Trevor Todd and Jackson Todd have over 65 years combined experience in handling estate disputes .

 

In De Cotiis v Decotiis 2026 BCSC 2001the court reviewed the law when an alleged conflict of interest is alleged by the opposing party that confidential information was shared with a lawyer in a firm and the same  firm subsequently acted against the same client. The lawyer deposed that no confidential information or advice was given and what was discussed was not shared with another lawyer in the same firm that then acted against the same client.

The court reviewed the law and allowed the lawyer to act.

 

The seminal decision on the need for adequacy and appropriateness of measures to protect confidential information in solicitor‑client relationships is MacDonald Estate v Martin, 1990 CanLII 32 (SCC), [1990] 3 SCR 1235 [MacDonald Estate]. In that case, a lawyer had received confidential information attributable to a solicitor‑client relationship while working at one law firm and then had transferred to another law firm.

[7]            Justice Sopinka, who wrote the majority judgment, noted that the court in such circumstances is balancing three competing values:

1. a) The concern to maintain the high standards of the legal profession and the integrity of our system of justice.
2. b) The countervailing value that a litigant should not be deprived of his or her choice of counsel without good cause.
3. c) The desirability of permitting reasonable mobility in the legal profession.

[8]            The third of these competing values is not at issue in the present case.

[9]            After a detailed review of the approach taken in numerous other jurisdictions as well as by trial and appellate courts within Canada, Justice Sopinka concluded that:

[…] [T]he test must be such that the public represented by the reasonably informed person would be satisfied that no use of confidential information would occur. That, in my opinion, is the overriding policy that applies and must inform the court in answering the question:  Is there a disqualifying conflict of interest? […]

Typically, these cases require two questions to be answered: (1)Did the lawyer receive confidential information attributable to a solicitor and client relationship relevant to the matter at hand? (2) Is there a risk that it will be used to the prejudice of the client?

[10]         With respect to the first question, Justice Sopinka held:

[…] [O]nce it is shown by the client that there existed a previous relationship which is sufficiently related to the retainer from which it is sought to remove the solicitor, the court should infer that confidential information was imparted unless the solicitor satisfies the court that no information was imparted which could be relevant. This will be a difficult burden to discharge. Not only must the court’s degree of satisfaction be such that it would withstand the scrutiny of the reasonably informed member of the public that no such information passed, but the burden must be discharged without revealing the specifics of the privileged communication. […]

[11]         With respect to the second question (the risk of prejudice to the client), Justice Sopinka distinguished between cases where the same lawyer who was originally provided with confidential information now seeks to act against the former client (in which case disqualification is automatic), and those where the lawyer with the confidential information is a partner or associate in the same firm as the lawyer who was acting. He rejected applying the concept of “imputed knowledge” where it would be assumed that the knowledge of one member of a firm the knowledge of all. Rather, he held that there is “a strong inference that lawyers who work together share confidences” and:

[…] the court should therefore draw [that] inference, unless satisfied on the basis of clear and convincing evidence, that all reasonable measures have been taken to ensure that no disclosure will occur by the “tainted” lawyer to the member or members of the firm who are engaged against the former client. […]

[12]         Justice Sopinka emphasized the importance of structured protective mechanisms which he was of the view should be established pursuant to guidelines from governing law societies and cautioned against simply accepting general statements from the lawyers involved. He held:

A fortiori undertakings and conclusory statements in affidavits without more are not acceptable. These can be expected in every case of this kind that comes before the court. It is no more than the lawyer saying “trust me”. This puts the court in the invidious position of deciding which lawyers are to be trusted and which are not. Furthermore, even if the courts found this acceptable, the public is not likely to be satisfied without some additional guarantees that confidential information will under no circumstances be used.

[13]         In accordance with the view expressed by Justice Sopinka that the Law Societies should establish guidelines, the BC Law Society has established the Code of Professional Conduct [Code].

[14]         Rule 1.1‑1 defines “client” for purposes of the Code, unless the context indicates otherwise as:

“Client” means a person who:

(a) consults a lawyer and on whose behalf the lawyer renders or agrees to render legal services; or

(b) having consulted the lawyer, reasonably concludes that the lawyer has agreed to render legal services on their behalf.

[15]         The definition would seem to exclude a situation where an initial free consultation did not result in any agreement to render legal services. However, commentary to the R 3.3‑1 states:

[4] A lawyer also owes a duty of confidentiality to anyone seeking advice or assistance on a matter invoking a lawyer’s professional knowledge, although the lawyer may not render an account or agree to represent that person. A solicitor and client relationship is often established without formality. A lawyer should be cautious in accepting confidential information on an informal or preliminary basis, since possession of the information may prevent the lawyer from subsequently acting for another party in the same or a related matter.

See s 3.4 (Conflicts).

[16]         As well, commentary 1 to R 1.1‑1 provides that a lawyer‑client relationship may be established without formality.

[17]         Rule 3.4‑1 provides that:

A lawyer must not act or continue to act for a client where there is a conflict of interest, except as permitted under this Code.

[18]         Rule 3.4‑11 provides that:

When a lawyer has acted for a former client and obtained confidential information relevant to a new matter, another lawyer in the lawyer’s law firm may act against the former client in the new matter, if the law firm establishes, in accordance with Code rule 3.4‑20 (Law firm disqualification), that it is reasonable that it act in the new matter, having regard to all relevant circumstances, including:

(a) the adequacy and timing of the measures taken to ensure that no disclosure of the former client’s confidential information to the partner or associate having carriage of the new matter will occur;

(b) the extent of prejudice to any party; and

(c) the good faith of the parties.

[19]         The commentary to this rule states:

[1] The guidelines following commentary [3] to Code rule 3.4‑20 (Law firm disqualification) regarding lawyer transfers between law firms provide valuable guidance for the protection of confidential information in the rare cases in which, having regard to all of the relevant circumstances, it is appropriate for another lawyer in the law firm to act against the former client.

[20]         For context, R 3.4‑20 deals with the transfer of lawyers between law firm, which is not at issue in this case, and states:

If the transferring lawyer actually possesses confidential information relevant to a matter respecting the former client that may prejudice the former client if disclosed to a member of the new law firm, the new law firm must cease its representation of its client in that matter unless:

(a) the former client consents to the new law firm’s continued representation of its client; or

(b) the new law firm has:

(i) taken reasonable measures to ensure that there will be no disclosure of the former client’s confidential information by the transferring lawyer to any member of the new law firm; and

(ii) advised the lawyer’s former client, if requested by the client, of the measures taken.

[21]         Commentary 3 expands on what might be considered reasonable measures stating:

[3] The guidelines that follow are intended as a checklist of relevant factors to be considered. Adoption of only some of the guidelines may be adequate in some cases, while adoption of them all may not be sufficient in others.

Guidelines:  How to screen / measures to be taken

1. The screened lawyer should have no involvement in the new law firm’s representation of its client in the matter.
2. The screened lawyer should not discuss the current matter or any information relating to the representation of the former client (the two may be identical) with anyone else in the new law firm.
3. No member of the new law firm should discuss the current matter or the previous representation with the screened lawyer.
4. The law firm should take steps to preclude the screened lawyer from having access to any part of the file.

4.1 The measures taken by the new law firm to screen the transferring lawyer should be stated in a written policy explained to all lawyers and support staff within the law firm.

5. The new law firm should document the measures taken to screen the transferring lawyer, the time when these measures were put in place (the sooner the better), and should advise all affected lawyers and support staff of the measures taken.
6. These guidelines apply with necessary modifications to situations in which non‑lawyer staff leave one law firm to work for another and a determination is made, before hiring the individual, on whether any conflict of interest will be created and whether the potential new hire actually possesses relevant confidential information.