April 28, 2011
Digest: (1) A judge may continue to serve as trustee of a trust that benefits the judge’s first cousin; (2) A judge may be a member with his/her siblings of an LLC that will own several pieces of real estate; (3) A judge must disqualify him/herself, subject to remittal, when an attorney from the judge’s former law firm appears in the judge’s court for two years after the judge’s employment with his/her former law firm ends or until the landlord/tenant relationship between the judge and his/her former law firm ends, whichever occurs later.
Rule: 22 NYCRR 100.0(I); 100.2; 100.2(A); 100.4(A)(1)- (3); 100.4(D)(2); 100.4(D)(3)(b); 100.4(E)(1); Opinions 10-77; 06-62; 05-130(B); 04-42; 99-84 (Vol. XVIII); 99-12 (Vol. XVII); 94-05 (Vol. XII); Joint Opinion 07-114/07-120
A recently elected judge asks whether he/she may continue to serve as trustee of a trust that benefits his/her first cousin. The judge advises that the vast majority of the trust assets comprise shares of stock issued by a small, closely held manufacturing business and that he/she has served as trustee for more than 10 years.
A judge must avoid impropriety and its appearance in all the judge’s activities (see 22 NYCRR 100.2) and must always act to promote public confidence in the judiciary’s integrity and independence (see 22 NYCRR 100.2[A]). Nevertheless, judges may engage in extra-judicial activities that do not cast reasonable doubt on their capacity to act impartially as a judge; detract from the dignity of judicial office; or, interfere with the proper performance of judicial duties and are not incompatible with judicial office (see 22 NYCRR 100.4[A]-). Specifically, a full-time judge may serve as trustee for the trust of a member of the judge’s family (see 22 NYCRR 100.4[E]), which is defined as a spouse, child, grandchild, parent, grandparent or other relative (see 22 NYCRR 100.0[I]).
Because the inquiring judge’s first cousin is a member of the judge’s family the judge may continue to serve as trustee of the trust that benefits his/her first cousin (see 22 NYCRR 100.4[E]; 100.0[I]).
The judge also asks whether it is permissible for him/her to be a member with his/her siblings of an LLC that will own several pieces of real estate.
A judge may hold and manage his/her own investments and those of members of the judge’s family, including real estate (see 22 NYCRR 100.4[D]). And, while a full-time judge is generally prohibited from being an active participant of any business entity, a full-time judge may manage and participate in a business entity engaged solely in investment of the judge’s or the judge’s family member’s financial resources (see 22 NYCRR 100.4[D][b]; Opinions 10-77 [judge may serve as officer of closely held family corporations that own real estate]; 99-84 [Vol. XVIII] [a family court hearing examiner may own stock in and be an officer of a family-owned corporation in which the hearing examiner and the hearing officer’s spouse are the sole shareholders]; 99-12 [Vol. XVII] [full-time judge may continue to serve as both the sole general partner and a limited partner with the judge’s spouse and children for the purpose of investing family assets in the stock of publicly-owned corporations and in government securities]). Thus, the judge in the present inquiry may be a member with his/her siblings of an LLC that will own several pieces of real estate.
However, the judge advises that his/her former law firm is a tenant in one of the buildings that the LLC will own. And, while the judge acknowledges that he/she must disqualify him/herself when members of his/her former law firm appear in his/her court for two years after his/her relationship with the firm ended (see Opinion 94-05 [Vol. XII]), the judge asks whether the law firm’s tenancy in the building imposes any additional requirement with respect to disqualification.
The Committee previously has advised that a judge who sells his/her law practice to another local lawyer must disqualify him/herself, subject to remittal, when the purchasing attorney appears in the judge’s court (see Opinions 06-62; 05-130[B]). The period during which the judge is required to disqualify him/herself ends two years after the attorney pays the judge the balance owed on the purchase price (see id.).
Therefore, the inquiring judge must disqualify him/herself whenever an attorney from his/her former law firm appears in the judge’s court for two years after the judge’s employment with his/her former law firm ended, including any existing financial relationship, or until the landlord/tenant relationship between the judge and his/her former law firm ends (see Opinions 05-130[B]; 04-42; 94-05 [Vol. XII]), whichever occurs later. The judge’s disqualification is subject to remittal unless a party appears without representation (see Joint Opinion 07-114/07-120).