Ontario Court Warns Litigants About the Risks of Misusing AI
Halton (Regional Municipality) v. Rewa et al., 2025 ONSC 4503 is a multimillion-dollar municipal fraud case that produced a decision worth reading for reasons beyond its facts. Justice Tzimas used the occasion to address something courts are increasingly confronting: a self-represented defendant filed a legal brief citing cases that did not exist, generated by an AI tool and submitted to the court without verification. The warning that followed was direct and unambiguous.
But the AI issue was only one of three problems the decision addressed. Alongside it sat discovery failures on both sides and the broader consequences that follow when parties treat credibility, disclosure, and preparation as secondary concerns. For anyone involved in commercial litigation in Ontario, all three carry practical lessons that apply well beyond the specific facts of this case.
Background: a multimillion-dollar municipal fraud dispute
The case involved the Regional Municipality of Halton and dozens of defendants, including companies and individuals connected to a public housing and construction project. Halton alleged that certain contractors and consultants inflated invoices, overbilled for services, and misused public funds. The litigation was large and complex, involving multiple defendants, overlapping claims, counterclaims, privilege arguments, and extensive discovery disputes.
The decision arose from a series of interlocutory motions during the discovery phase. What made it notable was not just the procedural outcomes but the Court's broader commentary on three problems that had emerged in how the parties were conducting themselves.
The three problems the Court addressed
A self-represented defendant filed a factum, the formal written legal argument submitted to court, that cited cases which did not exist. The citations had been generated by an AI tool and filed without any verification that the cases were real. When the Court reviewed the materials, it found the cited cases were fabrications.
Justice Tzimas described the conduct as misleading and unacceptable. The warning extended beyond this particular defendant: all litigants, including those without lawyers, owe duties of honesty and diligence to the court. Submitting materials containing false citations, even without deliberate intent to deceive, damages the submitting party's credibility and undermines the integrity of the proceeding. The Court's message was clear: AI tools cannot substitute for legal research, and the party who files the document is responsible for its contents regardless of how it was generated.
The decision also addressed ongoing discovery disputes. Some parties had failed to produce key documents they were obliged to disclose. Others had taken the opposite approach, demanding disclosure that went well beyond what was relevant or proportionate to the issues in the proceeding. The Court reinforced that evidence must be relevant, organized, and supported by facts rather than speculation, and that both under-disclosure and excessive demands can result in court sanctions, delays, and cost awards.
Discovery obligations in Ontario civil litigation are not optional and not a matter of degree. The obligation to produce relevant documents honestly and completely exists independently of whether a party believes those documents help or hurt their case. Selective disclosure, whether by omitting documents that are unfavourable or demanding everything in the hope of overwhelming the other side, is equally problematic before the court.
The combined effect of the fake citations and the disclosure issues was a credibility problem that affected how the Court received everything those parties put forward. Justice Tzimas dismissed one defendant's motion entirely, granted another only in part, and postponed a third. The explicit message running through the decision was that credibility, preparation, and honesty are not peripheral to litigation: they are central to it. A party whose materials cannot be trusted, whose disclosure is incomplete, or whose arguments are not supported by real authority starts every hearing at a disadvantage that no amount of substantive merit fully overcomes.
This is not a new principle. Ontario courts have long held that parties owe duties of candour and good faith to the court and to the other parties in a proceeding. What is new is the specific application to AI-generated content, which the Court in Halton treated as no different from any other unverified material: the party who files it owns the consequences.
The AI problem in litigation: what Halton confirms
Courts in Canada and internationally have been addressing AI-generated fake citations with increasing frequency. The problem is structural: current AI language models generate text that sounds authoritative and is formatted like legal citations, but the underlying cases may not exist, may not say what the citation claims, or may have been decided differently than described.
The risk is not limited to self-represented parties. Any litigant who uses an AI tool to assist with legal research and does not independently verify every citation against a reliable legal database before filing is exposed to the same consequence. The duty to ensure that materials filed with the court are accurate falls on the party and their counsel, not on the technology used to draft them.
The practical response is straightforward: every case cited in any document filed with an Ontario court must be verified against CanLII, Westlaw, LexisNexis, or another authoritative legal database before filing. This applies regardless of how the document was drafted. It applies to self-represented parties, to counsel, and to anyone else whose name appears on a court filing.
The discovery lessons: what proper disclosure looks like
The discovery issues in Halton are a reminder that the rules governing document production in Ontario civil litigation are not aspirational. Rule 30 of the Rules of Civil Procedure requires each party to produce an affidavit of documents listing all documents relevant to any matter in issue in the proceeding, including documents that are adverse to the producing party's interests. The obligation to produce does not depend on whether the document helps or hurts.
Under-disclosure, which means failing to produce relevant documents, is a breach of that obligation and can result in the evidence being excluded, adverse inferences being drawn, cost sanctions, or in serious cases the striking of pleadings. Over-disclosure, which means demanding every document a party can think of regardless of relevance, burdens the other side, wastes court time, and can itself attract cost consequences.
The proportionality principle now embedded in Ontario civil procedure requires that discovery be commensurate with the issues and amounts at stake. Courts expect parties to approach document production cooperatively and in good faith, not strategically. For related guidance on what happens at the examination stage once documents are exchanged, see our guide to examinations for discovery in Ontario.
Dealing with a discovery dispute or preparing court materials in a complex Ontario proceeding?
Credibility problems in litigation are far easier to prevent than to repair. If your disclosure obligations are not clear, or if you are unsure whether your court materials meet the standards the Court in Halton described, get advice before you file.
Call: 1-800-771-7882 Get Advice Before You FileWhat this means for businesses and individuals in Ontario litigation
Verify every citation before filing
Any document filed with an Ontario court must be based on accurately cited, verifiable legal authority. If AI tools are used in drafting, every case name, citation, and legal proposition must be checked against an authoritative database before the document is filed. The party who files the document is responsible for its contents regardless of how it was prepared.
Produce relevant documents honestly and completely
The obligation to disclose relevant documents in Ontario civil litigation extends to documents that are adverse to your interests. Selective production, deliberate omission, or unexplained gaps in disclosure invite adverse inferences, cost sanctions, and loss of credibility with the court. Complete and timely production is not just a procedural obligation: it is a credibility investment.
Discovery demands must be proportionate
Demanding every document that might conceivably exist, without regard for relevance or proportionality, is as much a problem as under-producing. Courts in Ontario are required to consider proportionality in managing discovery, and excessive demands can attract cost consequences and damage the demanding party's credibility with the court.
Self-representation does not reduce the standards
Self-represented parties owe the same duties of candour and accuracy to the court as represented parties. The Court in Halton made this explicit. A self-represented litigant who files materials containing false citations is not given additional latitude because they lack legal training: the consequences are the same as for any other party.
Involved in complex litigation in Ontario and want to make sure your approach protects rather than damages your position?
Credibility, disclosure, and preparation are as important as the merits of the claim. Get the fundamentals right from the outset.
Talk to a Commercial Litigator Or call us: 1-800-771-7882Practical takeaways
Facing a complex commercial dispute or discovery challenge in Ontario? Tell us what's happening.
Whether you are managing a large commercial litigation with complex discovery obligations, responding to a fraud claim, or preparing court materials that need to meet the standards Justice Tzimas described in Halton, Achkar Law advises businesses, organizations, and individuals across Ontario on commercial litigation strategy at every stage. We will help you get the fundamentals right from the outset.
Call us at 1-800-771-7882 or fill out the form below and we will be in touch.