AI law firm wins 'landmark' approval and offers clients £2 legal letters
The Solicitors Regulation Authority has authorised the first law firm providing regulated legal services using artificial intelligence.
Garfield.Law, based in Tunbridge Wells, Kent, offers small and medium-sized businesses the use of an AI-powered litigation assistant to help them recover unpaid debts of up to £10,000 through the small claims courts.
Speaking to This is Money, Philip Young, co-founder of Garfield.Law, said: 'This week's decision by the SRA is very significant.
'To our knowledge, we're the first law firm in the world to provide legal services largely via tech-based solutions rather than humans.'
Garfield.Law is the 'first purely AI-based firm' the SRA has authorised to provide regulated legal services in England and Wales, it said.
The firm charges £2 for a 'polite chaser' letter, while a letter before action costs £7.50.
Young, who previously founded litigation-focused firm Cooke, Young & Keidan, said the AI-driven services Garfield.Law provides will improve access to justice, particularly for small businesses or the self-employed, and help clear court backlogs more quickly.
He said there was a major issue across the economy of small debts not being recovered. He estimated that there were around £50billion worth of smaller unpaid debts never recovered each year.
'The inspiration for Garfield.Law came from my step-brother, Andy, who works as a plumber and often had trouble with unpaid debts being owed to him', Young told This is Money.
He added: 'Having a AI-driven law firm is, I believe, good for small business and the economy. It's hugely cheaper for clients and the services are available around the clock. The services are also available to law firms'
Young told This is Money that Garfield.Law has sparked the interest of politicians. The firm's top brass were summoned to a parliamentary committee meeting a few months ago and the firm has been in contact with the Ministry of Justice.
Young said the use of AI across law firms looks set to increase.
He added: 'There will be a lot more law firms looking for outside AI solutions they can buy in, while others will be building tools internally to give themselves a competitive advantage. The use of AI will enhance the work of a lawyer rather than replace it.'
Paul Philip, chief executive of the SRA, said: 'The first regulatory approval of an AI-based law firm is a landmark moment for legal services in this country.
'With so many people and small businesses struggling to access legal services, we cannot afford to pull up the drawbridge on innovations that could have big public benefits.
'Responsible use of AI by law firms could improve legal services, while making them easier to access and more affordable.'
He added: 'Any new law firm comes with potential risks, but the risks around an AI-driven law firm are novel.
'So we have worked closely with this firm to make sure it can meet our rules, and all the appropriate protections are in place.
'As this is likely to be the first of many AI-driven law firms, we will be monitoring progress of this new model closely, so we can both manage the risks and realise the benefits to consumers.'
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