Smart-er Contracting: The Augmented Lawyer's Use of CISG and Smart Contracts in Shipping

Abstract

The maritime industry relies heavily on paper documents underpinned by contracts. This presents challenges for shipping transactions, as paper in the system is greatly inefficient and prone to fraud and error, creating a specific systemic risk and dysfunction in the economy. This paperwork problem remains despite the long-standing use of Electronic Data Interchange (EDI) for Bills of Lading (eBL). This paper provides a legal analysis of the benefits and drawbacks of deploying blockchain technology and smart contracts in the supply chain, within the Convention on the International Sale of Goods (CISG) framework, and international trade. The CISG in the digital age is assessed by focusing on the specific and critical maritime industry as a case study of transitioning from traditional methods to a new digital environment, thus providing insights into the legal design aspects of technological change. While smart contracts are part of the answer for the maritime industry, the need is not for smart contracts per se but rather smart-er contracting as a solution for what this paper calls the 'Augmented Lawyer. This paper offers the novel argument that this augmented lawyering proposal is important for both the CISG generally and for the shipping industry specifically. The legal design aspect involves incorporating smart contracts as part of an augmented solution. The augmented lawyer works on legal design solutions that seek to solve industry challenges by departing from an overly technological focus and thus to resolve the challenging issues of human collaboration, communication, and dysfunction.