AI Contract Review: Assistant, not Author

AI Contract Review: Assistant, not Author

For in-house counsel in construction, contract review is not a mechanical exercise. It is a core risk function and must result in a contract that can be administered in the real world and respond to events and risks as they arise.

Every clause sits within a web of commercial intent, project delivery constraints, regulatory exposure, and downstream liability. When something goes wrong and the contract doesn’t give end-users the tools they need, responsibility does not sit with a tool or a process, it sits with the legal function.

That reality explains why “AI contract review” is often met with hesitation rather than excitement.

The Fear is not About Technology

Most in-house counsel are not concerned about AI existing. Rather, they are concerned about where authority appears to shift and the technology begins driving the contracting process without proper oversight and the application of commercial sense and legal judgement.

Phrases such as, “automated decision-making” and  “AI-approved contracts” create an immediate red flag. They suggest that judgement, accountability, and professional discretion are being displaced by an opaque system that does not bear risk, hold context, or understand project-specific nuance.

For construction and legal professionals , that is not innovation, it is exposure.

Contract Review is an Exercise in Judgement, not Detection

Standard form contracts are not complex because clauses relating to risks are hard to identify. They are complex because those risks and their allocation is not a binary process.

In the vast majority of cases in-house counsel and commercial end-users must seek to strike a balance between the extent of risk transfers, cost control and allocation of risks to the party best placed to manage it in practice.

In-house counsel routinely assess:

• whether a deviation from standard terms is tolerable given programme pressure;

• how risk is mitigated elsewhere in the contract or project structure;

• whether a clause is enforceable in practice not just in theory; and

• the cumulative effect of multiple “minor” concessions.

These assessments require legal experience, commercial understanding, and situational awareness. They also require accountability and that is something no AI system can meaningfully assume.

This is why AI should never be treated as the author of contract outcomes. Human judgement remains an essential part of every stage of a contracts lifecycle.

Where can AI safely add Value? 

When positioned correctly, AI can play a valuable but specific role in contract review.

As an assistant, not an author, AI can:

• identify risks, non-standard clauses and deviations from playbooks;

• surface inconsistencies;

• flag and prioritise risk concentrations that warrant closer scrutiny; and

• reduce the time spent on repetitive, low-value review tasks.

This is not about removing judgement.

It is about creating the conditions for better judgement.

AI can handle the routine, but critical, task of reviewing particular conditions, cross checking general conditions to identify risks and provide insight on what an organisations risk profile can tolerate. AI can then assess risks, prioritise them and present them to in-house counsel or commercial end-users alongside suggested solutions and explanations.

By reducing the routine workload and manual comparison work, AI tools allow in-house counsel to focus on the high risk items that need the benefit of their experience, judgement and expertise.

Additionally, AI can get that ‘first cut’ review done in a matter of minutes where it might take in-house counsel (even an experienced one) previous hours to complete the same task.

Trust Comes From Limits, Not Capability Claims

In legal environments, particularly construction,trust in new systems is not built through expansive claims about AI replacing years of experience, know-how and practical judgement.

The first step is finding the right tool for the job. No one would expect a corporate lawyer to mark-up a FIDIC quickly and accurately, and it is unrealistic to expect a generic AI tool to be able to do so either.

Once you have identified the right tool for your contracts, the next step is building trust in that tool.

Trust in AI systems can only truly be built through:

• matching the right tool to your needs, bringing with it domain specific knowledge, accuracy and the ability to fine-tune the system to your own risk appetite;

• understanding the role of the system and the author in a single workflow;

• setting and adhering to clear boundaries on what the system does and does not do;

• transparency in how outputs are generated;

• respect for existing workflows; and

• a consistent emphasis on human-in-the-loop decision-making.

The most credible AI tools are those that are intentionally restrained and focused on a particular domain and set or related tasks.

A More Realistic Future

The future of contract review in construction is not one where AI replaces in-house counsel.

It is one where AI forms a key part of a more efficient, but human led, workflow. By matching the right tools with human judgement and experience:

• review becomes more consistent across contracts and projects;

• risk is identified and addressed earlier in the negotiation cycle; and

• human judgement is applied where it is most needed and without unnecessary time pressures driven by balancing commercial time pressure against the need to take the time to undertake a detailed manual review.

In that future, AI is not the author of contracts or decisions.

It is the assistant that helps ensure those decisions are made accurately, efficiently and consistently.

And critically, control and responsibility remains exactly where it belongs, with you.

Follow Contrafly on Linkedin for updates on Contrafly. A new tool, powered by AI and focused on construction contracts…coming soon.