**1. Introduction**

Blockchain is a distributed ledger comprised of immutable blocks chained together to create an encrypted history of transactions. It carries the functionalities of automatically self-executed, avoiding human errors, immutable, providing permanent records with real-time information, and reducing cumbersome documentation using high processing power. Its embedded feature of transparency and integrity shows the reliable nature of the technology. These features are attractive for commercial use that involves a large amount of repetitive and similar transactions for example in the logistics sector for management of supply chains [1, 2], the financial services industry [3], the insurance industry to deal with payment of claims [4, 5], the handling of health care data [6, 7], the UK court justice system [8, 9], and the list is growing fast.

A smart legal contract is a computer program that defines obligations between parties and is performed, solely or in part, automatically by software algorithms.

It runs on a blockchain platform and carries blockchain features. It has the potential to replace the traditional natural language contract system so that the benefits offered by blockchain technology are fully utilised.

Commercial contracts have always been using natural language, and their development represents human civilisation in doing business [10]. It remains a scientific fantasy that offers no practical use to society if the smart contract is not recognised and enforceable as a way of entering contracts between parties. The smart contract is now developed in such a way that it is no longer the law of the future. However, as its applications become widespread, novel legal issues emerge. Each of these issues creates barriers to adoption in industries and practices. Identification and resolutions of these issues are essential for maximising the benefits of the technologies.

The objectives of this chapter are threefold. Firstly, there have been diverse discussions on the validity and enforceability of contracts written in computer code. This chapter seeks to clarify and unify the descriptions of blockchain-enabled smart contract that gives legal effects. Secondly, it provides an understanding of the development history of smart contracts to give further development of this practice area a sense of direction. The third objective is to identify the legal issues that arise from this novel practice area where the technology behind it is in a nascent state with vast scope for development and reaching maturity.

Section 2 of this chapter gives an account of the advance of the smart contract from its origin as a concept to today's status of being recognised by the legal profession as enforceable and does not require any law reforms for its application in England and Wales. The first reported court case that has significant impacts on the use of smart contracts is unpacked considering the current status of its recognition and applications. Section 3 identifies and proposes solutions to key legal issues arising from the operation of computer code. The current digital dispute resolution rules that apply to smart legal contracts are examined in Section 4.

At the outset, it is noteworthy that there are various types of emerging technologies, including artificial intelligence (AI) and blockchain. The current recognised practice of smart legal contracts is enabled by blockchain without any deployment of AI. This book chapter does not cover any discussions of the concept of combining AI and blockchain technology that potentially offers other versions of a smart contract.

It should also be noted that this book chapter builds on, but far from exclusively, the materials discussed and reported in the author's published work [11, 12]. Readers will realise that this chapter represents substantial work, in breadth and depth, beyond those reported in the previous publications.
