AI Has a Seat at the Contract Table Now

When budgets won't cover attorney review of every hotel contract and planners are maxed out, some are turning to AI for help — at least at the initial stages.

Caitlin Gaborow, project manager at Delaney Event Management, is the primary contract reviewer for her company, providing final review on all venue contracts before they are sent to clients for signature. 

While she is comfortable with contract verbiage, there are occasions when she needs additional verification. “I still come across challenging or ambiguous clauses that I want to be sure I understand and can advise clients on,” she said. 

In those situations, Gaborow turns to the “Analyze Clause” prompt in Spark, a tool built in collaboration with PCMA and Gevme.

Spark lets her drop the clause in question and analyze it from the perspective of both the client and the venue. “That way, I can see what legal arguments the venue might make, preparing me for any future negotiation conversations,” Gaborrow said.

Gaborow has used other Spark options, including one to generate a clause from the information she supplied.

Though she finds the tool “incredibly valuable,” she doesn’t see it as a replacement for legal counsel. “There is too much nuance to contract language, not to mention possible legal precedent, for an AI tool to be able to capture everything accurately,” Gaborow said.

Spark’s terms and conditions spell out a clear limitation of liability, warning users that the service does not guarantee “the accuracy, completeness, or usefulness” of any generated content. 

Meghan Risch, chief of staff and vice-president of corporate communications at PCMA, described Spark as a starting point and highlighted that users are advised to consult a lawyer. She pointed to the cost savings it creates for its association clients. “It allows the event strategist to return to the client with recommendations to tighten up the contract before it is shared with legal for final review.”

Lawyers Speak Out

Meetings industry lawyer Josh Grimes would never discourage anyone from using AI but agrees that he still has a place in the process.

AI is only as good as the information inputted into its database, he said.

“One cannot know if AI includes a pro-hotel or supplier bias in interpreting contracts or if its database was influenced by planners,” he said. He has performed random reviews of contract clauses using ChatGPT, Spark, and other programs and found that AI tends to develop clauses that are fairly generic and often pro-supplier. 

“Rarely does AI account for issues like security, cost increases due to tariffs and fuel prices, and concerns particularly related to foreign travel,” he said.

AI also is unable to address what’s important to a specific meeting or to understand current market trends that might affect a planner’s negotiating power, said Kimberly Pendo, attorney at law at Chicago Law Partners.

“It’s important for us all to remember that AI is not infallible, and it usually doesn’t pay to be penny wise and pound foolish,” she said.

Inherent Privacy Risks

Unknowing planners face risks when they enter personally identifiable information (PII) into an AI that’s not proprietary. Inputs such as new product details and attendees’ private data that might be part of a hotel contract could end up becoming public. Some enterprise AI systems offer zero data retention, guaranteeing that data is not used to train future AI models.

For now, it appears that those planners who rely solely on AI solely for their contracts are those who hadn’t relied on legal advice before it was developed, said Grimes.

He has seen no decrease in his business, and believes it’s the same for his peers. “I also have not seen any decrease in demand for legal education at industry organization meetings,” Grimes said.“The need for up-to-date knowledge continues — despite the services AI provides.”