The Gazette 1991

JULY/AUGUST 1991

GAZETTE

inability to be independent. The consumer would accordingly require to consult new pro- fessional advisers. MDPs will, in many instances, jeopardise the professional relationship with the client, the judiciary and professional col- "MDPs will jeopardise the independence of the legal profession and of the advice given." leagues. MDPs will jeopardise the independence of the legal profession and of the advice given. (iii) Conflicts of Interest The following is an extract from the CCBE Information Gazette of Ireland which highlights the important area of conflicts of interest. The author, Mr. H. Collot d'Escury, a lawyer from the Netherlands, highlights the matter by reciting personal experience. "Conflicting professional rules: In the case of notaries in the Netherlands, it is profession- ally acceptable for the notary, should two parties wish to enter into an agreement, to advise and draw up a draft agreement for both parties concerned. Now let us assume that one party is a client of one of the notaries of your firm and the other of one of the lawyers. The first client (that of the notary) regards it as normal and insists that his notary makes the draft for both sides and does not accept that the lawyer-partner advises the other client, which client has a much longer standing with the firm. What do you do? Conflicting interest: The difference in the type of practice may create diffi- culties. The notary may have clients who use his services always for conveyancing matters in real estate. Such a notary client - certainly where the mixed partnership is fairly young - may not necessarily use the same MDP firm for lawyer services.

Now it may happen that such a notary client is engaged in a conflict leading up to legal action against a - client of one of the lawyer partners. As the notary client himself has instructed another law firm to handle this matter there seems to be no problem. The lawyer partner is acting for the adversary of the notary client. So far so good. What may happen, however, as we found out, was that suddenly out of the blue the notary client objected to the lawyer partner acting in this matter on the ground that the notary partner has privileged know- ledge of certain real estate transactions he intended to complete involving consider- able amounts of money. He felt that this was dangerous for him. It has been argued of course that there was no reason for the notary client to be afraid, because the lawyer partner will never try to have and cannot have access to this privileged knowledge. Furthermore, we pointed out that he himself had chosen another law firm to assist him in the legal proceedings. All to no avail! We decided in the end to withdraw from the lawsuit, but were not happy. It created much com- motion, also within the law firm and brought us to the conclusion that a "mixed committee' to handle these highly complicated conflicts of interest problems - which in this case we in fact had not foreseen - was absolutely necessary! This example brings me to another problem. How do you realise as partners of the one discipline that there may be a conflicting interest with a client of one of the partners of the other discipline? In our case we can ask the administration whether the name of the counterpart of one of our clients appears in the client administration of either the law practice or the notary practice and who is the responsible partner. The client administration is split in

two parts but the admini- stration, at least the head of the administration, can be this check. The question was put to me whether one should not avoid the possibility that the partners of one profession can get to know the names of the clients in the section of the other profession. In our case we do not want to avoid this unless the partner in question in a very special case decides that for reasons such as protection of the client, it should not be known. One can, however, keep this totally separate and avoid this possibility if there were reasons - for example, again, the protection of the client. This could arise in the case of a mixed partnership with a tax lawyer or accountant who do not - like the lawyers - enjoy the privilege of professional secrecy in criminal investigations. One would then have to keep the administration of the law practice totally separated from that of the tax practice or accountant's practice and include only the result in the administration of the mixed partnership. In our case there remains the question of professional secrecy. We see no reason to avoid the situation where a practitioner on the one side can find out whether a certain person or company is a client of one of the partners of the other side. The knowledge he thus obtains is privileged and thus protected. In case of a mixed partnership with tax lawyers or chartered account- ants one would have to arrange a system whereby the tax lawyer and/or accountant would have no access to the names of the clients of the law practice, combined with a warning system for the lawyers". (iv) Foreign Dependence If partners of the multi- national accountancy firms were to become partners of Irish solicitors, it would not be long before the financial muscle of English, European or American influence could

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