By Eliot Hibbert, CEO and founder of Legal Futures Associate Nexa Law
Summary
- AI is already changing the way legal services are structured. Small, agile firms that adopt AI quickly are moving ahead of larger competitors who are slowed down by old systems and slow decision-making.
- The Master of the Rolls, the Chancellor of the High Court and the Ministry of Justice have all said publicly that lawyers must embrace AI. They see adopting AI as essential for professional survival and ensuring access to justice.
- UK lawyers are expected to gain £2.4bn in productivity from AI by 2026. Each solicitor could save about 140 hours a year now, increasing to 240 hours within three years.
- In the US and Australia, small firms that use AI are growing faster, taking on more work, and competing directly with much larger practices.
- The consultant solicitor model, used in new model law firms, gives experienced lawyers a proven way to adopt AI efficiently. It comes with shared support for compliance, technology, and governance.
Small law firms have a built-in advantage in the AI era, though many do not yet realise it. Large firms often spend months dealing with approvals and old systems, while a small practice can pick a tool, start using it, and save hours each week before a big firm even finishes its risk review. The real question is whether small-firm solicitors will take advantage of this before it disappears.
A senior English barrister recently told a writer for The Spectator that he saw an AI model recreate a complex civil court appeal in 30 seconds, a task that had taken him a day and a half. He even thought the AI’s work was better than his own.
He was not saying lawyers would disappear, but that slow lawyers would struggle. Firms charging high fees for work that AI can now do in minutes will face challenges, while those using AI to work faster and more efficiently will grow.
The numbers support this. Clio’s 2026 UK and Ireland Legal Insights Report found that 89% of legal professionals now use AI in some capacity, and 70% began using it in the past year. Of those using AI, 78% can handle more work and 77% say it improves their work quality.
UK lawyers are expected to save 140 hours each year with AI, rising to 240 hours a year within three years. This equals about £12,000 per lawyer per year and, across the profession, adds up to £2.4bn in 2026 alone.
What the judiciary, politicians, and commentators are saying
The head of the civil justice system in England and Wales has not hedged. Sir Geoffrey Vos, Master of the Rolls, has stated that lawyers and judges have “no real choice” about whether they embrace AI.
His reasons were straightforward: clients will use it, AI liability disputes will generate significant legal work, and the technology simply saves time and money.
He dismissed the hallucination argument as an excuse for avoidance, saying: “AI tools are not inherently problematic, so long as we understand what they are doing, and use them appropriately.”
By October 2025, speaking at the Legal Geek Conference, Sir Geoffrey observed that the profession had moved from suspicion to widespread adoption within a year, deploying tools such as Harvey, Copilot, Claude and Gemini across litigation support, document analysis and contract drafting, without the chaos that sceptics had predicted.
At a February 2026 event at the Old Bailey, Sir Geoffrey went further. Generative AI, he said, would dramatically increase the number of civil, family and tribunal claims, as litigants who once relied on lawyers turn to ChatGPT or Copilot to construct arguable cases at no cost.
He went on to observe: “I should say at once that I am not suggesting that AI will solve all our problems, particularly where vulnerable people in the civil, family and criminal justice system are concerned.
“But I do think that, in the context of the use of AI and technology more generally in the justice system, we have been guilty of some quite short-sighted thinking. It is important now to look beyond the short term and to consider not only what machines can do to help deliver justice, but also what humans will still be required to do in the fully developed machine age.”
Sir Colin Birss, Chancellor of the High Court, added a practical dimension in April 2026 when he confirmed to the City of London Law Society that judges in England and Wales now have two secure AI systems in active use: a version of Microsoft Copilot available to all judges, and an in-house system developed with HMCTS and the Ministry of Justice.
Judges are using both to produce anonymised judgments and assist with transcription. His assessment was unambiguous: “This is very exciting and has potential to make a big difference in all our courts and tribunals.”
The government has matched the judiciary’s tone. In July 2025, the Ministry of Justice published the AI Action Plan for Justice, backed by both the Prime Minister and Lord Chancellor, setting out over 60 initiatives to embed AI across courts, tribunals and legal services.
Lord Timpson, the prisons and probation minister, wrote in the foreword that he had seen “real opportunities for AI to improve the working lives of our frontline staff” and that there was clear evidence it was already making a difference.
The plan explicitly identifies the UK’s £37bn legal services sector and its concentration of lawtech start-ups as a national asset to be grown, and describes AI as a route to “swifter, fairer, and more accessible justice for all”.
US and Australia legal industry insights
Smokeball’s 2025 State of Law Report found that generative AI adoption among small US firms and solo practitioners almost doubled in two years, from 27% in 2023 to 53% by early 2025.
That rate of growth is not uniform across firm sizes. Larger firms still lead on enterprise-grade deployments, but the cost gap is narrowing as AI tools become embedded in platforms that small practices already use.
Thomson Reuters research found that law firms with a visible, structured AI strategy were 3.9 times more likely to see a return on investment than those without one, and that mid-sized firms appeared in the top tier of adopters because they approached AI deliberately from the start.
A Citi Global Wealth and Hildebrandt Consulting report published in January 2026 found that 86% of large US law firms planned to increase associate headcount through 2027, but only 35% planned to grow their first-year intake. AI is absorbing the high-volume, repetitive work that previously went to junior lawyers. A small firm that uses AI to do the same production work can now compete directly for matters that once required a team behind them.
Australia is the most useful case study. Almost all Australian legal professionals now use AI, the fastest rate of adoption in the common law world.
Two-thirds of firms using AI reported a direct positive effect on revenue, and growing firms were nearly three times more likely to use automation than shrinking ones. Boutique and small practices reported three to five times faster research turnaround. Several have used that efficiency gain to take on more complex matters without a proportional increase in headcount.
Practical implications for small firms
Start by looking at non-billable time. The Wolters Kluwer 2026 Benchmark Report found that lawyers spend less than half their day on billable work. The rest goes toward tasks such as drafting documents, legal research, client intake, and billing.
AI tools built into LexisNexis and Thomson Reuters products can help reduce this overhead without needing special procurement or IT set-ups. The first step is to use what is already available, track the hours saved, and put that time back into client work.
The second stage is governance. The SRA Standards and Regulations apply in full to AI-assisted work, as do the obligations under the Data Protection Act 2018.
The Solicitors Regulation Authority’s (SRA) published guidance on AI compliance confirms that solicitors remain fully accountable for the work they deliver, regardless of how it was produced, and sets out minimum expectations: oversight through the COLP, a written AI policy, data protection assessments before client information enters any AI platform, and review of all AI-generated outputs before use.
A firm that skips this stage while adopting tools is likely to end up embroiled in an SRA investigation.
The maths behind adopting AI is simple. If a lawyer saves 140 hours a year with AI, they can handle about 10-15% more client work without extra costs. In three years, with 240 hours saved, this could rise to 20% or more.
For a small firm with up to five lawyers, these gains can transform the business, making it more competitive, faster to respond, and able to take on more complex work than firms that do not use AI.
Could the consultant solicitor model provide the answer?
For many small-firm lawyers, the main barrier to adopting AI is not doubt, but a lack of time. Running a law firm means handling compliance, insurance, billing, marketing, administration, and IT, in addition to practising law.
Working as a consultant solicitor in a new model law firm removes most of this extra work right away.
Under the consultant model, the solicitor works on a self-employed basis under the umbrella of an SRA-regulated firm. The firm handles professional indemnity insurance, SRA compliance, billing and cashiering, case management systems, some marketing support, and file auditing.
The solicitor retains a high proportion of their billable fees. Access to legal technology infrastructure, including AI-integrated tools that a small, independent firm would struggle to procure and maintain on its own, is typically part of that arrangement.
A consultant working within a well-resourced new model law firm can adopt AI tools more quickly and safely than a sole practitioner managing everything independently. The compliance framework, including an AI policy, already exists. Data protection governance can be consistently addressed at the firm level, across all consultants.
New model law firms deal with the same competition as other practices. The key difference is that they were built to be lean and use technology from the start. For a solicitor running a small traditional firm who wants to keep up with a fast-changing market, the consultant model offers a real, practical solution.
Wrapping up
The SRA has authorised two AI-only law firms since May 2025: Garfield Law, which automates small claims debt recovery up to £10,000, and LawFairy, which handles immigration eligibility assessments. Both operate in narrowly defined, rule-based areas.
The SRA’s then chief executive, Paul Philip, described Garfield’s authorisation as a landmark and explicitly tied it to access to justice: with so many people and small businesses unable to afford legal services, pulling up the drawbridge on innovation that could address that gap is not a responsible regulatory position.
However, he made clear that any risks to consumers would be carefully monitored: “[T]rust and confidence in regulated legal services depends on the public knowing that high professional standards are being met. Any new law firm comes with potential risks, but the risks around an AI-driven law firm are novel. So we have worked closely with this firm to make sure it can meet our rules, and all the appropriate protections are in place.
“As this is likely to be the first of many AI-driven law firms, we will be monitoring progress of this new model closely, so we can both manage the risks and realise the benefits to consumers.”
The message for the UK lawyers is the same as it for all knowledge professionals: AI won’t replace you, but people who use AI well will replace those who don’t.
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