Writing in NLJ this week, Dan Carlton, legal director in the debt recovery team at Clarion Solicitors, examines how generative AI is changing payment disputes.
Debtors can produce lengthy, authoritative-looking responses containing irrelevant legislation, flawed reasoning and confident assertions that debts are unenforceable. In one commercial dispute, a defence relied on the Consumer Credit Act 1974, although it did not apply.
Carlton urges businesses to ‘focus on the substance rather than the style’. Genuine factual disputes, such as whether goods arrived, should be separated from generic legal arguments.
Creditors should avoid lengthy exchanges rebutting every point and seek early advice when straightforward debts become complex disputes.
AI-generated correspondence still requires assessment, but mistaking sophistication for substance can increase collection costs, squeeze cash flow and push resolution further away.
