The Time for Reform

“Concluded Retainer” Argument Holds No Weight: Analysing Solicitor Conflicts Under the SRA Code

Introduction

The legal profession is built upon a foundation of ethics, integrity, and an unwavering commitment to protecting client interests. Solicitors, as officers of the court, bear a sacred responsibility to uphold these principles, even in the face of competing loyalties or personal gain. However, the line between permissible representation and impermissible conflicts of interest can sometimes become blurred, particularly when solicitors attempt to justify their actions through technical arguments that undermine the very essence of their ethical obligations.

One such argument that has gained traction in some circles is the notion that a solicitor’s duty to avoid conflicts of interest can be circumvented if the initial retainer with a client has “concluded.” In other words, once a specific legal matter or transaction has been completed, the solicitor is free to take on representation adverse to that former client’s interests, even if it relates to the same subject matter or confidential information obtained during the prior representation.

This argument recently came to light in a particularly egregious case, where a solicitor drafted a will for a client, listing the client’s business as an asset within the estate plan. Shockingly, the same solicitor later represented a third party against that very business asset, allegedly engaging in fabrication, facilitating illegal evictions, and enabling unjust enrichment – all resulting in severe financial hardship and emotional distress for the former client.

When confronted with these allegations, the solicitor’s defence rested primarily on the assertion that the initial will retainer had “concluded,” thereby rendering any subsequent representation permissible. However, as this article will demonstrate, such an argument holds no weight under the Solicitors Regulation Authority (SRA) Code of Conduct and well-established principles of legal ethics.


Duties Owed to Former Clients Under the SRA Code

The SRA Code of Conduct, which governs the professional conduct of solicitors in England and Wales, is unequivocal in its stance on the duties owed to former clients. Principle 6 of the Code, which focuses on acting in the best interests of clients, explicitly states in Rule 6.7 that a solicitor “must not act in relation to a matter or particular aspect of it if there is a conflict, or a significant risk of a conflict, between the interests of one of your former clients in that matter or aspect of it, and your interests or the interests of your current client, unless the prior client has given informed written consent or the contrary is permitted by law or the circumstances are such as to allow you to disregard the duty to the former client.”

This rule clearly establishes that the duty to avoid conflicts of interest extends beyond the duration of a specific retainer and applies to both current and former clients, particularly on the same or closely related matters. In the context of will drafting, where a solicitor gains intimate knowledge of a client’s assets, debts, and overall estate plan, any subsequent actions that undermine or adversely affect those very interests identified during the will drafting process would undoubtedly constitute a closely related matter.

Furthermore, Principle 4 of the SRA Code enshrines the fundamental duty of confidentiality owed to clients. This principle mandates that solicitors must keep the affairs of current and former clients confidential, except where disclosure is required or permitted by law or the client consents. Crucially, this duty extends beyond the termination of the retainer and prohibits solicitors from misusing or disclosing confidential information obtained during the course of their representation.

In the context of the case at hand, where the solicitor is alleged to have taken actions detrimental to the former client’s business interests after previously including that business as an asset in their will, there are strong arguments that the solicitor violated both the duty to avoid conflicts of interest and the duty of confidentiality.


Analysis of the Concluded Retainer Argument

Despite the clear ethical obligations outlined in the SRA Code, some solicitors have attempted to justify their actions by relying on the “concluded retainer” argument. However, upon closer examination, this argument crumbles under the weight of well-established legal principles and the specific facts of the case.

Rebuttal 1: Ongoing Duty Despite Concluded Retainer

The first and most fundamental rebuttal to the concluded retainer argument lies in the SRA Code’s explicit recognition that the duty to avoid conflicts extends to former clients, even after the termination of a specific retainer. Rule 6.7, as previously discussed, makes it clear that solicitors cannot act in a way that is adverse to the interests of a former client on the same or a closely related matter, unless the former client provides informed written consent or exceptional circumstances apply.

In the context of will drafting, where a solicitor gains comprehensive knowledge of a client’s assets, liabilities, and intended beneficiaries, it is difficult to conceive of a scenario more closely related than subsequently representing a third party against one of those very assets identified in the will. The argument that the initial will retainer had concluded holds little weight in the face of such a clear conflict of interest.

Rebuttal 2: Abuse of Confidential Information

Another compelling rebuttal to the concluded retainer argument lies in the solicitor’s alleged abuse of confidential information obtained during the prior representation. By drafting the client’s will, the solicitor gained access to privileged and sensitive information about the client’s business operations, financial position, and overall estate plan. This confidential information was entrusted to the solicitor with the reasonable expectation that it would be safeguarded and used solely for the purpose of furthering the client’s interests.

However, the allegations suggest that the solicitor may have misused or exploited this confidential information to the detriment of the former client’s interests associated with that same business asset covered in the will. Such conduct would constitute a clear violation of the duty of confidentiality enshrined in Principle 4 of the SRA Code, as well as a breach of the fundamental ethical obligation to protect client confidences.

Importantly, the SRA Code does not provide any exception or justification for misusing confidential information simply because a retainer has concluded. The duty of confidentiality is an enduring obligation that survives the termination of the solicitor-client relationship and extends to former clients.

Rebuttal 3: No Informed Consent

The SRA Code does provide a narrow exception to the conflict of interest rules, allowing solicitors to act in certain situations where all affected clients have provided their informed written consent. Specifically, Rule 6.4 states that solicitors may act where there is a conflict or a significant risk of conflict if “the clients have given informed consent in writing to you so acting.”

However, in the case at hand, there are no facts suggesting that the former client ever provided such informed written consent, authorising the solicitor to take actions adverse to the interests of their business after previously including it as an asset in their will. Without this crucial consent, the solicitor’s actions cannot be justified under the limited exceptions provided by the SRA Code.

Rebuttal 4: Egregious Alleged Misconduct Overrides Technical Arguments

Perhaps the most compelling rebuttal to the concluded retainer argument lies in the sheer egregiousness of the alleged misconduct committed by the solicitor. The accusations leveled against the solicitor go far beyond a mere technical conflict of interest; they include fabrication, facilitation of illegal evictions, and enabling unjust enrichment – all resulting in severe financial hardship and emotional distress for the former client.

In the face of such grave allegations, which strike at the heart of a solicitor’s ethical obligations and the principles of justice and fairness, any attempt to justify these actions based on a technicality such as a concluded retainer rings hollow. No solicitor can reasonably argue that the mere conclusion of a retainer permits them to engage in conduct that directly prejudices the rights and interests of a former client, particularly on a matter closely related to the subject of their prior representation.

These allegations, if proven true, would constitute egregious violations of multiple SRA Principles, including the duty to uphold the rule of law and proper administration of justice (Principle 1), the duty to behave in a way that maintains the trust the public places in the profession (Principle 2), and the duty to act with integrity (Principle 5). Such severe breaches of professional conduct cannot be excused or diminished by relying on the argument that the initial retainer had concluded.


Case Precedents and Regulatory Guidance

The weaknesses of the concluded retainer argument are further reinforced by relevant case precedents and regulatory guidance from the SRA and other legal authorities. While each case must be evaluated on its specific facts and circumstances, there is a well-established body of case law and professional guidance that rejects the notion that a solicitor’s ethical obligations can be circumvented simply because a retainer has concluded.

For example, in the case of Hilton v Barker Booth & Eastwood (A Firm) [2005] UKHL 8, the House of Lords (now the Supreme Court) emphasised the enduring nature of a solicitor’s duty of confidentiality, even after the termination of the retainer. The court held that a solicitor’s duty to preserve confidential information obtained during a retainer is a continuing one that does not automatically terminate upon the conclusion of the retainer. This principle reinforces the argument that the confidential information obtained by the solicitor in drafting the will cannot be misused or exploited, regardless of whether the initial retainer had concluded.

Additionally, the SRA itself has issued guidance emphasising the importance of managing conflicts of interest with former clients. In its “Warning Notice on Money Laundering and Terrorist Financing” published in 2021, the SRA stressed that solicitors must remain vigilant about potential conflicts of interest, even after a retainer has ended. The notice states: “You will need to consider whether there is a risk of misuse of confidential information obtained from a former client in a way that could disadvantage them.”

Furthermore, the Law Society of England and Wales has published comprehensive guidance on solicitors’ duties to former clients, including the obligation to avoid conflicts of interest and maintain confidentiality. The guidance explicitly states that “even after a retainer has ended, you must not act in a way that is adverse to the interests of your former client on the same or a closely related matter.”

These authoritative sources underscore the fact that a concluded retainer does not absolve a solicitor of their ethical obligations, particularly when it comes to preserving client confidences and avoiding conflicts of interest on closely related matters. The argument that the initial will retainer had concluded holds little sway in the face of such clear and consistent guidance from regulatory bodies and professional associations.


Potential Disciplinary Consequences

If the allegations against the solicitor are proven to be true, the consequences could be severe, extending far beyond the realm of civil liability. The SRA, as the regulatory body responsible for maintaining professional standards and upholding public confidence in the legal profession, has a range of disciplinary measures at its disposal to address such breaches of conduct.

Firstly, the solicitor’s actions may constitute a violation of multiple SRA Principles, including Principle 1 (upholding the rule of law and proper administration of justice), Principle 2 (maintaining public trust in the profession), Principle 4 (duty of confidentiality), Principle 5 (acting with integrity), and Principle 6 (acting in the best interests of clients). These violations could result in disciplinary action, ranging from fines and reprimands to suspension or even potential striking off from the roll of solicitors.

Additionally, the former client may have grounds to file a formal complaint with the SRA, alleging misconduct and breaches of the Code of Conduct. The SRA has established procedures for investigating and adjudicating such complaints, which can lead to disciplinary proceedings and sanctions against the solicitor.

Furthermore, the solicitor’s alleged actions, particularly those related to fabrication, illegal evictions, and unjust enrichment, may also constitute criminal offenses under various laws, such as fraud, misrepresentation, or unlawful eviction statutes. In such cases, the SRA has a duty to report any suspected criminal conduct to the appropriate authorities for further investigation and potential prosecution.


Conclusion

The argument that a solicitor can circumvent conflicts of interest and ethical obligations simply because an initial retainer has concluded is a dangerous fallacy that undermines the very foundations of the legal profession. As this article has demonstrated, the SRA Code of Conduct, together with well-established case precedents and regulatory guidance, unequivocally rejects such a narrow and technical interpretation of a solicitor’s duties.

The duties owed to former clients, including the obligation to avoid conflicts of interest and maintain confidentiality, are enduring and survive the termination of a specific retainer. These duties are particularly stringent when it comes to matters closely related to the subject of the prior representation, such as actions that adversely affect the very assets or interests previously identified and addressed in a will drafting process.

Moreover, the egregiousness of the alleged misconduct in the case at hand – fabrication, illegal evictions, and unjust enrichment resulting in significant harm to the former client – only serves to further undermine any reliance on the concluded retainer argument. Such severe breaches of professional conduct cannot be excused or justified by technical arguments that disregard the fundamental ethical principles that guide the legal profession.

This case serves as a stark reminder of the importance of robust conflict checks, diligent compliance with ethical obligations, and an unwavering commitment to upholding the best interests of clients – both current and former. Solicitors must remain vigilant about potential conflicts, even after a retainer has concluded, and take proactive steps to identify and address any situations that could compromise their duties of loyalty and confidentiality.

While the technical conclusion of a retainer may have administrative or procedural implications, it does not absolve a solicitor of their enduring ethical responsibilities. The trust and confidence placed in the legal profession by the public hinges on the profession’s ability to uphold the highest standards of integrity, honesty, and adherence to ethical principles – principles that transcend the mere technicalities of retainer status or procedural formalities.

Ultimately, the concluded retainer argument holds no weight in the face of the clear ethical obligations imposed by the SRA Code of Conduct and the long-standing principles of legal ethics. Solicitors must remain ever vigilant in their commitment to upholding these duties, even after a retainer has concluded, lest they risk compromising the very foundations upon which the legal profession stands.



References

Cases:

  • Hilton v Barker Booth & Eastwood (A Firm) [2005] UKHL 8

Regulatory Sources:

  • Solicitors Regulation Authority (SRA) Code of Conduct for Solicitors, RELs and RFLs (Version 21, 2019)
  • SRA Warning Notice on Money Laundering and Terrorist Financing (March 2021)
  • The Law Society of England and Wales, “Duties to Former Clients” Guidance

#LegalEthics #SolicitorConduct #SRACode #ClientConfidentiality #ConflictsOfInterest #ProfessionalMisconduct


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