Get It In Writing

Why AI-Drafted Leases Fall Apart — 3 Real Examples

A lease looks like the kind of document AI should be good at. It’s full of boilerplate, it follows a pattern, and there are a thousand templates online. So business owners increasingly just… generate one. As a business attorney, I keep getting handed the result — and I keep seeing the same problem: the lease reads fine and doesn’t hold up. Here are three real situations that show why.

Example 1: The Gemini lease that was a “mish mash of ideas”

A client recently admitted he’d used Gemini to create the commercial and residential leases he sent me. What came back looked like a mish mash of ideas about certain situations, organized in a way that made no sense. It took me over an hour just to go through one of the shorter contracts. Another hour to discuss it with him. And it will take several more hours to take those ideas and actually turn them into something enforceable.

Here’s the part people miss: AI seems to think it can just throw words down and create or get rid of legal obligations. It can’t. There are laws that govern what a lease can and can’t do, and you don’t get to write your way around them just because both sides agreed to the language. A lease that “sounds right” isn’t the same as a lease that works.

Example 2: The hidden clause that only a human catches

I had a lease cross my desk with a large landlord that required arbitration of all disputes — in a different state. Buried in the same document: if you give written notice within 30 days of the first time you use the landlord’s tenant portal, you can waive that arbitration requirement entirely.

Nobody reads a lease looking for a 30-day window tied to portal usage. That kind of clause isn’t a drafting error — it’s intentional, and it’s the sort of thing a generic AI-drafted (or AI-summarized) lease will glide right past, because it has no idea that clause exists or what it actually costs you. Missing that window can mean losing the right to fight a dispute anywhere near home.

Example 3: The lease that was actually three leases stacked together

Not every lease is one clean relationship between one landlord and one tenant. I recently worked on a commercial deal where the client wanted to let tenants lease shared common areas and set rules for how those areas get used. Some tenants also had separate leases for their own units. Some didn’t. On top of that, there was a third-party property manager responsible for parts of it.

That’s three different structures layered into what looks, from the outside, like “a lease.” A generic template — AI-generated or otherwise — has no way to know your deal has that many moving parts unless someone maps them out first. AI drafts to the pattern it’s seen before. Real deals don’t follow the pattern; they follow whatever the parties actually agreed to.

The pattern across all three

None of these are AI being “bad at writing.” The output reads smoothly every time. The problem is what it can’t see: the actual laws that constrain what’s enforceable, the buried clause that changes your rights, and the real structure of a deal that doesn’t match any single template. A lease isn’t just prose — it’s a set of obligations that has to survive contact with a real dispute, a real landlord, or a real tenant mix. That’s exactly the part AI skips.

(If you’re wondering whether this problem is bigger than leases, it is — see can I use ChatGPT to write a business contract? for the general version of this issue.)

What to do instead

  • Use AI to get oriented, not to finalize. A first draft to react to is fine. A lease you sign is not the place to stop there.
  • Assume there’s a clause you’re not seeing. Leases hide their most important terms in the least obvious places — notice windows, portal-usage triggers, arbitration carve-outs.
  • Map the actual structure of your deal before you draft anything — how many parties, how many separate agreements, who’s responsible for what. A template can’t do that step for you.
  • Have a human read it who’s bound to catch what AI can’t — before you send it, and definitely before you sign it.

The bottom line

AI can produce something that looks like a lease in seconds. Whether it actually protects you is a different question entirely — and by the time you find out the answer is no, you’re usually already in a dispute. The fix isn’t avoiding AI. It’s not mistaking “it reads well” for “it works.”

Want to know where your business is actually exposed? Grab the free Get-It-In-Writing Business Audit — 15 things that should be in writing, but usually aren’t. [Get the checklist →]

This article is general education, not legal advice, and does not create an attorney-client relationship. Laws vary by state and situation — for your circumstances, talk to a licensed attorney.