Lawyer vs AI: A legal revolution

If futurists and experts are to be believed, the impact of artificial intelligence (AI) on humankind will be as significant as the Industrial Revolution. A recent study by the McKinsey Global Institute reports that automation and other new technology could eliminate as many as 800 million jobs by 2030. Yet leaders in the sector, such as Elon Musk and Google’s chief engineer Ray Kurzweil, believe the coming automation age could be a chance for progress to leap forward, much like it did in the Industrial Revolution.

Until recently, the field of law was relatively untouched by the march of technology. But AI and automation are starting to cause disruption. McKinsey estimates that 22 per cent of a lawyer’s job and 35 per cent of a law clerk’s job can be automated. While concerning on the surface, it could actually mean law will expand at a rapid pace. With technology driving down costs, more people will have access to legal advice.

This is the crux of the human-versus-machine conflict. It is not about the machines taking over. It is about the machines taking over work that is so labour-intensive and repetitive that usually takes many hours of low-skilled human effort. AI frees people to explore more creative and constructive endeavours.

The legal field is a great example of how AI and humans can work together to improve the quality, cost and timeliness of legal delivery. Instead of wasted man-hours, AI takes care of mundane jobs like crawling through reams of jurisprudence, drafting contracts, and scouring petabytes of legal data to find answers – an impossible task for even an army of associates to complete.

There are four primary areas within the legal field that play to AI’s strengths:

1. Due diligence

A major challenge for firms is contracts – not only the sheer number of them, but also their lack of uniformity, and difficulty to organise, manage and update.

AI, specifically machine learning technology, can be trained to recognise concepts. This allows firms to contain costs, reduce risk and speed up the contract-review process.

2. Prediction technology

By analysing past legal data, AI can provide insights into future outcomes through predictive analytics. This could involve forecasting a judge’s holding in litigation, or an examiner’s allowance of a patent application based on previous rulings.

By analysing cases in this way, AI can reveal when judges reuse similar language or follow certain patterns, which can increase a lawyer’s odds of winning.

3. Legal analytics

By making use of machine learning, legal analytics solutions can plough through vast legal databases to provide transparency to lawyers and clients. LexisNexis Australia has taken an exciting step forward in this way by introducing a suite of analytics solutions.

Its innovative tools can identify crucial insights from legal data to help lawyers make smarter, evidence-based decisions. The High Court Analyser, for example, gives lawyers the power to dissect millions of High Court judgments to uncover valuable insights fast.

4. Practice management

All lawyers, especially solos and small firms, must to do more in less time. Tools that provide insight into your processes and allow for automation of repeatable tasks are becoming more common. Whether it’s practice management like billing, social media management, legal research or e-discovery, there are now tools to handle repetitive work.

Lexis Draft is a solution that is increasingly popular with small and single-lawyer firms. Saving time and improving the quality of documentation, Lexis Draft enables easy document reviewing, editing and proofreading. It also allows users to undertake analytical and legal research validation, search LexisNexis and local folder directories, and access deeper research libraries – all without leaving the document itself.

Research from LexisNexis customers shows a technology tool like Lexis Draft provides them with more freedom to focus on important tasks (93 per cent) while also improving accuracy and reducing risk (91 per cent) in their documents.

AI is very good at processing data, but it’s weaker in areas requiring emotional intelligence and human judgment. Complex areas of statutory law, like tax, will benefit from AI’s superior processing skills – but humans will always be better at negotiating deals, mediating disputes and making ethical judgments. However, there is little doubt that AI will fundamentally alter the legal profession.

Some of the changes AI will drive include:

Closing the gap

Big law and small law have often been the two ends of the legal spectrum that never meet. Big law has the resources of associates and legal graduates to trawl through mountains of judgments, documents and case files, while small law can’t compete with that.

AI changes everything. A single-lawyer firm, with the right AI tool, is just as likely to find the relevant information as a team of associates. In fact, AI will probably do it faster and cheaper, giving small law the advantage.

Changing cost structures

The ability to process data faster and cheaper is leading to changing cost structures. Technology reduces the costs associated with representing a client and running a business. Everything from intake, research, discovery, brief writing and managing client relations is becoming digitised, providing lawyers with more time to grow their business.

This has led to a variety of new fee structures, driven largely by client expectations. Fixed fee, contingent fee, task-based billing, percentage fee and retrospective fee are just some of the alternative billing methods that law firms are now able test, thanks to technology putting a lid on their costs.

More cases and deals

As market pressure pushes down legal costs, more cases will be filed, and more deals done. For example, in the past copyright infringement was rarely pursued due to the prohibitive costs. But AI lowers those barriers, meaning more work for human lawyers than is currently possible.

Newer ways to practise law

At age 69, Lyn Lucas set up Online Divorce Lawyer and used social media and digital technology to run her niche online service. Based in Newcastle, the small law firm can service clients all across Australia.

Leonie Chapman established LAWyal partly because she had young children and sought more flexible working arrangements. The virtual firm allows freelance lawyers to work remotely for LAWyal and keeps overheads low. Her clients include large banking and finance institutions, but also fintech ‘disruptors’ that complement a virtual firm.

LawPath is another example of an Australian business based on the sharing economy model. It offers clients a network of over 700 lawyers, and much of the work and contact is online.

AI has undoubtedly made inroads into the legal industry. But in doing so, the technology is empowering lawyers to concentrate on what’s most important: practising law. The advance of AI is particularly advantageous for small law firms that have so far lacked the resources to take on big law. With the explosion of affordable tools in almost every area of legal research, tasks that would normally consume hundreds of hours are completed in a fraction of the time, at a fraction of the cost.

With AI and automation becoming more readily available, small legal firms have access to not only information, but systems, workflows and processes that until recently were held exclusively by big legal firms. AI is disrupting the legal sector, and the opportunity for small law is huge.

To learn more, download a complimentary copy of the whitepaper, ‘The rise of legal AI: Big-firm intelligence for small law firm’ which illustrates how AI is helping small law firms grow and freeing them up to focus on clients, sales and operations.