Formal contract language

[R. A. Hettinga]

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Status:  U
Date: Sun, 19 May 2002 23:41:54 -0400
To: Digital Bearer Settlement List <dbs at philodox.com>
From: "R. A. Hettinga" <rah at shipwright.com>
Subject: Formal contract language
Sender: <dbs at philodox.com>


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Status:  U
From: szabo at szabo.best.vwh.net
Subject: Formal contract language
To: dbs-list-managers at philodox.com
Date: Mon, 20 May 2002 02:02:01 +0000 (GMT)
Reply-To: "DBS list-managers" <dbs-list-managers at philodox.com>
Sender: <dbs-list-managers at philodox.com>


Hi,

Can you post the following to the DBS list?

thanks,
Nick


I have designed a formal mini-language for accountants,
auditors, lawyers, economists, financial engineers, and others
interested in analzying or drafting contracts.   The language
has a formal semantics and thus will be readable by computers,
too. The main purpose of this language is to, as unambiguously
and completely and succinctly as possible, specify common contracts
or contractual terms.  These include financial terms, secured
transactions, transfer of ownership, insurance, online services, and
supply chain workflow.

<http://szabo.best.vwh.net/contractlanguage.html>

The following problems may be addressed by the language when interpreted by
computer:

* Accounting and auditing. Sophisticated contracts, including derivatives and
combinations, can be specified in formal language. Then automated or
manual accounting rules may be applied to convert transactions completed
under the contract to audit trails and ledger entries.

* Analyze formally specified contracts for flaws in logic, scheduling, and
opportunities for parties to breach the contract.

* Some kinds of contracts, especially financial and commodity contracts
and their derivatives, can be converted into a decision or game tree
that can be analyzed to determine risk, net present value, etc.

Using this language is also a great way to explore the
basic nature of contracts (what are the "elements" out of which a wide
variety of useful contracts can be drafted?) and their composibility
(what rules for composing these atoms rule out impossible contracts?)
The language is also a great creative tool for thinking up and "sketching"
new kinds of contracts. I welcome your participation.

best regards,
Nick Szabo

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-- 
-----------------
R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

--- end forwarded text


-- 
-----------------
R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

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