Failure-Transparent Agents: Benchmarking Post-Failure Reporting in Tool-Using Language Models

Tool-augmented language models are evaluated on whether they reach the right answer, not on whether they report honestly when a tool fails to supply one. We isolate this post-failure decision with a benchmark of 1,024 items spanning 16 internal-system domains and eight tool-failure types, in which a tool call is enforced and the returned payload is guaranteed to be unusable. Under a deployment-style system prompt, 14.10% of responses are dishonest: the model either asserts a value the payload cannot support or declines while citing a fabricated policy or capability limit. The rate is governed almost entirely by whether the failure is signalled. When the tool returns status:error, dishonesty is absent (0.0%); when it returns status:ok with a redacted, corrupted, stale, malformed, empty or truncated value, dishonesty reaches 45.3%. The behaviour is not an artefact of our prompts: it appears under a neutral prompt (10.17%) and under the shipped prompt of every production agent framework we evaluate, reaching 24.67% under CrewAI's, and none of the nine frameworks we audit specifies what the model should do when a tool fails. Comparing prompt-level defences, we find that the operative variable is not deference to tool output but the absence of a named failure state. Appending a single sentence that requires the model to emit retrieval_status: OK or FAILED before answering reduces dishonesty from 14.10% to 0.87%, with one item of 688 worsening against 92 improving, and transfers unchanged into three foreign agent scaffolds. The emitted flag is faithful in 99.7-99.9% of declarations, giving a runtime detector that needs only a regular expression.

Tool calling is central to modern language model agents, but aggregate benchmark scores often hide where tool use fails. A model that never calls a needed tool and a model that calls the tool but ignores the result can look similar under final task accuracy. We introduce ToolFailBench, a diagnostic benchmark for measuring tool-use failures across 1,000 tasks in finance, medicine, law, cybersecurity, and real estate. Tool-required tasks return values the model wouldn't guess, forcing it to trust the tool while control tasks attach the same tools but should be answered directly. We label each trace with Tool-Skip, Result-Ignore, Output-Fabrication, and Unnecessary-Tool-Use, using a rule classifier and two LLM judges aggregated by majority vote. Across 19 headline models, the best reaches 86.33% Clean Tool-Use Rate, showing that faithful tool use is not saturated. More importantly, models with similar aggregate scores fail in different ways: most stay disciplined on no-tool controls, while Llama-3.1 models show an Always-Call pattern, and at the same parameter scale Llama-3.1-70B and Qwen2.5-72B differ by 89 percentage points on control-task accuracy. Tool-use evaluation should measure not only whether agents call tools, but whether they use tool outputs correctly and avoid tools when none is needed.

Large language models are increasingly deployed as agents that solve tasks by interacting with external tool environments. Although recent tool-use benchmarks increasingly cover complex task settings, they still largely assume clean, stable, and trustworthy tool environments, leaving tool-environment unreliability insufficiently examined. We introduce ToolBench-X, a benchmark for evaluating agents under recoverable reliability hazards. ToolBench-X contains executable multi-step tasks across diverse domains and sequential, parallel, and mixed workflows, each paired with deterministic tools and a canonical final answer for automatic evaluation. Starting from clean tool environments, ToolBench-X injects five structured hazard types: Specification Drift, Invocation Error, Execution Failure, Output Drift, and Cross-source Conflict. Crucially, each injected instance remains solvable through at least one valid recovery path, such as retrying, fallback, verification, or cross-checking. Experiments reveal a substantial reliability gap: agents that perform well with reliable tools often fail under recoverable hazards. Further analysis shows that failures are driven less by tool-use volume or inference budget than by limited hazard diagnosis and ineffective recovery. Targeted recovery hints recover many failed tasks, while test-time scaling yields more limited gains. These results suggest that tool-use evaluation should move beyond function-call accuracy toward task completion under unreliable tool environments. The code and data is available at https://github.com/Foreverskyou/ToolBench-X.