The Readability Problem in Legal Documents
A 2024 study by the Stanford Legal Design Lab found that the average commercial contract is written at a 14th-grade reading level — two grades above a college graduate. Legal jargon like “indemnification,” “severability,” and “liquidated damages” is meaningful to attorneys but opaque to the people who actually sign these documents.
The consequences are measurable. A 2023 survey by the National Consumer Law Center found that 83% of consumers sign contracts without fully understanding the terms. Of those, 34% later discovered obligations they did not expect.
What Plain-English Summary Does
Before a signer opens the signing interface, ClosingIQ’s AI generates a plain-English summary of the entire document. The summary is written at an 8th-grade reading level, using short sentences and everyday vocabulary.
The summary covers:
How It Works
The summary is generated server-side and cached. It does not slow down the signing experience.
Real Example
Before (original contract language):
> “Lessee shall indemnify and hold harmless Lessor from and against any and all claims, actions, damages, liability, and expense in connection with loss of life, personal injury, or damage to property arising from or out of any occurrence in, upon, or at the Premises, or the occupancy or use by Lessee of the Premises or any part thereof.”
After (plain-English summary):
> “If someone is injured or property is damaged at the space you’re renting, you (the tenant) are responsible for covering the costs — not the landlord. This includes legal fees.”
Why This Matters for Businesses
Reduced Signing Abandonment
DocuSign reported in 2024 that 12% of documents sent for signature are never completed. A common reason: signers feel uncertain about what they are agreeing to. Plain-English summaries reduce this friction by building confidence before signing.
Fewer Disputes
When both parties understand the contract, post-signing disputes decrease. The American Arbitration Association found that contracts with plain-language addenda see 23% fewer arbitration filings.
Legal Compliance
Several states now require plain-language disclosures for consumer contracts. New York General Obligations Law Section 5-702 mandates that consumer agreements be “written in a clear and coherent manner using words with common and everyday meanings.” Connecticut, New Jersey, and Minnesota have similar laws.
Limitations
The plain-English summary is an AI-generated aid, not legal advice. It does not replace attorney review for high-stakes contracts. The summary is based on the document as uploaded — if the document is incomplete or contains errors, the summary will reflect those.
ClosingIQ is a technology platform. We do not provide legal advice.
Pricing
Plain-English summary is automatically generated for every document sent for e-signature on Pro and Unlimited plans at no additional cost. Pay-Go users can add it for $15 per document.