Chapter

Exploding the Fine Print: Designing Visual, Interactive, Consumer-Centric Contracts and Disclosures

Authors:
To read the full-text of this research, you can request a copy directly from the author.

Abstract

In this chapter, we present new models for the presentation of contracting terms and interactions, based on user research and design work into consumer contracts. As more contracts become machine-readable, there is an open question of how people will actually interact with these computable contracts, so that they can effectively, efficiently, and meaningfully use them. At Stanford Legal Design Lab we went through several human-centered design cycles to generate new contract designs, gather qualitative feedback about them, and then propose guiding insights and new conceptual models for better consumer-facing legal communications. This initial study led to key principles, models, and patterns that demonstrate how consumer contracts can be more comprehensible, engaging, and effective. Following on this qualitative design research, we then conducted more structured, qualitative evaluations of the new contract interface models that we had designed. We did a comparative study of how users engaged with and used different interface models to determine which ones were most effective. Effectiveness is judged on several criteria: the ability to engage the attention and actions of the user, the ability to help the user comprehend the content that it is communicating, and the ability to help the user make a decision that fits with his or her own preferences and needs. This study can serve all those interested in improving disclosures, terms of service, privacy policies, and various other forms of business-to-consumer contracts. It provides empirical research on new models for communicating complex terms and conditions to lay people. It bridges the literature of contract design for improved usability and outcomes, behavioral economics’ concern for choice engines and decision making, legal scholarship on the effectiveness of disclosure as a regulatory mechanism, and HCI research on how best to engage users and help them navigate systems.

No full-text available

Request Full-text Paper PDF

To read the full-text of this research,
you can request a copy directly from the author.

ResearchGate has not been able to resolve any citations for this publication.
Full-text available
Conference Paper
Major gaps may exist between the legal representation of an agreement (“the paper deal”) and the goals and intentions of its negotiators (“the real deal”). This paper outlines contracting pitfalls and proposes new approaches to the use of visualisation to overcome them. We categorise contract visualisation and introduce comics and visual interfaces for deal-making as examples of two new categories. These approaches open new possibilities for the future for both theory and practice. They also contribute to next generation deal design as a way to narrow the gaps between the real deal and the paper deal, turning contracts into user-friendly communication tools that reflect the true will of the parties. Full text available at: http://ssrn.com/abstract=2747821
Full-text available
Article
We show that the fundamental legal structure of a well-written financial contract follows a state-transition logic that can be formalized mathematically as a finite-state machine (also known as a finite-state automaton). The automaton defines the states that a financial relationship can be in, such as “default,” “delinquency,” “performing,” etc., and it defines an “alphabet” of events that can trigger state transitions, such as “payment arrives,” “due date passes,” etc. The core of a contract describes the rules by which different sequences of event arrivals trigger particular sequences of state transitions in the relationship between the counterparties. By conceptualizing and representing the legal structure of a contract in this way, we expose it to a range of powerful tools and results from the theory of computation. These allow, for example, automated reasoning to determine whether a contract is internally coherent and whether it is complete relative to a particular event alphabet. We illustrate the process by representing a simple loan agreement as an automaton.
Full-text available
Conference Paper
Notifying users about a system's data practices is supposed to enable users to make informed privacy decisions. Yet, current notice and choice mechanisms, such as privacy policies , are often ineffective because they are neither usable nor useful, and are therefore ignored by users. Constrained interfaces on mobile devices, wearables, and smart home devices connected in an Internet of Things exacerbate the issue. Much research has studied usability issues of privacy notices and many proposals for more usable privacy notices exist. Yet, there is little guidance for designers and developers on the design aspects that can impact the effectiveness of privacy notices. In this paper, we make multiple contributions to remedy this issue. We survey the existing literature on privacy notices and identify challenges, requirements, and best practices for privacy notice design. Further, we map out the design space for privacy notices by identifying relevant dimensions. This provides a taxonomy and consistent terminology of notice approaches to foster understanding and reasoning about notice options available in the context of specific systems. Our systemization of knowledge and the developed design space can help designers, developers, and researchers identify notice and choice requirements and develop a comprehensive notice concept for their system that addresses the needs of different audiences and considers the system's limitations and opportunities for providing notice.
Full-text available
Conference Paper
Online privacy policies are di! cult to understand. Most pri- vacy policies require a college reading level and an ability to decode legalistic, confusing, or jargon-laden phrases. Privacy researchers and in- dustry groups have devised several standardized privacy policy formats to address these issues and help people compare policies. We evaluated three formats in this paper: layered policies, which present a short form with standardized components in addition to a full policy; the Privacy Finder privacy report, which standardizes the text descriptions of privacy practices in a brief bulleted format; and conventional non-standardized human-readable policies. We contrasted six companies' policies, delib- erately selected to span the range from unusually readable to challeng- ing. Based on the results of our online study of 749 Internet users, we found participants were not able to reliably understand companies' pri- vacy practices with any of the formats. Compared to natural language, participants were faster with standardized formats but at the expense of accuracy for layered policies. Privacy Finder formats supported accuracy more than natural language for harder questions. Improved readability scores did not translate to improved performance. All formats and poli- cies were similarly disliked. We discuss our findings as well as public policy implications.
Full-text available
Conference Paper
For years the HCI community has struggled to integrate design in research and practice. While design has gained a strong foothold in practice, it has had much less impact on the HCI research community. In this paper we propose a new model for interaction design research within HCI. Following a research through design approach, designers produce novel integrations of HCI research in an attempt to make the right thing: a product that transforms the world from its current state to a preferred state. This model allows interaction designers to make research contributions based on their strength in addressing under-constrained problems. To formalize this model, we provide a set of four lenses for evaluating the research contribution and a set of three examples to illustrate the benefits of this type of research.
Article
Simplification of disclosures is widely regarded as an important goal and is increasingly mandated in a variety of areas. In the area of data privacy, lawmakers and interest groups developed best-practices techniques to help consumers understand how firms collect and use personal information. Commentators have even advocated going a step further and using simpler disclosures--warning boxes that alert consumers to the least-expected elements. But do these techniques succeed in better informing consumers or preventing unwise behavior? To answer this question, we engaged a leading market research firm to conduct a survey on risky sexual behaviors while randomizing the format of the privacy disclosures provided to the respondents. We find that best-practice simplification techniques have little or no effect on respondents' comprehension of the disclosure, willingness to share personal information, and expectations about their rights. Our results challenge the wisdom of focusing regulatory effort on simplifying disclosures.
Article
Government-published documents often fail to communicate clearly – with citizens, but also with “professional readers” like civil servants. Highly visual or multimodal approaches remain rare. In particular, this is an unhelpful practice in regards to legal-bureaucratic instructions (e.g. contracts, rules, policies), which exist to guide compliant behaviour. The study explores the development and the experimental evaluation of a highly diagrammatic guide for public procurement Terms & Conditions, addressed to civil servants. Results show that the diagrammatic format, in comparison to prose, significantly enhances comprehension accuracy and answering speed, and is perceived as more appealing and functional by the users.
Article
The author draws a parallel between the world of law and the world of the computer. Law accordingly can be seen as a collection of programs, as a programming language—as a programming environment of human society. In this article, the social roles are highlighted in this tripartite system, and the author points to the dangers of turning law from something humanistic into something mechanistic.
Article
In this paper, we illustrate how merging contract design with information design, especially visualization, can help to transform contracts (and people's perceptions about contracts) from legal rules to communication tools. We argue that improved human-contract interaction can maximize the value of commercial relationships, minimize risk, and prevent workplace frustration. Viewing contracts as boundary objects and changing their design to overcome the current challenges offer unexplored opportunities for both research and practice.
Conference Paper
Contracts are complex just like the business relationships, processes and tasks they seek to describe. Despite being necessary tools for collaboration, most contract users are frustrated by traditional contracts, which are long, overly legal and difficult to understand. Some approaches to managing complexity and designing user-friendly contracts have been suggested, based, for instance, on the principles of proactive law, lean manufacturing/management and plain language. Recent research has explored the possibility of using information design and visualization to facilitate knowledge transfer and collaboration in complex organizational settings. This paper investigates visualization applied to contracts. A contract prototype was created and tested with users, in order to assess whether visualized contracts are more usable and provide a better user experience than traditional text-only contracts. The paper illustrates hypotheses regarding the correlation of visualization, usability and user experience, proposes a test procedure and presents the results obtained.
Article
Instead of attempting to promote informed consumer assent through quixotic attempts to have consumers read ever-expanding disclosures, this Article argues that consumer protection law should focus on unexpected, unfavorable terms. We propose a system under which mass market sellers are required periodically to engage in a process of "term substantiation" through which sellers would learn whether their consumers held accurate beliefs about the terms of their agreement. Terms that meet or exceed the median consumer’s expectation would be enforceable even if buried or only available on request. But sellers could enforce unexpected, unfavorable terms only if they are disclosed in a "warning box" that has a government-provided standard border. To prevent overuse of the box, sellers would need (i) to exclude terms from the box that meet or exceed consumer expectations and (ii) to order terms in the box in descending order of consumer importance. Such a system of term substantiation coupled with targeted warnings about unexpected terms jettisons as unworkable the duty to read ideal. It instead economizes on consumer scarce attention by increasing the salience of those terms that are most likely to inhibit informed consent. We report on the results of an original term substantiation field experiment documenting user expectations concerning unread Facebook EULA provisions. Consistent with our analysis, we find that users can correctly evaluate many of these provisions. Importantly, we also uncover the existence of a few unexpectedly, unfavorable terms that, under our proposal, would be presumptively unenforceable unless subject to heightened disclosure.
Article
It is possible to formulate contractual obligations so that computers can 'understand' and make prima-facie compliance assessments with specified terms and conditions. Such a contractual obligation, formulated specifically for computer processability, is what this Article terms a 'computable contract.' Computable contracts are not merely theoretical, but instead are increasingly being used in economically significant domains. Certain widely used financial contracts exemplify this model. The emergence of computable contracts has largely been unrecognized in the legal literature. However, computable contracting is not extensible across all, or even most, contracting scenarios. Rather, it is limited to a small subset of contracting scenarios involving standardization, and relative legal and factual certainty. Drawing upon computer science research, this Article provides a theoretical account of computable contracting. It first explains how firms can communicate contracting information to computers by representing contracts as data instead of (or in addition to) the traditional written language form. Formalizing contractual obligations in this way is what is termed 'data-oriented' contracting. The representation of contractual obligations as data, in turn, allows for novel contracting properties. For example, parties can effectively 'translate' certain contractual criteria into a comparable set of computer-processable rules. To make contracts 'computable', parties provide computer systems with external data that is relevant to performance. This model is supported by contemporary examples of computable contracts in domains ranging from finance to intellectual property. This Article also provides principles for distinguishing contracting scenarios that are amenable to computability from those that are not.
Article
What follows is an exploration of innovative new ways to deliver privacy notice. Unlike traditional notice that relies upon text or symbols to convey information, emerging strategies of “visceral” notice leverage a consumer’s very experience of a product or service to warn or inform. A regulation might require that a cell phone camera make a shutter sound so people know their photo is being taken. Or a law could incentivize websites to be more formal (as opposed to casual) wherever they collect personal information, as formality tends to place people on greater guard about what they disclose. The thesis of this Article is that, for a variety of reasons, experience as a form of privacy disclosure is worthy of further study before we give in to calls to abandon notice as a regulatory strategy in privacy and elsewhere.
Article
Like property, contractual boilerplate is less tailored to its contractual and business environment than one might expect considering only the costs of producing it. Boilerplate, like all legal communication, requires actors to trade off the benefits of information-richness with the need for adaptability to a wide variety of contexts. One device for managing the complexity of contexts is modularity, under which a system is divided into information-hiding components which allow internal interaction but only limited interaction across component boundaries. Modularity helps boundedly rational agents to understand systems and to specialize in working on a subset of modules. Modularity also facilitates adaptability of systems in response to changes in the environment. Boilerplate utilizes modularity to allow for its addition, subtraction, and porting from one contract to another, without the need to worry about unforeseen interactions with other parts of the contract and the business context. Governing law and severability provisions provide particularly dramatic examples. Boilerplate is also intermediate between contract and property in terms of contexts not taken into account by the creators of boilerplate, and thus boilerplate requires less judicial intervention to maintain standardization than does property, but more so than in the case of contracts. The need for modularity also helps explain the role of "reading costs" in parties' choice of simpler contractual provisions over other more complex provisions that are not necessarily more costly to write. Modularity and formalism more generally are matters of degree, and underappreciated benefits of modularity help explain the incompleteness of the Realist revolution in contracts and the relationship of contracts to off-the-rack doctrines in civil and common law.
Article
Contracts are an important construct for the formation and performance of agreements. Yet, many business people view contract review as a time-consuming nuisance or an administrative burden. Furthermore, contracts contain concepts and language that non-lawyers often find overly complicated, obscure, and unappealing. We explore whether contract visualization, the description of their scope and terms of an agreement through visual means rather than the written word, can have a beneficial impact on the contracting process and the value capacity of organizations.
Article
This Article argues that freedom of contract will take on different meaning in a world in which ubiquitous information about places, goods, people, firms and contract terms is available to contracting parties anywhere, any time. In particular, our increasingly “augmented reality” calls into question leading justifications for distrusting consumer contracts - and thereby strengthens traditional understandings of freedom of contract as enforcing contracts as written. This is largely a descriptive and predictive argument: the Article aims to introduce contract law to these technologies and consider their most likely effects. It certainly has normative implications, however. Given that the vast majority of consumer contracting occurs in physical space, the introduction of ubiquitous digital information into these transactions has profound consequences for contract law.
Adding document-design bling to contracts
  • K Adams
Zynga combines privacy education, gaming and rewards with PrivacyVille
  • L Rao
Innovating contract practices: merging contract design with information design
  • S Passera
  • H Haapio
  • T-D Barton
Making good business decisions - the business judgment rule as a tool for better decision making
  • M Salo
  • H Haapio
The death of search and the rise of choice engines. Big data made simple
  • S-V Shankar
Compare the best cell phone plans
  • Whistleout
A step towards usable privacy policy: automatic alignment of privacy statements
  • F Liu
Compare rewards credit cards for good credit
  • Nerdwallet
Bringing innovation to the tradition of contract drafting: an interview with Ken Adams. Scholastia, 22 Sept
  • D Padula
So a corporate seal can be relevant
  • K Adams
What’s privacy checkup and how can I find it?
  • Facebook Help Center
Spanish language personas: informing the design of healthcare websites
  • S-I Salazar
  • J-R Bergstrom
How healthcare.gov taught America to finally care about design. Wired
  • C Valberg
Healthcare.gov: helping millions gain coverage
  • E Mullen
Putting some product into work-product: corporate lawyers learning from designers
  • J-A Mitchell
Improving contract quality: modularity, technology, and innovation in contract design
  • G Triantis
Notice, assent and form in a 140 character world
  • J-M Moringiello