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“Hey, Siri, Draft This Contract Agreement”: The Rise of AI in Corporate Law

The potential of artificial intelligence (AI) has long been on the forefront of technological advancement, even if it seems better suited to science-fiction. Developing AIs have made recent leaps that are prompting many industries to consider how the inevitable normalisation of this technology will affect their businesses. The world of corporate law is no different; this is not to say that other areas of law will not benefit from AI, but that large law firms have both the money to invest in this technology and the large number of cases to make it necessary. Corporate lawyers are already beginning to take advantage of the beneficial edge that AI brings. It’s now common to see chatbot services available on websites, offering answers to typical questions quickly and efficiently. In the legal world, this can be incredibly useful to offer basic legal advice to those who may not otherwise be able to access it. Likewise, the development of ChatGPT, “an advanced AI-powered language generation model that can understand and generate human-like text,” is furthering the integration of legal work and technology.


Law is a particularly unique field in how much work relies on precedent and agreed upon structures, and this makes AI attractive in how it can help revolutionise repetitive aspects of law work. For example, legal documents can be quickly and accurately filled in by AI based on hundreds of thousands of previously used templates. As explained by Lillian Edwards, a professor of law, innovation, and society at Newcastle University to WIRED, law firms can rely on “highly standardised templates and precedent banks to scaffold document generation, making the results far more predictable than with most free text outputs.” Likewise, using AI to draw from case banks to find any relevant precedents to aid with a case is a ground-breaking tool in legal research that helps save time and money. AI has even advanced to the point that it can now predict how a case will be judged based on a bank of similar preceding cases. These are incredibly useful developments in a field defined by research and depth of knowledge.


However, this is where fears arise - how can a human brain compete with a super-computer that can scan every recorded case for evidence to support a client? The Law Society’s 2018 report, Horizon Scanning: Artificial Intelligence and the Legal Profession, attempted to hypothesis some of the human negatives arising from over-reliance on AI. At the time of its publishing, common AIs included virtual assistants such as Siri and the virtual chatbot doctor Melody, developed by Chinese search giant Baidu. Now, five years later and with ChatGPT-3, the report’s predictions do not seem too far in the distance. The principal worry is a loss of jobs, particularly at lower, less specialised levels in the law field. While replacing people with technology here may be more efficient, it would increase the difficulty in getting on to the corporate law ladder by removing the bottom rung. In addition, increased reliance on technology may lead to lower fees for lawyers as individual skill and expertise is less necessary. In the same vein, the report identifies that legal jobs will therefore shift to prioritising human skills, such as communication, empathy, and reasoning. It was suggested that the key legal areas where AI would thrive are “insurance, mortgages, data protection, IP, criminal sentencing, privacy, surveillance, medical diagnosis, AI created contracts, currency/banking and legal research.”


Whilst that seems like a large portion of the legal profession, it is important to remember that the AI is still in relatively early stages; whilst it has passed many legal exams in the US including the Uniform Bar Exam, the grades it has received by law schools are that of a C- student, just scraping a pass. Even more important is the fact that AI is built to supplement and support lawyers, not replace them. Human lawyers and judges will still be the ones interpreting and applying the law, not only because AI does not yet have the capability, but because the law is not black and white. This means it is reserved to definitive areas, such as contracts and research, and enables human lawyers to continue their job. AI is also not perfect; Allen & Overy’s law-focused AI, Harvey, is used with the rule that everything it generates must be validated by a real person as AI has the tendency to confidently make things up in a way that seems legitimate. This is known as ‘hallucinating’ and is another area that humans using AI must be trained in to prevent mistakes; this again limits its use to entry-level, basic legal tasks. Even more concerning are the legal rules surrounding data protection in AI; even if a reliant AI was created, international laws on privacy and data collection may mean that anything submitted to the AI would break confidentiality and data protection rights for clients.


Ultimately, AI will not be replacing lawyers anytime soon. Although it does have its uses in the drafting of contracts and legal documents, as well as in research, AI just does not have the ability to replicate human reasoning and consideration that is required when evaluating the intricacies of law when applied to specific cases. Now, AI at its best is a comprehensive tool to supplement legal professionals, and therefore is not a threat to corporate lawyers; lower-level jobs may have reason to fear — but the need to fact-check AI means that these jobs could shift their focus to AI regulation instead of becoming obsolete. One thing is certain: AI will revolutionise the way we all live and work, and this will be no different for the law field.

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