Problematic situations can also arise when an individual collects confidential information in the course of his or her professional duties. Any such information used by an employee for personal purposes constitutes a major conflict of interest, at least in the United States. The financial sector is constantly confronted with this type of conflict of interest in the form of insider trading.  Generally, a lawyer may take contradictory legal positions before different courts at different times on behalf of different clients. The mere fact that the representation of a legal position on behalf of a client may set a precedent contrary to the interests of a client represented by the lawyer in an unrelated case does not create a conflict of interest. However, a conflict of interest exists when there is a significant risk that the action of a lawyer on behalf of a client will significantly limit the lawyer`s effectiveness in representing another client in another matter; For example, when a decision in favour of one client sets a precedent that seriously weakens the position taken on behalf of the other client. Factors relevant to determining whether clients should be informed of the risk include: whether the cases are pending, whether it is a substantive or procedural matter, the temporal relationship between the cases, the importance of the matter to the immediate and long-term interests of the clients involved, and the reasonable expectations of the clients regarding the continuation of the lawyer`s services. If there is a significant risk of significant restriction, the lawyer must refuse one of the representations or withdraw from one or both cases without the informed consent of the clients concerned.  Informed consent requires that each affected client be aware of the relevant circumstances and the real and reasonably foreseeable possibilities in which the conflict could adversely affect that client`s interests. See Rule 1.0(e) (informed consent). The information required depends on the nature of the conflict and the nature of the risks involved. If multiple clients are represented in a single case, the information must include the effects of joint representation, including the potential implications for loyalty, confidentiality and solicitor-client privilege, as well as the associated benefits and risks. See notes  and  (Confidentiality implications of joint representation).
Rules of professional conduct have evolved in such a way that almost all clients and lawyers have different interests to some extent. The «different interests» standard used in early drafts of the ABA Model Code of Professional Liability was ultimately rejected as too broad and unworkable. See, for example, Disciplinary Rule 5-105 A, ABA Model Code of Professional Liability, 1969. The current model of professional ethics and ABA jurisprudence have established a standard of «adverse effect» on a lawyer`s representation of a client. The differences between clients` interests therefore do not reach the level of a prohibited conflict of interest, unless the different interests affect the lawyer`s representation of a client. A prohibited conflict of interest must play a role. This generally means that conflicting interests must be essential for representation. CPR 1.7(a)(2). «Materiality» is determined by examining the functions performed by the lawyer, either by the type of representation or by agreement with the client. Restatement § 121, cmt.
c(ii), p. 248. Conflicts of interest are a conflict that most often arises between requirements and interests. Different types of conflicts of interest can arise due to the nature of the relationship in relation to the rules of the organizations or federal and state laws. People can easily be biased (have an unfair preference) on small things like friendship, food, or flattery, or they can be influenced to make a decision because they can gain power, prestige, or money. Conflict can arise when a person makes or influences a decision and does so for personal gain, which can be unfair, unethical, or even illegal. The important thing is what you do in each of these situations. Do you allow your family, friends, financial or privileged acquaintances to influence your actions? If you do, you could be violating state laws and university policies. A conflict of interest may also exist when a person has to respond to two different individuals or groups whose needs conflict with each other. In this case, serving one person or group will harm the other. A conflict of interest in business generally refers to a situation where a person`s personal interests conflict with the professional interests owed to their employer or the company in which they are invested.
A conflict of interest arises when an individual chooses personal gain over duties to an organization in which he or she is a stakeholder or uses his or her position in any way for personal gain. Factors relevant to determining whether a conflict of interest may affect a lawyer`s representation of a client include (1) the length and intimacy of the lawyer`s relationship with the client(s) involved; (2) the work to be performed by the advocate; (3) the likelihood of actual conflict occurring; and (4) the probable harm to Customer resulting from the dispute if it occurs. Colo. RPC 1.7, cmt. ; ABA Annotated Model Rules of Professional Conduct 1.7, cmt. , 5th ed. (American Bar Association Center for Professional Responsibility, 2002). The question is often one of proximity and degree.
Id. Restatement § 121, cmt. c. Conflicts are classified as actual or potential. Menschen v. Delgadilio, 275 pp.3d 772, 776 (Colo. App. 2012). A real conflict of interest is a real and material conflict, whereas a potential conflict of interest is possible or arising but is likely to occur during the presentation. The comment on the rewording states: «Unless there is a risk that the lawyer`s representation will be `negatively affected`, there is no conflict of interest.» Restatement § 121, cmt.