Conflict rules set for major shake-up

Solicitors will be able to act for clients where conflicts rules currently stop them from doing so, if proposals put before the Law Society's Council next week proceed to the rule book.The proposals recommend a fundamental overhaul of the conflicts and confidentiality regimes.Conflicts of interest would be defined as a conflict between the duty to act in the best interests of two or more clients, rather than by a series of examples, as in the current conduct guide.Crucially, lawyers would be given the opportunity to act - with client consent - in certain defined situations of conflict or potential conflict.Confidentiality rules would be separated from conflicts rules, and would permit and define the circumstances in which Chinese walls could be used within firms.The current conflict principles in the conduct guide prevent solicitors acting with consent where there is any conflict.The ban has caused problems, as clients are often happy to consent to the solicitor continuing to act, and the cost and inconvenience of instructing another solicitor may be disproportionate.The draft rules were produced by the Society's regulation review working party, after consultation on an initial draft by the City of London Law Society.Working party chairman Edward Nally said: 'I hope these changes will be received enthusiastically, because they represent a clear and rational approach to conflicts.'He said the confidentiality proposals would clarify the rules relating to Chinese walls at a time when the courts already accept their existence.

They would also aid multi-disciplinary partnerships if and when they come into being, he added.Mr Nally said any amendment to the rules would not alter the ongoing duty of solicitors to take precautions if any conflict should arise while they are acting for clients.The draft rules will be put before council this week seeking approval of the working party's approach, but will then be subject to another consultation before returning to council for final approval.

They would probably take effect next year.