conflict of interest

n. a situation in which a person has a duty to more than one person or organization, but cannot do justice
to the actual or potentially adverse interests of both parties. This includes when an individual's personal
interests or concerns are inconsistent with the best for a customer, or when a public official's personal
interests are contrary to his/her loyalty to public business. An attorney, an accountant, a business adviser
or realtor cannot represent two parties in a dispute and must avoid even the appearance of conflict.
He/she may not join with a client in business without making full disclosure of his/her potential conflicts,
he/she must avoid commingling funds with the client, and never, never take a position adverse to the
customer.

What is a Conflict of Interest?

A conflict of interest is a situation in which an individual has competing interests or loyalties. A conflict of interest

can exist in many different situations. The easiest way to explain the concept of conflict of interest is by using some

examples.

 with a public official whose personal interests conflict with his/her professional position.

 with a person who has a position of authority in one organization that conflicts with his or her interests in

another organization

 with a person who has conflicting responsibilities.

 Conflicts of interest for individuals and organizations are not uncommon given the multitude of transactions
and relationships that occur in politics, government, industry, science, commerce, research, education, and

the professions. A conflict of interest arises from a connection between two or more individuals or
organizations, or between an individual and an organization. It is a relationship, not an action. So, a person

or organization cannot commit or perform a conflict of interest.

 A particular conflict of interest is neither good nor bad, but its presence can interfere with perceptions about

a person's objectivity and independence. Someone exploiting a conflict of interest or mishandling conflicting
relationships can cause injury. For that reason, conflicts of interest are managed by recognizing a potential

or existing conflict, judging the risk of it leading to harm, deciding what level of risk is acceptable, and
reducing the conflict to a tolerable level. In some cases managing the conflict may not be sufficient to deal

with perceptions, so eliminating it may be the only solution. Objective analysis is key, otherwise flawed
preconceptions (e.g., there is no conflict of interest unless there has also been harm) and long-standing

customs can obscure the fact that a conflict of interest exists.

 He/she may not join with a client in business without making full disclosure of his/her potential conflicts,
he/she must avoid commingling funds with the client, and never, never take a position adverse to the
customer.
I. INTRODUCTION
Conflicts of interest for individuals and organizations are not uncommon given the multitude of transactions
and relationships that occur in politics, government, industry, science, commerce, research, education, and the
professions.
A conflict of interest arises from a connection between two or more individuals or organizations, or between
an individual and an organization. It is a relationship, not an action. A conflict of interest exists------

“if there is a substantial risk that the lawyer’s representation of the client would be materially and
adversely affected by the lawyer’s own interests or by the lawyer’s duties to another current client, a former
client, or a third person.” The key is whether the lawyer’s exercise of independent professional judgment is
likely to be unduly influenced by other interests.

A particular conflict of interest is neither good nor bad, but its presence can interfere with perceptions about
a person's objectivity and independence.

II. WHAT IS CONFLICT OF INTEREST?

1. A situation in which an individual has competing interests or loyalties.

2. A situation in which a person has a duty to more than one person or organization, but cannot do justice to
the actual or potentially adverse interests of both parties.

A lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A
concurrent conflict of interest exists if:
(1) the representation of one client will be directly adverse to another client; or
(2) there is a significant risk that the representation of one or more clients will be materially limited by
the lawyer’s responsibilities to another client, a former client or a third person or by a personal interest of the
lawyer.

This includes when an individual's personal interests or concerns are inconsistent with the best for a
customer, or when a public official's personal interests are contrary to his/her loyalty to public business.

The extent to which lawyers will confront potential conflicts of interest is influenced by the size, type, and
location of practice. For example, lawyers in specialized practice areas, or serving tight-knit ethnic communities, or
practicing in small towns are more susceptible to conflicts owing to the interrelationships among their
constituencies. But key strategies can help all lawyers avoid conflicts that can damage their reputations and lead to
liability or discipline.

III. REFLECTION

Lawyers must take conflicts seriously. They must be aware of interests that could impair their current or
future independent professional judgment and should regularly use thorough conflict-checking systems before
taking on all representations. In most cases, even where potential conflicts are identified, attorneys have a range of
choices to resolve those conflicts; the ultimate course of action will often depend on the lawyer’s degree of risk
adversity, the nature of the community, and law firm economics.

Managing conflicts requires staying on top of the situation, gathering and using relevant information, and
not letting personal relationships or the desire for income cloud your better judgment. A lawyer cannot have a
practice completely free of conflicts; they are inherent in the practice of law. But, using appropriate procedures, a
lawyer can prevent those conflicts from interfering with a successful practice.