CONFLICT OF INTEREST: WHAT IS IT AND HOW TO AVOID IT

From lawyers to politicians, we expect a certain level of trustworthiness and service out of those that we trust with governance and law. The hope is that members of the legal and governmental institutions will use their powers for the benefit of society. However, there will always be the temptation to use influence for personal gains, goals, or satisfaction.

This is not always a clearcut case of corruption either. Figures of power may be put into positions where their personal lives and interests start to overlap with the execution of their duty. These kinds of situations can create a political or attorney conflict of interest.

For lawyers, there are also conflicts of interest that can arise not because of overlap with personal affairs, but because of the tangling of relationships with clients. For example, if you gain confidential information from a client, you cannot act against that client. You also cannot act against the interests of a current firm client.

As you can tell, this can become a complex quagmire of responsibilities and duty. We’ll discuss the concept of conflict of interest, and guidance on how to avoid it.

THE CONFLICT OF INTEREST ACT

For those interested in the topic of conflict of interest, the Conflict of Interest Act may have popped up in your searches. This act is designed to address conflict of interest in political figures in Canada but is still worth understanding.

The essential purpose of the Conflict of Interest Act is to attempt to better divide the public and private lives of public office holders in order to avoid potential conflicts of interest. You can read the entirety of the act here.

The Conflict of Interest Act is intended to prevent solicitation of money or gifts, unacceptable use of political power for favours, use of insider information, or otherwise using a public office for self-benefit.

What may be more interesting for attorneys is that the Conflict of Interest Act also prevents holding another job at the time of public office. There is, however, an exception is made when holding a job in order to maintain a license – but there must be no revenue made from this career while holding public office. If you are considering going into public office, this is something to consider.

TYPES OF CONFLICT OF INTEREST

For more day-to-day operations, attorney conflicts of interest will mainly revolve around their relationships with their client base and law firm. Failing to account for conflict of interest can lead to prohibitions, cases being thrown out, disqualification from acting or even legal action. Some examples of conflict of interest include the following:

Personal Interest: In general it’s a bad idea to involve yourself in legal action involving friends, family members, business partners, or any other client to which you have a personal connection and interest. It is clear that you would be influenced in this situation by the connection.

Conflicting Interest: You should not ever be representing both sides in the same conflict or issue. In a divorce settlement, for example, you should only represent one party to avoid an attorney conflict of interest.

Non-Represented Conflict of Interest: Just because you avoid taking on a client does not prevent the emergence of conflict of interest. If someone comes for you for a consultation, you need to make a record of any information shared. Take the divorce example above. If a party shared confidential information planning for a divorce but did not go through with it, any involvement with the other half of the divorce proceedings later would still be a conflict of interest.

Non-Client Conflict of Interest: Confidential information can cause an attorney conflict of interest even if your firm has absolutely no contact with that client. If you receive confidential information about someone (from an employer or other means), you should be expected to not act against that person in future legal actions.

Imputed Conflicts: Sometimes a conflict of interest doesn’t even arise from potential clients or individuals but from the movement of lawyers and attorneys themselves. If a lawyer represented a particular client at one firm with any form of legal services, then moves to another firm, their new firm may have a conflict of interest dealing with that client.

CONFLICT OF INTEREST IMPLICATIONS FOR ATTORNEYS

In many cases the only and final implication of a conflict of interest is this – you can’t take the case. However, there are some situations where such a conflict of interest can be managed.

If you find yourself in the position of possibly acting against a client or former client, you may be able to do so as long as you receive consent. In order to do this, you must disclose all of the implications of doing so to that client. You should get the consent in writing, and make sure to advise the client to see independent legal advice as well. Doing all this can allow you to waive the conflict of interest.

The Canadian Bar Association has also developed procedures to set up an “ethical screen”, to try and limit the amount of conflict caused by the presence of confidential information. Doing the research on this can allow you to potentially mitigate, if not eliminate, risk.

If you are looking for help with a criminal trial, you need an expert lawyer with experience in trial settings and who understands how to prepare clients for trial. William Jaksa has over ten years of criminal defence experience in Toronto. Contact him today for a consultation on your case.