Solicitors can later act for opposing party

LAW REPORT: 16 May 1995

Re a firm of solicitors.

Chancery Division (Mr Justice Lightman).

4 May 1995.

A solicitor who was a former partner in a firm retained by one party in litigation can subsequently act for an opposing party in the litigation if he shows that there is no risk that he is in possession of relevant confidential information.

Mr Justice Lightman refused an application by three companies for an injunction to restrain a solicitor who was a former partner in a firm of solicitors retained by the companies in litigation from acting as solicitor for a defendant in the litigation.

The companies were plaintiffs in very substantial patent litigation concerning hepatitis C virus and related products. The partner was in the intellectual property department of the firm of solicitors retained by the companies but was not involved in the companies' litigation. He left the firm to join another firm of solicitors which, two-and-a- half years later, was retained by one of the defendants in the patent litigation to act as its solicitors. The companies applied to restrain the partner from acting in the litigation.

Anthony Watson QC and Richard Meade (Bristows Cooke & Carpmael) for the companies; Steven Gee QC (Hammond Suddards) for the partner.

MR JUSTICE LIGHTMAN said that the partner, whose honesty, integrity and good faith was in no way challenged, maintained he was possessed of no confidential information belonging to the companies and that he should be available to serve his new client. The companies concern was that although the partner had no present recollection of any information, his recollection might be triggered by future events if he had conduct of the litigation.

The basis of the court's intervention was not a possible perception of impropriety: it was the protection of confidential information. For the purpose of the law imposing constraints on solicitors acting against the interests of former clients, the law was concerned with the protection of information which (a) was originally communicated in confidence; (b) at the date of the later proposed retainer was still confidential and might reasonably be considered remembered or capable, on the memory being triggered, of being recalled; and (c) relevant to the subject matter of the subsequent proposed retainer.

Having regard to the close fiduciary relationship between a client and a firm of solicitors, the burden must be on any person who was a partner in a firm that became possessed of confidential information to establish there was no risk of his misusing confidential information before he could thereafter act against that client.

The solicitor must show there was no reasonable prospect of any conflict between his duty to his previous client and his personal interest in obtaining the new retainer and his duty to his new client, and not merely that he was not in possession of any relevant confidential information but there was no risk that he had such information.

If stricter rules were thought desirable, and if the rule in America precluding such a partner from acting was to be adopted, the Law Society might adopt such a rule of conduct if it thought it appropriate. Firms might insert appropriate provisions in their partnership agreements restricting the freedom of partners to act against former clients and clients might insist on such a provision in the contract of retainer.

On the facts of the case there was no real risk that relevant confidential information was possessed by the partner.

The companies were not entitled to the injunction.

Ying Hui Tan, Barrister