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Ethics Committee Rulings: Perception of conflict

Every Issue

Cite as: May 2015 89 (5) LIJ, p.69

Ethical dilemmas are part of everyday practice for solicitors. The LIV Ethics Committee is available to help. 

Family law

Conflict of interest Rule 4
(R4847 – September 2014)
In family law matters the perception of a conflict of interest means that a law firm should not accept instructions from one of the parties to an unsuccessful mediation where the mediation was conducted by the spouse of the principal lawyer of that law firm and where that spouse was also employed in an administrative role by that law firm. This can be remedied by the spouse ceasing employment with the law firm.

The practitioner was the principal of a law firm and practised, inter alia, in the family law jurisdiction. The principal’s spouse was the part-time practice manager and managed accounts and marketing. The principal’s spouse was also a registered family dispute resolution practitioner and worked part-time for the local family relationship centre. The principal’s spouse conducted family mediations and issued certificates under s60I of the Family Law Act. The sole purpose of the certificates was to allow the parties to file a court application should the matter fail to settle at mediation. In these circumstances, where a couple had attended an unsuccessful mediation with the principal’s spouse, would the spouse of a party to the mediation be justified in claiming a conflict of interest if the principal of the law firm accepted an engagement to act as a lawyer from the other party to the mediation?

Ruling

In the opinion of the Ethics Committee and on the information presented:

The law firm should not accept as a client one of the parties to an unsuccessful mediation conducted by the principal solicitor’s spouse because of the perception of a conflict of interest;

If the principal solicitor’s spouse ceased employment with the law firm there could be no such perception and the firm would be free to accept such clients.

Wills and estates

Conflict of interest
(R4848 – September 2014)
Where two firms share premises and advertise that they are associated, they are not necessarily part of the same firm and so there is no conflict of interest if they act for opposing parties.

Firm A acted for the estate of the deceased, and for his widow. Firm B acted for the adult children from the deceased’s first marriage, who had previously consulted Firm C. Firm C occupied the same premises as Firm A, shared a waiting room and receptionist, and had on its letterhead and advertising that it was “in association with Firm A”. The matter to be decided was whether or not Firm C was a separate entity from Firm A, and if it was not, whether Firm A had a conflict of interest in continuing to act for the estate and widow in circumstances where it had previously acted for the adult children.

Ruling

In the opinion of the Ethics Committee and on the information presented:

Despite the advertised relationship, Firm C is not part of the firm Firm A; and

Firm A may continue to act for the estate of the deceased and for his widow as there is no conflict of interest in them doing so – there is no relevant confidential information involved, there is no duty of loyalty to a previous client and it is not apparent how the proper administration of justice would require Firm A to cease to act.

The ETHICS COMMITTEE is drawn from experienced past and present LIV Council members, who serve in an honorary capacity. Ethics Committee rulings are non-binding. However, as the considered view of a respected group of experienced practitioners, the rulings carry substantial weight. It is considered prudent to follow them. The LIV Ethics website www.liv.asn.au/For-Lawyers/Ethics.aspx is regularly updated and, among other services, offers a searchable database of the rulings, a “common ethical dilemmas” section and information about the Ethics Committee and Ethics Liaison Group. For further information, contact the ethics solicitor on 9607 9336.

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