R Stewart v McClure Naismith Brodie and Macfarlane, 1886 13 CSIH
Citation: R Stewart v McClure Naismith Brodie and Macfarlane, 1886 13 CSIH
Rule of thumb 1: Can you act for both a lender & a buyer in a conveyancing transaction? Yes, if the parties agree to waive the conflict of interest.
Rule of thumb 2: Can an agent act where there is a conflict of interest? Only if this is put to the party & they agree to waive it – this is only for common law conflicts of interest & if this is forbidden in statute however then it cannot be waived.
Judgment:
Lawyers can act in conveyancing transactions for both lender and creditor when there is a conflict of interest, but if a complaint is made then the onus of proof to show no bias at all is high and difficult to discharge, ‘Where, as here, a law agent undertakes double agency – agency for both the borrower and also for the lender – he places himself in a very responsible position. I do not say that the position of acting for both parties is one in which the duties are incompatible, but I do say that the responsibility of that position is very considerable with reference to the duty to be discharged to the lender. Should any question arise, such as occurs in this case, I think it is incumbent on the agent to show that he was scrupulously careful in the discharge of his duty to the lender, because an agent who is also acting for the borrower is also in some respects for an opposing interest, and is liable to the influence or bias which that opposing interest may create’, Lord Shand
Warning: This is not professional legal advice. This is not professional legal education advice. Please obtain professional guidance before embarking on any legal course of action. This is just an interpretation of a Judgment by persons of legal insight & varying levels of legal specialism, experience & expertise. Please read the Judgment yourself and form your own interpretation of it with professional assistance.