Jan Juc lawyer warns against AI-generated legal documents

A JAN JUC lawyer is warning small business owners not to rely on generative AI tools to create legal documents, saying the risks could be financial, legal and reputational.

Rebecca McAllum, founder of Jan Juc Legal, shared the warning through the federal government’s Enterprising ME program, which supports women in business across the country.

In an article titled Why Chat GPT is a lousy lawyer, McAllum said AI platforms could be useful business tools but should not replace professional legal advice when drafting contracts, agreements or terms and conditions.

“A lot of what these sites suggest is often legally wrong, and they have the sneaky habit of making things up, such as case names and citations,” she wrote.

She said many small business owners were tempted to use platforms such as ChatGPT to save money but may be unaware the documents generated could be invalid or expose them to legal risk — particularly when state-based laws or specific contract terms are involved.

Enterprising ME is funded through the federal government’s Women’s Leadership and Development Program and delivered in partnership with the Council of Small Business Organisations Australia.

McAllum, who specialises in contract, commercial and business law, as well as wills and estate planning, said she was proud to be part of the Enterprising ME network and believed its resources could help women grow sustainable businesses.

“Knowing that there are other women out there going through the same struggles in business but also experiencing that spark of excitement is comforting – and, I’ve got to say it, empowering,” she said.

The program’s Accelerator for Enterprising Women initiative is also hosting a series of free Female Founder Festivals across Australia, including a Melbourne event on June 25, with both in-person and virtual options available.

Participants will have the chance to network, hear from experienced entrepreneurs, and prepare for a $60,000 Kickstarter Challenge launching in July.

Program director Fleur Anderson said demand for the festivals had been strong, with events regularly booking out.

“This year, we have changed the format to allow women more opportunities to network and also ask questions of our panellists so they can learn firsthand from a group of successful female entrepreneurs.”

For more information and registration details, head to enterprisingme.com.au/accelerate/female-founder-festivals