Candice Chan-Glasgow                                      

Director, Review Services and Counsel

March 4, 2024


A recent ruling on costs from the Supreme Court of British Columbia highlights the risks for counsel who do not understand the appropriate use of generative AI and legal technology.



In Zhang v Chen, 2024 BCSC 285 (CanLII), Justice Masuhara made a rare cost order, requiring the respondent’s counsel, Ms. Ke, to pay costs personally for the additional effort and expense arising from listing two cases “hallucinated” by ChatGPT into the respondent’s Notice of Application.




In a family custody dispute, counsel for the respondent, Ms. Ke, filed a Notice of Application and sought short leave without notice on December 6, 2023. The materials contained only two cases, both of which were ultimately discovered to be non-existent.


On December 13, 2023, the claimant’s counsel advised Ms. Ke’s office that the cases could not be located and requested she provide copies. Ms. Ke’s office advised that they were looking into the matter and provided four new cases. Counsel objected to the inclusion of the new cases and continued to demand copies of the two cases in the Notice of Application.


At the scheduled December 19th hearing, Ms. Ke sent an agent, Ms. Lokshin, to attend with an email to provide counsel and the court admitting that the cases did not exist and apologizing for the error. A judge was not available, and the matter was adjourned. Inexplicably, Ms. Lokshin did not provide counsel with a copy of the email.


Counsel received the email one day before the application was ultimately heard on January 15, 2024. The claimant was successful and the question of costs was dealt with at a hearing on January 31, 2024.


Costs Award


The Claimant sought special costs against Ms. Ke personally. In considering whether to award special costs against a lawyer, Justice Masuhara noted that:


[26]      It is an extraordinary step to award special costs against a lawyer.  It requires a finding of reprehensible conduct or an abuse of process by the lawyer.  The authorities make it clear that special costs against a lawyer are appropriate only where there has been “a serious abuse of the judicial system… or dishonest or malicious misconduct… that is deliberate”: Nuttall v. Krekovic, 2018 BCCA 341 at para. 28, citing Quebec (Director of Criminal and Penal Prosecutions) v. Jodoin, 2017 SCC 26 at para. 29.  A mere “mistake, error in judgment or even negligence” does not warrant such an order: Nuttall at para. 29


While Justice Masuhara found that citing fake cases is “an abuse of process” and “alarming”, he accepted Ms. Ke’s evidence that she was naïve about the risks of using ChatGPT and found that Ms. Ke did not have an intent to deceive. He therefore declined to impose a special costs award against Ms. Ke.


However, Justice Masuhara went on to state that various notices from the Law Society were sent to members regarding the risks of generative AI in July 2023 and November 2023, and that there is an express warning on the ChatGPT website that the output could be inaccurate. He also recognized that the non-existent cases and the delay in remedying the confusion they created resulted in additional effort and expense.


Justice Masuhara found that R. 16-1(30)(c) and (d), which allows a court to order a lawyer be personally liable for all or part of any costs to be paid to another party, do not require reprehensible conduct or abuse of process. Ms. Ke was therefore ordered to personally pay the costs of the additional effort and expense arising from the fictitious cases.


Further Thoughts


Ms. Ke was also ordered to review all her files before the court and advise opposing parties and the court of any case citations or summaries which were obtained from ChatGPT. If no such case citations or summaries exist, “a report confirming her review of her files is to be provided within 30 days.” This requirement raises some interesting questions, including whether the court has the jurisdiction to make such an order related to cases not before the court, and where and how Ms. Ke is to file the report?


While it was not found to be deliberate, the lack of technological competence exhibited in this case is alarming. Lawyers have a duty to perform legal services to the standard of a competent lawyer. As outlined in the commentary to the Ontario Rules of Professional Conduct, the competency requirement extends to the use of technology:


[4A] To maintain the required level of competence, a lawyer should develop an understanding of, and ability to use, technology relevant to the nature and area of the lawyer’s practice and responsibilities. A lawyer should understand the benefits and risks associated with relevant technology, recognizing the lawyer’s duty to protect confidential information set out in section 3.3.


The practice of law has evolved, and the use of technology and AI tools is increasingly necessary. The inability to effectively use technology raises the risk of cost awards, potential professional discipline and claims for solicitor’s negligence. It is critical for counsel to understand the appropriate use of technology and the limits of tools that are not purpose built and recognize there are significant risks of inappropriate use of these tools.