Victorian study finds 55 per cent of lawyers use AI but few cut legal bills

More than half of Victoria's lawyers now use artificial intelligence in their daily legal work, yet only about a quarter have passed on any resulting savings to clients. At the same time, clients attempting to handle their own legal work with public chatbots frequently bring flawed information that takes longer to fix.

Those findings come from the 2026 census conducted by the Victorian Legal Services Board and Commissioner's research team, covering 2,221 legal practitioners across the state. The study tracked a clear shift in how law firms operate, with AI usage jumping from 37 per cent in 2025 to 55 per cent this year.

Chatbots dominate law firms

While specialised legal software exists, most lawyers rely on ordinary public tools. The survey recorded that 79 per cent of lawyers using AI turn to standard chatbots including ChatGPT, Claude, Gemini and Microsoft Copilot. Dedicated legal systems accounted for only 22 per cent of users.

Adoption also varies sharply by legal speciality. Trade practices reported the highest uptake at 85 per cent, followed by banking and finance at 78 per cent and technology law at 78 per cent. In contrast, criminal law recorded 29 per cent adoption, family law 45 per cent, and administrative law 46 per cent.

Only 26 per cent of lawyers surveyed said their AI adoption led to cheaper bills for clients. Corporate clients fared better than everyday consumers, with 34 per cent of commercial practitioners reporting lower fees compared to 23 per cent for personal legal matters. The board's research team reported that commercial clients often use AI themselves and have the bargaining power to demand better rates.

Client mistakes create double work

The census uncovered friction on the other side of the desk. Nearly half of surveyed lawyers, 46 per cent, reported clients arriving with inaccurate or misleading claims generated by online chatbots. Another 41 per cent had to correct errors in AI-drafted contracts and legal filings brought in by clients.

Instead of saving money, 49 per cent of lawyers said client-generated AI material increased the billable hours needed to resolve the matter, compared to 19 per cent who felt it reduced their workload.

What this means for Australian businesses

For small and medium enterprises, the research offers practical lessons on managing legal costs:

• Commercial clients are achieving discounts, so ask your legal advisors whether they use AI to draft contracts, review leases or conduct discovery, and request fixed fees or discounted rates that reflect those efficiencies.
• Do not rely on general consumer chatbots to draft binding agreements, terms of service or employment contracts, because correcting errors can cost more in billable hours than having a solicitor draft them properly from scratch.
• Use AI internally for initial orientation, such as summarising long commercial proposals or organising facts, before meeting your lawyer. Provide the factual chronology to your lawyer rather than presenting chatbot-generated legal conclusions.