It is advisable to act for one client only
You must not act for more than one client where there is an actual or potential conflict, for example, between an older person and their adult child.
If you are contemplating acting for more than one party, you need to be sure that the advice you are giving each one would still be the same if you were not acting for the other, and that their individual interests will still be properly protected. If you are unsure, then you should not act for the two parties. (In the type of dealings covered by this guide, this will almost certainly be the case.)
To ensure confidentiality and develop trust, and to ensure that you get the whole story, it is also advisable to interview your client without anyone else present (unless you need an independent interpreter). It is important, however, to recognise the role of support people. If a client asks for a support person to be present, and privilege is not an issue, a support person’s presence could be considered for the initial introduction, provided they are a neutral person.
You need to be absolutely independent of the party with the influence or control over the older person. You need to clearly state that you cannot take instructions from the adult child/relative of your client or any other party with an interest in the transaction. If a family member with an interest in the transaction insists on being present, inform them of your professional obligations and explain that in order to advise your client properly, you need to speak to your client in confidence. (It can be difficult to convince clients that family members must be sent elsewhere for independent legal advice, but that is what must be done.)
Confirmation of instructions taken alone and any correspondence or follow-up work should be sent to your client and not to their children or other family members.
For advice on potential conflicts of interest:
call the Law institute of Victoria Ethics Advice line on 03 9607 9336 or visit the Ethics section of the LIV website.
Case study
Transfer of house with licence to reside in exchange for care – possible conflict of interest
Maud is 77 years old. She owns a house in the suburbs of Melbourne. Lately she has observed a gradual decline in her general health and feels she is starting to become quite forgetful. She has three adult children, who all live in Melbourne. None of her children get on with each other. Her youngest daughter, Julia, is the closest to Maud; she is not married and helps her mother manage her day-to-day affairs and household chores. They have a lovely relationship. Julia has suggested to her mother that she transfer her house into Julia’s name and that Julia will give her a licence to reside there for life. In exchange, Julia has promised Maud that she will care for her in the home until her death.
Maud and Julia come to you to do the conveyancing and to prepare a licence agreement.
Considerations:
- Who is your client?
- Who would you seek instructions from?
- Would your client’s interest be properly protected if you acted for both parties in this transaction?
- Would you interview Maud and Julia together?
- Has Maud come to your office of her own free will?
- Is Maud making the decision of her own free will?
- Can you identify a potential conflict?
Seniors Rights Victoria’s view
The client should be Maud or you should not act at all. A conflict arises because there is a proposed disposition of assets with inadequate consideration. The relationship between mother and daughter is good now but there is potential for it to break down. No protection has been put in place for Maud. There are issues of Maud’s dependence on her daughter and of her capacity.
Advice given to Maud should be comprehensive and you would need to make an assessment of her capacity. (See Capacity.)