Must a new judge give up shares in the law firm or legal professional association the judge came from, even if the shares earn no income?

Currency note

The Board flags this opinion as not current: it issued in 1989 under Ohio's former Code of Judicial Conduct (superseded by the Ohio Code of Judicial Conduct effective March 1, 2009), with Canons 1 through 6 amended effective May 1, 1997 and Gov. Bar R. III amended effective January 1, 1993 and November 1, 1995. Treat this page as historical context, not current guidance. Verify against the current Ohio Code of Judicial Conduct and Gov. Bar R. III before relying on any specific rule mentioned here.

Plain-English summary

The Board addressed two requests about whether a judge can keep an interest in the judge's former legal professional association (LPA). In the first, a minority shareholder proposed a trust for the departing majority shareholder who was taking the bench, with the requesting party as trustee, the judge having no control and receiving no income, and the stock returning to the judge upon leaving the bench. The second asked whether a shareholder must divest upon taking the bench even if he receives no income from the stock.

The Board applied Canon 2 (avoid impropriety and the appearance of impropriety) and Canon 2B (relationships should not influence the judge), and concluded that a judge who maintains any interest in a former law practice, however structured, creates the appearance of impropriety. It cited Canon 5C, under which a judge should refrain from business dealings that reflect adversely on impartiality or involve frequent transactions with lawyers likely to appear, and should divest investments that might require frequent disqualification as soon as that can be done without serious financial detriment. Holding shares in a former practice, even in trust and income-free, would adversely reflect on impartiality where the former firm is involved, and Gov. Bar R. III bars an attorney from being associated with an LPA other than one in which he is actively and publicly associated. The Board added that Canon 3C requires disqualification where impartiality might reasonably be questioned, which a financial interest in the former firm could trigger. It concluded that newly appointed judges should divest all financial interests in LPAs with which they had been associated.

Common questions

Q: Must a new judge sell shares in the law firm the judge left?

A: Under this opinion, yes. The Board concluded newly appointed judges should divest all financial interests in a former legal professional association.

Q: Does holding the shares in an income-free trust solve the problem?

A: No. The Board concluded that keeping any interest, even in trust and producing no income, would adversely reflect on the judge's impartiality and create the appearance of impropriety.

Background and rules framework

The opinion interprets Ohio's former Code of Judicial Conduct, Canon 2 and 2B (impropriety and influence), Canon 5C (financial and business dealings; divestment), and Canon 3C (disqualification), together with Gov. Bar R. III on association with a legal professional association.

Citations and references

Rules of Judicial Conduct and Bar Rules (Ohio):

• Former Code of Judicial Conduct, Canon 2 and 2B; Canon 5C; Canon 3C
• Gov. Bar R. III, Section 3(D), association with a legal professional association

See also

• Ohio BPC Opinion 1987-048: Judge's Name on Former Law Firm Letterhead
• Ohio BPC Opinion 1987-050: Judge as Trustee of a Religious Retirement Plan
• Ohio BPC Opinion 1989-003: Judge Serving on a College Board of Trustees

Source

• Landing page: https://ohioadvop.org/advisory-opinion-index/
• Original PDF: https://www.ohioadvop.org/wp-content/uploads/2017/04/Op-89-017.pdf

Original opinion text

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

The Supreme Court of Ohio
BOARD OF COMMISSIONERS ON GRIEVANCES AND DISCIPLINE
41 SOUTH HIGH STREET-SUITE 3370, COLUMBUS, OH 43215-6105
(614) 644-5800 FAX: (614) 644-5804

OFFICE OF SECRETARY

OPINION 89-17
Issued June 16, 1989

[Former CJC Opinion-provides advice under the former Ohio Code of Judicial Conduct which is superseded by the Ohio Code of Judicial Conduct, eff. 3/1/2009.]

[Not Current- subsequent rule amendments to Canons 1 through 6, Ohio Code of Judicial Conduct, eff. May 1, 1997 and to Gov. Bar R. III, Jan. 1, 1993 and Nov. 1, 1995]

SYLLABUS: Full-time judges who hold shares in their former legal professional associations would be creating the appearance of impropriety. Judges should divest themselves of any investments which would require their disqualification under Canons 5C and 3C of the Code of Judicial Conduct. Governing Bar Rule III prohibits an attorney from being associated in any capacity with a legal professional association other than one in which the attorney is actively and publicly associated.

OPINION: We have before us two requests for advisory opinions on whether a judge can maintain an interest in the judge's former legal professional association (LPA). The first requesting party, a minority shareholder in an LPA, is considering creating a trust for the departing majority shareholder, who is taking the bench. The requesting party would be the trustee and the judge would have no control over the trustee's decisions and would receive no income from the corporation. The stock held in trust would be transferred back to the judge when he steps down from the bench. The second request simply asks whether a shareholder in a professional legal corporation must divest himself of his ownership interest upon taking the bench, even if he receives no income of any kind as a result of such stock ownership.

Under Canon 2 of the Code of Judicial Conduct, a judge should avoid impropriety and the appearance of impropriety in all the judge's activities. In addition, judges should not allow any of their relationships to influence their conduct or judgment. Code of Judicial Conduct 2B. In our view, judges who maintain any interest in their former law practice, no matter how it is structured, would be creating the appearance of impropriety.

Furthermore, Canon 5C provides in part:

1. A judge should refrain from financial and business dealings that tend to reflect adversely on his impartiality, interfere with the proper performance of his judicial position, or involve him in frequent transactions with lawyers or persons likely to come before the court on which he serves.

2. A judge should manage his investments and other financial interests to minimize the number of cases in which he is disqualified. As soon as he can do so without serious financial detriment, he should divest himself of investments and other financial interests that might require frequent disqualification.

Holding shares in a former law practice would adversely reflect on the judge's impartiality in cases where the former firm is involved. This would be true even if the shares were held in trust and the judge was not receiving any income from his former practice. In this regard, an attorney may not be associated in any capacity with an LPA other than one in which he or she is actively and publicly associated. Gov. Bar R. III §3(D).

Canon 3C also requires a judge's disqualification in cases where impartiality might reasonably be questioned. A judge who maintains a financial interest in his or her former law practice may be precluded from hearing cases involving the former law firm. This situation can be avoided if the judge is divested of all financial interests in the law firm.

In conclusion, it is our opinion and you are so advised that newly appointed judges should divest themselves of all financial interests in legal professional associations with which they have been associated.

This is an informal, non-binding advisory opinion based upon the questions presented and limited to questions arising under the Code of Judicial Conduct and Code of Professional Responsibility.