Re your comments document orientation. This is a very good point and one that I have given a bit of thought. Contracts do indeed consist of business data and should be treated as such. To create such data in Microsoft Word and keep it in Word documents is as criminal. But the problem is worse than that. Contracts are also business logic manifest in a completely useless format called human language. If you are interested you should check these links out: http://contracts.scheming.org/http://www.stefansen.dk/presentations/isola-contracts.pdf
I believe the ISDA contracts are pretty close to being so standardized as to lend themselves to this.
The problem with composing contracts from modular units is negotiations. You would need both parties to agree to work within a closed system of modules at the outset. Otherwise, you are right back to where we are today – everything is composed more or less ad hoc.
At the end of the day, contracts will always need interpretation. Contracts are simply a manifestation (in whatever form) of what two or more people expect to happen.
A purely top-down, closed-system approach will fail to cover all situations. Likewise, a bottom-up, arbitrary system will not lend itself to systemization.
Interestingly, this dynamic is quite old in the law. There are two major types of legal system: civil and common. Civil is a top-down system where a code of laws tries to anticipate every eventuality. Common is a bottom-up system where individual cases set precedent by analogy to future situations.
In practice, both systems tend toward the middle. Civil law systems still require judges to interpret specific application of the laws. Common law systems still require codified rules to maintain credibility/consistency.
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