Legal Risk Scoring

• Reviewing contracts for legal exposure — You need to score indemnification clauses, uncapped liability provisions, or non-standard terms against a consistent impact-and-probability framework before signing or escalating.
• Building or maintaining a legal risk register — You want every open risk captured with a unique identifier, a calculated composite score, an accountable owner, and a scheduled review date.
• Deciding whether to escalate to senior counsel or retain outside lawyers — The skill applies explicit criteria (filed litigation, government proceedings, criminal risk, capital markets implications, etc.) to recommend the appropriate level of legal resource.
• Producing formal risk assessment memoranda — You need a structured, privilege-designated document covering factual background, scoring rationale, mitigation alternatives, recommended action, and a monitoring plan.

• You need jurisdiction-specific legal advice — This skill scores and classifies risk; it does not provide legal opinions, draft legal arguments, or substitute for qualified counsel in a specific matter.
• The task is purely document drafting or contract redlining — If the goal is generating or editing legal text rather than evaluating risk, a contract-drafting skill is a better fit.
• You are dealing with a purely factual or non-legal business risk — The scoring model and escalation criteria are designed for legal exposure; financial forecasting or operational risk management belong in different tools.

Every legal risk is evaluated on Impact Magnitude (Trivial → Severe, scored 1–5) and Occurrence Probability (Negligible → Near Certain, scored 1–5). Multiplying the two scores yields a composite between 1 and 25, placing the risk into one of four clearly defined bands.

Each color tier — GREEN (1–4), YELLOW (5–9), ORANGE (10–15), and RED (16–25) — comes with a distinct response protocol: who to notify, how frequently to review, whether to escalate to senior or outside counsel, and whether to activate crisis procedures. The protocols eliminate ambiguity about what to do once a score is assigned.

The skill produces a 10-section formal memo covering: risk statement, factual background, scoring rationale, aggravating and countervailing factors, a mitigation-alternatives table, recommended course of action, post-mitigation projected score, monitoring plan, and immediate next steps with owners and due dates. Privilege designation is explicitly flagged.

Each evaluated risk can be logged in a standardized register with 13 fields — including domain classification (Contract, Regulatory, Litigation, IP, Data Privacy, Employment, Corporate), accountable person, active controls, and disposition status — enabling a team-wide, auditable view of open legal exposure.

The skill applies a tiered decision model to recommend whether outside lawyers are required (filed litigation, government proceedings, criminal risk), strongly favored (multi-jurisdictional complexity, specialist knowledge gaps, major transactions), or worth evaluating (workforce claims, data security events, coverage disputes). When external engagement is recommended, it prompts consideration of firm selection criteria.

A legal or business team surfaces an uncapped indemnification clause in a vendor agreement. The skill scores the clause's impact (e.g., Serious — 4) and probability (e.g., Moderate — 3), yields a composite score of 12 (ORANGE), and triggers the ORANGE protocol: brief senior counsel, build a time-bound mitigation plan, and produce a full risk memorandum before signing.

During M&A diligence, multiple legal risks — IP ownership gaps, open litigation, data privacy compliance questions — need to be catalogued consistently. The skill scores each finding on the two-axis grid, assigns a color tier, records an accountable owner and review cadence, and outputs register entries ready for inclusion in a deal risk summary.

The organization receives a formal inquiry from a regulatory agency. The skill immediately classifies this as a situation requiring outside counsel engagement, scores the matter based on potential financial exposure and probability of enforcement action, activates the RED or ORANGE protocol as appropriate, and recommends immediate steps including insurance notification and evidence preservation.

At a quarterly review cycle, previously logged YELLOW and GREEN risks are reassessed. The skill re-evaluates whether circumstances have changed — new precedent, altered business conditions, elapsed time — adjusts composite scores, updates color ratings, and flags any items that should be escalated or closed.