Thursday, May 19, 2011

Conflicts Clarification -- Texas (and Canada) Are Not to Be Messed With

Two readers contacted us regarding the summary of the recent Texas Risk Roundtable meeting, which contained a bit of an oversimplification of situations in which firms can represent adverse parties.
  • Bill Frievogel (Freivogel on Conflicts) notes that while there is overlap between the rules of Canada, Europe and Texas, the situation is slightly more complex and fluid: “As to England and Wales, I agree, mostly. As to Canada, the Canadian Supreme Court adopted the U.S. majority rule (contrary to the Texas rule) in  R. v. Neil, [2002] 3 S.C.R. 631 (Can.).
  • Julia Holland from Torys writes: "I noticed in yesterday’s risk management blog update a reference to Texan conflicts law being similar to Canada’s and Europe’s in that firms may represent parties that are adverse to one another in unrelated matters. This is only true with client consent.  While many would like to see the rules changed in that regard, our duty of loyalty is still such that we can’t be adverse to a current client without informed consent."
We connected with Brian Lynch, who acknowledged the issue and suggested that this was indeed a "teachable moment," writing: "It's a complicated world and tracking across the myriad requirements has never been more difficult for global firms."

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