AI & the law
AI-Generated Contracts: What to Check
A practical checklist for Australian businesses using ChatGPT, Claude, Gemini or Copilot to draft agreements — and why a lawyer should always review the result.
Know what you need? Request a fixed-fee quote and upload your documents. Not sure of scope? Book a short call with a senior lawyer instead.
In short
An AI-generated contract can be binding, but individual clauses are often wrong for Australian law or for your deal. Before you sign or send one, check the ten points below — then have a lawyer review it. We do this for a fixed fee.
AI contracts are now common: a founder asks ChatGPT for a contractor agreement, a salon owner asks for booking terms, a developer generates SaaS terms for an app. The draft looks professional. Whether it protects you is a different question.
Ten checks before you rely on an AI contract
- Governing law. Is it the law of an Australian state or territory — and the right one?
- The parties. Are the correct legal entities named, with ABN or ACN, rather than a trading name?
- Scope and deliverables. Would a stranger reading it know exactly what each side must do?
- Payment. Amount, timing, GST, late-payment consequences and the right to suspend work.
- Liability. Is there a sensible cap, and are the exclusions lawful under the Australian Consumer Law?
- Unfair contract terms. If it is a standard-form contract with a consumer or small business, are any terms one-sided enough to be unfair — and therefore void and penalty-exposed?
- Intellectual property. Who owns what is created, and does an assignment actually transfer it?
- Termination. Can either side get out, on what notice, and what happens to money and work in progress?
- References. Does every Act, section or regulation it mentions exist and still apply?
- Missing clauses. Confidentiality, privacy, dispute resolution, variation, notices — the clauses that are only noticed when they are absent.
Why a lawyer review is still essential
The checklist catches obvious problems. It does not tell you whether the risk allocation suits your business, how a court is likely to read an ambiguous clause, or what the other side will push back on. Those are judgement calls. AI cannot make them for you, and its provider will not stand behind the result. Our firm view: always have a lawyer review an AI-drafted contract before you sign it or put it in front of customers.
What our review includes
- Correction of non-Australian or outdated legal concepts.
- Consumer law and unfair contract terms compliance for standard-form documents.
- Risk review against your commercial position, with protective clauses added.
- A clean, lawyer-checked version and a plain-English summary of the changes.
- A fixed fee agreed upfront — never hourly.
Start with our AI contract review service, or read AI lawyer vs a real lawyer.
Frequently asked questions
Is an AI-generated contract legally binding in Australia?
It can be. A contract is binding if the usual elements are present — offer, acceptance, consideration, intention to create legal relations and sufficient certainty — regardless of who or what drafted it. The risk is not that it is unenforceable as a whole, but that particular terms are void, unfair, uncertain or simply do not say what you intended.
Who is responsible if an AI-drafted clause fails?
You are. AI providers' terms of use typically disclaim liability for output. If a clause turns out to be unenforceable or exposes you to a claim, the loss sits with the business that used it.
Which contracts should never be finalised by AI alone?
Anything with real money or risk attached: shareholders' agreements, business sale agreements, commercial leases, employment and contractor agreements, SaaS and customer terms, guarantees and security documents, and any standard-form contract used with consumers or small businesses.
Can you just check the parts I'm worried about?
Yes. We can scope a full review or a targeted review of specific clauses — liability, IP, payment, termination — and quote a fixed fee for whichever you choose.
Related pages
Two ways to start
Get a fixed fee before any work starts.
Answer a few short questions, attach your documents if you have them, and a senior lawyer replies with the scope and the price.
Know what you need? Request a fixed-fee quote and upload your documents. Not sure of scope? Book a short call with a senior lawyer instead.