Diagnosing Live Within-Policy Instruction Conflicts in LLM Agents with Witnessed Resolution Profiles
Authors: Lu Yan, Xuan Chen, Xiangyu Zhang
Organizations: Purdue University
Abstract
LLM agents are governed by long-lived natural-language prompt policies, but individually reasonable standing rules can interact in uninspected ways. We study live intra-policy rule-conflict diagnosis: finding rule pairs inside a single prompt policy that can co-govern a realistic state, and measuring how models resolve that pressure in responses or tool actions. We introduce WIRE, a Witnessed Intra-policy Rule Evaluation pipeline. WIRE extracts source-grounded rules, encodes them as PyRule clauses, uses satisfiability checks to retain same-surface hard-collision candidates, realizes those candidates as concrete co-governance witnesses, and judges model outputs against the original source-rule text. Across six public prompt policies, WIRE extracts 276 source rules and 560 atomic clauses, classifies 30,944 within-policy clause-pair comparisons, retains 170 encoded hard-collision candidate source-rule pairs, and realizes them as 1,402 concrete witnesses. In policy-only evaluation, these witnesses yield 13,335 post- generation trials where both source rules govern and both compliance labels are judgeable. Only 35.4% fall in joint compliance; 64.6% violate at least one governed source rule. These profiles are conditional diagnostics for WIRE-selected candidates, not deployment-frequency or causal excess failure estimates, but they reveal distinct policy, model, and tool-action resolution patterns.
LLM agents handle user requests on behalf of organizations through tool calls and must follow the company policies stated in their system prompts. Prior work approaches this as a safeguarding problem -- external checks that block non-compliant agent actions. We argue that policy adherence is a broader problem: real workflows unfold across many turns, require explicit user confirmation and prerequisite reads, and hinge on the content of the dialogue rather than on any single argument value. Meeting this bar requires (i) full conversation context, (ii) self-reasoning over the policy and the current dialogue, and (iii) conversation-specific remediation that guides the agent's next turn -- three capabilities that prior safeguard work has often underestimated. We introduce POLICYGUARD, a sub-agent verifier that shares the agent's view of the dialogue, reasons over the policy in context, and provides actionable feedback for the agent's next turn. On tau^2-BENCH airline across three vendors (GPT-5.4, Claude Sonnet 4.6, Gemini 2.5 Pro) with four trials per setting, POLICYGUARD improves PASS4 by +12.0 / +6.0 / +12.0 pp. Per-call analyses show POLICYGUARD achieves higher policy-violation recall while blocking roughly half as often as argument-level guards.
Large language models (LLMs) often encounter conflicting prompts, although current instruction following benchmarks assess those meta-instructions in isolation, limiting the insights about how models process conflicting instructions. We introduce a framework \textit{PRIME}(\textit{Prompt Resolution under Incompatible Meta-Instructions Evaluation}) to analyze behavior of LLMs when provided with conflicting instructions. \textit{PRIME} purposefully produces calibrated conflicts across response length, output format, and reasoning; classifying model responses with a deterministic behavioral taxonomy. We are evaluating five instruction tuned open weight LLMs in two distinct settings, balanced and naturally distributed. The conclusion we reach upon analysis is that conflict type is more significant in affecting behavior than model scale, and various failure modes across different categories of conflict. Our findings emphasize the value of developing conflict awareness and suggest ability of LLM to follow instructions cannot be assessed through isolated constraints alone.
LLM agents operating under organizational policies must comply with authorization constraints typically specified in natural language. In practice, such specifications inevitably contain ambiguities and logical or semantic gaps that cause the agent's behavior to systematically diverge from the true requirements. We ask: by letting an agent evolve its policy understanding through interaction and corrective feedback from pre-deployment testing, can it autonomously refine its interpretation to close specification gaps? We propose PolicyBank, a memory mechanism that maintains structured, tool-level policy insights and iteratively refines them -- unlike existing memory mechanisms that treat the policy as immutable ground truth, reinforcing "compliant but wrong" behaviors. We also contribute a systematic testbed by extending a popular tool-calling benchmark with controlled policy gaps that isolate alignment failures from execution failures. While existing memory mechanisms achieve near-zero success on policy-gap scenarios, PolicyBank closes up to 82% of the gap toward a human oracle.