NLP for Legal Documents: use cases and benefits

September 21, 2021

Natural Language Processing (NLP) is a field of artificial intelligence (AI) concerned with the interaction between computers and human language. It involves processing natural language data by a computer to perform various tasks such as sentiment analysis, text classification, and summarization, among others. One of the most exciting applications of NLP is in the field of law, where it provides solutions to complex legal challenges.

NLP solutions for legal documents

Legal documents can be challenging to understand, given the specialized language and complex structures used. Lawyers and other legal professionals often spend hours going through legal documents, analyzing them for context, meaning, and key information. The use of NLP in the legal sector helps lawyers to cope with this significant challenge by providing relevant information and insights within a short time. Some of the available NLP tools for legal documents include:

1. Contract analysis

Contracts are a vital part of business agreements, and their proper examination is essential. NLP algorithms can analyze large volumes of contract data, identify key clauses, enhance risk-management strategies, and identify obligations and outcomes.

2. E-discovery analysis

Electronic discovery (e-discovery) refers to the discovery and examination of electronically stored data. NLP algorithms can analyze large volumes of electronic data, including emails, social media posts, and instant messages. NLP can also be used to identify relevant content for legal purposes.

3. Due diligence analysis

Due diligence analysis is an essential aspect of business operations, and it requires a lot of effort. NLP algorithms can perform due diligence analysis by examining legal data from a variety of sources, including official documents, news articles, and social media. The algorithms can highlight problematic information, helping lawyers to make informed decisions.

Benefits of NLP in legal documents

NLP provides numerous benefits to legal professionals, including:

  • Time savings: Lawyers can save time in analyzing legal documents by using NLP solutions, allowing them to focus on core tasks such as advising clients and attending court proceedings.
  • Increased accuracy: NLP solutions can identify relevant information and insights that may be challenging to detect manually. This increased accuracy leads to better decision-making.
  • Cost-effectiveness: NLP solutions are highly cost-effective in that they reduce the time and personnel required to analyze legal documents. It can be performed faster and more accurately than humans, making it a more efficient process.
  • Improved risk management: NLP algorithms can identify potential risks associated with legal documents, allowing lawyers to develop better risk management strategies.

NLP in legal documents compared to traditional methods

NLP in legal documents provides efficient and effective solutions when compared to traditional methods. It offers a more accurate analysis of legal documents and provides relevant insights in a shorter time than traditional human-assisted analysis. A study by Deloitte found that NLP-powered contract review was up to 60% faster than manual contract reviews.

Conclusion

NLP examples have demonstrated significant benefits to legal professionals, including time and manpower savings, increased accuracy, cost-effectiveness, and risk management optimization. As a result, more legal professionals are likely to turn to NLP solutions to optimize their legal processes.

References

  1. https://www2.deloitte.com/us/en/insights/topics/operations/contract-review-ai.html

  2. https://emerj.com/ai-sector-overviews/natural-language-processing-nlp-in-law-ai-applications-for-legal-professionals/


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