Skip to content

Legal Tech for Transactional Lawyers Newsletter: #9

Considering project management to improve closing process, some solid article links, and slowing down a little bit in summer to plan goals for the rest of the year with the framework of the Ikigai mindset!

Happy Friday and hope everyone is enjoying the start to summer!  

In this edition we consider how project management can help improve consistency in the closing process for real estate and corporate transactions.  Article links include information about Utah's regulatory sandbox, why prompt engineering is not a long term skill lawyers need to learn and several other great reads.  

Hopefully you find it useful and fun.  Please feel free to share with anyone that may be interested and have a great weekend!

Matt Basile

If you find this content valuable, please connect with me on LinkedIn.


Leveraging Tech in Transactional Matters

πŸ“— Project Management for Closing Process

Almost all transactional lawyers and their clients rely heavily on closing checklists to track deliverables when closing commercial real estate or corporate finance transactions, however traditional project management tools are almost never used in legal work.  I have experimented with the concept a few times during the course of my career but it has never really gone anywhere for some good practical reasons:

βœ… It is hard to break down exactly how a complex task should be done every time.

🧠 It is easier for the knowledge to just live in each person's head. 

πŸ‘¬  Different lawyers may have different specific ways they want something done (including stylistically) and it becomes impossible to reconcile approaches.

🀡 Client input is often needed to change checklists and closing processes and this can be hard and uncomfortable for some.

😎 Change management in legal teams is unique and no one wants to add one more tracking system to maintain.

🧩 Buy in from every single member of the team is necessary if you are trying to implement a project management tool and one senior level stakeholder can kill the entire initiative.

As a result, most of us stick to Microsoft Word closing checklists and complex tasks like reviewing a title report for a real estate transaction are listed as one item on the checklist, instead of having a full workflow that represents the 5-10 steps that go into finalizing that one item.  The problem with this is that two people can do the same task slightly differently or forget important parts of the task.

Now might be the perfect time to revisit adding workflow to closing process to take advantage of all the new tools that are becoming available.  If you want to automate as much as possible in a legal transaction, first you need to very clearly define each process in a very granular manner so you can figure out if you can have tech help to do it faster / better / more consistently. πŸš€πŸš€

One easy way to do this without adding a new project management platform with extra overhead is to create a separate closing checklist that can be used internally that breaks items down into all of the steps that are actually performed with very specific guidance on how to do the task that would not be contained on a checklist that is circulated to the entire deal team.

For example, a typical closing checklist might include two items for title review - (i) Title Commitment and (ii) Pro Forma Loan Policy.  There are several steps that get you from receipt of the title commitment to approving the final Pro Forma Loan Policy.  It could be broken down on a closing process checklist as follows:

Screenshot 2024-06-05 222534

Having a separate closing process checklist like this has some benefits:

πŸ‘Œ Forces you to review the steps in how you do tasks in a granular way that will uncover opportunities for automation as tech improves.

🀼 Peer review of processes might highlight new more efficient ways of doing the task or important steps / checks that might not be consistently applied.

πŸŽ‡ Easy to implement with no buy in needed from external parties to get started.

⚑ This is the first step to rolling out more advanced workflow / project management tools if you need to scale with a large team and measure progress.

Start with your highest volume or most important work and see if it adds any structure.  If you get it working well in checklist form you can then consider how to layer tech in to automate different parts of the deal.

Articles and News

 πŸ—»Utah Regulatory Sandbox Could Drive Shift in Legal Services

This article by Sean West foreshadows how removing regulatory restrictions on the ownership of entities providing legal services could pave the way for tech firms and lawyers to join forces to disrupt the legal industry.  For more information here is a link to the sandbox requirements and a list of some of the current participating companies.  It will be interesting to see how this impacts the delivery of legal services in the transactional space.

πŸ’²Tech Companies and Firms Should Not Spend on Building Models

Interesting take by Edward Bukstel on Harvey. I think the important point for any tech companies building using LLMs or law firms / law departments buying products built on them is to recognize that we should expect the compute power available via the models to get better over time and user experience should be where you build your moat, not building your own model or being tied too tightly to one model.  

🎨 Prompt Engineering Is Not a Skill for Lawyers

Some great points in this article by Nicola Shaver from Legaltech Hub on why prompt engineering is important but not be something that lawyers need to learn.  Totally agree with this as we have found that prompts are often very complex and long (and need to be tested over and over) but the best way for the end user to interact with the LLM is for them to not even know they are doing it.  Using prompts to return structured data / answers that can be presented via a well designed user interface should be where we focus our energy.  Legal tech companies need prompt engineers with legal subject matter expertise, not law firms.

πŸ“‰ Report on GenAI in Professional Services

Checkout this white paper by Thompson Reuters for some interesting data points and insights on the use of GenAI in law firms and corporate law departments.  I have heard this in multiple places, but most clients and corporate law departments expect their outside counsel to use AI in their practice, but most are not yet providing guidance on when or how to use it.  There is a huge opportunity for law firms to add value by showing clients how to augment legal processes with AI.

⚾ Moneyball and the Business of Law 

Love the analogy in this post by Kevin Walker at Centari on why leveraging AI to uncover data in contracts is going to level the playing field for law firms and clients in negotiating documents.  Interesting take that some clients will just grab the wheel themselves and take advantage of the insights in their own data (which may actually be better than one firm's data on their deals as that is only a fraction of their overall volume for most large lenders).

Other Thoughts

β›±πŸŠβ€β™‚οΈSummer Reflections on Goals and the Ikigai Mindset

As we jump into summer and spend time at the beach and outdoors with family, now is a great time to think about goals for the balance of the year.  I came across the Japanese concept of Ikigai and love this for thinking about setting the path forward and deciding what to focus on in work and in family life.