happy-technologies-llc/contract-analysis

Contract Analysis

Overview

This skill provides a structured approach to analyzing contracts within ServiceNow Legal Service Delivery and Contract Lifecycle Management. It helps you:

• Retrieve contract records from ast_contract and associated legal cases from sn_legal_case
• Extract and catalog key terms including payment, liability, indemnification, and termination provisions
• Identify obligations and deadlines for both parties across the contract lifecycle
• Flag high-risk clauses such as unlimited liability, automatic renewal, broad IP assignment, or non-standard terms
• Track renewal dates, expiration windows, and notice period requirements
• Assess compliance requirements including regulatory, data privacy, and industry-specific mandates
• Generate structured analysis reports for legal review and business stakeholder consumption

When to use: When a new contract needs legal review, during contract renewal assessments, for portfolio-wide risk audits, or when business stakeholders need a plain-language summary of contractual obligations.

Plugin required: com.sn_legal_service_delivery

Prerequisites

• Roles: sn_legal_case_user, sn_legal_case_manager, contract_manager, or sn_legal_admin
• Access: Read access to ast_contract, sn_legal_case, sn_legal_task, and sys_attachment tables
• Knowledge: Understanding of contract law fundamentals, your organization's standard contract terms, and risk tolerance thresholds
• Plugin: Legal Service Delivery (com.sn_legal_service_delivery) must be activated. Optional: Contract Lifecycle Management for enhanced contract metadata.

Procedure

Step 1: Retrieve the Contract Record

Query the contract to obtain its core metadata and current status.

Using MCP (Claude Code/Desktop):

Tool: SN-Read-Record
Parameters:
  table_name: ast_contract
  sys_id: [contract_sys_id]
  fields: sys_id,number,short_description,contract_type,vendor,starts,ends,renewal_date,payment_amount,total_cost,state,terms_and_conditions,auto_renew,notice_period,assigned_to,department,contract_administrator,parent_contract

Using REST API:

GET /api/now/table/ast_contract/[contract_sys_id]?sysparm_fields=sys_id,number,short_description,contract_type,vendor,starts,ends,renewal_date,payment_amount,total_cost,state,terms_and_conditions,auto_renew,notice_period,assigned_to,department,contract_administrator,parent_contract&sysparm_display_value=true

Step 2: Retrieve the Contract Document

Fetch attachments to access the actual contract text for analysis.

Using MCP:

Tool: SN-Query-Table
Parameters:
  table_name: sys_attachment
  query: table_name=ast_contract^table_sys_id=[contract_sys_id]
  fields: sys_id,file_name,content_type,size_bytes,sys_created_on,sys_created_by
  limit: 20
  order_by: sys_created_on

Using REST API:

GET /api/now/table/sys_attachment?sysparm_query=table_name=ast_contract^table_sys_id=[contract_sys_id]^ORDERBYDESCsys_created_on&sysparm_fields=sys_id,file_name,content_type,size_bytes,sys_created_on,sys_created_by&sysparm_limit=20

To download the attachment content:

GET /api/now/attachment/[attachment_sys_id]/file

Step 3: Extract Key Contract Terms

Analyze the contract for the following term categories:

| Term Category | Key Fields to Extract | Risk Indicators | |--------------|----------------------|-----------------| | Payment Terms | Amount, frequency, net days, late fees, escalation | Net 15 or shorter; annual escalation > 5% | | Liability | Cap amount, exclusions, consequential damages | Unlimited liability; no mutual cap | | Indemnification | Scope, carve-outs, defense obligations | Broad indemnity without IP carve-out | | Termination | For cause triggers, convenience period, wind-down | No termination for convenience; > 12-month lock-in | | Renewal | Auto-renew, notice period, price adjustment | Auto-renew with < 60-day notice window | | Confidentiality | Duration, scope, permitted disclosures | Perpetual confidentiality; no carve-outs | | IP Rights | Ownership, license grants, work product | Broad IP assignment to vendor; no license-back | | Data Privacy | Data handling, breach notification, DPA | No DPA; breach notification > 72 hours | | SLA/Performance | Uptime, response times, credits, remedies | No SLA credits; no termination for chronic failure | | Governing Law | Jurisdiction, dispute resolution, venue | Foreign jurisdiction; mandatory arbitration |

Step 4: Assess Risk Level

Score each term category and compute an overall contract risk level:

Risk scoring framework:

• Low (1): Term aligns with organizational standards, no deviation
• Medium (2): Minor deviation from standard; acceptable with documentation
• High (3): Significant deviation; requires senior counsel approval
• Critical (4): Unacceptable term; must be renegotiated before execution

Overall risk calculation:

• Any single Critical (4) score = Overall Critical
• Average score >= 3.0 = Overall High
• Average score >= 2.0 = Overall Medium
• Average score < 2.0 = Overall Low

Step 5: Check for Related Legal Cases and Matters

Query for any existing legal activity related to this contract or vendor.

Using MCP:

Tool: SN-Query-Table
Parameters:
  table_name: sn_legal_case
  query: short_descriptionLIKE[vendor_name]^ORdescriptionLIKE[contract_number]
  fields: sys_id,number,short_description,state,case_type,priority,assigned_to,resolution_notes
  limit: 10

Using REST API:

GET /api/now/table/sn_legal_case?sysparm_query=short_descriptionLIKE[vendor_name]^ORdescriptionLIKE[contract_number]&sysparm_fields=sys_id,number,short_description,state,case_type,priority,assigned_to,resolution_notes&sysparm_limit=10&sysparm_display_value=true

Step 6: Flag Concerning Clauses

Create legal tasks for each clause that requires attention or renegotiation.

Using MCP:

Tool: SN-Create-Record
Parameters:
  table_name: sn_legal_task
  fields:
    short_description: "Review unlimited liability clause - Section 8.2"
    description: "Contract [contract_number] contains an unlimited liability provision in Section 8.2. Organization standard requires liability cap at 12 months of fees. Recommend renegotiation to add mutual liability cap."
    legal_case: [case_sys_id]
    priority: 2
    task_type: contract_review
    assigned_to: [counsel_sys_id]
    due_date: [review_deadline]
    state: 1

Using REST API:

POST /api/now/table/sn_legal_task
Content-Type: application/json

{
  "short_description": "Review unlimited liability clause - Section 8.2",
  "description": "Contract contains unlimited liability. Standard requires cap at 12 months of fees.",
  "legal_case": "[case_sys_id]",
  "priority": "2",
  "task_type": "contract_review",
  "assigned_to": "[counsel_sys_id]",
  "due_date": "[review_deadline]",
  "state": "1"
}

Step 7: Generate the Contract Analysis Report

Document the complete analysis as work notes on the legal case.

Using MCP:

Tool: SN-Add-Work-Notes
Parameters:
  table_name: sn_legal_case
  sys_id: [case_sys_id]
  work_notes: |
    === CONTRACT ANALYSIS REPORT ===
    Contract: [contract_number] - [short_description]
    Vendor: [vendor_name]
    Analyst: AI Contract Analyst
    Date: [current_date]

    CONTRACT OVERVIEW:
    - Type: [contract_type]
    - Effective: [start_date] to [end_date]
    - Total Value: $[total_cost]
    - Auto-Renewal: [Yes/No] | Notice Period: [notice_period] days
    - Governing Law: [jurisdiction]

    KEY TERMS SUMMARY:
    1. Payment: [payment_summary]
    2. Liability Cap: [liability_summary]
    3. Indemnification: [indemnity_summary]
    4. Termination: [termination_summary]
    5. Data Privacy: [privacy_summary]
    6. IP Rights: [ip_summary]
    7. SLA/Performance: [sla_summary]

    RISK ASSESSMENT:
    - Overall Risk Level: [HIGH/MEDIUM/LOW]
    - Critical Issues: [count]
    - High-Risk Items: [count]

    FLAGGED CLAUSES:
    1. [CRITICAL] Section 8.2 - Unlimited liability (standard: 12-month cap)
    2. [HIGH] Section 12.1 - Auto-renew with 30-day notice (standard: 90 days)
    3. [HIGH] Section 15.3 - No DPA attached (required for data processing)
    4. [MEDIUM] Section 6.4 - IP assignment broader than industry standard

    COMPLIANCE REQUIREMENTS:
    - GDPR: [compliant/non-compliant] - [details]
    - SOC 2: [compliant/non-compliant] - [details]
    - Industry-specific: [details]

    RECOMMENDED ACTIONS:
    1. Renegotiate liability cap to 12 months of annual fees
    2. Extend auto-renewal notice period to 90 days
    3. Execute Data Processing Agreement before contract signing
    4. Narrow IP assignment clause to deliverables only

    RENEWAL CALENDAR:
    - Contract Expires: [end_date]
    - Renewal Decision Deadline: [notice_date]
    - Days Until Notice Required: [days_remaining]

Step 8: Update Contract Metadata

Record analysis results back to the contract record for portfolio tracking.

Using MCP:

Tool: SN-Update-Record
Parameters:
  table_name: ast_contract
  sys_id: [contract_sys_id]
  data:
    risk_level: high
    review_date: [current_date]
    short_description: "[original_description] [REVIEWED]"
    work_notes: "Legal analysis completed. Risk level: HIGH. 4 flagged clauses require renegotiation. See legal case [case_number] for full analysis."

Using REST API:

PATCH /api/now/table/ast_contract/[contract_sys_id]
Content-Type: application/json

{
  "risk_level": "high",
  "review_date": "[current_date]",
  "work_notes": "Legal analysis completed. Risk level: HIGH. 4 flagged clauses."
}

Tool Usage

MCP Tools Reference

| Tool | When to Use | |------|-------------| | SN-NL-Search | Find contracts by vendor name, type, or description | | SN-Query-Table | Structured queries for contracts, cases, tasks, attachments | | SN-Read-Record | Retrieve a single contract or case by sys_id | | SN-Create-Record | Create legal tasks for flagged clauses | | SN-Update-Record | Update contract risk level and review metadata | | SN-Add-Work-Notes | Post the analysis report to the legal case |

REST API Reference

| Endpoint | Method | Purpose | |----------|--------|---------| | /api/now/table/ast_contract | GET | Query contracts | | /api/now/table/ast_contract/{sys_id} | GET/PATCH | Read or update a contract | | /api/now/table/sn_legal_case | GET/POST | Query or create legal cases | | /api/now/table/sn_legal_task | POST | Create review tasks for flagged clauses | | /api/now/table/sys_attachment | GET | Retrieve contract document attachments | | /api/now/attachment/{sys_id}/file | GET | Download attachment content |

Best Practices

• Use playbooks: Maintain standard analysis templates for each contract type (SaaS, professional services, NDA, license) to ensure consistency
• Compare to standards: Always compare terms against your organization's approved contract templates and fallback positions
• Track deviations: Document every deviation from standard terms, even if accepted, for portfolio-wide risk visibility
• Set renewal alerts: Create calendar reminders at least 90 days before auto-renewal notice deadlines
• Cross-reference vendors: Check for other active contracts with the same vendor to identify aggregate exposure
• Privilege protection: Mark all analysis work notes as Attorney-Client Privileged; do not share raw analysis with non-legal staff
• Regulatory awareness: Always check for jurisdiction-specific requirements (GDPR for EU vendors, CCPA for California, etc.)
• Version tracking: Note which version of the contract was analyzed; flag if amendments or side letters exist

Troubleshooting

"Contract record not found in ast_contract"

Cause: The contract may be stored in a different table depending on your CLM configuration Solution: Check clm_contract_document, sn_sm_contract, or custom contract tables. Query sys_db_object with nameLIKEcontract to find all contract-related tables.

"Cannot access contract attachment"

Cause: Attachment ACLs restrict access, or the document is stored externally Solution: Verify you have the itil or contract_manager role. Check if the contract references an external URL field for document storage.

"Risk level field not available on ast_contract"

Cause: The field may be a custom addition or part of an optional plugin Solution: Query sys_dictionary with name=ast_contract^elementLIKErisk to find available risk-related fields. Create a custom field if needed.

"Renewal date calculation seems incorrect"

Cause: Auto-renewal logic may depend on custom business rules or the notice_period field format Solution: Verify the notice_period field stores days (not months). Check business rules on ast_contract that compute renewal dates: sys_script with collection=ast_contract^scriptLIKErenewal.

Examples

Example 1: SaaS Vendor Agreement Review

Input: Contract CON0045678 - "Enterprise SaaS Platform - 3-year agreement with DataCorp"

Analysis:

• Total value: $1.2M over 3 years
• Auto-renew: Yes, 30-day notice (flagged: below 90-day standard)
• Liability: Capped at 12 months fees (acceptable)
• SLA: 99.9% uptime with credits (acceptable)
• Data privacy: No DPA included (critical: required for GDPR)
• Overall risk: HIGH (missing DPA)

Action: Create legal task to draft and execute DPA before contract signing.

Example 2: NDA Review

Input: Contract CON0045679 - "Mutual NDA with AcquiCo for M&A due diligence"

Analysis:

• Duration: 3 years with 2-year survival after termination
• Scope: Appropriately limited to transaction evaluation
• Residual knowledge clause: Present (medium risk)
• Non-solicitation: 18-month rider attached (needs review)
• Overall risk: MEDIUM

Action:

Tool: SN-Update-Record
Parameters:
  table_name: ast_contract
  sys_id: def456abc...
  data:
    risk_level: medium
    review_date: 2026-03-19
    work_notes: "NDA reviewed. Medium risk. Residual knowledge clause and non-solicitation rider flagged for counsel review."

Example 3: Contract Portfolio Risk Audit

Input: "Analyze all contracts expiring in the next 90 days"

Query:

Tool: SN-Query-Table
Parameters:
  table_name: ast_contract
  query: active=true^endsBETWEENjavascript:gs.beginningOfToday()@javascript:gs.daysAgoEnd(-90)
  fields: sys_id,number,short_description,vendor,ends,auto_renew,notice_period,total_cost,risk_level
  limit: 50
  order_by: ends

Result: 12 contracts expiring, 4 with auto-renew requiring notice within 30 days, 2 with no documented risk assessment. Prioritize these 6 for immediate review.

Related Skills

• legal/legal-request-triage - Triage incoming contract review requests
• legal/contract-obligation-extraction - Extract specific obligations from contracts
• legal/legal-matter-summarization - Summarize legal matters linked to contracts
• document/document-extraction - Extract structured data from contract documents
• document/smart-documents - Manage contract templates and generation