Conflicts, Confidentiality and Disclosure

Question 1

What are the two types of conflicts of interest you will encounter in practice?

Answer 1

1. Own interest Conflict
2. Conflict of interest

Relating to the same matter or a related matter

Question 2

What are the differences between an own interest conflict and a conflict of interest

Answer 2

The first is a conflict between the solicitor/firm and the client. The second is a conflict between clients

Question 3

What is a related matter?

Answer 3

A matter related to the same asset or liability

Question 4

Will there be a conflict if there is a general business interest of the same type of business between two clients?

Answer 4

No, as long as the issues are different

Question 5

Can other solicitors act from the same firm where one solicitor is conflicted?

Answer 5

No, conflicts apply to the whole firm

Question 6

When should a solicitor consider conflicts of interest (i.e conflicts between clients)

Answer 6

At the start of the matter before the retainer is created

Question 7

You act for two people investing in a business (no conflict). Later on, one of the clients wants to increase their investment for greater control - has a conflict now arisen?

Answer 7

Yes

Question 8

What should you do if a conflict arises before the retainer?

Answer 8

Decline to act or only act for the client/s who they can best represent

Question 9

What should you do if a conflict arises after the retainer?

Answer 9

Inform all the clients and consider declining to act for all or some clients

Question 10

Can a client consent to a conflict of interest?

Answer 10

No

Question 11

What is a limited retainer?

Answer 11

When there is a conflict but you decide to act only on aspects where there is no conflict and advise the client to take independent advice on the conflicted area

Question 12

Can a firm decline to act if it thinks it will result in professional embarrassment?

Answer 12

Yes

Question 13

Give examples of an own interest conflict?

Answer 13

1. Financial interest in the client’s business
2. The client leaves you property in a will they want you to draft
3. Personal relationships
4. Commercial Relationship
5. Employment claim of former employee
6. Solicitors own conduct is in question

Question 14

Can you act for a client in drafting a will where the client will leave your brother very expensive jewellery?

Answer 14

Yes, if you are happy the client took independent legal advice with regards to the making of the gift

Question 15

Are there exceptions to own-interest conflicts?

Answer 15

Yes, if you are happy the client would not be undermined by the financial interest

Question 16

Can you advise a client on a matter against your mother?

Answer 16

No

Question 17

Can you advise a client on a matter where your commercial interest in a business is adverse to your client’s business

Answer 17

No

Question 18

Can you act for a client who was an employee of the firm and wants to bring an employment claim against the firm?

Answer 18

No

Question 19

Can you act for a client where you made a mistake in their matter and the client needs advice on how to rectify the losse arising from that mistake?

Answer 19

No, if one of the options is for the client to bring a claim against you for professional negligence

Question 20

Are there any exceptions to acting where there is an own-interest conflict?

Answer 20

No, it is an absolute bar

Question 21

What is a conflict of interest between clients?

Answer 21

When you owe duties to both clients in respect of the same or related matters and those duties conflict

Question 22

If your advice to one client would be different to your advice to another client involving the same matter, is there a conflict?

Answer 22

Yes

Question 23

What are the exceptions to the rule that you cannot act where there is a client conflict ?

Answer 23

1. Substantially common interest exception
2. Competing for the same objective exception

Question 24

What is the substantially common interest exception?

Answer 24

Clear common purpose and a strong consensus on how it is to be achieved

Question 25

What is the competing for the same objective exception?

Answer 25

Clients are competing for something which, if attained by one client will be unattainable by others. That thing can be an asset, contract, or business opportunity or non-public tender

Question 26

What are the conditions for relying on an exception to the rule that you cannot act where there is a client conflict?

Answer 26

1. Client gives informed written consent
2. You add safeguards to protect confidential information
3. It is reasonable for you to act for the clients