Understanding Legal Liabilities of Artificial Intelligence ("AI") in British Columbia and Canada

The advent of Artificial Intelligence ("AI") has reshaped the very nature of how people interact online. No longer a futuristic concept, AI helps decide what we see online, answers customer service questions automatically, edits photos, and generates text and images in mere moments.

While AI is a powerful tool, most users do not think too much about how it works, or more importantly, what happens when it goes wrong. As AI systems become more powerful and accessible to the general public, they can cause real harm to people. At the end of 2025, xAI released a feature for its AI chatbot Grok that allowed users of X (formerly known as Twitter) to use the AI to directly edit images posted by other users of the platform. Shortly after, Grok began to digitally undress photos of other users on the platform without their consent. While xAI moved quickly to put restrictions into place on this feature, the damage had been done. Countless individuals, some of whom are underage, were affected.

Such events have raised new and emerging questions regarding the liabilities involved when AI chatbots cause harms to people. Who exactly is liable when AI breaks the law?

Can AI Itself Be Held Liable in British Columbia and Canada?

In short, an AI chatbot itself cannot be held liable in a legal capacity. The British Columbia Law Institute concluded that AI systems are not "legal persons" who can be sued or forced to pay damages. Unlike individuals or corporations, AI has no legal identity, no assets, and no ability to comply with court orders. As such, when harm occurs, the law must look beyond the AI itself, and identify the people or organizations responsible for creating, deploying, or using it.

Fortunately, this does not imply that individuals or corporations harmed by AI lack legal recourse. Rather, it indicates that legal action should be directed towards the individuals and corporations responsible for allowing the AI to cause harm.

Who Can be Held Liable for the Harms AI Causes?

Fortunately, British Columbia law has already begun to clarify how responsibility for AI-caused harm should be assigned. Courts and tribunals have made it clear that artificial intelligence does not exist in a legal vacuum, and that companies cannot avoid liability by blaming autonomous systems. A particularly important example comes from a 2024 decision of the British Columbia Civil Resolution Tribunal involving Air Canada and its use of an AI chatbot. In the case of Moffatt v. Air Canada, the tribunal found Air Canada liable for the damages caused by incorrect information by their AI chatbot.

At the time the harm occurred, Air Canada had deployed an AI-powered chatbot on its website to handle customer support inquiries. When a customer inquired about bereavement fares following a death in their family, the chatbot incorrectly promised the customer that Air Canada offered a bereavement fare, which the customer would receive after they booked a full-fare flight through the airline. Air Canada later refused to honor the promised discount, arguing that the chatbot was a separate legal entity and that Air Canada was not liable for any incorrect information.

However, the British Columbia Civil Resolution Tribunal rejected this argument and found Air Canada liable for the damages. In their decision, the tribunal found that Air Canada was still wholly responsible for all information coming from their website, whether or not it had come from a static page or a chatbot. As Air Canada was a service provider, Air Canada was found negligent as the airline did not take reasonable care to ensure that its chatbot provided accurate information.

What Should I Do if I am Harmed by AI?

If you have been harmed by the actions of an AI chatbot, whether through misleading information, violations of your privacy, misuse of your image, or any other method, it is essential that you contact a lawyer as soon as possible to discuss your legal options. British Columbia precedent has provided clear accountability for who is responsible for these damages. The legal team at Duncan and Associates is highly experienced in civil litigation, and can help you ensure that you are appropriately compensated for the harm you have suffered. Contact us today to discuss your legal options.