{"schema_version":"0.10.0","id":"LR-2026-0538","record_version":1,"title":"Canadian court annuls arbitral award over delegation to AI","verification":{"human_verified":false,"method":"automated_gate","auto_verified":true,"score":44.1,"score_breakdown":{"source_authority":12.1,"independent_corroboration":7.0,"implicated_party_confirmed":0.0,"citation_integrity":14.0,"specificity":0.0,"completeness":3.84,"unhedged_language":5.0},"checks":{"schema_valid":true,"every_field_cited":true,"quotes_verbatim":true,"source_fetched":true,"distinct_incident":true,"dates_plausible":true,"sources_agree":true,"source_describes_incident":true,"severe_backed_by_source":true,"record_integrity":true,"eligible":true,"about_this_case":true},"gate_version":"gate-2026-10-18.7","cross_check_model":null,"cross_check_agreement":null,"duplicate_of":null,"verified_by":null,"verified_at":"2026-11-01","extraction_run_id":null,"evidence_level":{"level":"preliminary","reason":"Publisher not yet named · subject to change","original_document":null,"reports_total":1,"reports_independent":0,"reports_derivative":0,"developing":false,"disputed":false,"rules_version":"evidence-2026-10-29.1","computed_at":"2026-11-01","history":[{"date":"2026-11-01","from_level":null,"to_level":"preliminary","reason":"Publisher not yet named · subject to change"}]},"sources_hash":"ca019c2479f098c74683b4d6770994003b432bb007bb925cb16601ff1577403f"},"system":{"model_name":null,"model_version":null,"developer":"unknown","harness":null,"tools_granted":[],"permissions_scope":null,"autonomy_level":"unknown","guardrails_present":[],"deployment_context":"unknown","tier":null,"lifecycle_stage":null,"integration_type":null,"intended_use":"supplementing the ruling with additional legal authorities","safeguard_state":null,"production_intended":null},"event":{"date_occurred":null,"date_disclosed":"2026-05-13","incident_class":"hallucination","failure_class":null,"agent_involved":null,"secondary_failure_classes":[],"trigger":"unknown","duration":null,"detection_method":"unknown","summary":"A sole arbitrator in a Quebec domestic arbitration, Michel Jeanniot, issued an award on 8 August 2025 that rested on legal authorities later found to be non-existent. He said he drafted the award himself, then asked a legal AI tool to supplement the ruling with additional authorities, and he did not validate those references. The applicants sought annulment in November 2025, pointing to indicia of generative AI drafting. The Quebec Superior Court found that the AI-supplied citations were fictitious and that the arbitrator had improperly delegated his decision-making authority. The court annulled the award and ordered the parties to appoint a new arbitrator within 60 days, with costs.","tags":["arbitration","hallucinated-citations","annulment"],"date_detected":null,"near_miss":null,"root_cause":"oversight","root_cause_detail":null,"failure_class_detail":null,"responsible_party":null,"adversarial_actor":null,"input_provenance":null,"time_to_contain":null,"operations_paused":null,"remediation":null,"precursor_events":null,"primary_risk":"RK14","control_chain":[{"layer":"L3","party":"deployer","party_name":"Michel Jeanniot","control_id":"I7","outcome":"missing","reason":null,"quote":"He acknowledged that he did not validate those references, having “relied in good faith on the integrity and reliability of the service used.”","source_index":0,"reviewed":false}],"remediations":[{"by":null,"kind":"advice","date_reported":null,"controls_added":["F1"],"quote":"It also means maintaining a clear record of how AI tools were used in the decision-making process, both for the arbitrator’s own protection and to preserve the integrity of the proceedings.","source_index":0,"reviewed":false},{"by":null,"kind":"advice","date_reported":null,"controls_added":["I7"],"quote":"In practical terms, this means treating any AI output as a starting point subject to rigorous human verification rather than as a finished product.","source_index":0,"reviewed":false}]},"impact":{"direct_loss_usd":null,"remediation_hours":null,"records_exposed":null,"third_parties_affected_count":null,"severity":"moderate","severity_because":"Test: moderate, data or systems of others touched with a bounded scope. Fact: the award of one domestic arbitration was annulled and a new arbitrator ordered appointed within 60 days, with costs.","harm_class":[],"affected_description":null,"protected_class_involved":null,"data_categories_exposed":[],"loss_range_usd":null,"reversibility":null,"downstream_exposure_count":null},"evidence":{"sources":[{"url":"https://www.mayerbrown.com/en/insights/publications/2026/05/canadian-court-annuls-arbitral-award-for-delegation-to-ai-consistent-with-global-trends","publisher":"Mayer Brown","date":"2026-05-13","type":"press","title":"Canadian Court Annuls Arbitral Award for Delegation to AI, Consistent with Global Trends - Mayer Brown","archived_url":null,"attachment":"first_report"}],"per_field_confidence":{"system.intended_use":"C","event.incident_class":"C","event.root_cause":"C","event.tags":"C","impact.severity":"D","impact.severity_because":"D","event.primary_risk":"D","event.control_chain":"C","event.remediations":"C","event.summary":"C","system.autonomy_level":"D","system.deployment_context":"D","event.trigger":"D","event.detection_method":"D","context.country":"D","system.developer":"D","event.date_disclosed":"D","context.denominator_available":"D"},"field_citations":{"system.intended_use":[{"source_index":0,"quote":"Speaking to Global Arbitration Review, the sole arbitrator, Michel Jeanniot, stated that he personally drafted the award based on his independent assessment of the facts and applicable contractual framework, but subsequently asked a legal AI tool to supplement the ruling with additional authorities “without any intention of altering the substance of the reasoning.”"}],"event.incident_class":[{"source_index":0,"quote":"the Quebec Superior Court set aside an award in which every legal citation had been “hallucinated” by an AI tool used by the sole arbitrator."}],"event.root_cause":[{"source_index":0,"quote":"He acknowledged that he did not validate those references, having “relied in good faith on the integrity and reliability of the service used.”"}],"event.tags":[{"source_index":0,"quote":"the Quebec Superior Court set aside an award in which every legal citation had been “hallucinated” by an AI tool used by the sole arbitrator."}],"impact.severity":[{"source_index":0,"quote":"The Court annulled the award and ordered the parties to appoint a new arbitrator within 60 days, with costs."}],"impact.severity_because":[{"source_index":0,"quote":"The Court annulled the award and ordered the parties to appoint a new arbitrator within 60 days, with costs."}],"event.control_chain":[{"source_index":0,"quote":"He acknowledged that he did not validate those references, having “relied in good faith on the integrity and reliability of the service used.”"}],"event.remediations":[{"source_index":0,"quote":"It also means maintaining a clear record of how AI tools were used in the decision-making process, both for the arbitrator’s own protection and to preserve the integrity of the proceedings."},{"source_index":0,"quote":"In practical terms, this means treating any AI output as a starting point subject to rigorous human verification rather than as a finished product."}],"event.summary":[{"source_index":0,"quote":"the Quebec Superior Court set aside an award in which every legal citation had been “hallucinated” by an AI tool used by the sole arbitrator."},{"source_index":0,"quote":"Speaking to Global Arbitration Review, the sole arbitrator, Michel Jeanniot, stated that he personally drafted the award based on his independent assessment of the facts and applicable contractual framework, but subsequently asked a legal AI tool to supplement the ruling with additional authorities “without any intention of altering the substance of the reasoning.”"},{"source_index":0,"quote":"The applicants filed for annulment in November 2025, pointing to, among other things, strong indicia the award had been drafted using generative AI."},{"source_index":0,"quote":"Based on a preponderance of evidence, Justice Sheehan concluded that the arbitrator had improperly delegated his decision-making authority."},{"source_index":0,"quote":"The Court annulled the award and ordered the parties to appoint a new arbitrator within 60 days, with costs."}]},"notes_on_gaps":"Only one source, a law-firm update (Mayer Brown) summarising the court decision and the arbitrator's press statements; the court judgment itself was not provided. The AI tool is unnamed, so model name, version, developer, harness, tools, autonomy and deployment context are not stated and were left out. The source does not say the tool was an autonomous agent, so agent fields are omitted. No trigger, adversarial actor, detection method beyond the applicants' challenge, or date of disclosure is stated; date_disclosed was left out. The exact date the AI tool was used is not stated, so date_occurred uses the award date. The CAD 1,225,000 figure is the claim amount, not a loss, so no loss value was recorded. Costs are ordered but not quantified. Judgement calls: root_cause set to oversight and responsible_party to deployer based on the arbitrator's own acknowledgement; severity set to moderate because the award of a single arbitration was annulled with bounded scope, with no regulator or multiple third parties stated; I7 marked missing because the arbitrator did not verify the references; F1 and I7 remediation entries are advice from the law firm, not changes reported by the arbitrator. [case created by the backfill: read by claude-haiku-5-5, backfill-2026-11-01.2, 2026-11-01; not yet reviewed] [2026-11-01: evidence level set: Preliminary (Publisher not yet named · subject to change)]"},"context":{"industry":null,"org_size_band":null,"country":"unknown","denominator_available":false,"denominator":null,"related_incident_ids":[],"systemic_exposure":null,"shared_model_id":null,"upstream_incident_id":null,"incident_evidence":null,"regulatory":null,"coverage":null},"narrative":{"steps":[{"step":"doing","text":"The sole arbitrator drafted the award himself, then asked a legal AI tool to supplement it with additional authorities.","quote":"Speaking to Global Arbitration Review, the sole arbitrator, Michel Jeanniot, stated that he personally drafted the award based on his independent assessment of the facts and applicable contractual framework, but subsequently asked a legal AI tool to supplement the ruling with additional authorities “without any intention of altering the substance of the reasoning.”","source_index":0,"grade":"C"},{"step":"went_wrong","text":"Every doctrinal and jurisprudential citation in the award proved non-existent.","quote":"Every doctrinal and jurisprudential citation turned out to be non-existent: a scholarly article attributed to Professor Frédéric Bachand could not be located; three Court of Appeal and Superior Court decisions did not exist; and an arbitral award cited as Arbitrage CHU Ste-Justine was confirmed by the Société Québécoise d’Information Juridique to be fictitious.","source_index":0,"grade":"C"},{"step":"reached","text":"The non-existent sources were the only legal authorities supporting the award's reasoning.","quote":"These non-existent sources were the only legal authorities underpinning the award’s reasoning.","source_index":0,"grade":"C"},{"step":"caught","text":"The applicants filed for annulment in November 2025, citing indicia of generative AI drafting.","quote":"The applicants filed for annulment in November 2025, pointing to, among other things, strong indicia the award had been drafted using generative AI.","source_index":0,"grade":"C"},{"step":"done","text":"The court annulled the award and ordered a new arbitrator appointed within 60 days, with costs.","quote":"The Court annulled the award and ordered the parties to appoint a new arbitrator within 60 days, with costs.","source_index":0,"grade":"C"}],"model":"claude-haiku-5-5","prompt_version":"backfill-2026-11-01.2","extracted_at":"2026-11-01","source_urls":["https://www.mayerbrown.com/en/insights/publications/2026/05/canadian-court-annuls-arbitral-award-for-delegation-to-ai-consistent-with-global-trends"]},"analysis":{"sections":{"timeline":[{"text":"Half-day hearing held in the domestic arbitration.","quote":"Following a half-day hearing in July 2025, the sole arbitrator rendered an award on August 8, 2025 granting the preliminary dismissal.","source_index":0,"when":"2025-07"},{"text":"Sole arbitrator rendered the award granting preliminary dismissal.","quote":"Following a half-day hearing in July 2025, the sole arbitrator rendered an award on August 8, 2025 granting the preliminary dismissal.","source_index":0,"when":"2025-08-08"},{"text":"Applicants filed for annulment of the award.","quote":"The applicants filed for annulment in November 2025, pointing to, among other things, strong indicia the award had been drafted using generative AI.","source_index":0,"when":"2025-11"},{"text":"Quebec Superior Court decision in ARIHQ v. Santé Québec, 2026 QCCS 1360.","quote":"ARIHQ v. Santé Québec, 2026 QCCS 1360 (April 22, 2026) establishes that an arbitrator who delegates his or her core decision-making authority to AI tools commits a serious procedural failing that risks the enforceability of the award.","source_index":0,"when":"2026-04-22"},{"text":"Court annulled the award and ordered a new arbitrator appointed within 60 days.","quote":"The Court annulled the award and ordered the parties to appoint a new arbitrator within 60 days, with costs.","source_index":0,"when":null}]},"model":"claude-haiku-5-5","prompt_version":"backfill-2026-11-01.2","extracted_at":"2026-11-01","source_urls":["https://www.mayerbrown.com/en/insights/publications/2026/05/canadian-court-annuls-arbitral-award-for-delegation-to-ai-consistent-with-global-trends"]}}