City law firms are rushing to adopt artificial intelligence, but a high-profile court case has exposed the dangerous gap between ambition and proper oversight.
A junior lawyer at Pinsent Masons used AI to draft misleading emails containing hallucinations that were submitted to the High Court in an insolvency case.
Judge Mullen said it is “concerning” that the junior solicitor used AI instead of reading an official resource on the Insolvency Act’s rules.
The incident prompted Pinsent Masons to refer itself to the Solicitors’ Regulation Authority, which has confirmed it is looking into the matter and will decide on next steps.
The firm has not responded to questions about whether the junior lawyer remains employed there, leaving key details unresolved as the regulator’s review continues.
There have been several red flags in London courts already, while across the Atlantic, elite US firm Sullivan and Cromwell had to issue its own apology for AI hallucinations in a New York bankruptcy case.
Senior lawyers at major firms have traditionally been slow to embrace AI, but competitive pressure across the legal sector has forced firms to get on board regardless.
The problem is that large law firms are giving junior lawyers more and more responsibility, yet those juniors are being trained in fundamentally different ways than previous generations were.
Tasks such as threading through case law for a partner or manually reviewing court documents are no longer seen as necessary, because AI can perform that work in seconds.
Crucially, there is a significant difference between a lawyer forgetting something and submitting a completely fabricated document produced through AI hallucination.
Younger lawyers also carry a different attitude towards the technology, having used AI throughout school and their law degrees, treating its outputs with automatic belief rather than critical scrutiny.
This attitude was starkly evident in the Pinsent Masons case, as the chatbot transcript actually included a warning from the AI that it was “not fully confident” it was reproducing the exact statutory wording, advising the lawyer to verify it before submitting it to a court.
The junior lawyer appears to be taking the brunt of the blame, yet responsibility should also fall on the senior associate and partner who oversaw the work.
Pinsent Masons only faced exposure because the judge knew insolvency principles well enough to immediately recognise that something quoted did not make sense.
The firm did not help its position by attempting to explain away the error with a so-called summary conclusion excuse when the judge challenged them directly.
With AI hallucination becoming more prevalent, clients may not always be as well-placed as an experienced judge to spot mistakes buried inside legal documents.
If errors continue to emerge, both clients and judges will need to begin applying additional scrutiny to work produced by firms charging substantial hourly rates.
At that point, lawyers will find it increasingly difficult to justify those hefty bills to clients already questioning the value they receive.