While the technology is impressive, there’s a serious question to consider: can AI fully replace the expertise of a qualified solicitor? The short answer is no, and here’s why.
The benefits of AI in contract crafting
AI can bring some genuine advantages to the early stages of contract preparation:
- Speed: AI can produce a draft agreement in minutes, which can be useful for brainstorming or getting a starting point.
- Convenience: AI tools are available 24/7, with no appointments or phone calls needed.
- Cost savings (on the surface): for businesses on tight budgets, AI can appear to offer a cheaper alternative to traditional drafting.
Beyond contracts, AI can assist with due diligence, analysing large volumes of data, and preparing standard company documents such as board minutes or shareholder resolutions. Used correctly, these tools can help reduce costs and allow solicitors to focus on strategy and client protection.
These benefits make AI a tempting tool for some. But when it comes to legally binding documents that protect your business, “quick” and “cheap” can become very costly later on.
The risks of AI-generated contracts
However, despite the hype, AI has clear and serious limitations:
- Outdated or inaccurate law: AI tools are not always up to date with current UK legislation and case law. They can easily insert clauses that are unenforceable or inappropriate.
- Generic and misaligned terms: AI doesn’t truly understand your business model, commercial priorities, or the nuances of your industry. This means it may generate terms that work against you.
- Ambiguities and loopholes: poorly drafted or unclear clauses can lead to disputes – and litigation costs often dwarf the money “saved” by avoiding a solicitor.
- Jurisdiction confusion: many AI tools default to US law or other jurisdictions, which can make a contract invalid or ineffective in the UK.
- Accuracy concerns: AI can “hallucinate,” producing incorrect or even fictitious information. A well-known case in New York saw lawyers sanctioned for submitting AI-generated case law that didn’t exist.
- Data privacy and confidentiality: uploading sensitive business information into an AI system can risk breaching data protection laws or confidentiality obligations. Not all AI platforms meet the strict privacy and security standards required in legal practice.
Why a solicitor’s input is crucial
A commercial solicitor does more than just “fill in the blanks” of a template. At TWM our expert team of solicitors tailor contracts to our client’s specific business goals, risks, and industry norms. We are also highly experienced at spotting issues before they become disputes, saving our clients stress and money in the long term by negotiating terms that actively protect our client’s position, rather than just being legally adequate.
While AI can be a useful tool for drafting ideas, it cannot replace human judgement, commercial awareness, or legal strategy. Business law often involves ethical considerations, complex risk assessments, and practical solutions – areas where human insight, not algorithms, remains essential.
The bottom line
If you rely on an AI-generated contract without legal review, you may be signing more than just an agreement – you could be signing away valuable rights, taking on hidden liabilities, or committing to terms you don’t fully understand.
At TWM, we use technology where it adds value, but never as a substitute for careful legal advice. Our priority remains the same: delivering the best outcomes for our clients with efficiency, security, and trusted professional judgement. From drafting a contract from scratch to reviewing or amending an existing agreement, our Corporate and Commercial team ensures that your contract truly works for your business and stands up in practice.
