SUCCESSIVE REPRESENTATION

Successive representation is covered by the Law Society rules under principle 15.02, namely ‘relevant confidential information’. It is stated that:

If a solicitor or firm of solicitors has acquired relevant confidential information about an existing or former client during the course of acting for that client, the solicitor or the firm must not accept instructions to act against that client.^[90]

This means that once a client imparts confidential information to a solicitor, it is very unlikely that the solicitor could act against that client in the future.

a solicitor in possession of confidential information concerning a client which is or might be relevant to another client, is put in an impossible position and cannot act against that client.^[91]

Consequently, if PP had told XYZ about their special procedure for processing pictures, that information might be relevant to SS and as a result XYZ would be placed in an ‘impossible’ position.

There is no time limit on when a firm ceases to owe a duty of confidentiality to a former client. The City Disputes Panel has argued that the duty to maintain confidentiality lasts indefinitely unless the information ceases to be confiden- tial.^[92] Thus the duty may survive long after any contractual or other business relationship has come to an end.^[93] Also, principle 15.02 applies to a solicitor or firm of solicitors. Therefore, if PP had imparted confidential information to Mr Smith, a solicitor in XYZ some years previously, and Mr Smith had subse­quently left the firm, XYZ would still be prevented from acting against PP.

There is an anomaly here within the notes attached to principle 15.02. The guidelines draw a distinction between a partner who changes firms and an assis­tant solicitor who does the same. Note 8 states:

Where a partner changes firm, the test to be applied before that firm may act against a client of the former firm is whether he or she personally has relevant confidential information. If challenged the burden of proof is on the solicitor to show that he or she has no confidential information.^[94]

Note 9 states:

Where an assistant solicitor changes firms and the firm he or she moves to is acting against a client of the solicitor’s former employer, that solicitor cannot act for the new firm’s client in that matter. The solicitor owes a duty of confidentiality to his or her former employer and former clients. The solicitor cannot use any information obtained about a former client to assist his or her new employer’s client. The new employer can continue acting for the client only if the solicitor can be adequately isolated from the matter.^[95]

In both cases, however, the original firm is prevented from acting against its for­mer client. This is difficult to justify given that some firms have over 1000 fee­earners and the person who managed the former client’s case may have left some time ago. The distinction between a partner and an assistant solicitor is perhaps more understandable. A partner may be privy to more information than an assistant solicitor as he will attend partners’ meetings at which on-going cases within the firm may be discussed.

This raises the question of the extent to which principle 15.02 reflects the common law in relation to former clients. It is sometimes the case that profes­sional bodies impose stricter rules on their members than the law dictates. There may be many reasons for this.^[96] The professional body may perhaps consider that the law does not give adequate guidance in respect of a particular area of regulation, or that problems have arisen in other professions which should not be allowed to occur in theirs.

In June 1911 Rakusen sought advice from Munday, a partner in the firm of solicitors Ellis, Munday & Clarke, concerning a possible claim for wrongful dis­missal against his former employers. As a result, Munday was given sensitive and confidential information. The Plaintiff then changed solicitors and the mat­ter was referred to arbitration. Clarke, the other partner in the Defendant firm, was appointed to act by the Plaintiff’s former employers. Clarke was unaware that the Plaintiff had been a client of the firm. From the evidence adduced, it was clear that Clarke knew nothing about the Plaintiff’s consultations and that Munday and Clarke usually conducted business separately without any know­ledge of the other’s clients. In addition, the firm undertook to ensure that only Clarke participated in the proceedings. Nevertheless, the Plaintiff still sought an injunction to prevent the Defendant firm from acting for his former employers. The Plaintiff lacked confidence that Munday would not, either voluntarily or involuntarily, divulge information which had been conveyed to him.

The Court of Appeal was unanimous in stating that

there is no general principle that a solicitor who has acted for a client in a particular matter cannot, under any circumstance, act for the opposite party in the same matter.

The Court added that ‘it depends on the circumstances of each case.’^[98] Their Lordships each set out a test to determine the circumstances in which a solicitor should be prevented from acting for a later client.

Cozens-Hardy MR held that:

We must be satisfied that real mischief and real prejudice will in all human probabil­ity result if the solicitor is allowed to act.^[99]

Fletcher Moulton LJ provided a slightly wider test, namely:

As a general rule the Court will not interfere unless there be a case where mischief be rightly anticipated.

Buckley LJ stated:

The whole basis of the jurisdiction to grant the injunction is that there exists, or, I will add, may exist, or may be reasonably anticipated to exist, a danger of a breach of that which is a duty, an enforceable duty, namely, the duty not to communicate confiden­tial information; but directly the existence or possible existence of any such danger is negatived, the whole basis and substructure of the possibility of injunction is gone.^[101]

In summary, the tests proposed were:

—Probability of real mischief and prejudice (Cozens-Hardy).

—Reasonable anticipation of mischief (Fletcher Moulton).

—Danger that the duty of confidentiality will be broken (Buckley).

On examining the evidence, the Master of the Rolls found no mischief or preju­dice and accepted that none would arise in the future, as the Defendant solici­tors had given an undertaking that only Clarke would participate in the proceedings and that Munday would not disclose any information concerning the Plaintiff.^[102] Fletcher Moulton LJ was of a similar view, finding ‘an absolute absence of any reasonable probability of mischief whatever’.^[103] Buckley LJ agreed that, in light of the solicitors’ undertaking, the danger of communicating confidential information was eliminated.

Perhaps unfortunately, it was not made clear in Rakusen which of their Lordships’ tests was the correct one to follow. Although the decision was unan­imous, the tests differed from one another. Furthermore, their Lordships’ tests are much less strict than the ‘relevant information’ test subsequently laid down by the Law Society in principle 15.02.

1. The Rationale Behind the Law Society’s Rules

The current rules governing conflicts of interest were adopted by the Law Society in 1986. Between the decision in Rakusen and the Law Society’s framing of these rules, the matter had not been differently decided before another court.^[104] Rakusen had not been overruled. Why then did the Law Society choose to adopt a stricter test?

The most compelling explanation for the adoption of principle 15.02 lies in two further principles of professional conduct. These are:

1. A solicitor is usually under a duty to pass on to the client and use all informa­tion which is material to the client’s business regardless of the source of that information;^[105]

and

2. A solicitor is under a duty to keep confidential to his or her firm the affairs of clients and to ensure that the staff do the same.^[106]

Thus, according to principles 16.06 and 16.01, if a solicitor has information about a former client which is relevant to an existing client, he cannot pass all relevant information to one client without breaching his duty of confidentiality to the former client. These rules in turn reflect the basic principles laid down in Rule 1.^[107]

To suggest that the Law Society’s guidelines governing conflicts of interest are stricter than the common law because the Law Society’s own rules require such strictness does not, in itself, take one very far. Why are the rules framed with such scrupulousness? In fact it is often the case that professional bodies impose stricter rules on their members than the law dictates.^[108] In promoting the profes­sionalism of its members, one of the most important considerations for the Law Society is the solicitor-client relationship. As a previous President observed: ‘It is only through the maintenance of high standards... that justice will be served, the public will be protected and the profession as a whole will thrive.’²⁸ It is considered to be of fundamental importance that a client has full confidence in his solicitor and, therefore, all rules relating to a purported conflict must be completely clear and protective of the client’s interest.

The solicitor-client relationship is perhaps the Law Society’s primary consid­eration when drawing up rules and principles of professional conduct.³¹ It is of fundamental importance that a client has trust in his solicitor and can be confi­dent that his interests will be safeguarded. It is doubtful whether a client would have such confidence if his solicitor were in a position subsequently to use confidential information for the benefit of another.

The question of confidence aside, the solicitor owes a fiduciary duty to his client.³² A fiduciary can be defined as a person who holds a position of trust or confidence with respect to someone else and who is obliged to act solely for that person’s benefit.³³ Fiduciary relationships include those between trustees and their beneficiaries,³⁴ directors and their companies,³⁵ guardians and their wards,³⁶ accountants and their clients³⁷ and bankers and customers.³⁸ The nature and exact extent of fiduciary duties in relation to other professions will be discussed in more detail in chapter 3. For present purposes it is sufficient to say that the whole of chapter 15 of the Guide to the Professional Conduct of Solicitors reflects equitable principles in that:

A fiduciary

a) cannot misuse his position, or knowledge or opportunity resulting from it, to his own or to a third party’s possible advantage;

²⁸ M Sheldon, President of the Law Society, in his Foreword to The Guide to the Professional Conduct of Solicitors, 6th edn (Law Society Publishing, London, 1993) at xiii.

²⁹ ‘The first thing we do, let’s kill all the lawyers’, King Henry VI, Part III, I.iv. 137; also R Samborn, ‘Anti-lawyer attitude up’, (1993) National Law Journal at Table 1; C Sampford, Legal Ethics and Legal Practice (Clarendon Press, Oxford, 1990) at 13; H Kirk, Portrait of a Profession (Oyez Publishing, London, 1976) at vii; and MH McCormack, The Terrible Truth About Lawyers (Collins, London, 1987) at 9: ‘In the general view, lawyers are a clubby group who, with the benefit of an arcane body of knowledge and under the smokescreen of an elaborate system of professional courtesies and rituals, look out for their own—at the expense of the rest of us.’

³⁰ GC Hazard, Ethics in the Practice of Law (Yale University Press, Yale, 1978) at xiii.

³¹ See for example, Swain v The Law Society [1982] 2 All ER 827 at 830.

³² See Corderys Law Relating to Solicitors, 6th edn (London, Butterworths, 1968) and Parry- Jones v The Law Society [1969] 1 Ch 1.

³³ See J Glover, n 5 above at 6.

³⁴ See JC Shepherd, The Law of Fiduciaries (The Carswell Company, Toronto, 1981) at 23.

³⁵ Regal (Hastings) Ltd v Gulliver [1967] 2 AC 134.

³⁶ Hatch v Hatch (1804) 9 Ves 292.

³⁷ Evitt v Price (1827) 1 Sim 483.

³⁸ Lloyd’s Bank v Bundy [1974] 3 All ER 757.

b) cannot, in any matter falling within the scope of his service, have a personal inter­est or an inconsistent engagement with a third party;

unless this is freely and formally consented to by the beneficiary or is authorised by law.^[109]

Imposing a fiduciary duty, therefore, is meant to ensure that persons in a posi­tion of trust do not misuse information to their advantage or to the benefit of a third party.

Their Lordships specifically recognised these duties in Rakusen, observing that ‘the law says... you shall not disclose or put at the service of your new employer the secrets that belong to your old employer’^[110] and that the solicitor­client relationship is such that in this respect the law can ‘fix a standard for the behaviour of its own officers which is higher than it would be practicable to extract from persons in other types of confidential relations.’^[111] Nevertheless it was held that each case would depend on the facts given and that there was no general principle that a solicitor who acted for a client in a particular matter could not subsequently act for the opposite party in the same matter. In Rakusen the court did not question the professional integrity of the solicitors involved and there appeared to be no suggestion that they would allow commercial con­siderations to impinge on their professional responsibilities. However, the mod­ern-day Law Society is responsible for regulating the profession in a somewhat different climate,^[112] one in which all professions are subject to more searching scrutiny, and the voice of the ‘consumer’ figures prominently.

2. Endorsement of Rakusen

In the year following the adoption of the Law Society rules, two major develop­ments took place in the area of conflicts of interest. First, the question of which test should be followed arose in another case.

In 1987 Hoffmann J in Re a Solicitor^[113] appeared to support the reasoning of Fletcher Moulton LJ, namely, that the question facing the court was whether mischief was rightly anticipated. Although the conflict concerned two existing clients rather than a current and former client, the reasoning used by Hoffmann J was based on the Rakusen decision. The applicant had employed a firm of solicitors for over 10 years, although at the time of the application he had merely instructed them to handle the probate of his father’s estate. The firm also acted for O, who was a director of a large public company of which the applicant had formerly been managing director. The company was being investigated by a government department and O gave evidence that was hostile to the applicant. The parties’ interests were, therefore, in conflict and the applicant objected to the fact that the respondents were acting for O. However, Hoffmann J, apply­ing Fletcher Moulton’s reasoning, concluded that there would not be any real risk of prejudice to the applicant if the firm were to continue to act for O.

A second key development followed when the Law Society introduced an exception to the rules governing conflicts of interest. Although this exception related to existing rather than former clients, the Law Society appeared to accept the ruling in Rakusen. In note 3 of principle 15.03, the Guide now states that solicitors may continue to act in a conflict situation following the amalga­mation of two or more firms, provided they erect a ‘Chinese wall’.^[114] Upon amal­gamation, the clients of the former two firms automatically become clients of the new firm. If the interests of the clients of the new firm conflict, the firm must cease to act for both clients unless the firm is able to establish one of two things. First, if the firm is able to show that no confidential information has been obtained whilst acting for one of the clients, then it may continue to represent the other. The other option for the amalgamated firm is to erect a ‘Chinese wall.’

A Chinese wall is a procedure

for restricting flows of information within a firm to ensure that information which is confidential to one department is not improperly communicated (and this includes inadvertent communication) to any other department within the... firm.^[115]

In other words, the firm must ensure that the department advising the first client is separated from those other members of the firm who are advising the second client. Moreover, care must be taken to prevent any accidental spillage of information and to ensure that the two departments remain isolated from each other.^[116]

It must be stressed that the Guide provides that such a device may be used only where two or more firms of solicitors amalgamate, and then only in ‘excep­tional circumstances.’^[117] The Law Society rules conceive that those situations will indeed be rare and will reflect circumstances where it is in the best interests of the respective clients for the amalgamated firm to continue to act for one or, possibly, both.^[118]

Any Chinese wall erected in these circumstances has to be effective, and the following must apply:

a) both clients must have consented (if one does not, that must be an absolute bar to the firm acting for either);

b) it must be in the client’s best interest that the new firm continues acting despite the conflict of interest;

c) there must be no embarrassment to the solicitors, who must not favour one client to the detriment of the other; and

d) the clients must have the risks fully explained.⁴⁹

The rules stress that the purpose of the wall is to preserve confidentiality in relation to the affairs of each client. To this end, the following (minimum) safeguards must be in place:

If acting for both clients, the relevant personnel must adopt appropriate guidelines.

If acting for both clients, complete physical separation into different rooms should be made (as far as can reasonably be achieved) of:

a) all papers relating to each client; and

b) all property relating to each client; and

c) all personnel dealing with each client.⁵⁰

It is debatable why the Law Society introduced the idea of the Chinese wall into the rules.⁵¹ It may have been in response to the changing economic climate and the impact of this upon the profession, this being a period when significant num­bers of law firms opted to merge with one another.⁵² It is noteworthy, however, that although the exception relates to existing clients, effectively all that the Law Society has done is to approve the conduct of the solicitors in the circumstances that pertained in Rakusen. Although in 1912 their Lordships were not familiar with the term, what they had identified in the Rakusen case was the existence of a Chinese wall. Effectively, Munday and Clarke separated all information and personnel relating to their respective clients and ensured that confidential information known by one partner would not be communicated to the other. The only differences were that the Rakusen case involved litigation and, second, that it did not follow the amalgamation of two firms.

⁴⁹ The Guide, 8th edn, Annex 15A, at 322.

⁵⁰ The seventh edition of the Guide placed a further restriction upon the amalgamated firm in that the new firm could not continue to act for both clients where the matter was subject to litiga­tion (see note 7, Annex 15A at 282). This restriction has now been removed. The idea of a Chinese wall was introduced by the Law Society in May 1987. The guidelines were revised in February 1999. It is interesting to note that prior to the seventh edition of the Guide, the Law Society’s view was that Chinese walls were to be used extremely rarely. However, provided that a firm could overcome the problems with separation and embarrassment, in principle, a wall could be used for litigation.

⁵¹ Law Society minutes were inspected at the Law Society library but no discussion was recorded as to the reason behind the introduction of Chinese walls.

⁵² See for example RL Abel, ‘Comparative Sociology of Legal professions’, in RL Abel and PSC Lewis (eds), Lawyers in Society Volume 3—Comparative Theories (University of California Press, Berkeley, 1989) at 122 to 125, and C Rose, ‘Clifford Chance The Merger That Worked’, (1997) 15 Commercial Lawyer 32.

This raises the question of why the Law Society does not allow the possibil­ity of Chinese walls in other circumstances found with growing frequency in modern legal practice.

3. Is Rakusen Applicable to Modern Practice?

The decision in Rakusen has been heavily criticised by some commentators and rejected by other commonwealth countries.^[119] Finn describes the judgment as ‘untenable today’, stating that it should be allowed to ‘sink into oblivion’. According to Finn, the ‘vices’ of Rakusen are four-fold:

—First, it was formulated when our law of breach of confidence was in an embryonic state. In particular it paid no heed to the now well accepted phenomenon of ‘uncon­scious plagiarism’ or unconscious use of information;

—Secondly, with the onus now being on the former client to prove not merely that his former lawyer acquired information in confidence but also that there is a real like­lihood that some or all of that information will be misused, the Rakusen ruling does in effect ‘tear aside the protective cloak drawn about the lawyer-client relationship’ and undermines the policy ensuring both client secrecy and the related doctrine of legal professional privilege;

—Thirdly, if as is well accepted, a solicitor cannot pray in aid a duty of confidence to justify his non-disclosure to his client of relevant information he possesses, then the assumption underlying the Rakusen rule conflicts with the duty of lawyer to his second client, namely to put at that client’s disposal not only his skill but all of his relevant knowledge;

—Fourthly, and consistent with the guarantee of legal professional privilege, the rule adopted must eliminate the apprehension a client might have that disclosures he may make to a lawyer might somehow become available to third persons. To allow that apprehension is to prejudice the possible utilisation of legal services.^[120]

Other commentators have observed that the decision was made some 85 years ago when telephones were rare, and telexes, faxes, photostat machines, com­puter links and the like were unknown.^[121]

In response, several points can be made. First, although the law of breach of confidence may have been in an embryonic state, the Master of the Rolls, Cozens-Hardy, recognised that such problems could exist, stating:

I do not doubt for a moment that the circumstances may be such that a solicitor ought not to be allowed to put himself in such a position that, human nature being what it is, he cannot clear his mind from the information which he has confidentially obtained from his former client.^[122]

The judges in Rakusen were merely maintaining that there was no general prin­ciple that a solicitor who has acted for a client in a particular matter could not, under any circumstances, act for the opposite party in the same matter. They stressed that it depended on the circumstances pertaining in each case.^[123] The ‘unconscious use of information’ is not something which will alter this general principle. It may be a factor which will be taken into consideration in deciding the outcome of a particular case, but the recognition of such a phenomenon does not mean that an effective Chinese wall can never be erected.

The next issue raised by Finn concerns solicitor-client confidentiality. He con­tends that the former client, in proving his case, will be placed in a position where he is almost bound to reveal the precise nature of the confidential information which he fears may be disclosed. However, this may not be a true reflection of what actually happens at the hearing. For example, in Rakusen all we learn about the information in question is that the client ‘gave him much confidential information in regard to the matters in dispute between him and the company.’^[124] Whilst it is conceivable that, in some cases, the court will have to examine what was actually said to the former solicitor, there are a number of ways of overcoming such difficulties. One would be to hold the proceedings in camera.

Finn’s third argument seemingly has the most weight. How can a solicitor dis­charge his duty to the second client if he is unable to make available all relevant information? Sole practitioners may indeed be faced with substantial problems and would be unwise to act. Yet is it reasonable to impose the same restrictions upon multi-partner firms? There is no obvious reason why different partners in the same firm cannot act against former clients if the firm preserves confiden­tiality. It has also been argued that it is ‘artificial and unrealistic’ to suggest that the knowledge of one partner must be imputed to another, and that client A is entitled to all of the information that is known to the partner acting for client B.^[125]

Finally, the argument that Rakusen should not apply because modern techno­logy has made it easier to disclose information is surely questionable. Modern technology may have made the transfer of information faster, but this does not mean that an effective Chinese wall cannot be maintained. If solicitors could be trusted to maintain such a device in 1912, why doubt their integrity today? Any solicitor making disclosures would face disciplinary proceedings and the possi­bility of very heavy penalties. Moreover, it could be argued that modern techno­logy may assist the erection of a Chinese wall. Computer programmes can be protected with passwords, and rooms containing confidential information can be made secure through granting access only to personnel who have the neces­sary codes.

It may therefore be argued that, provided Chinese walls are properly maintained, the decision in Rakusen is both correct in law and offers a practical solution to some of the problems experienced by solicitors today.^[126] The reason­ing adopted by the court requires that high standards of professional behaviour be maintained, while at the same time it attempts to ensure that the best interests of the clients are served.

Nevertheless, given that the Law Society prohibits the use of Chinese walls as a means of enabling firms to act against former clients, and that it is reluctant to regulate practice along the lines proposed in Rakusen, it is debatable whether a firm today could successfully rely on a Chinese wall, or on the Rakusen case itself, when defending its decision to act in the face of conflict.

4. Rakusen and the Chinese Wall

Use of the Chinese wall was judicially recognised in 1991 in the case of Supasave Retail Ltd. v Coward Chance; David Lee & Co (Lincoln) Ltd v Coward Chance.^[127] Moreover, it appeared that Fletcher Moulton’s formulation in Rakusen was the preferred test. Sir Nicholas Browne-Wilkinson followed what he believed to be Hoffmann’s reasoning from Re a Solicitor (1987).^[128] The case involved the amalgamation of two firms of solicitors, one situated in London, the other in Sheffield. Prior to the amalgamation the firms were acting for opposing sides in litigation involving a fraudulent breach of trust by the plain­tiff company’s directors. One of the clients wished to retain the services of the merged firm because the partner who had represented them throughout had extensive knowledge of the case. The other client, however, objected to this and refused to give consent on the grounds that some of the partners of the merged firm had previously advised them on matters which had a bearing on their defence. In order to continue to represent their client, the merged firm under­took to keep separate and confidential the information which they had con­cerning the two earlier cases. Furthermore they gave an assurance that if any sensitive information from one side reached the other, they would either cease to act or would apply to the court for directions. They also contended that there was minimal opportunity for any leakage of sensitive information since the ear­lier cases had been managed separately, using offices in different parts of the country.

Sir Nicholas Browne-Wilkinson, VC, acknowledged that there was some dif­ficulty in deriving a definite test from Rakusen. He therefore relied heavily on Hoffmann J and said that ‘... the test [as to whether] mischief was rightly antic­ipated... seems to me to be a fair expression of what the court has to look for.’^[129] He concluded that as no detail had been given as to how the firm was organised, or who was aware of the confidential information, and that as no concrete steps had been taken to ensure that staff were aware of the sensitive nature of the issues, the risk of leakage of information had not been eliminated.^[130] Accordingly he decided that it would not be lawful for the amalgamated firm to continue to act. Although a wall was not successfully erected in this case, the Vice­Chancellor recognised that there was no general rule prohibiting a firm from acting for both sides.

It seemed, however, that the question of which test should be followed had still not been settled. In 1992, in Re a Firm of Solicitors,^[131] it transpired that the edited report of Re a Solicitor did not accurately reflect what Hoffmann J had said. Rather than relying on a passage from Fletcher Moulton LJ, he had in fact used a passage from the Master of the Rolls, Cozens-Hardy.^[132] The effect of this was that Hoffmann J’s decision and Vice-Chancellor Browne-Wilkinson’s reasoning were mutually inconsistent. So in Re a Firm of Solicitors the Court of Appeal was left once again with the task of determining which of the three Rakusen tests to apply, or indeed whether some other test was more appropriate.

The test propounded by Cozens-Hardy MR was unanimously rejected. Parker LJ stated:^[133]

I have no hesitation in rejecting the test... If adopted it would seem to me to enable a firm which had acted for client A in one matter thereafter to act for client B against client A in the same or a related matter provided only that there were undertakings.

Likewise, the test suggested by Fletcher Moulton LJ was thought by Parker LJ to be too limited, as it did not cover such matters as the nature of the mischief, or by what standard one considers whether mischief was rightly anticipated.^[134] He suggested that Buckley LJ’s test of whether ‘there may reasonably be antici­pated to exist a danger’ of breach of duty not to communicate information was the most useful, adding that the proper approach is to consider whether a rea­sonable man informed of the facts might reasonably anticipate such a danger. In his opinion this approach had the advantage of addressing over-sensitivity on the part of the objector whilst at the same time maintaining public confidence in the process of litigation.

Sir David Croom-Johnson was of the same view, stating that the court would act if danger of a breach of duty might reasonably be anticipated.^[135] However, Staughton LJ thought that Fletcher Moulton LJ’s test was the correct one, namely: ‘whether there is or is not a reasonable anticipation of mischief.’⁷⁰

Their Lordships’ respective tests were then applied to the facts. The case con­cerned a large and well-known firm of solicitors which had acted for a group of companies and their subsidiaries in litigation arising out of the Lloyds scandal. Some five years later, and with the group no longer a client, the same firm was instructed to defend one of the parties who had been closely associated with the other side in the original case. The claim was being brought by subsidiary com­panies of the original client. The solicitors in question offered to erect a Chinese wall, proposing that all documents relating to the previous case be put in stor­age, that no-one who appeared in the first case would take part in the second, and that those who would be or had been involved in the two cases would not communicate with each other during the proceedings.⁷¹

Parker LJ was not satisfied with these measures. He concluded that:

Any reasonable man with knowledge of the facts... including the proposals for a ‘Chinese wall’, would consider that some confidential information might permeate the wall and would indeed regard it as astonishing that the plaintiffs should be faced with solicitors on the other side to whom, over a considerable period, they had forwarded much confidential information concerning matters being investigated in the main action.⁷²

Moreover, he added:

Save in a very special case such as Rakusen’s case, I doubt very much whether an impregnable wall can ever be created... In the very particular circumstances of Rakusen’s case the undertakings given, coupled with the retainer being not of the firm but of Mr. Clarke personally, afforded an impregnable barrier against leakage or mis­use of information... The situation here is very different. The firm is a very large one and it acted for three years in a matter which attracted great public interest and much discussion in the legal profession and in the insurance world.⁷³

Thus, whilst Parker LJ appears at first to adopt the approach laid down in Rakusen, namely that the court should intervene only when there may reason­ably be anticipated to exist a danger of a breach of duty, when he applied the test to the facts his conclusion was substantially different from that arrived at in Rakusen. His view that Chinese walls would hardly ever be effective is perhaps another way of saying that the court will automatically raise a presumption that a risk exists and it will then be up to the solicitors to establish that the circum­stances amount to a ‘special case.’⁷⁴

⁷⁰ Ibid, at 366.

⁷¹ Ibid, at 367 and 369.

⁷²Ibid, at 363.

⁷³Ibid.

⁷⁴ This should be compared to the comments of Lord Donaldson in Watkinson v Legal Aid Board [1991] 2 All ER 936, where he states ‘In cases where people seek to sue the Legal Aid Board, the board has very properly instituted a system of Chinese walls, and these are real Chinese walls as opposed to the artificial variety which we sometimes experience. There has accordingly, and very properly, been absolutely no communication...’

Sir David Croom-Johnson agreed with Parker LJ and added:

There is no analogy to be drawn from the two-man firm in Rakusen’s case to a large firm of 107 partners and obviously a correspondingly large staff of executives and other employees. The reasonable man would recognise the existence of a risk of use of the earlier information no matter what steps the firm had taken to protect it.^[136]

Staughton LJ, however, dissented, saying that the test was whether there is or is not a reasonable anticipation of mischief and, having regard to the measures which the solicitors had taken to ensure that information remained confidential, he concluded that there were no grounds for supposing that mischief was rightly anticipated.^[137] More fundamentally, he stated:

I cannot detect... any authority for the proposition that a large law firm of many part­ners is obliged to disclose to each client any knowledge relevant to his affairs that may be possessed by any of its partners or staff. Nor do I think it is right to enlarge the law to that extent... There has no doubt been a change in the way that many solicitors practise since 1912. In [Rakusen] Mr. Munday and Mr. Clarke were the only partners in the firm; they were in the habit of doing business separately and without any knowl­edge of each other’s clients, and each of them had the exclusive services of some of their clerks. There are, of course, still sole practitioners or small firms today. But there are also giants with 100 partners and more, employing large numbers of assistant solicitors and articled clerks... It seems to me impracticable and even absurd to say that they are under a duty to reveal to each client, and use for his benefit, any know­ledge possessed by any one of the partners or staff. I would not hold that to be the law.^[138]

It is Staughton LJ’s dissenting judgment which is closest to Rakusen, both in wording and application, although the majority also claimed to follow that early case.

5. Applying the Principles

For some years it was thought that the matter had been resolved. Following Re a Firm of Solicitors (1992),^[139] it seemed that a solicitor could not act against a for­mer client if the firm had prior to that received relevant confidential informa­tion. This seemed to be the case even if a Chinese wall were attempted, given that the courts doubted whether an impregnable wall could ever be created. Thus, while the courts paid lip service to the principle laid down in Rakusen, namely that there is no general principle prohibiting a firm from acting against a former client, in practice they were unwilling to support this proposition. Moreover, although the judges admitted that the Guide to Professional Conduct was stricter than the general law,^[140] it appeared that they did not wish a less rig­orous approach to be applied by the court.

Therefore, when in 1995 Lightman J was faced with a case involving a con­flict of interest,^[141] he followed the reasoning of the Court of Appeal in Re a Firm of Solicitors (1992). The facts of the case are worthy of repetition as they involve a different circumstance from those seen thus far, namely that of a partner moving firms. Lightman J’s judgment is also noteworthy for its clear summary of the law.

The plaintiffs were involved in substantial international patent litigation in the United States. They had retained a firm of English solicitors, specialists in intellectual property law, to act for them in the United Kingdom. The first defendant was a partner in the intellectual property department of that firm, but was not involved in the plaintiffs’ litigation. After 11 months the first defendant left the firm to become head of the intellectual property department of another firm of solicitors. Some two-and-a-half years later one of the defendants in the patent litigation instructed the new firm. There was evidence that although con­fidential information relating to the plaintiff’s litigation was available to the first defendant through general office conversation, none was in fact communicated to him. The plaintiffs did not challenge the first defendant’s integrity and good faith but they were concerned that although he had no present recollection of any relevant confidential information, he might in fact have received some and its recollection could be triggered by future events, thereby giving rise to a real risk of prejudice to the plaintiffs.

Lightman J concluded that the law regulating the freedom of a solicitor to act against a client for whom he (or his firm) had previously acted reflected a need to balance two potentially conflicting public interests. First, there is the right of that client to the fullest confidence in the solicitor whom he instructs. This requires that there shall be no risk or perception of a risk that confidential information relating to the client or his affairs will be disclosed to anyone else. Secondly, there is an interest in allowing solicitors freedom to obtain instruc­tions from any member of the public, and in members of the public being able to instruct solicitors of their choice. In every case these two interests must be weighed against each other. There must be good and sufficient reason to deprive the client of his chosen solicitor, or the solicitor of the client. Lightman J analysed the position which had been reached by English law as follows:

1. The basis of the courts’ intervention is not a possible perception of impropriety: it is the protection of confidential information.

2. In view of the special importance of the relationship of confidence between solici­tor and client and of the fact that the solicitor is an officer of the court, the court is particularly sensitive to the need to afford the fullest and, where required, special protection to such confidential information.

3. Confidential information passing between solicitor and client and otherwise acquired by a solicitor on behalf of his client may, like any other confidential information com­municated to anyone else, subsequently cease to be confidential. Confidential docu­ments and information may become common knowledge or at least known to an opponent in the course of a trial. Some information may be memorable and some emi­nently forgettable. Common sense requires recognition that not all confidential information acquired by a solicitor will remain in the mind of the solicitor or be sus­ceptible of being triggered as a recollection after the lapse of a period of time. For the purpose of the law imposing constraints upon solicitors acting against the interests of former clients, the law is concerned with the protection of information which (a) was originally communicated in confidence, (b) at the date of the later proposed retainer is still confidential and may reasonably be considered remembered or capable, on the memory being triggered, of being recalled and (c) relevant to the subject matter of the subsequent proposed retainer. I shall refer to information that satisfies these three qualifications as ‘relevant confidential information’.

4. (a) A solicitor at one time retained by a client, but not in possession of relevant con­fidential information, is not by reason of the fact of such past retainer precluded from subsequently acting against him; (b) a solicitor possessed of relevant confi­dential information is precluded from acting against his former client; (c) in the case of a firm previously retained by a client: (i) the members of the firm, whether partners or employees, who are in possession of relevant confidential information are likewise subject to such a constraint, whether they remain with the firm or prac­tise elsewhere; (ii) the members who are not in possession of such information (a) are free from such restraint once they have left the firm and are practising else­where, (b) so long as they remain with the firm are undoubtedly precluded from so acting if the court considers there is a real, as opposed to fanciful, risk of a com­munication to them of any such relevant confidential information by those within the firm possessed of it and may possibly be precluded in any event even if there is no such risk save in exceptional circumstances.

5. On the issue of whether the solicitor is possessed of relevant confidential informa­tion: (a) it is in general not sufficient for the client to make a general allegation that the solicitor is in possession of relevant confidential information if this is in issue: some particularity as to the confidential information is required. But the degree of particularity required must depend upon the facts of the particular case, and in many cases identification of the nature of the matter on which the solicitor was instructed, the length of the original retainer and the date of the proposed fresh retainer and the nature of the subject matter for practical purposes will be sufficient to establish the possession by the solicitor of relevant confidential information. (b) It may readily be inferred that confidential information is imparted to members of the firm having the conduct of the client’s matter. Such information may, however, be imparted to other members in the course of partnership meetings or social meetings of members of the firm. (c) The court attaches weight to the evidence of the solicitor as to his state of knowledge and whether he has received confidential information, in particular where there is no challenge to his integrity and credibility.

Accordingly Lightman J adopted the reasoning of the Court of Appeal In Re a Firm of Solicitors (1992),⁸¹ concluding that

⁸¹ [1992] QB 959.

the members of the firm wishing to act against a former client are disqualified from so acting if there is any real risk of subsequent communication to them of relevant confi­dential information by members of the same firm possessed of such information; and the same strict test (i.e. the need to establish the absence of any real risk) is appropri­ate in determining whether the solicitor is already possessed of such information.^[142]

He decided that on the facts before him there was no risk. The former partner had satisfied the court that there was no real possibility that confidential information was ever communicated to him and that there was therefore no risk that his memory would be triggered. No injunction was therefore given to the plaintiffs. He added that

if stricter rules are thought desirable and greater limitations on the freedom of solici­tor are thought necessary... avenues are available. The Law Society may adopt such a rule of conduct to this effect if it thinks this appropriate.^[143]

It seemed, therefore, that the position in relation to former clients was now set­tled and only where it could be shown that there was no real risk of prejudice to a client could a firm act. Chinese walls were seen as insufficiently secure to elim­inate such risks. However, in November 1998 the House of Lords finally had an opportunity to address the issues raised by Rakusen.

6. Reconsideration of Rakusen Eighty Years On

The extent of the interest in the House of Lords’ decision in Prince Jefri Bolkiah v KPMG,^[144] prompted one commentator to observe:^[145]

A few weeks ago a sign appeared in the front window of one of the legal bookshops, advertising copies of the judgment in the Prince Jefri case. It is rare indeed that a judg­ment has attracted such attention.^[146]

What attracted so much attention was the possibility of the Lords adopting a more relaxed attitude towards Chinese walls. Although the case concerned not a firm of solicitors but an accountancy firm (KPMG), comparison was made with the position of solicitors as there were no authorities dealing with the duties of accountants when acting in a forensic capacity.

KPMG was asked by the Brunei Investment Agency (BIA) to investigate Prince Jefri, a former chairman of the BIA, following a family dispute between the Prince and his brother, the Sultan. From its establishment in 1983, BIA had instructed KPMG to undertake the annual audit of its core funds. In addition KPMG carried out advisory and consultancy work for the BIA. As a result, a long and close working relationship had been established between the BIA and KPMG. The difficulty for KPMG in being asked to investigate Prince Jefri was that the firm had acted as forensic auditors for the Prince some two years previ­ously in connection with a major dispute in which he had been involved. Whilst acting in this matter they had obtained full knowledge of his financial affairs over the preceding 14 years. KPMG concluded that, as the Prince was no longer a client, there was no conflict. They decided, however, that they still owed him a duty of confidentiality which they sought to maintain by establishing a Chinese wall. On discovering what was happening, Prince Jefri started action to restrain KPMG from acting for BIA.

At first instance, Pumfrey J,^[147] following Lightman J in Re a Firm of Solicitors (1997),^[148] was of the view that there should be ‘no risk or perception of a risk that confidential information relating to the client or his affairs acquired by the solic­itor will be disclosed to anyone else.’ The only evidence that KPMG could put forward to demonstrate the absence of such risk was a Chinese wall. Pumfrey J concluded that this was inadequate and, therefore, granted an injunction. He emphasised that the courts had, on a number of occasions, expressed ‘extreme scepticism as to the efficacy of Chinese walls.’^[149] Such devices, he stated, could prevent deliberate disclosure, but provided inadequate protection against accidental, inadvertent or negligent disclosure. He was of the view that Prince Jefri should not be exposed to such a risk unless there were powerful reasons for saying that he should. No such reasons were identified.

The Court of Appeal, in a majority judgment, disagreed.^[150] The Master of the Rolls, Lord Woolf, and Lord Justice Otton were particularly impressed with the reasoning adopted by the New Zealand Court of Appeal in Russell McVeagh McKenzie Bartleet v Tower Corporation.^[151] Drawing on that case, Lord Woolf said that three questions should be asked to determine issues of this kind: 1) Is there confidential information which, if disclosed, is likely to affect the former clients’ interests? 2) Is there a real risk that the confidential information will be disclosed? 3) Does the nature and importance of the former fiduciary relation­ship mean that the confidential information should be protected through the court’s intervention?

Lord Woolf thought there was a risk that Prince Jefri’s affairs might be disclosed, but considered that the firm had taken reasonable action to prevent disclosure. He believed that as KPMG had been BIA’s auditors for 15 years, find­ing new accountants would involve BIA in considerable expense and delay. Largely for these reasons, he refused to grant an injunction. Of particular importance were his remarks on the adequacy of Chinese walls. In Lord Woolf’s opinion, an ‘unrealistic standard for the protection of confidential information’ would be set if KPMG were not allowed to rely on the wall they had erected. This, he stated, would create unjustifiable impediments for large international firms in the way they conducted their business. He added:

There are differences between the position of solicitors and accountants, but where what is involved on the accountants’ part is forensic work, it is not likely that the dif­ference between the two professions will be decisive... It is the ability of the firm to protect those interests which will be critical.

The House of Lords was not persuaded by this reasoning and unanimously overturned the Court of Appeal’s ruling. Speaking on behalf of the House, Lord Millett stated that Rakusen was authority for two propositions:

(i) that there is no absolute rule of law in England that a solicitor may not act in liti­gation against a former client; and (ii) that the solicitor may be restrained from acting if such a restriction is necessary to avoid a significant risk of the disclosure or misuse of confidential information belonging to the former client.^[152]

He confirmed that the basis of the court’s jurisdiction to intervene on behalf of a former client was founded not ‘on the avoidance of any perception of possible impropriety, but on the protection of confidential information.’ He observed that former clients are in a different position from existing clients because the fiduciary relationship which exists between a solicitor and client comes to an end with the termination of the retainer. The only duty to the former client which survives is a continuing duty to preserve the confidentiality of informa­tion imparted. For this reason Lord Millett laid down that a plaintiff who seeks to restrain a former solicitor from acting for another client must establish:

(i) that the solicitor is in possession of information which is confidential to him and to the disclosure of which he has not consented and (ii) that the information is or may be relevant to the new matter in which the interest of the other client is or may be adverse to his own.^[153]

Lord Millett emphasised that, whether in contract or equity, the solicitor’s duty to preserve confidentiality is unqualified. He added, however:

The former client cannot be protected completely from accidental or inadvertent dis­closure. But he is entitled to prevent his former solicitor from exposing him to any avoidable risk; and this includes the increased risk of the use of the information to his prejudice arising from the acceptance of instructions to act for another client with an adverse interest in a matter to which the information is or may be relevant.^[154]

His Lordship then turned to examine the appropriate test for determining the degree of risk to which the former client may be put. He rejected the ‘reasonable probability of real mischief’ test adopted by the Court of Appeal in Rakusen, saying that the test has been ‘the subject of criticism both in this country and overseas... and a more stringent test has frequently been advocated.’^[155] In his view, the criticisms of the test laid down in Rakusen were ‘well founded’ as the test imposes an unfair burden on the former client, exposes him to a poten­tial and unavoidable risk, and fails to give him a sufficient assurance that his confidence will be respected. Lord Millett preferred instead to adopt the simple test that ‘a court should intervene unless it is satisfied that there is no risk of disclosure’.

Once the former client has established that the defendant firm is in possession of confidential information, the evidential burden moves to the defendant firm to show that there is no risk that the information will come into the possession of those now acting for the other party. Lord Millett stated that

there is no rule of law that Chinese walls or other arrangements of a similar kind are insufficient to eliminate the risk. But the starting point must be that, unless special measures are taken, information moves within a firm.^[156]

Adopting Sopinka’s test in MacDonald Estates v Martin,^[157] he concluded that firms should be restrained from acting for the second client ‘unless on the basis of clear and convincing evidence... all reasonable measures have been taken to ensure that no disclosure will occur.’^[158] In considering what measures were to be regarded as reasonable, he referred to five guidelines laid down by the Law Commission:^[159]

—physical separation of the various departments in order to insulate them from each other, often extending to such matters of detail as dining arrangements;

—on going educational programmes for staff;

—strict and carefully-defined procedures for crossing walls and the mainte­nance of proper records where this occurs;

—monitoring by compliance officers of the effectiveness of the wall; —disciplinary sanctions where there has been a breach of the wall.^[160]

Lord Millett was of the view that, to be effective, a Chinese wall needed to be an established part of the organisational structure of the firm, not created ad hoc and not dependent on the acceptance of evidence sworn for the purpose by members of staff engaged on the relevant work.

He concluded that ‘where effective arrangements are in place, they produce a modern equivalent of the circumstances which prevailed in Rakusen’s case.’ As KPMG’s wall was created ad hoc and within a single department, the House of Lords believed that it could not be satisfied that there was no risk of disclosure and, accordingly, the injunction to prevent the firm from acting for BIA was granted.

7. Implications of the KPMG Decision

Opinion following the Lords’ ruling was sharply divided. Some commentators read it as quite a narrow judgment, limited to accountants carrying out litiga­tion work. Others believed that the judgment was not about accountants at all.^[161] Indeed, it was reported that the accountants involved were seeking ‘top­level legal advice’ about the case as they were unsure what to make of it.^[162]

Lord Millett’s speech certainly clarified the position following Rakusen. It is now clear that there is no general rule that a solicitor cannot act against a for­mer client, but a former client is entitled to prevent his former solicitor from exposing him to any risk of disclosure of relevant confidential information, and a court should intervene to prevent a solicitor from acting unless it is shown that all risk has been eliminated. Chinese walls or other arrangements may be suffi­cient to eliminate such risk provided they are not created ad hoc and provided they comply with the guidelines laid down by the Law Commission.

The controversy over Lord Millett’s judgment centred on whether his remarks were intended to be of general application or whether they applied just in relation to accountancy firms. He stated:

The duties of an accountant cannot be greater than those of a solicitor, and may be less, for information relating to his client’s affairs which is in the possession of a solic­itor is usually privileged as well as confidential.^[163]

He added, however, that in the present case:

... some of the information obtained by KPMG is likely to have attracted litigation privilege... and an accountant who provides litigation support services of the kind which [KPMG] provided to Prince Jefri must be treated for present purposes in the same way as a solicitor.^[164]

The use of the words ‘for present purposes’ suggests that the main body of the judgment at least is also applicable to solicitors. However, when Lord Millett examined the adequacy of the wall used by KPMG, he said:

It is one thing, for example, to separate the insolvency, audit, taxation and forensic departments from one another. Such departments often work from different offices and there may be relatively little movement of personnel between them. But it is quite another matter to attempt to place an information barrier between members, all of whom are drawn from the same department and have been accustomed to work with each other. I would expect this to be particularly difficult where the department con­cerned is engaged in the provision of litigation support services. Forensic accountancy is said to be an area in which new and unusual problems frequently arise and partners and managers are accustomed to share information and expertise.

This may be taken to mean that where accountants are acting in a solicitor-type role, a Chinese wall will never be adequate, in which case firms of solicitors can never create a secure wall. However, as will be seen below, the House of Lords’ decision in Bolkiah v KPMG has subsequently been cited with apparent approval in relation to solicitors.^[165]

8. Institutionalised Chinese Walls

Following Bolkiah v KPMG it was believed that, to be effective, Chinese walls had to be part of the organisational structure of a firm and not be created ad hoc. Subsequently, doubts were cast upon this view by Laddie J in Young and others v Robson Rhodes (a firm) and another.^[166] Laddie J interpreted Bolkiah to mean that the test was whether the Chinese wall was effective in each case. He thought that the only distinction between established barriers within an organisation and ad hoc barriers was that the former were likely to be more effective. In this case a syndicate of Lloyds names sued their auditors and instructed a partner in Robson Rhodes to undertake forensic accountancy work. Some time later Robson Rhodes and the auditors (Pannell Kerr Forster) proposed to merge and sought to terminate their retainer with the plaintiffs.^[167] The plaintiffs in turn sought an injunction to prevent the merger taking place until after their action. Robson Rhodes offered to erect a Chinese wall, but the plaintiffs rejected this on the grounds that it was ad hoc. Laddie J held that an ad hoc wall was suffi­cient given the facts of the case.^[168]

In Re a Firm of Solicitors (1999),^[169]9 Walker J appeared to reaffirm that, to be effective, any barriers within a firm had to be part of the organisational struc­ture. What was particularly interesting about his analysis, however, was that he believed that such structures could be present within a law firm. In this case the evidence was that the two matters had always been handled by two separate departments. As Walker J observed:

The partner and his assistant [in the one department] have their offices on the third floor of one building, and the partner [in the other department] has his office on the second floor of another building. His assistant has his office on the first floor of the for­mer building.

There was, therefore, physical separation of the relevant personnel and paper­work. Furthermore, the individuals in charge of the two cases had never been into each other’s offices and had never met before the case arose. Thus there had been no ‘cross-pollination’ between the two departments and it appeared that social contact was limited. In any event, Walker J stated:

I have to say... the subject matter of the two cases is hardly the stuff of which gossip is made. Documents are only held in hardcopy, and are stored in the respective depart­ments of those concerned.

He concluded that these arrangements were not ad hoc, drawn up to cover the concerns of breach of confidence in the specific case:

In my judgment the barriers are not artificial, but were very substantially in place already as ‘an established part of the organisational structure of the firm’ (to re-quote Lord Millett’s words of Bolkiah v KPMG).

A further and slightly different interpretation of Bolkiah v KPMG was offered by Neuberger J in Halewood International v Addleshaw Booth & Co.^[170] There, a solicitor, Mr Robinson, was appointed to work for Addleshaw Booth & Co (ABC), a firm which was acting against Mr Robinson’s former client (Halewood International). ABC’s evidence was that Mr Robinson would have no involve­ment in the case. A Chinese wall had been set up when the conflict arose and undertakings had been given by all the lawyers involved (including Mr Robinson) that they would not discuss the case. All documentation was to be kept in a specific partner’s room—not the same room as Mr Robinson’s. Although Neuberger J was not prepared to accept that all risk had been elimi­nated, and ordered that Mr Robinson be transferred to a different office for the remainder of the case, he pointed out that ABC’s intellectual property depart­ment in Leeds was relatively small in comparison with departments of the firms in Bolkiah, Robson Rhodes and Re a Firm of Solicitors (1999). He stated that it appeared to him to be ‘self-evidently easier to police a system involving fewer people rather than more people.’ He continued:

Mr Robinson is a single individual. This is not a case like Bolkiah or indeed like [Robson Rhodes], where there are a large number of staff who have confidential information, indeed, a vast amount of obviously confidential, and obviously relevant information, accumulated over a long period.

Thus, by implication, Neuberger J was suggesting that it might be easier for smaller firms to act against former clients, and that in these circumstances Chinese walls erected within a single department might be sufficient to eliminate risk.

9. Conclusion

Significant questions remain about the legal position of a solicitor who is faced with a successive representation conflict. Although the House of Lords’ decision in Bolkiah upheld the fundamental principle laid down in Rakusen that there is no absolute rule prohibiting a solicitor from acting against a former client, it now appears that, unless there is absolutely no risk of impropriety, a court should intervene to protect the former client. Thus it would not in most cir­cumstances be difficult for a plaintiff to obtain an injunction against a former solicitor: the burden of proof that he would be required to discharge is not a heavy one.

In addition, although judicial recognition has been given to the use of Chinese walls, the conditions are strict. Whether an ad-hoc wall similar to the one erected in the Robson Rhodes case would suffice is debatable. It has been sug­gested that Laddie J believed that to grant an injunction preventing a merger would have been disproportionate on the facts, and that he interpreted Bolkiah accordingly.^[171] Alternatively it has been argued that, ‘essentially, what Laddie J. did... was, by metaphorically “knocking the parties heads together,” to reach a settlement which both parties were, in view of the circumstances, happy to accept.’^[172] Moreover, although Walker J found an institutionalised Chinese wall to exist within a law firm, it is unclear whether the Lords would consider a firm of solicitors as capable of creating anything other than an ad-hoc wall. In addition, it is questionable how effective most firms of solicitors would be in separating different departments. It may merely have been a coincidence that the firm in Re a Firm of Solicitors (1999) lacked office space so that the practice was spread between several buildings.

Further questions have been raised as to the measures required following Neuberger J’s comments in the Addleshaw Booth case. He implied that it might be easier for smaller firms to invoke measures to permit them to act against for­mer clients, and that no physical separation of personnel was therefore needed.

The question essentially is whether the only effective means of safeguarding client confidentiality is to erect formal barriers to the transmission of informa­tion, or whether, in the end, the client is bound to rely upon his solicitor’s (and his firm’s) commitment to the integrity of the solicitor-client relationship. There is at least a theoretical possibility that information will be passed on no matter what physical or electronic barriers are in place. Equally, solicitors may ensure, through their adherence to the professional ethic of confidentiality, that nothing untoward is disclosed even to colleagues sharing the same office space. These issues are explored further in chapter 7.

Meanwhile, the Law Society’s rules governing a solicitor’s duty to former clients appear comparatively simple and straightforward. A solicitor or firm of solicitors should not act if in possession of relevant confidential information.