11.5 – Conflict Checking Systems

One of the most important tools you can utilize to avoid conflicts of interests is a thorough conflicts checking system. Conflicts systems use a centralized database to compare potential clients with current and former clients to check for conflicts. While manual conflicts systems are acceptable, there is tremendous value in using a centralized computerized system, particularly as your practice grows.

It is important to have routine procedures to check for conflicts before opening a file and before you receive any confidential information from a potential client. Best practice requires you to perform a conflict check at the time a potential client seeks to engage you/your firm, prior to the first meeting where the client would provide you with confidential information beyond what you would need to know to complete a conflict check. You would also assess this on an ongoing basis every time a new party enters the mix.

For the conflicts system to be effective, it needs to be integrated into the other systems utilized in your practice. No file should ever be opened or worked on until the conflicts search has been performed. Further, everyone at your firm must understand how the system operates and participate in its operation.

Want more information?
For more information on conflicts systems, please see the Canadian Bar Association Resource “Developing a Conflict Checking System for Your Law Firm”.

Data Identifiers

There are many data identifiers you can enter into your conflicts checking system. As a general rule, the more information, the better the conflicts checking process. The information, however, must be relevant and correctly entered.

Each conflict index should contain the following information (provided it exists):

• Client’s name (including any former names or aliases)
• Current and former clients
• Affiliates or partners of the client
• Directors or officers of the client
• Affiliated corporations/entities of a corporate client
• Adverse parties, including potential adverse witnesses
• Co-plaintiffs or co-defendants
• Known relatives of the client as well as other relevant parties
• Spouses, including common law spouses, of the client
• Names of counsel representing any party to the matter
• Names of lawyers and staff in the firm

Identifying Conflicts

Entering relevant data will help flag potential conflicts. However, you must still turn your mind to whether a potential conflict is likely to arise. This will depend on the circumstances. Commentary [9] to section 3.4-1 of the Code lists the following factors for consideration in determining whether a conflict of interest exists or may come to exist:

• The immediacy of the legal interests
• Whether the legal interests are directly adverse
• Whether the issue is substantive or procedural
• The temporal relationship between the matters
• The significance of the issue to the immediate and long-term interests of the clients involved; and
• The clients’ reasonable expectations in retaining the lawyer for the particular matter or representation.

Other considerations include:

• The various interests of the parties involved in the matter
• Whether more than one person is relying on your advice
• Whether more than one person believes you are protecting their interests. In circumstances where those involved in the matter have an apparently common interest, you need to assess the equality of their bargaining positions
• The likelihood for falling out to occur between the parties