Solicitors’ Practice (Conflict) Amendment Rule 2004
(1) (Introduction)
(a) This rule sets out provisions for dealing with conflicts of interest other than
those conflicts in relation to conveyancing, property selling or mortgage
related services which are dealt with in rule 6.
(b) This rule applies to a regulated individual and a regulated practice.
(c) Conflicts between the duty of confidence and duty of disclosure owed by an
individual or a practice to two or more clients are dealt with in rule 16E.
(2) (Duty not to act)
(a) You must not act if there is a conflict of interests (except in the limited
circumstances dealt with in paragraph (3)).
(b) There is a conflict of interests if:
(i) you owe, or your practice owes, separate duties to act in the best
interests of two or more clients in relation to the same or related
matters, and those duties conflict, or there is a significant risk that
those duties may conflict; or
(ii) your duty to act in the best interests of any client in relation to a matter
conflicts, or there is a significant risk that it may conflict, with your own
interests in relation to that or a related matter.
(c) For the purpose of paragraph (2)(b) above, a related matter will always
include any other matter which involves the same asset or liability.
(3) (Exceptions to duty not to act)
(a) You or your practice may act for two or more clients in relation to a matter in
situations of conflict or possible conflict if:
(i) the different clients have a substantially common interest in relation to
that matter or a particular aspect of it; and
(ii) all the clients have given in writing their informed consent to you or
your practice acting.
(b) Your practice may act for two or more clients in relation to a matter in
situations of conflict or possible conflict if:
(i) the clients are competing for the same asset which, if attained by one
client, will make that asset unattainable to the other client(s);
(ii) there is no other conflict, or significant risk of conflict, between the
interests of any of the clients in relation to that matter;
(iii) the clients have confirmed in writing that they want your practice to act
in the knowledge that your practice acts or may act for one or more
other clients who are competing for the same asset; and
(iv) unless the clients specifically agree, no individual solicitor acts for, or
is responsible for the supervision of, more than one of those clients.
(c) When acting in accordance with paragraphs (3)(a) or (b) above it must be
reasonable in all the circumstances for you or your practice to act for all those
clients.
(d) If you are relying on the exceptions in paragraphs (3)(a) or (b) above, you
must:
(i) draw all the relevant issues to the attention of the clients before
agreeing to act or, where already acting, when the conflict arises or as
soon as is reasonably practicable, and in such a way that the clients
concerned can understand the issues and the risks involved; and
(ii) have a reasonable belief that the clients understand the relevant
issues; and
(iii) be reasonably satisfied that those clients are of full capacity.
(4) (Conflict when already acting)
If you act, or your practice acts for more than one client in a matter and, during the
course of the conduct of that matter, a conflict arises between the interests of two or
more of those clients, you, or your practice, may only continue to act for one of the
clients (or a group of clients between whom there is no conflict) provided that the
duty of confidentiality to the other client(s) is not put at risk.
(5) (Accepting gifts from clients)
Where a client proposes to make a lifetime gift or a gift on death to, or for the benefit
of:
(a) you;
(b) any proprietor or employee of the practice; or
(c) a family member of any of the above
and the gift is of a significant amount, in itself or having regard to the size of the
client’s estate and the reasonable expectations of the prospective beneficiaries, you
must advise the client to take independent advice about the gift, unless the client is a
member of the beneficiary’s family. If the client refuses, you must stop acting for the
client in relation to the gift.
(6) (Public office or appointment leading to conflict)
You must decline to act where you, or another proprietor or employee in your
practice, or a member of your family holds some public office or appointment as a
result of which:
(a) a conflict of interests, or a significant risk of a conflict, arises; or
(b) the public might reasonably conclude that you, or your firm, had been able to
make use of the office or appointment for the advantage of the client; or
(c) your ability to advise the client properly and impartially is inhibited.
(7) (Waivers)
Notwithstanding Rule 17 of these rules, the Council of the Law Society shall not have
power to waive any of the provisions of this rule.”
