An AI contract looks professional until something goes wrong.

An AI contract looks professional until something goes wrong.

While AI-generated contracts keep getting better, this also makes them more dangerous. 

They look complete and read like real agreements. Yet they can leave you exposed in ways you won’t discover until you’re in a dispute or trying to close a deal. This is especially problematic when you’re sitting across from someone with legal representation.

 

What AI gets wrong about contracts

AI approaches contracts the same way it drafts everything — by producing language that defaults to average. The language learning models  don’t know your business or the technicalities of your industry. Worse yet, they don’t understand bargaining power between two parties.

Remember, a contract is more than a list of what both sides agreed to. Your contract governs what happens when a relationship goes sideways, such as who bears the risk and what triggers a breach (as well as what remedies are available). So your agreement needs to hold up when you need it most. 

AI-generated contracts often lack this language. So, yes, the terms the parties agreed on are there. But too often the language doesn’t give you the protection you need or the best deal that your bargaining power is able to secure.

You must take into account context too. A contract reflects who you are and how you do business. Some clients want to open negotiations from a strong, aggressive position. Others want something balanced that makes it easy for both sides to reach a fast agreement. 

Since AI doesn’t know the difference, you get something generic that rarely serves either side well.

 

Contract Review and Drafting

Whether you already used AI to get a first draft or you’re starting from scratch, here’s how we help you get to an agreement that protects you:

AI Contract Review

Bring us your AI-generated draft before you sign or send it. This way you know what’s missing and what could work against you. We can then revise the contract to make sure you’re protected.

Contract Drafting from Scratch

With over 20 years drafting business agreements, we start from a foundation that’s tested and refined across hundreds of transactions. In many cases, this is faster and more cost effective than spending hours trying to fix what AI produced.

Contract Negotiation

Having us negotiate on your behalf changes the dynamic. It removes tension from the process and gives you a buffer, making it easier to push back without damaging a relationship. Your clients and counterparties can always blame the lawyer.

Contract Review Before You Sign

Received a contract from someone else? We review it line by line to make sure you understand what you’re agreeing to. We also flag anything that you need to renegotiate before you sign.

 

FAQs on AI-Written Contracts

 

Is an AI-generated contract legally valid in Texas?

It can be. If both parties sign it, a court generally treats it as an enforceable agreement. But enforceability isn’t the only thing that matters. The real risk with AI-generated contracts is that they often miss the language that protects you when something goes wrong. 

A contract that says Party A sells and Party B buys is technically binding. It says nothing about who bears the risk if the goods are damaged in transit, what happens if delivery is delayed, or what remedies either side has if the other walks away. Those gaps cost money to litigate and are easy to close before you sign.

 

Can I use AI to fill in the gaps on a contract?

You can try, but the problem is knowing where the gaps exist in the first place. AI generates language that sounds complete, even when critical protections are missing. This recognition is where an attorney’s experience benefits you now and protects you for the future. 

 

Is it worth hiring an attorney if the contract is for a relatively small deal?

Deal doesn’t determine your amount of exposure. Your risk has less to do with what a deal is worth than what it costs to unwind a bad agreement or litigate a dispute. In most cases, a contract review is a fraction of what it takes to fix a preventable problem.

 

What types of contracts do you review and draft?

We work with a wide range of business agreements, including: 

  • Vendor and service contracts
  • Partnership and operating agreements
  • Asset purchase agreements 
  • Contractor agreements
  • Franchise agreements 
  • Commercial leases
  • Licenses
  • General business-to-business contracts 

(Full list is available at our Contracts practice area page.)

 

I already signed a contract I’m unsure about. Can you still help?

Yes. We can review what you signed, so you understand your obligations and rights under the agreement. We can also advise on your options. 

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Begum Pelaez-Prada Business Law

Begum Pelaez-Prada Business Law N/a
Begum Pelaez-Prada Business Law
5511 I-10 Suite 3
San Antonio, TX 78201
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