As creative, marketing and communications agencies turn to AI to draft contracts and other legal documents, lawyers are warning that seemingly “polished” agreements could leave businesses exposed to hidden legal and commercial risks.
According to Leeds-based law firm Blacks Solicitors LLP, its lawyers are seeing more clients seek advice on documents produced using AI, whether created themselves or received from other parties. Rather than saving time or reducing costs, these materials can create delays, compliance issues and additional risk.
Phil Parkinson, head of the commercial team at Blacks, said: “At Blacks, we have seen a clear increase in the use of AI tools as a starting point for legal guidance or drafting.
“While this may seem like a way to save time, the result is often inaccurate or legally non-compliant. We have, for instance, advised clients on documents they have received that neither reflect the agreed commercial terms nor meet the relevant legal requirements.
“In many cases, correcting a document produced this way takes longer than preparing one from scratch, ultimately delaying the process rather than speeding it up.”
The warning comes amid growing concern over so-called “AI slop” – low quality or inaccurate content produced using generative tools, often with little scrutiny of the information being presented.
While the term has become associated with a flood of poor quality content appearing online, the same problem carries more serious consequences when seemingly credible material is used to inform professional or commercial decisions.
The issue has attracted increased scrutiny from the legal profession. Earlier this month, the Solicitors Regulation Authority (SRA) issued a warning over the misuse of AI, highlighting instances of fabricated information appearing in legal research, advice and court submissions. The regulator received 42 reports relating to its potential misuse between July 2025 and July 2026, according to the SRA.
The Law Society has also cautioned that responses can appear confident and authoritative while still being incorrect.
For agencies, the consequences can be significant where contracts govern areas such as intellectual property, ownership and usage rights, payment terms, exclusivity, confidentiality, liability and termination.
Parkinson added: “The most significant risk arises where the answer is not legally straightforward. Where there is no clear legislation and the law must be interpreted, AI tools can get it wrong or simply fabricate answers.
“We have already seen examples of false case citations making their way into court submissions, showing why information that appears convincing still needs to be properly scrutinised.”
There are also questions around who carries the liability when businesses act on information obtained through AI rather than regulated legal advice.
“AI tools accept no liability for the outputs they generate,” he said. “The responsibility therefore falls on the individual or business acting on that information.
“If an agency relies on a contract produced this way and something goes wrong, it is the agency and its client that have to deal with the consequences, not the AI tool.”
The issue is becoming more pressing as consumers increasingly turn to AI for professional guidance. Research from Which? found that 51 percent of UK adults use AI search tools to look for products, services and advice online, with 13 percent of users saying they often or always use the results as a substitute for seeking advice from a legal professional. Among 18 to 34-year olds, that rises to 22 percent.
Almost half of users also said they trust the information provided to a great or reasonable extent.
Parkinson said there is a role for technology in helping businesses work more efficiently, but warned against confusing a polished response with professional advice.
He concluded: “The fact that something looks professional doesn’t necessarily mean it is legally sound.”
