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CCCA_V2No4_ConflictMgmt-FIN.qxd:CCCA_V1No1_DriversSeat-FIN.qxd 11/24/08 2:51 PM Page 28 Feature Keith Perrett Managing Director of Litigation Bank of Montreal, Toronto coming down, go out and retain counsel, and advise them on the Conflicts as tactics problem.And then,if you and they have to sit and wait,they’ve got Several corporate counsel report an increase in the use of con- to sit and wait. But at least you’re not trying to get in at the end, flicts as a weapon in litigation. Some companies have used a after everybody else is taken.” “preemptive strike” strategy: dispersing a variety of files out to And to counter any potential future conflicts problems,it’s best several law firms, then taking the position that none of these to deal with multiple familiar firms.“Putting all your eggs in one firms can litigate against them in the event of a dispute. basket these days is a bit of a dangerous thing,” says Perrett. No The simple allegation that the other party’s lawyer has a con- one wants to be starting off with brand new counsel on an flict is a way to gain leverage in a dispute. It may not happen fre- important matter, especially on a bet-the-company file. quently, but it’s on the rise,says Currie.“That’s something I think Years ago, corporate counsel at large companies would send all everybody would agree is not to be encouraged, in fact, actively their litigation to one firm. No longer. Perrett picks and chooses discouraged.” Conflicts should be dealt with when there are real from a list of firms, depending upon the size and type of the file conflicts, not perceived ones created for tactical reasons, he says. and the size and type of the firm.And it’s better to have a slight- Finding out halfway through a matter that “your lawyer [has ly longer list, he says. been] knocked out of the box can represent a very substantial “The problem with managing all of that is that in order to keep negative development to your file,” says Currie, especially when people loyal, you still have to have a volume of work necessary to he or she has been working for months or even years on a file. keep them occupied,” he notes. “So it’s a bit of a management “You’ve spent a great deal of money on the lawyer of your thing from time to time. I guess if you’re getting sued a heck of choice, only to find out that he or she is no longer the lawyer of a lot, it makes it easier.” your choice.” Perrett often hires boutique firms in the jurisdictions he knows If it’s for reasons of legitimate conflict, that’s one thing. But if he will use.There tend to be fewer conflicts with them than at it’s being done by the other side as a matter of leverage in the larger national firms, although he says that’s now changing. “As lawsuit, when there isn’t any risk to the lawyer’s loyalty or confi- ALENA GEDEONOVA the boutique firms get bigger, their client base gets bigger, and dentiality, that’s an entirely different matter. therefore their potential for conflict gets larger as well.” Currie adds that the vast majority of such issues are resolved 28 CCCA Canadian Corporate Counsel Association WINTER 2008