⚡ CASE DIGEST
Zou v. Miracon Development Inc., 2026 BCSC 85 — British Columbia Supreme Court, 20 January 2026
Self-represented plaintiffs Jinhu Zou and Huan Yi Zhou won a $4,800 judgment against a developer but then submitted costs submissions citing AI-generated non-existent cases. The BC Supreme Court addressed the AI hallucinations in a costs judgment — one of Canada’s first provincial superior court decisions to explicitly deal with AI citation fabrication.
Why it matters: Canadian provincial courts are now handling AI hallucinations in costs proceedings — even plaintiffs who have won on the merits can undermine their costs arguments with AI-generated fabrications.
Category: Hallucinations & Sanctions | Jurisdiction: Canada | Read time: 5 min
Case at a Glance
| Full Citation | Zou v. Miracon Development Inc., 2026 BCSC 85 (S258821, New Westminster) |
| Court | Supreme Court of British Columbia |
| Date of Decision | 20 January 2026 |
| Category | AI Hallucinations & Sanctions |
| Jurisdiction | Canada |
| AI Tool Used | Generative AI (specific tool not named — hallucinations identified by court) |
| Judgment / Order | 2026 BCSC 85 (AustLII / CanLII) |
Background
Jinlu Zou and Huan Yi Zhou, appearing as self-represented plaintiffs, brought a dispute against Miracon Development Inc. regarding a property transaction. On 12 December 2025, they obtained judgment for $4,800. The defendant requested the opportunity to make submissions on costs. Both parties submitted written arguments on costs in December 2025. In their costs submissions, the plaintiffs cited legal authorities that Justice Blok found to be AI-hallucinated — non-existent cases that appeared to support their costs arguments.
The AI Issue
The BC Supreme Court had to deal with costs submissions that contained AI-generated fabricated case citations. Justice Blok addressed the hallucinated authorities in the published costs judgment — flagging them as non-existent and declining to rely on them.
“The Court notes that some authorities cited in the plaintiffs’ costs submissions appear to be the product of AI hallucination — cases that do not exist and cannot be verified in any legal database.”
— Justice Blok, BC Supreme Court, Zou v. Miracon Development Inc., 20 January 2026
Quick Takeaways
- Even winning litigants can undermine their position with AI-hallucinated citations — verification duty applies equally to costs submissions.
- Canadian provincial courts are now producing AI hallucination jurisprudence.
- Indian advocates handling costs arguments must verify all cited precedents.