Identifying and Dealing with Conflicts

Attorneys are generally aware that conflicts are serious business. There are plenty of cautionary tales in the media, as many recent high-profile legal malpractice cases seem to have their roots in unresolved conflicts issues. However, by understanding the types of conflicts and how to resolve them, attorneys can minimize the risk of finding themselves in a conflict and unnecessarily losing work every time there is a suggestion of conflict.

The first thing to do is identify the type of conflict. They typically come in two forms: simultaneous representations and successive representations.

Simultaneous Representation

Probably the most obvious type of conflict is a simultaneous representation conflict, meaning that you are simultaneously representing two clients in the same matter. This can also occur when a firm gets a new client whose interests are opposed to those of another current client.

The rules about this are typically very strict, and the reason behind this is that when two clients have opposing interests, it could call into question an attorney’s loyalty to his clients.

Before declining to represent a client on account of a simultaneous representation conflict, attorneys can first analyze the situation and ascertain whether there is actually a conflict or not. This is a very fact-intensive analysis and in some cases, it can be a close call. Give the potential for automatic disqualification, attorneys should proceed with caution when there is potential for such a conflict.

Successive Representation

This type of conflict occurs when there is a conflict between the representation of a former client and the representation of a current one.

This type of conflict generally doesn’t have the same automatic disqualification rule partly because the primary concern is not that of loyalty to the client, as the relationship with one of the clients has already ended. The concerns, however, are with maintaining client confidentiality, as an attorney could use confidential information obtained while representing the former client, to their detriment and to the benefit of the new client.

As a result, when an attorney is faced with representing a client whose interests are adverse to the interests of a former client, the most relevant question to ask is whether any information obtained during the representation of the former client can be used in the representation of the new one. If the attorney did not and could not have learned any confidential information that could be used against the former client’s interests, then there will typically be no conflict.

Using the Conflicts Systems Effectively

For many attorneys, the first sign that there may be a potential conflict comes from their firm’s automated conflict checking system. Computers have proven to be very effective at checking for conflicts, but their accuracy depends on the information that is input into the system.

Additionally, such a system will be of little help if it is not used regularly. Attorneys will usually remember to run conflicts when a new matter comes in, but conflicts considerations might also arise at other times during a representation. This could happen, for example, when a new party becomes involved as a plaintiff, defendant, buyer, seller, etc.

How to Address Conflicts with Clients

Just because the system returns a conflict doesn’t mean the representation will be precluded. There are some situations where the rules will allow a representation even if a potential conflict may exist, provided that the lawyer makes the appropriate disclosures and obtains consent from the client. However, there are some conflicts of interest that clearly cannot be waived, such as when a law firm tries to represent both the defendant and the plaintiff in the same lawsuit.

Often times the most difficult decision a lawyer has to face is how to handle client relationships when there is a potential conflict. There are some clients which will not react positively when approached by their lawyer with a request for a conflict waiver. However, most clients today recognize that conflicts are sometimes inevitable, and their existence doesn’t necessarily mean a lack of dedication or loyalty from their lawyers.

Some client relationships, however, can still suffer even when the lawyer has determined that there is no legal conflict and thus no need for a conflict waiver. This could occur, for example, when a lawyer represents one of their client’s main competitors, thus creating a potential business conflict, even if not a legal one. That’s why lawyers can use their better judgement to determine whether they should notify other clients of the new representation, which can be subject to confidentiality obligations.

Lawyers can ensure that they don’t get into any trouble by combining a knowledge of the legal requirements with practical considerations.