Navigating AI Liabilities: Legal Challenges in the Age of Technology

Abstract

A recent issue of a popular computing journal asked which laws would apply if a self-driving car killed a pedestrian. This paper considers the question of legal liability for artificially intelligent computer systems. It discusses whether criminal liability could ever apply; to whom it might apply; and, under civil law, whether an AI program is a product that is subject to product design legislation or a service to which the tort of negligence applies. The issue of sales warranties is also considered.

Introduction

AI, although not entirely new, is one of the hot topics in technology accredited with disrupting the economy and favorably transforming society. It is rapidly being consumed in the mainstream functions of regular users. With automated chat boxes, digital voice assistants, and smart home devices, AI is everywhere. Policy thinkers and many experts specializing in the interface of technology and law have found interesting questions regarding AI.

Legal Liability of AI

1. Contractual Liability

• Business-to-Business Contracts: If the AI provided by a third-party supplier fails to meet agreed specifications or performance standards, the business may have a breach of contract claim against the supplier. Many AI contracts include exclusion clauses to limit liability.
• Business-to-Customer Contracts: Improper use of AI that causes customer losses can result in breach of contract claims if businesses fail to meet expected standards.

2. Negligence

• Duty of Care: Businesses owe a duty to operate AI responsibly, ensuring its proper use.
• Breach of Duty: Relying on incorrect data, failing to maintain systems, or misapplying AI recommendations may breach this duty.
• Causation and Loss: Affected parties must prove the breach directly caused foreseeable losses.

3. Product Liability

If a defective AI system causes losses, claims can be made under product liability laws. Developers may be held strictly liable for failing to ensure safety or functionality, without the need to prove negligence.

4. Employers’ Vicarious Liability

Businesses may be vicariously liable for improper AI use by employees during their employment. This is a form of strict liability.

5. Professional Liability

Professionals relying on AI for advice may face negligence claims if they misuse these tools. Regulatory bodies may take action for failing to meet expected standards when using AI.

Conclusion

The rise of AI has created numerous legal challenges, particularly concerning intellectual property and data protection laws. Issues of authorship, ownership, consent, transparency, and accountability highlight gaps in current legislation. Legal frameworks must evolve to balance the benefits of AI innovation with ethical and legal standards. Clear liability requirements are essential to ensure AI development aligns with societal values while maintaining robust legal protections.