Login | December 14, 2019

Can an AI contract robot engage in the unauthorized practice of law?

Technology for Lawyers

Published: November 22, 2019

What? What kind of a question is that? Science fiction? Bad tech dream?
Nope. The answer is yes—at least in Germany. But the implications may be far vaster.
A German court has ruled that an AI-based platform that creates a contract out of the answers to a set of questions violates its laws on who (or what, apparently) can practice law in the country.
German publishing company Wolters Kluwer has an AI contract building app called Smartlaw.de. It creates contracts by sussing out the needs of the parties through a series of questions, without human interference in the robotic process.
Germany has a Legal Services Act (called the RGD) which in part defines what a lawyer is as the ability to perform some things that non-lawyers can’t. Among those qualities are the ability to advise a client and help with decision making. Certain functions—like writing contracts—seem to require the presence of an attorney under the act (although there are gray areas).
The Hamburg bar association took Smartlaw.de to court to prevent it from “practicing law” since it isn’t a lawyer. It is a machine. It can’t be a lawyer.
The court sided with the bar association in a decision that may have far-reaching implications for the entire legal tech industry—certainly in Germany, possibly in the rest of Europe, and maybe even over here.
The court stated that writing contracts requires legal guidance, which cannot be supplied by a computer.
Wolters Kluwer said that this is the wrong approach to the question, stating that the data plugged into the system is just standard facts, and the result doesn’t require legal reasoning. Besides, they said, they aren’t trying to replace lawyers. Just make it easier for people doing simple legal tasks.
But doesn’t it? Everybody out there knows that a simple legal task can escalate into complexity at the drop of a hat. How would a robot accommodate major shifts in emphasis or needs?
Over here, we seem to be pretty much caveat emptor when it comes to legal AI—if you engage a robot to write a contract, that’s on you. But in Germany, even what seems like simple data entry may involve the practice of law.
Gray areas, indeed, and, I think, just the start of the worldwide war between robots and lawyers.
Go here to read more: https://www.artificiallawyer.com/2019/10/15/contract-platform-shock-ban-wolters-kluwer-to-appeal-clarify-german-regulation/