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Exercising independent legal judgment requires an objective detachment from the client's interests. This objectivity may be compromised by financial or personal conflicts. Conflicts of interest are usually thought of as limited to situations in which an attorney attempts to represent parties with conflicting interests. Attorneys usually avoid such obvious conflicts. The more common problem is a conflict between the attorney's interests and the client's interests. This is always the case when attorneys provide legal advice to their business partners. A special problem is the lack of objectivity that arises when attorneys are patients of their physician clients.

It is not unusual for attorneys to identify with physician clients. They have common educational backgrounds, interests, and friends. Because of this identification, the attorney may not evaluate the physician's legal problems objectively. This loss of objectivity can hurt the client in many ways. The attorney may not investigate the physician's recitation of the facts diligently or appreciate how a jury will view the physician's actions. These misperceptions increase the risk of poor legal advice. Just as physicians are cautioned about treating their close friends and family members, so should physicians take care to ensure that their attorneys are objective.

Whenever a physician is in a business venture with an attorney, there is potential for confusion of roles. If the attorney acts only as a businessperson, there is no conflict of interest. However, if the attorney also provides legal services or makes legal decisions, there is a conflict with the other participants in the venture.

As long as the interests of all of the participants are the same, this conflict will not be a problem. But in most ventures, the interests of the participants are not the same. It is best if the legal work for the business is done by an attorney who has no financial or other interest in the business. If this is impractical, the nonattorney participants should have a separate attorney review the basic business documents. They should also consult with their own counsel whenever there are changes in the business organization.

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