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Articles contributed by Lewis Silkin LLP
There are many situations where decisions are made by organisations such as local authorities (during the tendering process, the grant of contracts or planning decisions, for example) or professional or disciplinary bodies where a party may wish to challenge the outcome. A party with an interest in a decision may feel aggrieved by the outcome due to what appears to be a conflict of interest by those making the decision, or the appearance of bias. This may have serious consequences for in-house lawyers acting for organisations subject to such decisions, and therefore this briefing is intended to provide a general overview of the areas to consider. Challenging judicial or quasi-judicial decisions where there is a conflict of interest was considered by James Levy in a previous briefing (IHL146, p37-40).
The world of arbitration is small and the number of arbitrators limited. The arbitrator with the most appropriate experience and skills for resolving a dispute (especially in a specialist field) might have arbitrated an earlier dispute involving one of the parties, or acted as an adviser to one of the parties.
This month, we look at conflicts of interest in the context of the accountancy profession. First, we look at the common law rules relating to conflicts of interest between a firm and its existing and/or former clients. Then we consider the way accountants' professional rules may restrict an accountancy firm's freedom to provide different services to the same company.
We will be examining conflicts involving property and property transactions in this briefing, using some real examples from recent cases. To some extent, this brings together areas that we have considered in other articles in this series, but we think that it is interesting to look specifically at conflicts that arise in the property context and, in particular, the issues for solicitors and directors.
Every director owes a fiduciary duty to avoid conflicts between his own interests and those of the company. In addition, when the company is facing insolvency, its directors must have particular regard to the interests of its creditors, more so than to those of its shareholders.
The outcome of a court case can, and often does, turn on expert evidence. Selecting the right expert can therefore mean the difference between winning and losing. In view of the importance that expert evidence plays, and the potentially partisan way experts are instructed, the courts have become increasingly concerned about the conflict which some experts stumble into, ie between their duty to the court and their desire to assist those who have instructed and paid them.
Why is this briefing relevant to in-house lawyers? Imagine this scenario: you are head of legal at a major UK company that is involved in substantial litigation, which, at long last and great expense, is set for trial. On the Friday evening before trial, you discover that the assigned judge:
In this article, we deal with existing client conflicts. This briefing gives a quick refresher on the common law position and the new Law Society rules. We then turn to some real-life examples by considering two important cases in this area: Marks & Spencer Group Plc and another v Freshfields Bruckhaus Deringer and Hilton v Barker Booth and Eastwood (a firm). We conclude with a consideration of the special position of in-house lawyers and the situations where they may be in conflict with their existing client (ie their employer).
When a client’s retainer ends, the professional’s fiduciary duty to that client also ends. However, a professional owes a continuing duty to the former client to protect his confidential information. The duty survives the termination of the retainer, and applies to professionals such as forensic accountants as well as solicitors.
The long-awaited new Law Society rules on conflicts of interest and confidentiality came into force on 25 April 2006. They replace the old rules as set out in the Guide to Professional Conduct of Solicitors (8th edition) 1999.