The Not-So-Bright Line Rule: Lingering Questions about Lawyers' Duty of Avoid Conflicting Interests Following CN Railway v. McKercher

Abstract

CN Railway v McKercher presented the Supreme Court of Canada with the opportunity to clarify the “bright line” rule governing lawyers’ duty of loyalty to current clients, and set limits that would guide the profession in assessing potential conflicts of interest. Unfortunately, the Court did not take sufficient advantage of this opportunity. Although the decision injects some further clarity into the bright line rule, many questions remain with respect to its proper application. The Court introduced new uncertainties into the law by holding that the bright line rule is of limited scope, without providing practical guidance as to how this scope is constrained. Although the Court listed factors for lower courts to consider when asked to disqualify counsel for a breach of the rule, it neglected to apply this analysis to the facts before it. Finally, it is not clear that the rule as formulated appropriately targets the risk of impaired representation – the rule remains both overbroad and under-inclusive. These lingering questions will be left for the lower courts to resolve, and one hopes that further clarity will emerge in future cases.