When AI Lies - A Cautionary Tale of The Dangers of Artificial Intelligence in Legal Practice

It was past midnight, the deadline looming, when Sarah Smith (not her real name) thought she had struck legal gold. ChatGPT had just supplied what seemed to be the perfect precedent: Whitmore Industries Ltd v. Blackstone Holdings (2019) EWCA Civ 847. Exhausted and relieved, Sarah built her entire appeal around it, citing the case over a dozen times and making it the cornerstone of her argument.

But when the Court of Appeal hearing began, opposing counsel leaned over with a puzzled look. “I can’t find this Whitmore case anywhere,” he said…

There was a good reason. Whitmore Industries never existed. ChatGPT had invented the whole thing: names, facts, citations, even legal reasoning. The fallout was brutal: a withdrawn brief, a reprimand from the court, and a disciplinary hearing that dominated legal headlines. All with one copy and paste, Sarah’s career was in tatters.

This may be a fictional tale, but it illustrates a very real danger facing legal professionals today,  AI-hallucinations,  when the system confidently invents entirely fabricated information. In legal contexts, this can mean citing non-existent cases, mischaracterizing precedent, or reproducing copyrighted material without permission. These are not just academic concerns; they’re happening in courtrooms around the world.

In Mata v Avianca (2023), two New York attorneys were fined after submitting a brief full of fictitious ChatGPT-generated citations. Even high-profile figures have been caught out: Michael Cohen, Donald Trump’s former lawyer, submitted false ChatGPT-sourced cases to a court. A Colombian judge admitted to using AI to help write a ruling, prompting urgent questions about transparency and judicial ethics.

The concern extends beyond accuracy to fundamental questions of professional responsibility and potential miscarriages of justice. When AI fails, who bears the blame, the software developer, the AI company, the firm, or the individual lawyer?

In the UK, the Solicitors Regulation Authority is unequivocal: accountability cannot be outsourced. Lawyers remain personally responsible for all work they sign off on, regardless of whether AI was involved in its creation.

Forward-thinking firms are responding proactively. Linklaters launched ‘Laila’, a generative AI assistant, alongside mandatory firm-wide training on responsible AI use.

In the US, over 80% of law firms surveyed by the American Bar Association in 2024 reported offering ‘AI clinics’ for junior lawyers to practice with these tools under supervision. This represents a broader cultural shift within the profession, a new model of ethical professionalism that combines technical competency with traditional values like judgment, diligence, and accountability. The challenge lies in harnessing AI’s remarkable efficiency and speed while maintaining the rigorous standards that underpin public trust in the legal system.

The law itself is evolving to address AI’s challenges and opportunities. The EU has taken a comprehensive regulatory approach with its AI Act (2024), creating a tiered risk framework that bans “unacceptable risk” systems, tightly regulates “high-risk” tools (including those used in legal services), and lightly monitors low-risk applications.

The EU’s revised Product Liability Directive (2024) now explicitly classifies AI systems as ‘products’, making developers and providers potentially liable for defects. The proposed AI Liability Directive could go further, allowing courts to compel disclosure of technical documentation from AI developers and introducing rebuttable presumptions of causality where harm is likely AI-related.

The UK, by contrast, has so far opted for a “pro-innovation” model based on non-binding guidance emphasizing safety, fairness, and accountability. Critics argue this approach is too permissive, but the government contends that rigid legislation risks becoming obsolete in such a rapidly evolving field. The EU itself required thousands of amendments before passing its AI Act, a sharp reminder of AI’s breakneck pace of development.

For international law firms, this regulatory divergence creates fresh compliance challenges. The coming years will reveal which approach proves most effective, but for now, practitioners must navigate a complex legal landscape with limited precedent.AI is no longer merely a tool, it is becoming an important colleague, and  like any colleague, it can be invaluable but also fallible.

Law students entering the profession will need to be ready to navigate this dual reality: harnessing AI’s transformative potential while safeguarding the fundamental principles of justice. This means maintaining healthy scepticism, implementing robust verification processes, and never allowing efficiency to compromise accuracy or integrity.

Don’t become the next cautionary tale. In an age where artificial intelligence can fabricate convincing but false legal precedents, the most human of skills: critical thinking, ethical and moral judgment, and professional accountability, are more essential than ever. Perhaps, the future of law will be defined not necessarily by ever more powerful artificial intelligence, but by a human lawyer’s unwavering and sacred duty to truth and justice?