In an effort to reduce professional indemnity insurance premium payments, Ireland’s Law Society will be convening a special general meeting in order to discuss the abolition of so-called ‘Chinese walls’ which permit major firms to act for clients in opposition to them.
The Law Society was petitioned by the Mayo Solicitors Bar Association for the meeting. The MSBA also stated that the scrapping of undertakings on solicitors for residential conveyancing might also result in a reduction to professional liability insurance premiums.
John Costello, Law Society president, and other officers of the society, will be meeting with the motion’s sponsors within the coming week. The society is understood to be already considering the issues raised by the Mayo solicitors; however the general meeting of the Law Society is scheduled for 18 June, provided the sponsors do not cause a ruckus in regards to business liability insurance premiums.
One Mayo association senior member recently stated that the Law Society initially drew up draft guidelines in the 1990s suggesting that one transaction should not include several parties being represented by solicitors. However the larger firms turned down the guidelines and instead used so-called ‘Chinese walls’ in order to avoid any conflicts of interest.
The association member continued, remarking that it was decided by the Law Society that solicitors should not be acting for first-time developers, builders, and purchasers. The larger firms had no objection as they typically had no business with small-scale first-time purchasers, the spokesperson added.
The larger firms once more shot down new proposals made around five years ago to ban Chinese walls. The Law Society effectively ceased to pursue the issue since then.