeted questions instead of asking your lawyer to read the whole thing fresh. You're not avoiding legal advice — you're making it dramatically more efficient. Always have a lawyer review any contract before you sign something with significant financial or legal consequences.

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