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Ethics FAQs

Confidentiality

Q. What is the duration of the duty of confidentiality?

A. Rule 2 in the Solicitors’ Rules makes clear that the duty of confidentiality survives the termination of the retainer. There is a duty to keep confidential information obtained from or on behalf of a former client in the same way that the duty is owed to a current client.

Q. How does the death of the client affect the duty of confidentiality owed in respect of information obtained from or on behalf of that client?

A. Upon the death of a client the duty of confidentiality becomes owed to the client’s legal personal representative without whose authority (subject to compulsion of law) any confidential information obtained from or on behalf of the deceased cannot be divulged.

Q. What is your position where you are subpoenaed to give evidence in proceedings in which a former client is a party and asked to give a statement to the solicitor at whose request the subpoena was issued?

A. The duty of confidentiality owed to the former client requires you not to volunteer any confidential information. However, you can be compelled by the Court to divulge information which is merely confidential but not that which is privileged from compulsory disclosure.

Generally the solicitor for the party at whose request the subpoena has been issued will ask you to provide a statement or affidavit, usually to enable a decision to be made as to whether to call you to give evidence. As there is no property in witnesses there is no problem with your communicating with that solicitor but you need to bear in mind the duty reflected in Rule 2.

The appropriate course is to say to the solicitor who has had the subpoena issued that you will seek the authority of the former client to disclose information. If that is not forthcoming then you will still need to answer the subpoena as it is a direction of the Court but on being asked to answer particular questions you must submit to the jurisdiction of the Court and it is up to the legal representatives of the party seeking the information in evidence and of the former client to make submissions to the Court as to whether or not you can answer the question.

Conflict of Interest

Q. Is there a problem in acting for more than one party in a matter?

A. See Rule 9 of the Solicitors’ Rules. There is no rule against acting for more than one party (including in conveyancing matters) but each needs to be informed that should a conflict arise then you will need to cease acting for all.

Q. Is acting for vendor and purchaser in a conveyancing transaction prohibited?

A. No, but regard should be had to Rule 9 as a conflict of interest may arise in certain circumstances.

Q. Can I act for a person seeking to challenge a will which I have drawn?

A. Generally, no as that would potentially involve using confidential information obtained from the testator which vests on his or her death in the executor. This is no different from a breach of Rule 3 where the former client is still alive.

Q. Is there anything improper about a solicitor having a sexual relationship with a client?

A. There is at present no rule prohibiting this. However, as with any situation where a solicitor acts for a person with whom there is some sort of personal as well as professional relationship there may be problems of objectivity and it may be more likely that the solicitor would be a material witness in the client’s case which, pursuant to Rule 19 of the Solicitors’ Rules would preclude the solicitor from acting.

Q. Would I have a conflict of interest in acting for a client where the opponent was previously a client of a firm in which one of my partners or employees previously practised? Does it matter that the partner/employee had no involvement in the matter?

A. It depends on the precise circumstances. Generally it is probable that the firm in this situation would have a conflict of interest and there may need to be an exploration of the extent to which the partner/employee was involved in the relevant matter while at the previous firm. If the opposing client accepts that that solicitor had no involvement then that party may accept that there is no conflict of interest, but without that exploration the perception probably is that the solicitor may have been privy to confidential information which might be used to the opponent’s detriment. For more information search the Law Society Journal for articles on conflict of duties and interest.

Q. Does it make any difference if the employee is not a solicitor?

A. A conflict of interest can still arise where a paralegal not a solicitor has confidential information.

Q. Can I accept a gift from a client?

A. This may involve the appearance of undue influence which must be avoided and possibly a breach of the fiduciary duty. The principle reflected in Rule 11 in the Solicitors’ Rules would require you to send the client to another solicitor if the client wished you to draw a will in which you were to receive a substantial benefit should be considered. There is no definite answer to cover all situations but great caution should be taken and the gift declined in the case of any doubt.

Duty to client – improper instructions and unlawful activity

Q. Can I prepare a contract for the sale of land which includes a special condition allowing for a substantial rebate on the purchase price for early or on time settlement?

A. This may be an attempt to mislead the purchaser’s incoming mortgagee into granting a larger loan than might otherwise be granted. For more information see Law Society Journal articles, “A party to misrepresentation – not a proper role for a practitioner” (August 2000) and “When it comes to deception, try prevention. There may be no cure” (May 2001). See also a note from the Property Law Committee of August 2011.

Q. What is my position if I am acting for the purchaser?

A. Even though you have not drawn the contract by acting for the purchaser without disclosing the rebate clause you may be assisting the client in misleading his or her incoming mortgagee.

Duty to disclose professional conduct of colleagues

Q. What obligation do I have to report improper conduct on the part of another solicitor to the Office of the Legal Services Commissioner or to the police or other authority?

A. The answer depends on the specific conduct involved but in general terms all members of the profession have an ethical duty to assist in suppressing dishonourable conduct which may involve reporting improper conduct of a colleague.

In some circumstances there may be an obligation under the law, for example section 316(1) of the Crimes Act (NSW). Another example is section 263 of the Legal Profession Act 2004 which requires a solicitor to report the possible trust account irregularity of another solicitor to the President of the Law Society.

There is no statutory obligation or any rule which requires you to report conduct not falling within those categories and therefore you will not be liable to prosecution or disciplinary action for failing to do so. However, your general ethical duty referred to above suggests you should bring it to the attention of the Law Society or the Office of the Legal Services Commissioner. If the conduct involves a problem which can be resolved it may be appropriate to raise the matter with the Ethics Committee of the Law Society rather than making a formal complaint which would need to be made to the Legal Services Commissioner. For an explanation of the difference between these two courses of action, see the Law Society Journal article, “Appropriate pursuit of a greviance” (November 2001).

Q. Should I put the other solicitor on notice of my intention to complain/report?

A. Generally, as a matter of professional comity you should do so particularly as the colleague may have a reasonable explanation. However, there may be circumstances where to do so might thwart the due administration of justice and a proper investigation. See Law Society Journal articles “There but for the grace of…?” (March 1998) and “Be careful of the ‘blind eye’ syndrome” (May 1996).

Professional rapport, tactics and communications with colleagues

Q. How far-reaching is the so-called "golden rule" against communicating with another solicitor's client?

A. There is a general ethical duty not to undermine another solicitor's relationship with his or her client. However, Rule 31 in the Solicitors’ Rules which deals with the issue relates only to the situation where you are acting for a client in a matter or proceedings. It does not prohibit communication outside the ambit of that matter or proceedings but great care needs to be exercised.

Q. Even though I am a solicitor, if I am personally a party to the matter or proceedings can I communicate with the other party without breaching Rule 31?

A. It probably depends whether you are acting for yourself or whether you have another solicitor acting. If the latter, then there is probably no problem with communicating directly with the other party but, again, care needs to be taken to avoid a breach of fundamental ethical requirements of courtesy towards other practitioners and the need to avoid unduly influencing the other party to his or her detriment.

Q. What if I am acting for a client in a matter or proceedings and the opposing party expresses a desire to communicate directly with me?

A. The other party’s wishes do not release you from the obligation to comply with the rule. Such communication is only permissible if the other solicitor does not object to it.

Q. I have been approached by a party who has a solicitor acting in a matter but wishes to obtain advice about whether or not that solicitor’s advice should be followed, ie. to give a second opinion.

A. For more information read the Law Society Journal article, “Critical colleagues, second opinions and solicitor swapping” (July 2001).

Q. My client is a party in a Family Law matter and wants me to assert that the opposing solicitor should cease acting because of a conflict of interest. I am aware that the main reason the client wishes the other solicitor to have to withdraw is that he is a good friend of the opponent and is apparently charging costs at a low rate, whereas I know my client wants the opponent to be put to significant expense. Is it appropriate for me to assert a conflict?

A. If there is the possibility of a conflict of interest then it should be asserted if there might be a breach of a duty of confidentiality owed to your client otherwise. The fact that this may be of a tactical advantage to your client does not prevent you from raising the issue, but such an assertion should not be made purely for tactical reasons if it is not supportable.

Q. My client is selling a property at auction. The contract for sale of land which I drew has been duly displayed in the auctioneer’s office. The client has asked me at the last minute before the auction to include a clause requiring the purchaser to pay the land tax adjustment. Should I attempt to ensure that the auctioneer draws the amendment to the attention of prospective purchasers?

A. Yes, as it may be misleading ethically and a misrepresentation at law for the amendment not to be notified.