These are the limitations of the version of ChatGPT you were using at that moment. They are not categorical limitations of AI or even LLMs.
It’s amazing to me how many people are sleeping on AI, mixing up the failing cases of a freemium chatbot for the full capability of the tech, even on HN. LLMs can say “I don’t know”. Even ChatGPT can do it. Ask some super niche historical questions of any version and see what you get. Is it perfect every time? No. But that’s something that can be reduced.
Over the next year, you’ll see more instances of lawyers citing hallucinated cases. There will also be a handful of startups that hook up LLMs to document stores, and they’ll be able to check for this sort of thing and do an even better job.