Managing conflicts of interest as an attorney

An attorney must recognise when a proposed transaction benefits themselves or someone close to them. OPG's gifting guidance explains limits on transferring the donor's property without full value and when additional authority may be required. ^[1]

Identify the personal interest before deciding Examples needing scrutiny include buying the donor's home, forgiving a family loan or paying yourself for work. A transaction that seems convenient may still involve a conflict or fall outside the attorney's powers.

Record the relationship, proposed terms and alternatives. Obtain independent valuation or legal advice where appropriate. Agreement between family members does not by itself expand the attorney's authority.

Distinguish expenses from benefits Reimbursement for a supported expense differs from a gift or remuneration. Check the LPA and applicable rules before paying fees to yourself or making transfers that benefit a prospective beneficiary.

Keep records of the decision and expenditure. For gifts, compare the proposal with the donor's previous gifting records without assuming a past habit authorises any future amount. If court authority is needed, obtain it before carrying out the transaction rather than treating later approval as guaranteed.

Identify every benefit created by the proposed arrangement Describe the transaction without relying on a reassuring label. A family loan, discounted sale, waived debt or use of a property without full payment can transfer value even if nobody calls it a gift. Identify who receives the benefit and how they are connected to the attorney. Record the proposed terms and the evidence of value. This allows an adviser to assess the substance of the arrangement instead of accepting an internal description that conceals the donor's contribution or the attorney's personal interest.

Consider indirect benefits as well as money paid to you. A transaction may help your business, reduce an obligation owed by a close relative or improve an asset you jointly own. Those connections should be disclosed before the decision is made. Do not assume that using an intermediary removes the concern. Explain the full arrangement, including any linked transaction, so independent advice addresses the real economic effect. A conflict can remain important even where the attorney sincerely believes that everyone in the family will ultimately be better off.

Keep the donor's decision distinct from the attorney's powers Ask whether the donor can make the particular decision with appropriate support and whether they can obtain independent advice where needed. OPG's gifting guidance explains that attorneys have limited gifting powers and cannot expand them simply by relying on the donor's instructions. Where a donor has capacity to make a gift, the guidance normally envisages the donor making that decision themselves. Substantial gifts and transactions benefiting the attorney warrant careful assessment of capacity, freedom of choice and authority. [1]

Avoid treating an expectation of inheritance as a current entitlement. A prospective beneficiary's preference for preserving or transferring assets is not the same as the donor's present interests. Likewise, a past pattern of generosity does not automatically authorise a new transaction of any size or kind. Give the adviser relevant historical records without assuming they decide the issue alone. The assessment should address the proposed transaction now, including its effect on the donor's resources, needs and continuing commitments.

Obtain evidence that tests the arrangement independently Where value matters, discuss an appropriate independent valuation and the assumptions behind it. A price suggested by the intended buyer may not provide a sufficient basis for an attorney's decision. Identify alternative courses and their practical consequences, including whether no transaction is needed. Ask who should advise the donor and whether you require separate advice because your interests differ. Independence is meaningful when the adviser receives the full facts and can examine the proposal without pressure to approve a prearranged family outcome.

Check the LPA's restrictions and any need for court authority before transferring value. Agreement from other relatives or co-attorneys does not automatically cure a lack of legal power. OPG's guidance describes gifts outside the relevant authority as requiring Court of Protection approval and cautions against self-benefiting arrangements. Do not proceed on an assumption that retrospective approval will be granted. If advice identifies a required application, clarify the evidence, scope and timing before committing the donor to the proposed transaction. ^[1]

Record a decision without treating paperwork as permission Keep the proposal, relationship disclosures, valuation and advice together. Record the donor's participation and any material uncertainty, distinguishing factual evidence from an attorney's belief about what the donor would have wanted. A careful file can explain how an issue was considered, but it cannot create authority that the law or instrument does not provide. If the proposal changes after advice, ask whether the revised terms need further assessment rather than assuming the earlier conclusion covers a different benefit or recipient.

If a questionable transfer has already occurred, preserve the records and seek prompt advice about the next step. Do not disguise it as an expense, alter the historical explanation or make compensating transfers without understanding their effect. Identify what was paid, to whom and under what purported authority. The response may involve information, repayment, reporting or an application, depending on the circumstances. Handling the issue transparently gives the adviser a basis to protect the donor's position and assess the attorney's responsibilities accurately.