Complaints | A commercial approach to conflicts

You are a solicitor within the matrimonial department of your firm's Bristol office. You receive an instruction from a wife in a divorce matter. You perform all of the relevant conflict checks. It is drawn to your attention that your firm's London office has previously worked on a deal for a construction company of which both the wife and her husband were directors.

A conflict of interest arises where a firm owes separate duties to act in the best interests of two or more clients in relation to the same or related matters, and those duties conflict, or there is a significant risk of a conflict occurring. Given that the divorce is an entirely separate matter to the construction deal, you consider that there is no conflict and therefore proceed.

The following week, you receive a call from the husband complaining that your firm is acting for his wife in divorce proceedings against him. He has instructed another firm in the matter. He claims that, as a result of the deal, your firm is in possession of financial information which could be used against him. He considers there to be a conflict of interest and that your firm should not be acting for his wife. In this situation, you will need to commit to investigate the matter. You must inform him of the complaints procedure, as per your client care letter, and that he may have a right to refer this matter to the ombudsman if he does not feel that the situation is adequately resolved. You investigate the matter and consider that there is no conflict and, further, there is no information held by the firm which might prejudice the position of the husband.

It is important to understand that whether you think there is a conflict or not, the complainant does perceive that one exists and, as such, a degree of sensitivity is required. Your practice is a business and good client service is imperative to retain clients. It may be the case that this construction company is a repeat client and it is more important to your firm commercially to keep the existing client happy rather than to accept the new matter. On the other hand, the wife may be in a vulnerable position and is in need of protection. Although no conflict occurred, you consider that there may be a perceived advantage to the wife in the matter. It is clearly in both parties' interests to attempt to resolve any matters in dispute between them in the spirit of the overriding objective and any perceived advantage might be a block to this. In the circumstances, you report back to both, explaining your decision and confirming that you will cease to act for the wife and agree not to act for the husband in this particular matter. You make enquiries of another suitably qualified firm who you feel able to recommend to the wife and ensure a safe and quick transfer of the file to that firm.