ACT Supreme Court denies director leave to represent corporation after he cited AI-generated legal cases
The ACT Supreme Court refused to allow a corporate director with legal qualifications to represent his company in court, citing his reliance on generative AI to produce written submissions containing nonexistent case law.
The director, the sole shareholder of the defendant company in Geha Enterprises Pty Ltd v Deuteronomy 28 Investments Pty Ltd and Registrar General of the ACT, applied under court rules to appear without legal representation. He held a law degree and had been admitted to practice in December 2011, though his practising certificate expired in June 2012.
The court accepted his initial arguments. He knew the company's affairs intimately, held legal qualifications, and said he could not afford a lawyer. The company had once secured finance exceeding $2.1 million and owned at least six properties.
The AI problem
The court rejected the application after examining his written submissions. Of three cases he cited, one was real but irrelevant to the dispute. The other two did not exist.
The director conceded he used generative AI to produce the submissions. The court said the nonexistent cases showed the risks of allowing someone without a current practising certificate to rely on AI-generated legal authority.
A lawyer with an active practising certificate who cited false authority could face disciplinary action. The court implied the same standard should apply to unqualified representatives, making the director unsuitable for the role.
Complexity and finances
The court also noted the case involved interpreting a loan agreement and a deed of forbearance, plus analysing whether conduct had varied the terms. This required legal expertise beyond what the director could reliably provide.
The court found no evidence the company lacked funds for legal representation. A business that had accessed finance of over $2 million and held multiple properties could afford a solicitor.
The court ordered the company to pay the plaintiff's legal costs related to the application.
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