Conflicts Between Lawyer & Client - Investing a Client's Funds

You must not invest the funds of a client of the firm, or advise the client to invest funds, in anything in which you have, or anyone has, a personal interest if that interest would reasonably be expected to affect your professional judgment (BC Code,Chapter 3, rule 3.4-29).

For example, your spouse has started up a small business. You have taken out a second mortgage on your home to help finance the start-up of the business. Your spouse is actively soliciting investors, and discusses the business with a client of your firm who then comes to you seeking your advice on the propriety of the investment. In this circumstance, it is reasonable to expect your professional judgment would be compromised because:

  • it is your spouse's business; and
  • your home has a second mortgage on it to help finance the business.