Monlex Logo Blue

Chatbots, Failures, and Responsibilities

Canal de denuncias

Relying on automated rules, natural language processing, machine learning, and artificial intelligence, chatbots process data and provide responses to various requests. They help reduce waiting times and offer 24/7 rapid responses. Hence, their use has become widespread on various websites (agencies, airlines, etc.), for instance, during booking, to replace and/or support customer service staff.

By acting independently or semi-autonomously, chatbots have the capacity to create legal effects, leading to situations (responses, advice, etc.) that may result in liabilities.

Air Canada has just been ordered to pay for a pricing error made by its customer service chatbot. Mr. Jake Moffatt filed a complaint with the CRT (Civil Resolution Tribunal) against the airline, arguing that he was harmed by its chatbot, which invented a discount. Although Air Canada claimed that the tool constituted “an independent legal entity,” the Canadian tribunal ruled against it.

The CRT is the first online tribunal in Canada, part of British Columbia’s public justice system. It offers an accessible and affordable way to resolve disputes without needing a lawyer or appearing in court. If a claimant cannot resolve their dispute, a tribunal member can make a decision about it. The members are independent legal experts, and their decisions can be enforced like court judgments.

Surprisingly, in its defense, Air Canada argued it could not be held responsible for information provided by one of its “agents, employees, or representatives,” including a chatbot. It did not adequately explain why it believed this to be the case. Indeed, Air Canada suggested that the chatbot is a separate legal entity responsible for its own actions. According to the tribunal member, although a chatbot has an interactive component, it remains just a part of Air Canada’s website: it should have been evident to Air Canada that it is responsible for all information on its website, regardless of whether it comes from a static page or a chatbot.

Consequently, Mr. Moffatt was placed by the tribunal member in the position they would have been in if the chatbot had not made the erroneous representation. The measure of damages is generally considered the difference between the price paid and the real market value at the time of sale. Thus, he was awarded damages of 650.88 CAD$, in addition to 36.14 CAD$ in pre-trial interest and 125 CAD$ in CRT fees.

Spain does not yet have specific regulations for chatbots, but the European AI Act provides a general framework for their regulation. The AI Act introduces specific transparency obligations to ensure that humans are informed when necessary, fostering trust. For example, when AI systems like chatbots are used, humans must be aware that they are interacting with a machine so they can make an informed decision to continue or step back. Providers will also have to ensure that AI-generated content is identifiable.

Related reading:
Share this article


Senior lawyer specializing in Commercial Law, Corporate Law, Civil Law, and International Law, who efficiently coordinates legal matters spanning multiple jurisdictions. His meticulous approach and extensive knowledge make him a trusted advisor.
Related keywords

Mantente informado con consejos legales de Monlex

No hay spam, sólo enviamos actualizaciones sobre nuestras áreas de práctica

Do you require legal assistance?

Receive personalized advice from our experts at MONLEX.