March 10, 1994
Digest: A full-time judge may remain a shareholder of the professional corporation under which he/she practiced law, solely for the purpose of winding up its affairs.
Rules: Code of Judicial Conduct, Canon 5 (f).
The inquiring full-time judge took office on January 1, 1994. Since 1982 the judge had been practicing law as a professional corporation in which he/she is the sole shareholder, director and officer. Substantial legal fees are owed to the professional corporation, which also owns considerable assets. The judge’s accountant has advised that to liquidate and dissolve the corporation immediately would result in severe income tax consequences.
The judge notes that the professional corporation will not continue in the practice of law and asks whether his/her continuation as officer and director for the purpose of wrapping its affairs is permitted. Also, inquiry is made as to whether the judge can remain a shareholder and designate his/her spouse - - a non-lawyer - - as secretary of the corporation solely for the purpose of executing documents on behalf of the corporation.
A full-time judge - - as the inquirer acknowledges and as Canon 5 (F) of the Code of Judicial Conduct states - - should not practice law, nor may the professional corporation organized for that purpose practice law. Since neither the judge nor the corporation would be engaged in the practice of law, it is the opinion of the Committee that the corporation may remain in existence and the judge may remain a shareholder of the professional corporation solely for the purpose of winding up its affairs, which would include the collection of fees.
The question of whether the judge’s spouse may be designated as secretary of the corporation is a legal question outside the realm of the Committee’s authority and thus no opinion is rendered.