Could a judge buy stock in a corporation whose owners included an attorney who regularly practiced before the judge?

Plain-English summary

The request asked whether a judge who had joined a bank’s board could buy stock in a corporation whose stockholders included bank directors, its auditor, and its attorney. The attorney regularly practiced before the judge.

The Commission said the judge should not acquire stock unless the arrangement complied with Canon 5C’s restrictions on dealings affecting impartiality and on minimizing cases requiring recusal. It said the close business relationship with the attorney could prohibit the investment; Canon 5C(2)’s permission for remunerative activities was limited by the other cited provisions.

Currency note

This opinion was issued in 1981, after the Alabama Supreme Court’s 1975 adoption of the Alabama Canons of Judicial Ethics. Subsequent amendments or later opinions may have changed the analysis. Treat this page as historical context and verify the current Canons and linked opinion before relying on its conclusions.

Common questions

Q: Did the opinion give an unconditional approval to buy the stock?

A: No. It made the answer depend on Canon 5C’s limits and said the close relationship could prohibit the investment.

Q: What relationship concerned the Commission?

A: The business relationship between the judge and an attorney who regularly practiced before the judge.

Background and rules framework

The opinion discusses Canon 5C(2) and Canon 5C(l) and (3) on financial dealings and minimizing disqualification.

Citations and references

Alabama Canons of Judicial Ethics:

• Canon 5C
• Canon 5C(l)
• Canon 5C(2)

See also

• AL Judicial Ethics Op. 82-130: Judge’s Family Renting Office Space to Counsel

Source

• Landing page: Alabama JIC advisory opinions
• Original PDF: Advisory Opinion 81-110
• Canon history: Alabama JIC, Canons of Judicial Ethics

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

81-110
Judicial Inquiry Commission
800 SOUTH MCDONOUGH STREET
SUITE 201
MONTGOMERY, ALABAMA 36104
March 30, 1981
The Judicial Inquiry Commission has considered your request for an opinion based on the following facts: “An Alabama business corporation (a Section 1244 Corporation) has stockholders consisting of such directors of a national bank as choose to participate, the auditor for the bank, and the attorney for the bank. This attorney regularly practices before the Circuit Judge who has recently become a member of the Board of Directors of the bank. May the judge become a stockholder in this business corporation without violating the Canons of Judicial Ethics?” It is the opinion of the Commission that under 5C of the Alabama Canons of Judicial Ethics that the judge should not become a stockholder in the corporation in question unless the judge can do so without violating the provisions of Canon 5C(l) and (3). These provisions are in pertinent part: (1) A judge should refrain from financial and business dealings that tend to relect adversely on his impartiality ...

(3) A judge should manage his investments and other financial interests to minimize the number of cases in which he is disqualified. While Canon 5C(2) permits a judge to engage in remunerative activities, this provision is strictly limited by 5C(l) and (3). Due to the close business relationship of the judge and the attorney in the facts as they have been presented, Canons 5C(l) and (3) could prohibit the judge from becoming a stockholder in the corporation.