Can a lawyer structure a home purchase so title goes to the wife alone in order to keep an existing judgment against the husband from attaching to the property?

Plain-English summary

The Committee was asked two related questions. First, whether an attorney representing prospective purchasers (husband and wife) of residential property may arrange to take title in the name of the wife alone for the sole purpose of preventing the lien of an existing judgment against the husband from attaching to the property. Second, whether, where the purchasers had contracted to buy in their joint names and then, upon disclosure of a judgment against the husband, sought to assign the contract to the wife alone, the attorney may arrange to have title taken in her name alone to avoid having the judgment attach to the husband's interest.

The Committee answered by stating the governing principle: participation by an attorney in a fraudulent conveyance, with actual knowledge of its true character and purpose, constitutes unethical and unprofessional conduct. It relied on In re DePamphilis, 30 N.J. 470 (1959), quoting the Court's statement that "Any such conduct is unquestionably unethical and unprofessional despite the fact that it may be thought to serve the client and no one may be actually injured. It is dishonorable, enables violation of the law, and brings the profession into disrepute."

Currency note

This opinion was issued in March 1968, before New Jersey's September 13, 1971 adoption of the Disciplinary Rules (Code of Professional Responsibility), and well before the 1984 Rules of Professional Conduct and all later revisions. It applied the Canons of Professional Ethics as construed in In re DePamphilis. A lawyer's knowing assistance of a client's fraudulent conduct is now treated under RPC 1.2(d) and RPC 8.4(c). Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific requirement mentioned here.

Common questions

Q: Can a lawyer put title in the wife's name to keep a judgment against the husband off the property?

A: Not where the purpose is to defeat the judgment lien and the lawyer knows it. The Committee held that knowingly participating in such a fraudulent conveyance is unethical and unprofessional.

Q: Does it matter that the move helps the client and arguably injures no one?

A: No. Quoting In re DePamphilis, the Committee said the conduct is unethical despite serving the client and injuring no one, because it is dishonorable, enables violation of the law, and brings the profession into disrepute.

Background and rules framework

The opinion applies the principle of In re DePamphilis that a lawyer who knowingly takes part in a fraudulent conveyance acts unethically, regardless of benefit to the client or absence of injury. In current New Jersey terms, a lawyer may not counsel or assist a client in conduct the lawyer knows is criminal or fraudulent (RPC 1.2(d)), and conduct involving dishonesty, fraud, deceit, or misrepresentation is prohibited by RPC 8.4(c).

Citations and references

Cases:

• In re DePamphilis, 30 N.J. 470 (1959): an attorney's knowing participation in a fraudulent conveyance is unethical and unprofessional

See also

• NJ ACPE Op. 133: Points on a Savings-and-Loan Mortgage
• NJ ACPE Op. 135: Suing an Estate He Previously Represented

Source

• Landing page: https://law.justia.com/cases/new-jersey/advisory-committee-on-professional-ethics/2004/acp125-1.html

Original opinion text

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

91 N.J.L.J. 193
March 28, 1968

OPINION 125

Fraudulent Conveyance

The following inquiries have been submitted for consideration:

1. May an attorney representing prospective purchasers (husband and wife) of residential property arrange for taking title in the name of the wife alone for the sole purpose of preventing the lien of an existing judgment against the husband from attaching to the property involved?

2. May an attorney representing prospective purchasers (husband and wife), who have entered into a contract to purchase residential property in their joint names and thereafter, upon disclosure of the existence of a judgment against the husband, seek to have the contract assigned to the wife alone, arrange to have title taken in her name alone to avoid having the judgment attach as a lien against the interest of the husband in the property?

Participation by an attorney in a fraudulent conveyance with actual knowledge of its true character and purpose constitutes unethical and unprofessional conduct. In re DePamphilis, 30 N.J. 470 (1959). The Court said at page 483: "Any such conduct is unquestionably unethical and unprofessional despite the fact that it may be thought to serve the client and no one may be actually injured. It is dishonorable, enables violation of the law, and brings the profession into disrepute."