Edited write-up from Welcome Remarks at webinar on Managing Conflicts of Interest for Legal Practitiones and Law Practices on 27 July 2021.
The area of Conflict of Interest is of especial significance in the Legal Profession (Professional Conduct) Rules 2015 (PCR). There are five rules in PCR with titles expressly referring to COI:
- Rule 11 (Conflict of interest in proceedings before court or tribunal);
- Rule 15B (Conflict of interest in family proceedings);
- Rule 20 (Conflict, or potential conflict, between interests of two or more clients);
- Rule 21 (Conflict, or potential conflict, between interests of current client and former client); and
- Rule 22 (Conflict, or potential conflict, between interests of client and interests of legal practitioner or law practice, in general).
Yet it is not just the above five expressly headed rules that concern conflict. There are themes of conflict embedded in other rules too. For instance, Rule 23 (prohibited borrowing transactions) and Rule 25(2)(gifts from client).
The issue of Conflict of Interest or COI is particularly sobering and serious. There are two chief areas of concern disciplinarily that come up regularly before the Council. These are issues of costs (typically overcharging) and COI. The disciplinary record data bear these out too.
A high-level survey over the last two years reveal the following.
Conflict of Interest Disciplinary Cases from 2019 to 2020
|2019||6||4 dismissed, 2 escalated to DT|
|2020||5||2 presently ongoing, others dismissed|
Law Society’s Regulatory Department did a data sweep of the last five years and these are some of the analytics I can share with us:
- In cases where complaints were dismissed, a COI complaint was only one of an omnibus set of complaints. Most COI complaints occur in the context of a commercial setting, but we have also received some complaints from divorce proceedings and personal injury claims;
- in commercial settings, one common complaint is where the Complainant, being a former employee of a company (either as defendant or plaintiff in an action initiated by his former employer or against the former employer as the case may be) alleges conflict of interest on the part of the solicitor. The intelligible reason divined from some of these cases is where the solicitor had been engaged by the company in previous unrelated matters in which the former employee was giving instructions to the solicitor on behalf of the former employer;
- in the context of divorce proceedings, a common complaint is one where the solicitor acted for either the husband and wife in prior unrelated matters and the complainant alleges that there is conflict of interest as the solicitor concerned is now acting for one of the spouses battling the other; and
- in personal injury claim cases, some allegations of conflict of interest have been levelled where the solicitor may have acted for the insurers in previous claims brought by the Complainant. The lay person then alleges a conflict of interest so long as the solicitor is known to him previously in a historical matter. Speaking candidly, this type of complaint is neither intelligent nor intelligible but instead ill-informed and inane.
Leaving aside statistics, the High Court itself weighed in recently on a disciplinary case involving COI. That decision of Law Society of Singapore v Bhagwandas Mahtani  SGHC 170 (judgment delivered on 5 July 2021 in OS No. 8 of 2020) underscores the gravity.
In the course of acting for a former client, the Respondent obtained information on various matters relating to the assets and holdings of that client. After the former client tragically passed away, the Respondent subsequently chose to act for the mistress of the former client in her claim for a share of the Estate. The Complainant, wife of the former client, was the co-administratix of the Estate. The Court of Three Judges ordered the Respondent to be suspended from practice for 24 months.
Woo Bih Li JAD delivering the judgment of the High Court observed that underlying rule 21(2) of the Legal Profession (Profession Conduct) Rules 2015 and also the acquisition of confidential information was the basic principle of conflict of interest.
In that case, all three charges against the Respondent pertained to conflict of interest The Court considered that there were relevant aggravating factors necessitating an uplift in overall sentence to two years suspension. Apart from a serious finding by the Disciplinary Tribunal of fabricating certain disclosures, the other aggravating factors included: (a) the Respondent was of 27 years standing; (b) it was well within the Respondent’s ability to avoid placing himself in a position of conflict by making full and frank disclosure; (c) not only did the Respondent fail to ensure that the Complainant was not labouring under misapprehension that he was willing and able to act for the Estate, he made positive representations that he would in fact act for the Estate; and (d) the Respondent sought to persuade the Complainant to settle or compromise in relation to the mistress’ claim.
That judgment unfortunately serves as a cautionary tale for all of us.
But prevention is better than cure as the old adage goes. In my Opening of Legal Year Speech in January, I had foreshadowed a Conflict of Interest Toolkit being developed for members this year. I said we would take a leaf from the Canadian Bar Association’s work in this area. To that end, the Law Society has developed a practical Conflicts of Interest Toolkit (member login required) courtesy of the fine and expeditious work of Alvin Chen, our former Director, Legal Research and Development. These contain excellent checklists to help legal practitioners detect, precent and manage COT situations commonly encountered in practice. Specifically, there are eight checklists in the Toolkit to assist legal practitioners circumnavigate around ethical mines in COI in daily law practitioner interactions with the Court, client, former clients and third parties:
- Managing conflicts of interest in practice;
- Conflicts of interest systems, policies and controls for law practices;
- Should you advise or act for a family member or a friend?;
- Dealing with an unrepresented person or other third party;
- Conflicts of interest in court or tribunal proceedings;
- Acting for multiple clients;
- Acting against a former client; and
- Personal interest conflicts.
I commend you to read and have ready tip access to the Toolkit even while you analyze the COI situations that may pop up in practice. You cannot be too careful in respect of this specific ethico-legal concern.