Contractual Liability for AI Agents and Assistants: Questions of risk allocation and contracting out
On 7 May 2026, the Obligations Group was pleased to host a lecture presented by Professor Jeannie Paterson and chaired by Professor Andrew Robertson.
This lecture dealt with the contractual liability that arises from the mistakes that may be made by artificial intelligence (AI) algorithms, assistants, and agents in providing information within a firm and to its customers. It considered the extent to which the existing law of contract in Australia can respond to the harms that may be caused by AI not performing as expected with a focus on the upstream business to business contracts. The analysis sought to demonstrate the capacity of contract law to respond in ways that are doctrinally and normatively compelling to transactional AI harms. This discussion responded to concerns that are sometimes expressed that the unique features of AI may stymie rights to compensation against developer or deployer firms. It further sought to consider the opportunities to limit liability for flawed services by contract when these risks are inherent in the AI being provided. Finally, it considered the ‘horizontal’ influence of government guidance on firms’ liability for AI harms.
Photo by Steve A Johnson on Unsplash
About the Speaker
Jeannie Marie Paterson is a Professor of Law and co-founding Director of the Centre for Artificial Intelligence and Digital Ethics in the Faculty of Engineering and Information Technology at the University of Melbourne (CAIDE).
Jeannie’s research and teaching focuses on the ethical and regulatory challenges of AI. Her current projects cover misleading AI (incl deep fakes, scams and misinformation), the regulation of AI chatbots (including in mental health, companionship and consumer facing roles) and AI in the civil justice system (with a focus on access to justice).
Jeannie is the co-author (with Professor Andrew Robertson) of the widely used textbook Principles of Contract Law, as well as work on consumer credit law, consumer law and AI, regulation and law. She is an editor of the Cambridge Elements Series on Data Rights and Wrongs. She regularly presents seminars and masterclasses on consumer protection law, contract and AI to business, regulators, government agencies, health providers and not for profits.