How predictive coding is changing the practice of law

With the recent changes such as Office of the Registrar General of NSW’s abolition of certificates of title in favour of a completely electronic ‘eConveyancing’ system under the Real Property Amendment (Certificates of Title) Act 2021 (NSW), the future of legal practice is undeniably digital.

Predictive coding in the law refers to an automated document review process, and is a type of a technology-assisted review (TAR). In today’s digital world where more information is recorded and available than ever before, this means the legal industry has experienced an enormous surge in materials that need to be reviewed and classified as part of the discovery process in large litigation matters. Traditionally, law firms would gather an army of paralegals to sift through dozens of boxes of documents, emails and other correspondence to flag and identify privileged materials, but today, predictive coding as an effective solution to minimise the time and costs associated with document review.

Predictive coding works by having lawyers review an initial sample suite of documents that then teaches the computer how to identify, or predict, similar documents. After the computer has identified similar materials, the reviewer is able to validate those findings and refine the computer’s output. While some legal professionals have expressed concerns that the computers will soon replace lawyers, predictive coding is dependent on the initial reviewer’s work to code sample documents that teach the computer what to look for. Human reviewers are essential to the efficiency and accuracy of predictive code processes, which in turn will inform the future development of other legal technologies.

While minimising labour-incurred costs of traditional document review work sounds like a dream come true for many firm owners, the fact is that predictive coding technology is still complex and difficult to implement widely. The initial costs of establishing the technology in a firm are also expensive, despite the projected long-term benefits, making the technology inaccessible for smaller firms. In circumstances where it is used, the benefits of predictive coding include streamlining the discovery process, saving time and money for the client compared to equivalent human labour, limiting human error and enabling earlier case assessment through quick turnaround times. A key example of predictive coding technology being applied on a large scale in Australia is during the 2018 Banking Royal Commission, which required a colossal volume of documents to be reviewed within short timeframes. The use of predictive coding and other legal technologies was a key factor to the success of large legal teams being able to collate and review relevant documents to comply with the Commissioner’s demands. As data collection continues to expand alongside the rise of better software and our reliance on technology, we are likely to see more and more complex litigation matters that will require the assistance of predictive coding to help lawyers review all available materials.

Predictive coding is one of the most popular legal technologies currently being utilised by firms, but if you’d like to learn about other processes, you can listen to Episode 15 of Hearsay ‘The Role of Technology in Creating Operational and Organisational Efficiencies’ with legal tech experts Paul Bartholomew from Unison Outsourcing and Jonathan Prideaux from KordaMentha.