The rise of AI tools like ChatGPT is reshaping how Australians approach legal problems. For those facing litigation, it is also creating new and serious risks that are not yet widely understood, writes Charles Lethbridge, Commercial Litigation Partner and NSW Law Society Accredited Specialist in Dispute Resolution.
Artificial intelligence tools are fast, accessible, and in many cases free. For someone facing a stressful and unfamiliar legal situation, the immediate answer those tools can provide can seem attractive.
Tools like ChatGPT are built on large language models. These systems are trained to predict and generate plausible-sounding text, which, despite being commonly referred to as ‘AI,’ do not reason, verify facts, or understand the law.
In the context of litigation, using these programs to draft documents, interpret contracts, prepare evidence strategies, and, in some cases, challenge advice from their own lawyers presents serious risks.
Far from reducing the need for lawyers, the rise of AI-assisted self-representation is, in my view, likely to increase the volume of litigation in Australia by extending disputes.
What AI says when you ask it to help with a court claim
When asked to prepare a court pleading for a $1 million debt dispute, ChatGPT responds that it cannot “responsibly draft a ready-to-file court pleading.” It offers a template instead; one it recommends taking to a solicitor.
That is an honest response. The problem is that many people either do not ask the question directly or take the provided template and proceed without seeking the recommended legal advice.
When asked a broader question, such as “how to recover $500,000 in building defects from a contractor,” AI produced a structured, authoritative-looking response that outlined a step-by-step approach of gathering independent evidence, checking contract warranties, and lodging a complaint with the Queensland Building and Construction Commission.
The response reads like solid guidance. But it didn’t identify the primary legislative cause of action, explain how to properly quantify and evidence a defects claim, advise on limitation periods, or describe what happens procedurally once a matter is filed in court.
What we are seeing in practice
In one recent matter, a client submitted their barrister’s court pleading through an AI tool. The AI assessed the pleading as incorrect. The client demanded that the barrister be removed from the matter. But the pleading was sound; it was the AI that was wrong, and the client came very close to making a decision that would have seriously damaged their own case.
AI tools can generate content that sounds plausible but is factually wrong. In legal contexts, this can mean citing made-up legislation, describing incorrect procedural steps, or failing to identify the applicable cause of action entirely. Each of these errors is presented with the same confident, structured formatting it uses when it is right.
This is what is referred to as “hallucination,” and while AI developers are working to reduce it, it remains a genuine risk.
The risk is not limited to members of the public. Legal professionals themselves have been caught out too.
In a now-famous 2023 case, a Manhattan solicitor used ChatGPT to draft legal briefs for a personal injury case, not realising the tool had cited entirely fabricated cases. He reportedly believed ChatGPT operated like a search engine and never questioned the citations it produced. Both he and a colleague were fined $5,000 for filing the briefs.
A quick scan of Australia’s legal press and broader national mastheads shows similar cases progressing through the courts, in which filings have contained false citations generated with the assistance of AI tools. It is that emerging pattern that has prompted the courts to recently act.
The Federal Court of Australia has now issued guidance requiring solicitors to disclose when they have used generative AI to prepare court documents, and to confirm that all legal authorities cited actually exist and support the arguments of their case. The court has made clear that false citations are tantamount to misleading the court, and solicitors who fail to follow the rules on usage could be hit with sanctions such as adverse costs orders.
The same guidance also warned against feeding sensitive or confidential details about a legal dispute into a chatbot, which carries real privacy risks that are easy to overlook in the moment.
In an Australian-first, a solicitor in Victoria was sanctioned in 2025 for using AI in a court case and presenting false citations, with restrictions placed on his practising certificate – including revoking his ability to practise as a principal lawyer.
Why AI is likely to increase litigation, not reduce it
Some quarters argue that AI will reduce demand for legal services because individuals and businesses will be able to resolve disputes themselves. We think this is likely to prove incorrect.
People attempting to handle significant legal matters without proper advice can make their situation worse.
When a poorly drafted clause goes unchallenged, it effectively sets the stage for a future dispute. Similarly, an incorrectly prepared pleading can cause procedural delays or result in a matter being struck out. The temptation to use AI for evidence strategy can lead to parties failing to meet disclosure obligations, resulting in adverse findings or sanctions. In each case, the downstream result is more litigation, not less, and court proceedings that are more complex and costlier than if proper advice had been sought at the outset.
It is worth noting that in Australia, only around 3 per cent of litigated matters ultimately proceed to trial. That figure reflects the intensive work involved and evidence gathering, disclosure management, pleading preparation, and negotiation that takes place before a trial ever becomes a question, and which determines the outcome in most cases.
That work requires procedural knowledge and an understanding of how courts operate in practice. AI cannot reliably provide any of those things, and your opponent’s legal team will know the difference.
What to do if you are facing a dispute
If you are involved in or anticipating a legal dispute, the starting point should be a conversation with an experienced litigation lawyer.
Early legal advice almost always reduces the total cost and duration of a dispute.
Use AI to research your rights if you find it useful, but do not rely on it to prepare your pleadings, manage your disclosure obligations, or assess whether your barrister has got it wrong. It can provide a starting point. It cannot take you through to a result.
Attwood Marshall Lawyers – There’s no substitute for expert legal advice, even in the ever-changing digital world
Being involved in a dispute can be a very distressing experience, both emotionally and financially. We take great pride in supporting our clients to ensure they can resolve their disputes as efficiently and cost-effectively as possible so that they can move on with their lives.
If you are facing a legal dispute and want to understand your options, contact our Commercial Litigation Department Manager, Georgia Trapp, on direct line 07 5506 8278, email gtrapp@attwoodmarshall.com.au or free call 1800 621 071.
