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In Reddy v Saroya, 2025 ABCA 322 (Reddy), the issue of generative artificial intelligence (GenAI) in legal work made its first appearance before the Court of Appeal of Alberta.
The appeal in Reddy mainly concerned an order of civil contempt of Court that was issued by the Court of King's Bench of Alberta for a failure to provide responses to undertakings. However, another issue on appeal included that counsel for the appellant originally submitted a factum which included citations of several cases without links or copies of their text. No evidence or verification could be found that these cases even existed. Counsel for the appellant explained to the Court that he had hired a contractor to write his factum who had delivered the factum late, and he was therefore unable to properly verify the cases cited due to time constraints.
While the contractor denied using GenAI, the respondent flagged that this was likely the work of GenAI as, despite extensive searching, several cases cited in the appellant's factum could not be found. The appellant was allowed to file an amended factum, as well as a supplemental factum, but the respondent argued that the submission of the factum constituted an abuse of process and that an enhanced costs award was warranted to set an example for the legal profession.
GenAI is one of many tools that a lawyer now has available to them to craft legal arguments for their client. However, the major issue with GenAI in the courtroom is that it has a habit of generating fake case law ("AI hallucinations"), which read like legitimate citations but ultimately refer to decisions that were never issued or stand for a different principle of law than GenAI may suggest. Earlier this year, the Honourable Justice Price of the Court of King's Bench of Alberta in the decision of NCR v KKB, 2025 ABKB 417, issued a stern warning to a self-represented litigant who had cited non-existent cases in her written submissions. In doing to, Justice Price cited caselaw from British Columbia and Ontario that stand for the proposition that offering written submissions that contain fake cases is equivalent to making a false statement to the court and is itself an abuse of process.
In Reddy, the ABCA examined the guidance that has been set out for lawyers in Alberta regarding the use of AI: the Law Society of Alberta has published guidelines setting out a safe starting point for using GenAI and the Alberta Courts issued a Notice to the Public and Legal Profession on October 6, 2023, cautioning that large language models can fabricate legal authorities and that any AI-generated submission must be verified with meaningful human control. The Court subsequently noted that the consequence for failing to adhere to this Notice was up to their discretion, and that proportionate and meaningful sanctions could be imposed to maintain the integrity and credibility of the court processes.
The Court also stated that they were considering a cost award to be paid by the appellant's lead counsel, up to the amount requested by the respondent, and invited the parties to provide further submissions on this point. Their costs decision in Reddy will be instructive, and potentially cautionary, for users of GenAI in the legal industry.
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