SUMMARY

One could be forgiven for imagining that identifying a potential conflict would be straightforward and that the difficulty would come when a firm was deciding whether to act in a potential conflict situation.

Whilst all the firms interviewed were aware of the need to address conflicts of interest and had devised some method of identifying potential conflicts, the degree of computerisation varied, depending on the size and nature of the firm. It was usually the case that the bigger the firm, the more technical support there was available to fee-earners. Larger practices, with commercial and banking clients, have complex systems in place and may need to carry out more than a simple client-and-matter check. Nonetheless, smaller firms did not appear to be obviously disadvantaged in this respect. It could even be said that smaller firms found it easier and quicker to highlight potential problems as their client base was not as extensive, making it easier for them to consult colleagues.

However, the way in which conflicts of interest are handled at this prelimi­nary stage does not merely reflect the quality of the computerisation within a firm. The establishment of an efficient system for identifying potential conflicts does not assist a firm which encounters problems merely as a result of being asked whether it can act for a certain client. It was the larger firms which expe­rienced this type of problem. They claimed that if they followed the Guide to Professional Conduct to the letter they would not be able to function. Accordingly they said that they had developed their own systems for handling the problem.

It is difficult to determine, on the basis of the interviews which I conducted with firms, whether client interests are being safeguarded by means of these devices. It would have been necessary to undertake a different kind of empirical study, one involving access to firms’ handling of specific cases, in order to verify some of the statements made to me. That having been said, little consideration appears to be given to ways in which the amount of information received can be limited at the initial point of contact with the prospective client. Some US firms, for example, train secretaries and receptionists to limit the amount of initial information acquired (confined to the identities of the parties and a short description of the case) when a potential client contacts the firm.^[355] As this information is usually taken over the telephone, a preliminary conflicts check can be made before any other meeting or conversation with the potential client. In this way the check can be carried out before a significant amount of informa­tion is acquired by fee-earners.

Two firms reported that they took the responsibility for the initial conflicts check out of the hands of the fee-earners involved in the case. By appointing an independent person or a team of people to investigate possible conflicts, these firms were effectively by-passing rule 16.06 completely, as the person carrying out the check was not necessarily a member of the partnership, or even a quali­fied solicitor. As the information was not passed to any of the partners, would- be clients were presumably advised that their affairs remained strictly confidential.

Many of the concerns raised over the effectiveness of firms’ procedures for identifying conflicts of interest could perhaps be ameliorated by clearer guid­ance from the Law Society. It is doubtful, however, whether an effective system of mandatory checks could be devised which would ensure that all potential conflicts were identified before any information has been transmitted to a firm. As has already been pointed out, no matter how effective the firm’s computer system, the check is still dependent on the fee-earner obtaining the necessary information from the client. This is not to say that the Law Society could not draft guidelines which highlighted the need for caution when taking on new instructions and identified the minimum safeguards which should be in place.

Although it has been demonstrated in this chapter that the problems faced by firms depend to a great extent on the nature of their practice, it is clear that solic­itors are in general aware of the need to discover a conflict as soon as possible. It is at the next stage—namely, deciding what is to be done about the conflict— that clear differences emerge.