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Proctor : September 2017
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38 PROCTOR | September 2017 Notes 1 Rule 4.1.1 ASCR. 2 Rule 4.1.3 ASCR. 3 Rule 7.1 ASCR. 4 Rule 8.1 ASCR. 5 Rule 9 ASCR. 6 Rule 10 ASCR. 7 Rule 11 ASCR. 8 Rule 8.1 ASCR requires us to act on the client’s lawful, proper, and competent instructions. 9 Sheikh Amed Jaber Al-Sabah v Ali & Ors [1999] EWHC 840 (Ch) at [48] Ferris J. 10 Vukminca v Betyounan [2008] NSWCA at [48]. 11 LPC 002/10. 12 Ibid at page 4. 13 Farrer v Messrs Copley Singletons (A Firm) [1997] EWCA CW 2127 at pp 20-21, emphasis added. 14 Perry v Eduoin WE, Independent April 1 1994 cited by Charles Hollander QC and Simon Salzedo QC in Conflicts of Interest (4th edition). The Queensland Law Society Ethics Centre has warned of recent incidents in which cyber criminals divert payments to and from solicitor trust accounts. The attackers access a firm’s email system, often without leaving any sign of the intrusion. The attackers then monitor email until a party is due to deposit funds to a specified account, at which point the request email is intercepted and the account number changed. The diverted funds may be money paid by clients to the solicitor’s trust account, or money being disbursed from trust. Almost $700,000 in funds has been diverted in this way in recent attacks. Once the criminals become aware that the intrusion has been detected, the final stage can be a mass email to everyone on the firm’s contact list attaching documents containing malware links. Firms are urged to avoid using email to communicate bank account numbers. If there is no other choice, confirm transfer instructions and account numbers by direct contact with clients. Practitioners should also know and follow good password and cybersecurity practices. Visit the QLS Ethics Centre page at qls.com.au for more guidance. Accepting instructions from joint clients by Stafford Shepherd The intention of this note is to flag some points for consideration when accepting instructions from joint clients. At the outset it is important to identify who is the client. The glossary of terms in the Australian Solicitors Conduct Rules 2012 (ASCR) defines client in these terms: “With respect to the solicitor or the solicitor’s law practice... a person (not an instructing solicitor) for whom the solicitor is engaged to provide legal services for a matter.” It is to this client that we owe a number of ethical obligations, including but not limited to: • serving the best interests of a client in any matter in which we represent the client1 • delivery of legal services competently, diligently, and as promptly as reasonably possible 2 • providing clear and timely advice to assist a client to understand relevant legal issues and to make informed choices3 • following a client’s lawful, proper, and competent instructions4 • maintaining a client’s confidences5 • avoiding conflicts between duties owed to current and former clients6 • avoiding conflicts between duties owed to two or more current clients.7 Identifying where our duties are owed and to whom may not always be straightforward. In accepting instructions from an ‘agent’, we need to satisfy ourselves that we have been instructed to act as we must be certain that we have the necessary authority.8 If instructions come to us from a third party who purports to represent the interests of a ‘client’, we need to satisfy ourselves that the ‘client’ indeed wishes us to act. To be satisfied that we hold instructions, we need to either see the ‘client’ personally or obtain written confirmation from the ‘client’ (including when the ‘client’ is a corporate entity of any resolutions appointing us to act) or taking such steps that the circumstances may require to be satisfied that we can act for the ‘client’. 9 On many occasions we are called upon to represent two or more persons whose interests appear the same in a ‘joint engagement’. Although the interests of the joint client appear the same, the ethical obligations are owed to each client separately. For example, when we act for a married couple or domestic partners in a transaction, we must be certain to obtain the authority of each partner to undertake the engagement. Even if satisfied that there is authority to create a solicitor-client relationship, we need to remember that such authority “is not the same as authority thereafter to give instructions in the performance of the relationship”. 10 The risks that arise are well illustrated by Legal Services Commissioner v Mines, 11 in which the practitioner acted on the sale of property for domestic partners and, acting on the instructions of the female partner, drew from the settlement monies a sum of money and released those funds to her without instructions of both sellers. As the tribunal noted: “A solicitor in the circumstances of Mr Mines facing two clients who were themselves personally at odds and with a known obligation jointly and severally... was to treat each with equal care and not as a single unit”. 12 It has been said that “a solicitor’s contract of retainer is with each and every client; the duties of the solicitor are owed and must be discharged to each of them. It must follow that a solicitor is entitled to communicate with and take instruction from only one of several clients if he has the authority of the other clients to do so... from the point of view of [the solicitor] the authority must be actual, whether express or implied, or apparent; but in each case the authority must emanate from the alleged principals, not the alleged agent.” 13 It has also been held that when we accept joint instructions we have a duty of disclosure to all. 14 In summary: 1. Identify the client. 2. Joint clients should not be treated as a single unit. 3. Make certain you have authority to act. 4. Clearly stipulate your authority to receive instructions. 5. Make certain joint clients are aware of all information. Ethics Stafford Shepherd is director of the QLS Ethics Centre. Cyber crims target funds transfers Bupa Australia To find out more about joining your company's health plan 134 135 and quote ID 2112595 bupa.com.au/ corporate user: QldLawBupaCorporate password: corporatehealthQLS QLS @ bupa.com.au Visit your local retail centre Bupa HI Pty Ltd ABN 81 000 057 590. Corporate health cover that keeps giving you more. Bupa have partnered with Qld Law Society to bring you great value corporate health cover that gives you more - including wellness programs, loyalty rewards and a range of offers exclusive to members.
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