A conflict of interest relevant for the purposes of appointing a special guardian pursuant to Article 78 of the Code of Civil Procedure arises in arbitration proceedings where a party brings an action simultaneously against both a company and its legal representatives, who are sued both in their capacity as organs of the legal entity and in their personal capacity, where the claims seek to establish the joint and several or pro rata liability of the company and the directors for conduct specifically attributable to each of them, given that the legal representatives have an interest that is antithetical and not convergent with that of the entity, having an interest in ensuring that the prejudicial financial consequences fall upon the company rather than upon their personal assets.
The conflict of interest between the company and its legal representatives, relevant for the purposes of appointing a special guardian in arbitration proceedings, is not removed by the appointment of an additional director who is not part of the original corporate structure, where the claims entail the establishment of joint and several or pro rata liability of the entity and the individual directors for conduct specifically ascribed to them, there being in such case an inherent conflict that cannot be overcome by supplementing the board of directors with persons who are added to, without replacing, the legal representatives against whom the action is brought.