Big tech has just made another move into legal – and this one’s got everyone talking. 

Microsoft has just demoed its Contract Builder Agent: an AI-powered assistant designed to help teams generate, negotiate, and finalise contracts directly within Microsoft 365. It’s early days, but if the demo is anything to go by, this tool could seriously shift the contracting game. 

So, what is it? And what does it mean for in-house lawyers already battling with high volumes and low bandwidth? Let’s break it down.

What is Microsoft’s Contract Builder Agent?

In short, it’s a Copilot for contracts. Think of it as an AI assistant embedded in Word and Outlook that can:

• draft contracts based on prompts or templates
• auto-fill with deal-specific information pulled from emails or CRM data
• suggest negotiation points or fallback clauses based on playbooks
• collaborate with others in real-time to review and update terms
  All without leaving the Microsoft ecosystem. For any in-house team already using Microsoft 365 (so, most of us), this is big. It means you don’t need to adopt a whole new contracting platform – just layer smarter tooling on top of what you’re already using.

What stood out in the demo?

You can watch the official demo here from Microsoft Build 2025 – the Contract Builder Agent segment kicks off around the 4-minute mark. In the clip, Microsoft shows a user:

• kicking off a draft contract using a plain-English prompt
• auto-filling key deal terms pulled from a sales email
• identifying a clause that doesn’t align with the company playbook
• suggesting a redline and providing a rationale

It also touches on how you can fine-tune the agent using model contracts stored in SharePoint, and involve subject matter experts to review or validate changes. In short: it’s automating the boring bits so you can focus on the brainy ones.

What does it mean for in-house lawyers?

It’s another clear sign that the AI wave isn’t coming – it’s already here. And if you’re not actively looking at ways to embed AI into your legal function, you’re about to be left behind. Tools like Contract Builder Agent:

• streamline contract creation and review
• improve consistency with built-in playbooks
• reduce the need for manual triage of templates and terms
• bring legal closer to the business by embedding legal tasks in business tools

But (and this is a big but) – this only works if your legal foundations are in place. If your templates are messy, your playbooks are out of date, and your clauses live in someone’s inbox, no AI is going to save you.

Final thoughts

If you’re already buried in contract requests and firefighting redlines, it’s easy to feel like this kind of innovation is miles away. But it’s closer than you think – and it’s built right into the tools your business is already using. 

The takeaway? Now is the time to get your legal house in order. Start by reviewing your templates. Clean up your clause library. Dust off your playbooks. 

Because when tools like this go live, you’ll want to be ready to hit the ground running – not scrambling to catch up.