Conflicts of Interest and Chinese Walls

By Charles Hollander QC
and Simon Salzedo
Publisher: Sweet & Maxwell
Price: £125

It is sometimes said a legal textbook is well timed if it fills an obvious gap and if the law is changing fast, so that practitioners will be happy to buy new editions as they appear. If that is correct, then this book fulfils both criteria.
As the legal profession changes rapidly, it has become increasingly apparent the laws and professional rules governing conflicts and the related issue of maintaining confidentiality have failed to keep up. As this book demonstrates, the relevant laws are based on general principles of fiduciary duty, which have only been very rarely considered by the courts in the context of professional conflict. The result has been that the law is unclear, and often built on nothing better than old obiter dicta. One disappointment is that the authors do not always assess their interpretation of the law against the realities of everyday practice for lawyers and their clients.
Any involvement that the courts have had has focused almost exclusively on the issue of confidential information. The Prince Jefri case set new guidelines and, as is often the case, a flurry of further cases have followed as those new guidelines are tested. What is still not clear is whether, as in the case of the Spiliada and ensuing jurisdiction cases, conflict-related cases will wane. If they do not, England and Wales will be heading towards an environment similar to the US where applications to the court seeking to prevent a lawyer or a firm from acting due to a conflict are part of everyday
litigation tactics.
In terms of the Law Society Rules, the authors are correct to criticise the 1999 Guide to the Professional Conduct of Solicitors. Fortunately, the Law Society has already identified the need for an overhaul. The resulting report, which is now out for consultation, would – if implemented – lead to significant changes and bring the rules up to date. They would certainly require the authors to produce another edition.
Conflict rules must protect clients and safeguard public confidence in the profession, but the dividing line with unnecessary restrictions on practice is a narrow one. At a time when the Office of Fair Trading is looking at competition restrictions in the profession, the book could have usefully set the English law and rules in the context of other countries, and in particular the European Union. Such an analysis carried out in the context of the Law Society’s own review of the rules has shown just how much more freedom lawyers in Europe have compared with England and Wales. In the context of Europe, there is a surprising of any reference to the CCBE Code, which although the position is not entirely clear, would seem to have the force of law, and which sets completely separate conflict rules in relation to work crossing the borders of EU countries.
Altogether a very useful and timely book – which will need to be updated soon.