Background 

Mr N was a director of a firm and had recently separated from his wife, Ms F. Mr N and Ms P then entered into a relationship.  

Mr N and Ms F had a family trust. After their relationship ended, Mr N commenced court proceedings to replace the existing trustees (himself, his fellow director and Ms F). Ms P represented Mr N in this matter.  

Issue 

Ms F complained that Ms P engaged in conduct which would reasonably be regarded by lawyers of good standing as disgraceful or dishonourable. She did not understand how Ms P could act for Mr N, given the requirements under the RCCC.  

Entering into an intimate personal relationship 

The Committee considered whether Ms P had breached rule 5.7.1 of the RCCC, which prohibits lawyers from entering into an intimate personal relationship when representing a client in any domestic relations matter.  

Since Mr N and Ms P were already in a relationship before she began acting for him in the family trust matter, the Committee determined that it could not be said that she “entered into” an intimate relationship. However, the “inevitable erosion” of her independent judgment was relevant to the application of other rules.  

Requirement to be independent and free from compromising influences or loyalties 

The Committee commented that the independence of counsel is particularly important when the proceedings relate to a relationship breakdown, as was the case here. Input from counsel must be “dispassionate” and “objective” in these matters. The Committee noted that Mr N’s interests would have been better served by a lawyer who was wholly independent of his personal life. 

The Committee’s view was that Ms P could not claim to be independent and free from compromising influences or loyalties, considering her personal involvement with Mr N. This was a breach of rule 5 and, when taken with the fact she was acting in litigation where her independence was in question, a breach of rule 13.5 of the RCCC.  

Acting where there is a conflict or risk of conflict 

Rule 5.4 provides that lawyers must not act where there is a conflict or a risk of a conflict of interests. Ms P decided not to act for Mr N in a separate Family Court proceeding for this reason. However, the Committee’s view was that the same conflict arose in the family trust proceedings, although perhaps to a lesser extent.  

It was unsurprising to the Committee that Ms F took issue with Ms P acting. Such a reaction was foreseeable in the circumstances, and the Committee noted that this is something Ms P should have considered before agreeing to represent Mr N.

The Committee strongly suspected that Ms P’s role as counsel for Mr N would have made an already difficult relationship property settlement worse. While Ms P may have considered the Family Court and trust matters to be separate, it was understandable that Ms F did not make the same distinction, as both sets of proceedings flowed from the breakdown of her marriage to Mr N.  

It was determined that there was at least a risk of conflict in the family trust proceedings between the interests of Mr N and Ms P, and that this was a breach of rule 5.4. Ms P was reminded to exercise particular caution in the future when considering issues of independence. The Committee noted generally that if there are any doubts as to matters of independence, a lawyer should not act.  

Penalty 

The Committee concluded that Ms P had breached rules 5, 5.3, 5.4 and 13.5 of the RCCC and that this amounted to unsatisfactory conduct. She was ordered to pay a fine of $1,000 and costs of $750.