Don't Disclose Deal's Details to Attorney Before Checking Conflicts of Interest

If you are engaging a real estate attorney for a new deal, don't spend time and money disclosing the deal's details to the attorney before you are sure that no conflict of interest exists that could prevent him from fairly representing your interests, says real estate expert Kevin M. Fogel. This advice applies whether the attorney is new to you or one with whom you have worked in the past. If you discover a conflict of interest after you have hired the attorney, you might have to change attorneys or law firms. Worse yet, you could get stuck with a bill for his legal services incurred up to the date that the conflict was discovered, he warns.

Protect yourself by giving the attorney the names of all of the people and/or business entities that are or may become involved in the matter. Do this as early as possible during your initial conversation with the attorney, suggests Fogel. Then request that the attorney promptly check his and his firm's records to see whether he or his firm currently represents those people or entities in any other matters. If no conflicts of interest exist, you can talk about the deal's details with the attorney, he says.

Fogel recently experienced a potential conflict of interest problem with his attorney. After several months of intensive marketing and negotiating a sale of his commercial property to the prospective buyer, Fogel's attorney notified him of a conflict of interest within his law firm. The firm had recently represented the same buyer in an unrelated transaction.

Fogel was advised that to solve this problem, he or the buyer could get a new attorney. Fortunately, Fogel later learned that the firm no longer represented that buyer and there was no conflict of interest. But that stressful situation could have been avoided with a conflict of interest check early on, he notes.

Insider Source

Kevin M. Fogel, MSRE: President, KMF Property Group, Inc., Oceanside, NY