CSG Law Alert: The Dangers of Using AI for Your Estate Planning
In a recent conversation with a friend, we discussed the necessity of obtaining proper estate planning, and my friend questioned why he could not use Artificial Intelligence (AI) to draft his estate planning documents. Why does one need an attorney’s assistance?
Having never used ChatGPT or any other AI for this purpose, I was intrigued. Can AI really draft estate planning documents? Might the estate planning world become obsolete? In The Atlantic’s “Breakthroughs of the Year” for 2022, ChatGPT was included as part of “the generative-AI eruption” that “may change our mind about how we work, how we think, and what human creativity really is.”1 Understanding the impact it has already had in our daily lives, could AI potentially throw the estate planning world off course or even eliminate the need for estate planning attorneys?
What is AI?
There are two types of AI – predictive and generative. We have all been using predicative AI for years now, regardless of whether we were conscious of it. When a search engine suggests the next word to write, that is predictive AI. When our smartphone compiles a collection of photos based on what it expects that we want to see, that too is predictive AI.
Generative AI is a whole different ballgame, and it can do so much more than predictive AI. Generative AI can create content in response to natural language requests. For example, what if a procrastinating college student needs a paper written for a history course? Generative AI has the student covered.
But how does generative AI work? Using algorithms, AI generates responses that resemble human-created content by learning from training data that includes examples of desired content. Generative AI predicts the results that you would want to see, largely influenced by data and human responses on the Internet.
In fact, today some of the most well-known AI models obtain a large percentage of their training data directly from Wikipedia. As Jon Gertner points out in the New York Times, “The new A.I. chatbots have typically swallowed Wikipedia’s corpus, too. Embedded deep within their responses to queries is Wikipedia data and Wikipedia text, knowledge that has been compiled over years of painstaking work by human contributors. While estimates of its influence can vary, Wikipedia is probably the most important single source in the training of A.I. models.”2
While AI is extremely impressive, AI is trained using text from Internet websites like Wikipedia – which often have the reputation of being untrustworthy. OpenAI, the company behind ChatGPT, admits on its website, “ChatGPT sometimes writes plausible-sounding but incorrect or nonsensical answers.”3
So, what does a curious trust and estates attorney do when researching the merits (or lack thereof) of AI for estate planning? Well, I tried it myself.
Initially, when asking ChatGPT to draft a Will for myself, I received the following response: “I am an AI language model, and I cannot provide personalized legal documents or advice. Creating a Will is a critical legal process that requires the expertise of a qualified attorney to ensure it adheres to the specific laws and regulations in your jurisdiction. . . .”
Interestingly, however, when I followed up immediately with a request for ChatGPT to draft a revocable trust, a common document to which a Will can “pour over” the decedent’s estate, it was more than happy to comply and provide a template.
Upon inserting the prompts, my first reaction was to be pleasantly surprised by the results. Considering that my expectations were quite low coming in, the trust document actually looked well drafted at first glance. AI easily created a document that ostensibly looked like a trust. Any layperson not familiar with the field of trusts and estates would most definitely be impressed. However, upon review, the AI generated trust agreement had critical flaws, which – if relied upon – could create an administrative nightmare.
Dispositive Provisions
What actually was produced by AI was an oversimplified revocable trust. If I was the trustee tasked with administering the trust, I would be at a complete loss. The essence of the trust was printed in sections 1 and 2 and stated:
“1. Trust Beneficiaries:
The beneficiaries of this trust shall be those individuals and/or organizations listed in Schedule A attached to this trust document. I reserve the right to amend or modify the beneficiaries during my lifetime.
- Distribution of Trust Assets:
Upon my death, the Trustee shall distribute the trust assets according to my wishes as outlined in Schedule B attached hereto.”
Typically, Schedule A of a trust document lists the assets that are contributed to the trust. In all my years of estate planning, I have never seen the dispositive terms of the trust included on a schedule attached to the trust – the terms should be included in the body of the trust agreement. To make matters worse, there was no Schedule A or B actually attached to the draft document. In essence, there were no beneficiaries named in this alleged “trust.” If assets are transferred to it, the trustee would have no idea how to administer it, and neither would the courts.
Tax Planning
Often, clients approach estate planning attorneys to provide for their beneficiaries following their passing. However, another crucial element of estate planning is estate tax minimization. Unfortunately, ChatGPT does not consider estate taxes whatsoever. This renders AI tools like ChatGPT practically useless for complex estates that require detailed tax planning.
Estate planning attorneys conduct a detailed analysis of the client’s situation and are then able to recommend the best approach to accomplish the client’s wishes while also minimizing estate tax consequences as much as possible. Not only do estate planning attorneys need to be conscious of federal estate taxes, but depending on the client’s domicile, there may be state estate and/or inheritance taxes to consider as well.
The proposed draft of the AI generated revocable trust contained no tax planning or minimization strategies. In fact, it did not reference estate taxes whatsoever.
When I asked ChatGPT whether this trust would save estate taxes, I was provided with the following response:
“As an AI language model, I cannot provide real-time or personalized advice, and I am not able to predict the specific tax implications of a trust or any other legal arrangement. Whether establishing a . . . Trust will save you estate taxes depends on various factors, including the size of your estate, applicable tax laws in your jurisdiction, and the specific provisions of the trust. . . . If you have concerns about estate taxes or want to explore tax-saving options, it is crucial to seek advice from an experienced estate planning attorney or a tax professional in your area . . . Estate tax laws can be complex and can vary between jurisdictions, so professional guidance is essential to ensure that your estate plan is appropriate and tax-efficient.”
Jurisdictional Requirements
Each state requires Wills and trusts to be executed in a certain manner. In essence, in New York and New Jersey a Will must be in writing, signed by the testator before two witnesses.4 ChatGPT gave me no instructions as to the requirements for signing a valid Will.
While many caveats were provided advising me to seek legal assistance, ChatGPT nonetheless gave me a draft template. And though any trusts and estates attorney would be able to immediately recognize the flaws in the document that AI generated, I would be nervous that a client would not. Indeed, I can imagine my friend potentially relying upon a document like this one for his estate planning, and that is a significant problem.
Next, I asked ChatGPT to produce a New York State Power of Attorney. New York State requires usage of its statutory short form Power of Attorney, which was most recently revised in June 2021.5 Not surprisingly, the AI-generated language was not compliant with the New York State statutory short form Power of Attorney. However, absent an attorney to review the document, a client would have no idea that this document was not a valid New York State Power of Attorney.
No Attorney Oversight
In a recent case in the Southern District of New York, two attorneys were sanctioned after citing “non-existent judicial opinions with fake quotes and citations created by the artificial intelligence tool ChatGPT.”6 The attorneys were “operating under the false perception that this website [i.e., ChatGPT] could not possibly be fabricating cases on its own.”7
The lack of attorney oversight is a major issue when utilizing AI for estate planning needs. While ChatGPT contains many disclaimers, people do not always pay attention to them. If the Southern District of New York case has taught us anything, AI has the dangerous ability to completely fabricate information. Without proper attorney oversight, there can be major repercussions.
Secure Information
Lastly, generative AI remembers a number of previous prompts in the same conversation. It then uses this information for further answers and to generate additional information. Therefore, it is imperative that no personal and confidential information is submitted to the platform.
Overall Takeaways
In summary, while AI has proven itself extremely impressive, it cannot replace human legal expertise. Estate planning is often complex and nuanced. AI cannot understand a client’s goals and does not offer any semblance of a human connection. Families are complicated and trusts and estates attorneys need to take into account a client’s family dynamics in order to present the client with the best approach for their estate planning.
If estate planning attorneys were viewed solely as “document drafters,” then yes, AI would have the potential to replace them at some point in the future. In fact, for years technology has had the ability to draft certain legal documents. However, estate planning attorneys provide far more value, and technology cannot replace the creativity, experience and understanding that they offer.
2 https://www.nytimes.com/2023/07/18/magazine/wikipedia-ai-chatgpt.html
3 https://openai.com/blog/chatgpt
4 New Jersey Statutes, N.J.S. § 3B:3-2 and N.Y. EPTL § 3-2.1.
5 NY Gen Oblig L § 5-1513 (2021)
6 Mata v. Avianca, Inc., No. 22-cv-1461 (PKC), 2023 BL 213626, at *3 (S.D.N.Y. June 22, 2023)
7 Id.