A troubling new trend is emerging across Canadian’s legal system as courts and tribunals confront a growing number of cases involving fake legal citations generated by artificial intelligence.
The issue recently drew national attention when a Canadian tribunal ordered a lawyer to pay $31,150 in costs after submitting court materials containing AI-fabricated case citations - the largest costs award of its kind issued by a Canadian court or tribunal to date.
The incident has intensified concerns among legal professionals about the increasing use of unverified, AI-generated research in court proceedings.
Among those sounding the alarm is Nainesh Kotak, founder of Kotak Law and a veteran litigator with more than three decades of experience representing disability claimants.
“The use of AI has many positive applications,” Kotak told CTVNews.ca in an interview Wednesday. “It’s a great tool for legal research, summarizing documents and with the right AI program, case law research
“What we’re seeing is people employing AI to help with their practice or their case, but the problem is they need to remember that you can’t outsource your duty of accuracy to an AI tool.”
Kotak says he is already seeing the effects of widespread AI use in his own practice, including clients arriving with AI-generated assessments of their cases that appear polished, but are riddled with significant errors about legal outcomes and expectations.
Cases increasing at an alarming pace
According to data compiled by access-to-justice watchdog Courtready, Canadian courts and tribunals recorded just seven decisions involving AI-fabricated legal materials in 2024.
By 2025, that figure had risen to 87 decisions. In the first six months of 2026 alone, courts have already documented 74 such cases.
If the current trend continues, legal observers warn that 2026 could set a new record for AI-related misconduct and errors in court filings.
“We’re going to see more sanctions when it comes to the filing of documents with AI hallucinations,” Kotak predicts.
While Courtready found that approximately 81 per cent of reported incidents involve self-represented litigants, who may be unaware that AI system can generate convincing but entirely fictitious legal authorities, nearly one in five cases involve licensed lawyers.
That means more than 30 legal professionals across Canada have already faced sanctions or judicial criticism for relying on AI-generated materials without proper verification.
Kotak believes the problem may be even larger than the publicly available numbers suggest.
“These are just the reported cases,” he said. “We don’t know how many AI-generated citations were accepted without being caught. We don’t know how many matters were resolved before sanctions were issued. This could very well be the tip of the iceberg.”
Risks extend beyond individual cases
Legal experts note that AI-generated hallucinations can be particularly dangerous, because they often appear authentic, complete with fabricated case names, citations and judicial language.
“Before, AI hallucinations were much easier to detect,” Kotak explained. “You would have a case that clearly didn’t exist or a quote that was so outlandish it was obvious to anyone reading it.
“What we’re seeing today are real-looking citations, real-sounding case names, plausible reasoning and fabricated quotations. It’s getting much harder to detect,” he added.
As generative AI tools become increasingly embedded in professional workflows, Canada’s legal community is facing growing pressure to balance innovation with accountability.
Ontario courts have already introduced safeguards requiring lawyers to certify the accuracy of documents they file and hyperlink authorities cited in court materials. However, Kotak says those measures alone may not be enough, as AI-generated errors become more convincing.
For Kotak, the issue extends far beyond technology.
“It’s not just a technology issue,” he said. “It’s a professional obligation and a justice issue. In fabricated cases or quotes that get into court filings, there’s real harm, there’s delays, there’s costs and potential miscarriages of justice.”
Kotak is calling for mandatory disclosure requirements whenever AI tools are used to prepare legal filings. He argues that lawyers should not only disclose AI use, but also certify that they have personally verified all authorities cited in their submissions.
His recommendations include formal verification standards issued by the Law Society of Ontario, judicial protocols for identifying suspected AI hallucinations and enhanced protections for self-represented litigants who may not fully understand the limitations of AI-generated content.
At the same time, Kotak is careful to emphasize AI is not the enemy.
“If running a successful law firm in today’s age, you have to use AI. It just streamlines processes,” he said.
“It’s the way of the future, but it has to be done responsibly,” he added.
