What are Master Services Agreement AI Mistakes?
A master services agreement (MSA) is a foundational legal document between two parties working together, such as a client and service provider. It has to include specific terms to guide their working relationship, such as by clearly defining work scope and payments to avoid disputes.
If you need to draft an MSA, you might wonder if you can use AI tools to help you. Although this can be safe if done properly, it can also expose you to risks. An MSA is a foundation for other business contracts, so it needs to be clear and comprehensive.
Read the rest of this article to explore common master services agreement AI mistakes, how to avoid them, and how a qualified lawyer can assist you with drafting or reviewing this important legal document.
What are Common Master Services Agreement AI Mistakes?
Knowing what errors AI tools can make during a master services agreement can help you to minimize them. Some of the most common mistakes include the following:
Lack of Clear Expectations
Since AI tools can provide ambiguous or generic text that seems professional at first glance, it’s easy to assume that your master services agreement is legally valid when it’s not. By being vague about work duties and expectations, AI can make it challenging for parties to know what’s expected of them.
Lack of Protections
AI might neglect to include specific information, which you might miss if you’ve never drafted an MSA before. The document needs to have specific protections regarding intellectual property (IP) ownership and data processing. Without these intact, you could put yourself at legal risk.
Internal Inconsistency
It’s common for AI tools to make errors with document consistency. For example, they might state that the liability cap doesn’t include indirect damages early on but then later in the document state that recovery of profits is allowed. This creates confusion and can lead to disputes.
While you might think these errors are easy to identify, they can be challenging to notice because individual clauses might seem to make sense when read in isolation.
Missing Industry-Specific Obligations
Although the final AI-generated MSA might seem complete, it could lack compliance provisions specific to your industry, such as by not including healthcare regulations or financial services requirements.
Lack of Scope Changes
AI tools won’t think about possible future scenarios that could affect your agreement, such as work scope changes. Although AI might state that the provider will accommodate reasonable requests for changes, it might not define details that both parties need, such as how the pricing will be adjusted or what timelines are acceptable. This puts you at risk of scope creep or unpaid work.
Vague Acceptance Processes
An important element of the MSA is how deliverables will be reviewed and accepted. While AI might provide a framework for deliverables, it won’t consider real-world processes. The MSA should clearly state the review period duration, what criteria there are for rejection, and what ensures acceptance.
Without these, there’s a risk that the client will delay accepting and paying for deliverables, leading to disputes.
How Can You Avoid Master Services Agreement AI Mistakes?
While you don’t have to completely avoid using AI tools to draft a master services agreement, there are important tips for using it safely and responsibly to minimize its mistakes.
Use an Approved Template
To ensure the MSA provides all the specific details you need, you should use a company-approved MSA document as a guideline for AI to work with.
You can also purchase a lawyer-drafted MSA from a legal platform like ContractsCounsel, one of the largest online legal marketplaces that connects you with qualified lawyers for contract drafting and review. Once you purchase the template from the platform, you’ll complete payment and can download the template immediately. It’s customizable so you can make it specific to your requirements. You can also chat to the lawyer who drafted the MSA should you have any queries.
Run it Through Multiple Reviews
After prompting the AI tool to draft your MSA, you should review it closely and ask it to edit its own work. You can do this by asking it to check the document for internal inconsistencies, undefined terms, conflicting risk allocations, and hidden assumptions. Doing this will help you to fine-tune the document and remove mistakes prior to settling on a final version.
How Does a Lawyer Help You Avoid Master Services Agreement AI Mistakes?
It might feel stressful to use AI tools to draft your MSA and review it thoroughly, which is why hiring a qualified lawyer to assist you is advisable. They have legal expertise to identify hidden risks and anything that could put you at a disadvantage.
A lawyer will:
- Consider your specific business model so the MSA is drafted in a clear, specific way. This avoids the vague or ambiguous wording common with AI tools.
- Include provisions for current and future projects or risks that could arise.
- Align your MSA with other documents so that there’s clarity and consistency.
- Create obligations for both parties that are easy to understand and match the agreed-on work standards.
- Protect you against third-party claims and data breaches.
- Align the MSA with all legal requirements and laws, ensuring that you’re compliant.
- Negotiate your MSA terms with the other party if they are unfavorable or unfair.
Where to Find a Lawyer to Draft a Master Services Agreement
If you need to find a lawyer to draft your master services agreement or review an AI-generated one, you don’t have to struggle to find the right one. Use an online legal marketplace like ContractsCounsel where you’ll access a curated network of vetted lawyers.
To request that a qualified lawyer draft or review your MSA, here are the steps to follow online:
- Go to the ContractsCounsel marketplace and post your project for free.
- Include a few details of what you need so that you match with the best lawyers.
- Receive bids from lawyers on the platform. You won’t receive one but multiple bids.
- Review the lawyer’s profiles. To ensure you match with the most suitable lawyer, review the platform’s extensive lawyer data, such as the lawyer location, client ratings, years of experience, and field of expertise.
- Connect with and hire a lawyer to draft or review your MSA.
