In-house legal work is heading toward an extinction event – and Dan Dagan thinks that's a reason for excitement, not alarm.
"When extinctions occur, new species evolve," says Dagan, general counsel at Siemens Energy Canada. The challenge for lawyers is figuring out which species to become. After 30 years spanning private practice at Torys LLP, nearly a decade at Ontario Power Generation (OPG), and more than a decade building the legal function at Siemens Energy Canada, Dagan keeps returning to the same four things that will matter most: trust, courage to make hard decisions, creativity, and the ability to frame a problem correctly.
From corner office to executive table
The notion that in-house departments handle the routine while law firms tackle the complex is, Dagan says, outdated. "Some in-house departments – I think ours is one of them – can equal any law firm in terms of the amount of work it can do, in terms of quality, in terms of complexity," he says. "We're often opposite sides of the table from people at the big law firms, but we just do it all in-house because we have the expertise."
That shift in capability has come alongside a broader shift in role. Dagan sits on the executive team and regularly talks strategy with the company's chief executive on matters well outside legal. His move from OPG to Siemens – which he feared would mean simpler work – turned out to be the opposite: nuclear power plants, transmission stations, wind farms, and a team that has grown to seven lawyers working virtually with legal partners in multiple countries.
Getting in the room early
In complex energy projects, Dagan is clear that legal's value goes beyond reviewing a contract before signing. "Legal should be in the room prior to day one – especially on the major projects, even a year or two years in advance of what's on the horizon," he says. Early involvement lets the legal team ask questions that commercial colleagues might not think to raise and draw on institutional memory of what has gone wrong before. His favourite moments in negotiations come when someone on the customer side turns to him and asks for his opinion on a solution – a signal, he says, that trust has been earned. "You do that by listening, and you do that by trying to find mutually good solutions to solve the problems," he says.
The AI inflection point
Dagan has encouraged his team to leverage AI tools for efficiency and productivity for a few years and offers a precise assessment of where AI stands now. A year ago, it was getting him 60 percent of the way to most tasks. Now it is reaching 85 to 90 percent, with legal-specific tools – those that integrate with a team's own documents and reason like a lawyer – representing the real step change.
His team has moved through four stages: awareness, individual adoption, standardization, and optimization, and they are currently working on the third – translating individual approaches into consistent team practices while preserving each person's working style. "I might like something that's a chart with visualizations because I'm a visual learner," he says. "Somebody else might want their output as a podcast. Somebody else might want it as a three-page memo." The challenge is building common standards without flattening what makes each person effective.
The quality implications are serious. Dagan does not send anything important out without running it through AI first and has seen AI identify errors in memos from outside firms. "I'm sure it's a matter of years before we see the first negligence case against a lawyer for not checking with AI," he says. As a historical parallel, he points to an essay he found by a late-1400s monk arguing that scribes would never be displaced – a warning against complacency about where the profession is headed.
Writing for the machine on the other side
A growing operational challenge is the volume of AI-generated correspondence he receives. When Dagan receives a letter that is clearly AI-generated, he looks past the volume to find what the other party actually needs. "You [have] to see through it almost like The Matrix," he says, "and say, ‘What are they really trying to get after here?’" On employment and human rights matters, claimants are increasingly using AI to self-advocate, sometimes raising valid but unconventional objections. Dagan tested his own standard release in an AI tool and found it flagged concerns a lawyer would not typically raise. His response is to rewrite releases with a more explanatory narrative so that AI advisors read the document correctly. The dual strategy: see through incoming AI content to find the real ask, and write documents in ways AI will correctly interpret from the outset.
What lawyers need now
When Dagan interviews candidates, the quality he looks for first is not technical expertise – it is curiosity. His standard closing question asks candidates to describe their favourite work story. "What I want to see is somebody light up with it," he says, "somebody who will just talk about how they get visibly excited about the problem they solved." Task-oriented lawyers burn out; those energized by problems bring their best work.
His guiding principle on difficult risk decisions is loyalty to the Siemens Energy brand, not to any individual leader. "You don't work for me, you don't work for the business leads here… you work for the Siemens Energy brand," he tells his team. "That is what you are protecting, and that's where your loyalty lies."
Looking ahead, Dagan anticipates in-house legal expanding into areas outside its traditional scope, as automation frees capacity and the skills legal departments have built – critical thinking, trust-building, questioning assumptions – prove valuable elsewhere in the organization. The lawyers who thrive will be the ones who get comfortable being uncomfortable. "I think if anybody's expecting the next five years to be the same as the last five or ten, it won't be – and you have to get comfortable in that space," he says.
Dan Dagan is a member of the Canadian Lawyer Leaders Network.