Job applications reviewed "until the position is filled" (i.e. soft deadline): What does that really mean?
"Review of applications will begin on Day X, and continue until the position is filled" is also translated as: 

We want you to get your application in on time, but if you're totes amazeballs and late we'll overlook it. 

The motivation is the same as what was mentioned. If you say that there's a hard deadline for submissions, and then Dr. Awesome Sauce applies a day later and gets hired, you're opening yourself up to a lawsuit from all the Dr. Not-So-Awesomes. 

Practically, academic hiring works on a calendar, and universities compete with each other. For example, in computer science it's rare to be making a first offer well into May unless you're at the University of I'm-So-Cool and know that you can afford to be last. And even then it doesn't always work. So practically speaking there's a deadline of sometime in March to make decisions on offers and start wooing your preferred candidates. 

This means that you can't realistically process a new application any later than early-mid February (because it takes time to collect references and organize a trip)