A partner leaves and the firm is asked to act against a former client
Neil Broadbent sold his 40 per cent shareholding in a packaging company in 2022 for $3.4 million. Harbour Legal acted for Neil and the company on the sale; the partner responsible, Mere Kaa, reviewed Neil's personal financial statements and a draft relationship property settlement with his former partner, Sonia, then left the firm in December 2023 for a government role. In February 2025 Sonia asks Tim Vaeau, a partner at Harbour Legal who has never acted for Neil, to act for her in a relationship property claim against Neil, based in part on the value of the shares and the sale proceeds. Neil objects, saying the firm holds his private financial information and that Mere discussed his position with the partnership. Tim proposes an information screen: Mere has gone, her files are archived, and no one now at the firm will look at them. Sonia is content to proceed and does not want to change lawyers.
1. Can Harbour Legal act for Sonia? Analyse the conflict and confidentiality issues and the effect of Mere having left the firm.
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The principles. A lawyer must not act where there is a conflict of interest or a real risk of one, and must never use or disclose a former client's confidential information (rr 6 and 8 of the Rules of Conduct and Client Care; the general law in Prince Jefri Bolkiah v KPMG [1999] 2 AC 222). The jurisdiction is protective, and the burden of showing there is no real risk lies on the firm.
Application. (1) Neil is a former client. (2) The earlier matter is related to, not merely adjacent to, the new one: the value of the shares, the sale proceeds and Neil's financial statements are the subject matter of Sonia's claim. (3) The firm therefore holds Neil's confidential information relevant to the new retainer. The duty of confidentiality owed to a former client, and loyalty on a related matter, both point against acting.
Effect of Mere leaving. Departure is relevant but not decisive. The firm can act if there is a genuine documented screen and, in practice, the former client's informed consent - or if the firm can show no real risk of disclosure.
Tim's difficulty. If Mere did discuss Neil's position with the partnership, the knowledge is already inside the firm and no screen can cure it. Tim should not accept Sonia's instructions on the assumption that screening will work.
Conclusion. Unless Neil gives informed consent, the firm should decline.
2. What would a defensible information screen require, what happens if Neil refuses consent, and what should Tim do now?
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A defensible screen. (1) A written protocol identifying the matter, the confidential information and the people excluded. (2) Physical and electronic quarantine of the archived file, with access logs and no route for anyone on Sonia's matter to open it. (3) Undertakings from every lawyer and staff member with any knowledge of the Neil matter that they will not discuss it. (4) A nominated compliance partner to monitor and enforce. (5) A record showing the screen was in place before the conflict arose, not after.
Consent. Neil's informed consent, given with knowledge of the screen and its limits, is the safest foundation. Sonia's consent is irrelevant: her wishes cannot override Neil's confidential information.
If Neil refuses. The firm can act only if confident it can satisfy a court that no real risk exists. Neil can apply for an injunction restraining the firm; the court weighs the risk of disclosure against prejudice to Sonia, and will look closely at the firm's conduct in taking the retainer. A breach may also found a complaint under the Lawyers and Conveyancers Act 2006.
What Tim should do now. On these facts, decline. The claim that Mere discussed Neil's file with the partnership is fatal to any screen, and the cost and risk of a disqualification application outweigh the retainer. Tell Sonia promptly, protect her limitation position, and help her instruct another firm.
3. Sonia asks whether she can see a copy of Neil's 2022 financial statement held on the firm's old file. Advise on what the firm may and may not do.
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The document cannot be used. The 2022 financial statement is Neil's confidential information and is almost certainly also privileged, having been prepared for the sale and for a relationship property negotiation. The duty of confidentiality survives the retainer and is not displaced because Sonia is now a client or because the document would help her.
What the firm must do. Keep the old file quarantined: do not open, copy, read aloud or summarise its contents to anyone working on Sonia's matter. If it has already been accessed, record exactly what was seen, notify the compliance partner and take advice - including whether the firm must decline the retainer altogether.
The legitimate route. If the financial statement is relevant, Sonia can obtain it through the court process: a discovery and inspection request in the relationship property proceeding, or a subpoena to the firm or the company. That route lets Neil object and leaves control with the court. Using the firm's own file would circumvent that protection and breach r 6 and Neil's privilege.
Exposure. If the firm acts for Sonia and uses material from Neil's file, the court may restrain the firm from acting and may exclude the evidence, and the conduct could amount to unsatisfactory conduct or misconduct. The safe course is to tell Sonia, in general terms only, that the firm cannot use material from its former file and that she should pursue formal discovery.