North Carolina lawyers have clearer guidance on AI than many professions. On November 1, 2024, the North Carolina State Bar adopted 2024 Formal Ethics Opinion 1 on using AI in a law practice. The short version: AI for law firms is allowed, as long as you use it competently, keep client information secure and supervise the work. The courts have added their own rules, and a few lawyers have already learned the hard way what happens when nobody checks a citation.
This guide covers what the State Bar opinion says, how to vet a tool, where AI helps a small firm, and the court rules that apply here. It’s a plain-language summary for busy practitioners, not an ethics opinion. Read the opinion itself before you change how your firm works.
What the NC State Bar says about AI for lawyers
The opinion answers six practical questions. Here’s how it comes out on each:
| Question | The State Bar’s answer |
|---|---|
| May a lawyer use AI? | Yes, if used competently, securely and with proper supervision. Using it is the lawyer’s choice, not a requirement. |
| May client information go into an AI tool? | Only after the lawyer is satisfied the tool is secure enough under Rule 1.6(c). Avoid putting client-specific information into publicly available AI tools. |
| Does hosting AI in-house change that? | No. The lawyer is still responsible for security, wherever the program runs. |
| Who is responsible for AI-drafted filings? | The lawyer who adopts the output, under Rule 3.1 and Rule 11. |
| Do clients have to be told? | Not for routine uses like research or practice management. Handing substantive work to AI is like outsourcing, which needs the client’s informed consent. |
| Can a lawyer bill for time AI saved? | No. If AI turns a three-hour task into one hour, you bill one hour. |
Rule 1.1 already expects lawyers to keep up with the benefits and risks of technology. North Carolina also requires one hour of technology training in each year’s CLE, so most lawyers here have some background to build on.
Vetting a legal AI tool
The opinion treats AI vendors like other outside services under Rule 5.3. Drawing on the State Bar’s earlier guidance on cloud computing, it suggests looking at:
- The company. Its experience, reputation and financial stability.
- The terms of service. How it handles confidential data, and what security it uses.
- Your exit. How you get your data back, or have it destroyed, if you stop using the service or the company is sold.
- Data rights. Whether the provider keeps what you enter or claims any rights to it, including for training its models.
Vetting isn’t one-time. Keep an eye on the vendor and move on if security concerns come up.
In practice, that rules out free and personal AI accounts for client work at law firms. A business plan with admin controls, or the AI built into a legal research platform you already trust, is the usual starting point. Our guide on whether ChatGPT is safe for business data explains what changes between plans.
Where AI helps a small law firm
These are the tasks where AI for law firms usually saves time first:
- First drafts. Engagement letters, routine correspondence and demand letters built from your own templates.
- Document summaries. Long contracts, records and deposition transcripts, using a tool you’ve approved for client data.
- Chronologies. Turning a stack of documents into a timeline you can check.
- Research starting points. Finding the issues and the likely authorities, which you then read and verify yourself.
- Time entries. Turning rough notes into clear billing descriptions.
- Office work. Scheduling, intake follow-ups and invoice reminders.
The rule for legal AI is the same for all of these. AI produces a draft, and a lawyer reviews it before it goes anywhere. The opinion warns that AI output can be wrong even when it looks reliable.
Court rules on AI in North Carolina
Federal court in Asheville. The Western District of North Carolina covers Asheville and Charlotte. In June 2024, its judges issued one of the stricter AI orders in the country, with a separate certificate for briefs about AI use and citation checks. The court updated that standing order on July 29, 2026. The update drops the separate AI certificate, but the person who signs a filing is still responsible for confirming that every cited authority exists and says what the filing claims. Read the current order before your next filing.
State courts. According to the UNC School of Government, as of April 2026 the NC Supreme Court hadn’t adopted a statewide AI rule, and Cabarrus County was the only trial court district with an AI order. That order doesn’t require disclosure when AI helps draft pleadings. It does require disclosure when AI is used to create or alter evidence.
A real example. In October 2025, the City of Raleigh told the NC Court of Appeals that a plaintiff’s brief cited two cases that don’t exist. The plaintiff’s lawyer said a contract attorney’s research, supplemented with a legal AI tool, introduced them. It’s the kind of mistake a simple citation check catches, whatever legal AI tool the firm uses.
Billing and engagement letters
The State Bar’s billing guidance for lawyers using AI is straightforward. Hourly bills must reflect time actually spent. A flat fee is fine for work done with AI, as long as the client agrees and it isn’t clearly excessive. AI costs tied to a specific client matter can be passed through if they’re accurate and the client agrees, preferably in writing. General technology costs belong in overhead or an administrative fee. The American Bar Association’s Formal Opinion 512 adds that lawyers generally can’t charge clients for time spent learning a tool.
Update your engagement letter to explain how the firm uses AI, how AI costs are billed, and when you’ll ask before handing substantive work to an AI tool.
Marketing copy and the word “specialist”
AI-written website copy for law firms loves the words “specialist” and “expert.” In North Carolina, Rule 7.4(b) bars a lawyer from stating or implying certification as a specialist unless the certification comes from the State Bar or an accredited organization, which must be named. Read every AI-drafted page and ad with that rule and Rule 7.1 in mind.
An AI policy for your law firm
A one-page policy answers the questions your lawyers and staff are already guessing at about AI. It should name the approved tools, set the rules for client data, say who checks citations and how, and explain how AI affects billing. Our AI use policy template is a good starting point. Lawyers Mutual, a North Carolina malpractice insurer for lawyers, also recommends keeping the opinion with your firm’s AI policies and tracking which tools staff use.
A simple first month:
- Week 1: Choose your tool and adopt the policy.
- Week 2: Pick one task, like first drafts of routine letters or summaries of long documents.
- Week 3: Set up the review step, including a citation check for anything filed or sent to opposing counsel.
- Week 4: Measure and decide, then update your engagement letter.
Our 30-day plan to start using AI has more detail on each step.
Getting help in Asheville and across North Carolina
Good People Technologies helps with AI implementation for small businesses, including law firms in Asheville, Western North Carolina and across the state. For law firms, AI work usually means setting up approved tools with admin controls and connecting practice management and accounting systems. It also means writing a policy your lawyers will actually follow. Our guide on how to choose an AI consultant covers what to ask any outside help. To talk it through, start with a free 15-minute operations and technology audit.
Frequently asked questions
Do lawyers have to tell clients they use AI?
Not for routine tasks like legal research or practice management, according to the State Bar. If you hand substantive work to AI, or AI use affects the fee, talk to the client and get consent.
Can I put client information into ChatGPT?
Not into a free or personal account. The State Bar says to avoid entering client-specific information into publicly available AI tools. Use a tool you’ve vetted, with business terms and admin controls.
Can a lawyer bill for time that AI saved?
No. Hourly bills reflect the time you actually spent. If AI makes you faster, a flat fee that isn’t clearly excessive is one way to share the benefit.
Does the Western District still require an AI certificate?
Not a separate one since its July 2026 update. Anyone who files is still responsible for verifying every citation and quote, so check the current standing order before filing.
Sources, checked November 2026: NC State Bar 2024 FEO 1 (via the UNC School of Government), UNC School of Government on AI court orders, the Western District of North Carolina’s local rules page, Carolina Journal, the ABA on Formal Opinion 512, Lawyers Mutual and LawSites on NC’s technology CLE rule.
Hi, I’m Benji, founder and CTO of Good People Technologies in Asheville, NC. We help small and mid-sized businesses put AI to work safely and connect it to the systems they already run, from QuickBooks to NetSuite.
For over a decade, we’ve helped businesses solve complex operations and technology problems. When not working, I’m hiking or enjoying rivers in western North Carolina with my wife and two dogs.
