This article introduces ten ways to embed images into contracts to reach greater clarity and avoid confusion. It demonstrates a first step toward reducing worries around the legal interpretation of contract visualization -- an emerging field of research and practice.   It builds on and expands the authors’ recent work on using and interpreting images in contracts.¹

Visualize contract language and what do you see? Text and more text? But, add some visual images and you’re stepping into an emerging trend called contract visualization. Figures, timelines, flowcharts and maps help clarify and simplify complex language and capture readers’ attention. A contract well composed with text plus images helps readers recognize sequences or processes or steps needed to get desired outcomes.  

Like plain language, visuals can help contract reviewers and readers find what they need, understand what they find, and use the information. Visuals speed up the process and make it more pleasurable -- or at very least -- less painful for the reader.   In fact, recent articles in the Financial Times, Forbes, and Harvard Business Review all agree that more businesses are successfully embracing visualized contracts users can relate to.²

That’s good, but there’s a caveat. Although many welcome the trend for visual contracts, some worry: what would a judge say, or will a visual contract hold up in court? The concern over confusing, passive, indirect language is valid. It demands absolute clause clarity in both text and images. And ironically, although images and word-image combinations have been researched in language studies and communication sciences for many years,³ scholarly exploration of contract visualization has only just begun for the legal world. And that time delay has resulted in some challenges we must resolve as we join this emerging trend.

To get better outcomes we need greater and safer use of images in contracts for making smarter decisions faster; for getting sharper clarity on deliverables and delivery requirements; for implementing easier contract policies and procedures - and for performing all such tasks without experiencing negative surprises.

This complex task cannot be compromised. With visualization you can lift contracting to a new level, open new options to make contracting simpler, provide contract writers more choices for clarifying text so that it is predictable for preventing unnecessary disputes - or creating confusion over meaning of clause language.

Within the context of visual communication, we prefer to use the term image or visual to avoid the sense of limitation to computer-generated graphs which are often associated with the term graphic. The term graphic is frequently used for pictures, charts, maps and graphs used for illustration,⁴ while image is understood more broadly as a visual representation of something. So, we focus on visualizing knowledge and information rather than visualizing large amounts of data.

Visualization techniques energize your contracting skills

Visualization gives you insight, not just images. So, when using visuals, you want to add images to supplement contract text, not replace it. Visualization is your tool for negotiating and interpreting contracts. You can use it in contract education and in various stages of the contracting process -- from supporting better communication when capturing or negotiating a deal -- to documenting terms of the agreement throughout its lifecycle. Here you can focus on embedding images in contracts themselves, rather than using images in contract-related guidance, playbooks or briefs.

Images serve many functions, and their relation to text will vary. As shown in Figure 1 below, images can, for instance, support the message of the text, highlight or add something to it, or contradict it. We may seek to capture readers’ attention and engage readers, or we may seek to motivate them to first skim-read for major clarity and then read in depth for more.

Figure 1. Concept map describing the functions of images in relation to text
© 2020 Vesa Annola, Helena Haapio and Merja Koskela.

Contracts cannot work well as operational guides for business, unless we pay attention to the quality of their content and expression. Just like words, images can be chosen well or poorly. And just like text, images can be designed well or poorly. They can be unclear, off the point, or misleading, and they can conflict with other parts of the contract. To avoid confusion and ensure that all contract components are performed well, contract writers can use many techniques to safely insert images to guide readers’ interpretation, decisions and action.

Ten ways to make the interpretation of images more predictable

Obviously, images can make contracts clearer and easier to use. So, if you choose to include images in contracts, we propose the following ways to make the interpretation of images more predictable:

1. Begin with both primary and secondary users in mind (we call them business and legal readers).

2. Think in terms of contract components and modules: they may have different users, and some may need visualization more than others. When your contracts are modular, you can start with clauses reflecting the most urgent business needs, for example those found on the World Commerce & Contracting (WorldCC) list of the Most Negotiated Terms 2020.⁵ Do not seek to visualize everything - just what makes sense to reach the contract’s business and legal objectives.

3. Make sure you are solving your organization’s and users’ real problems and the right problems. Use design methods such as visualization and sketching to find out.⁶

4. Seek clarity and consistency - use plain language and plain design: ensure images are consistent with the text and, if changes are made to either one, make sure they are also reflected in the other.

5. Provide clarity and hierarchy by visualizing your most important This will influence people to pay attention to them. You may also want to focus on the most disputed terms on the WorldCC list.

6. Simplify content to avoid over-complexity, but avoid over-simplification. Aim at quality simplification (better user experience), rather than quantity simplification - shorter is not always better. In fact, “simpler” may need explanation and so become longer.

7. Use headings, plain language summaries, visuals, layering and other effective solutions to recurring problems typical of business readers. Apply design patterns in the World Commerce & Contracting Contract Design Pattern Library⁷ on the basis of your primary audience and communication goals. Think of the contexts in which the contract will (or should) be read and interpreted.

8. Use contract terms to clarify what is and what is not part of the contract and what is given interpretative value and priority in case of conflict.

Examples include:

• • Contract definition: define the documents containing the parties’ rights and obligations such as: “This Agreement shall mean…”; “The documents constituting this Agreement are:…”

• • Order of precedence clauses: “In the event of any conflict between this document and any of the Attachments,…” - the heading can also be labeled priority of documents, conflicting provisions, rank of documents, or the like. Consider addressing the priority of text over images or vice versa.

• • Entire agreement clauses

9. Prevent unnecessary problems for legal readers by using further interpretation clauses that provide ‘rules’ guiding interpretation in the contract. Examples include:

• • applicable law clause,
  • no oral modifications clause,
  • headings clause, and
  • language clause.

10. When automating your clause library, consider pairing your most important clauses with images that match them and ensure they are aligned with company goals.

The contract writer can follow the legal steps of “ex ante” (before the event), and also follow the steps of the “ex post” (after the event) as per the decision of a judge. Here’s how:

• First determine the contractual documents, then
• determine their hierarchy and what is given priority in the context of the whole agreement, and, finally
• determine whether and to what extent other materials (such as previous contracts, pre-contract documents or side letters) or evidence are taken into consideration.

When it comes to legal interpretation, the key goal of the process is to determine the parties’ intent. This is something for the draftsperson to express as clearly as possible, where needed. Depending on the context and jurisdiction, a court or arbitrator may also imply terms into a contract. Contract writers may want to clarify or limit this, using gap-filling clauses or custom, usage and course-of- dealing clauses for this purpose. These may include references to the interpretation of certain terms (and, in the future, also images) in accordance with practices in a certain trade or dealer market. Yet some contract writers are more likely to try to exclude custom, usage, practices and course of dealing.⁸

In addition to images, you may choose to use illustrations or worked examples as part of your contract. Many of the topics listed above can be applied to these as well. Interestingly enough, although some UK cases⁹ pertain to illustrations and worked examples, we are not aware of any case law pertaining to images in contracts. For businesses and proactive, prevention-minded lawyers, this is a good thing, but for others, this may pose a problem, because no visual language tested in court exists to rely upon, and form books for visual contracts do not exist either.¹⁰

If you encounter a hostile attitude against giving decisive value to images (or plain language summaries or headings), one way to move forward regardless is to state in the contract that in case of conflict, text shall prevail over images and that images are included only to facilitate use and “shall not affect the meaning or interpretation of the agreement”. As we move forward, we hope to see less need for these signs of fear of images in general and inconsistencies between text and images in particular.  

The point of this?  

Images can help turn contracting parties’ true intentions into contractual provisions that bring predictable results and facilitate the parties’ collaboration. Ideally, a visualized contract is easy to use and implement as intended, removing the need for ex post legal interpretation; if not, the methods introduced in this article will help contract writers guide legal interpreters’ ex post view of the contract so that it will match that of its ex ante makers.

If using visuals helps your primary contract users - that is, business readers - understand the content and know what is expected, they can use the contract to make things happen and avoid unnecessary conflict. If a dispute is inevitable, a well-thought-out contract combining well-designed text and visuals will provide guidance for legal readers’ interpretation as well.

END NOTES

1. See, for example, Interpreting Images in Contracts, Vesa Annola, Helena Haapio & Merja Koskela, in Research Handbook on Contract Design, Marcelo Corrales Compagnucci, Helena Haapio & Mark Fenwick (eds), Edward Elgar, forthcoming; Contract quality and AI: garbage in, garbage out, Helena Haapio & Daniel W. Linna Jr, Contracting Excellence Journal, 31 August 2020; Next Generation Contracts: a Paradigm Shift, Helena Haapio, Lexpert Ltd 2013.

2. Can Contracts Use Pictures instead of Words? Bruce Love, Financial Times, 23 October 2019; A New Approach to Contracts, David Frydlinger, Oliver Hart & Kate Vitasek, Harvard Business Review, September-October 2019; Plain Language Contracts on the Rise, Kate Vitasek, Forbes, 19 March 2018; Comic Contracts: A Novel Approach to Contract Clarity and Accessibility, Kate Vitasek, Forbes, 14 February 2017.

3. Doing Visual Analysis: From Theory to Practice. Per Ledin & David Machin, Sage 2018; A Taxonomy of Relationships Between Images and Text, Emily E. Marsh & Marilyn Domas White, Journal of Documentation, Vol. 59, No. 6, 2003, pp. 647-672. - The Authors have created the concept map in Figure 1 on the basis of the Marsh-Domas White taxonomy.

4. “graphic”, Merriam-Webster.com Dictionary, 20 October 2020.

5. Most Negotiated Terms 2020, WorldCC, 7 October 2020.

6. From Visualization to Legal Design: A Collaborative and Creative Process, Gerlinde Berger-Walliser, Thomas D. Barton & Helena Haapio, American Business Law Journal, Vol. 54, No. 2, 2017, pp. 347-392, available at SSRN.

7. World Commerce & Contracting Contract Design Pattern Library

8. For different examples of these and other interpretation clauses and the limitations on their use, see Drafting International Contracts. An Analysis of Contract Clauses, Marcel Fontaine & Filip De Ly, Transnational Publishers, Inc. 2006.

9. See Altera Voyageur Production Ltd v Premier Oil E&P UK Ltd [2020] EWHC 1891 (Comm) (17 July 2020).  

10. See, for example, Whiteboard and Black-Letter: Visual Communication in Commercial Contracts, Jay Mitchell, University of Pennsylvania Journal of Business Law, Vol. 20, No. 4, 2018, pp. 815-862; Diagrammatics and the Proactive Visualization of Legal Information, Michael D. Murray, University of Arkansas at Little Rock Law Review, forthcoming (draft available at SSRN). Michael Murray applies visual literacy and visual legal rhetoric principles to transactional, litigation, and informational documents. He is currently working on an article on "Toward a More Universal Visual Language of Law."

ABOUT THE AUTHORS

Helena Haapio is a contract lawyer and an advocate of contract simplification and redesign. She is an Associate Professor of Business Law at the University of Vaasa, Finland, and a Contract Strategist at Lexpert Ltd. In addition to her LLM and other degrees, Helena is proud to hold a Master of Quality degree and be a Fellow of the WorldCC. She is the author and editor of several books and a co-founder and co-creator of the WorldCC Contract Design Pattern Library. She is currently co-editing two books for Edward Elgar, Research Handbook on Contract Design and Legal Design: Integrating Business, Design and Legal Thinking with Technology. For more information, see Lexpert team and Helena Haapio's profile at the University of Vaasa.

Vesa Annola is a Professor of Business Law at the University of Vaasa, Finland. In addition to his work in academia, he has been a partner in a law firm for numerous years. He focuses primarily on contract law. His books and articles deal with, for example, the Interpretation of Contracts, Letters of Comfort and Insider Trading. For more information, see Vesa Annola's profile at the University of Vaasa.

Merja Koskela is a professor of applied linguistics at the School of Marketing and Communication at the University of Vaasa. Her research focuses on professional communication and discourse. She has studied academic writing, bureaucratic communication, visual communication, online communication, and lately in particular financial communication. She has published widely in international journals in the fields of linguistics and communication studies. For more information, see Merja Koskela's profile at the University of Vaasa.

 

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