Could an Illinois judge passively own shares in a corporation buying foreclosure properties?
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This page answers the general question as of 2006. Ask about yours and see what the current rules of professional conduct in your state say for your facts, with citations.
Plain-English summary
A juvenile-court judge held shares, with a spouse and lawyer niece, in a corporation that purchased, rehabilitated, and resold foreclosure property. The judge was neither an officer, director, employee, nor manager.
The Committee permitted the investment on those facts under former Rule 65C. It found no indicated interference with duties or adverse reflection on impartiality from passive ownership and said colleagues’ foreclosure work alone did not establish exploitation of office.
The result changed if the judge heard foreclosure cases while the corporation continued buying property in the judge’s circuit: that combination would appear to exploit judicial office, even if foreclosure assignments were infrequent. The Committee said the apparent conflict would end if the corporation stopped buying there during those assignments.
Currency note
The Committee’s page states that this opinion interprets the 1993 Illinois Code of Judicial Conduct, which was superseded on January 1, 2023. It does not assess whether the 2023 Code changes the analysis. Verify the current Code before relying on it.
In practice
The Committee could not determine whether dealings with people likely to appear before the judge would be frequent without more information about the corporation’s holdings. It required continuing evaluation as the corporation’s activities developed.
Common questions
Q: Could the judge manage the company?
A: No. Former Rule 65C(2), as described by the Committee, barred active management and service as an officer, director, or employee.
Q: Could the judge hear occasional foreclosure cases while the company bought local property?
A: No. The Committee said even occasional foreclosure assignments would create an apparent exploitation of office if the company kept buying in the circuit.
Q: Did colleagues’ foreclosure cases alone bar the investment?
A: No. The Committee did not find that colleagues’ cases involving later-purchased property alone established exploitation.
Background and rules framework
The Committee applied former Illinois Supreme Court Rules 65B and 65C, including the limits on business roles and exploitation of office. It also cited IJEC Opinion 97-13 and Ohio State Bar Association v. Reid, 708 N.E.2d 193 (Ohio 1998).
Citations and references
- Illinois Supreme Court Rules 65B, 65C(1), 65C(2), 65C(5), and 63C(1)(e).
- Ohio State Bar Association v. Reid, 708 N.E.2d 193 (Ohio 1998).
- IJEC Opinion 97-13.
See also
Source
- Landing page: Illinois Judicial Ethics Committee Opinion 2006-04
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