Is Your Legal Contract Ambiguous? Convert to a Smart Legal Contract

Abstract

A legal contract is something that is in spoken or in written form, which binds a party or multiple parties into given terms and conditions. On the other hand, a smart contract is also a contract which is a computer program that binds parties into given terms and conditions but unlike a legal contract, it is self-executable, efficient, and unambiguous. Almost all legal contracts are complex while reading because of its ambiguous nature. In this paper, we take a real-world ambiguous legal contact as a test contract, and generate various interpretations from it, convert all those interpretations into the smart legal contracts and identify the most ambiguous and accurate smart legal contract by performing various measurements such as transaction fees and ambiguity index for each interpretation. We came to the conclusion that the most ambiguous legal contract would be the contract with general interpretation as it was more complex when written in the smart contract and had many possible interpretations due to ambiguity than the rest of the interpretations.