For the Public

Common Concerns

Conflict of Interest

 

Real Estate/ Joint or Dual Representation

  • In many cases a lawyer may act for more than one party in a legal transaction. As long as the clients' legal interests are not adverse and both parties are made aware of the joint representation, there is no problem.  However, there are many instances where a lawyer cannot or should not act for more than one party because the duty and loyalty owed to one party may, or is likely to, become adverse to the duty and loyalty owed to the other party. If the interests of the parties become opposed, the member cannot continue to act for either party and both parties should get their own counsel.
  • Chapter V of The Code of Professional Conduct allows lawyers to represent both parties in a residential real estate transaction, as long as both parties are aware. Before the lawyer agrees to act for more than one client in the same matter, the lawyer must advise the clients that:
    • The lawyer has been asked to act for both or all of them;
    • No information received in connection with the matter from one can be treated as confidential so far as any of the others is concerned; and
    • If a dispute develops that cannot be resolved, the lawyer cannot continue to act for both or all of them and may have to withdraw completely.
  • If the lawyer has a continuing and regular relationship with a client, the lawyer must disclose the relationship and obtain consent from all parties to the joint representation. If, following such disclosure, all parties are content that the lawyer act for them, the lawyer should obtain their consent, preferably in writing, or record their consent in a separate letter to each. If following such disclosure, a party raises an objection, the lawyer shall advise the party that the party is free to obtain independent representation.
  • The Code prohibits a lawyer from acting for both the builder/developer and the purchaser in a real estate transaction in a new home construction situation, even if the parties consent. In accordance with the Code of Professional Conduct, lawyers are prohibited from advising or representing both sides of a dispute unless there has been adequate disclosure to both sides and the clients or prospective clients have given their express consent.  However, no lawyer may act or continue to act in a matter when there is or is likely to be a conflicting interest and lawyers must not act for both the builder or developer and the purchaser in a real estate transaction resulting from the construction of a new home, even if the parties consent.  If the parties become opposed in interest, the lawyer may not advise either party about the issue in dispute. The lawyer may a attempt to negotiate on minor issues.