Opinion 10-96

June 9, 2010

Digest:         A judge should disqualify him/herself, subject to remittal, while the judge is negotiating a mortgage loan with a bank that also may be the undisclosed seller of the property the judge is buying when the bank or a subsidiary of the bank appears in the judge’s court.

Rules:          22 NYCRR 100.2; 100.2(A); 100.3(E)(1); 100.3(E)(1)(a)(i); 100.3(F); Opinion 04-50; 92-126(Vol. X).

Opinion:

         A judge is negotiating with a bank for a mortgage and has reason to believe the bank also may be the undisclosed seller. The judge asks whether he/she must disqualify him/herself should the bank or its subsidiary appears before the judge.

         A judge must always avoid impropriety and its appearance (see 22 NYCRR 100.2) and must always act in a manner that promotes public confidence in the judiciary’s integrity and impartiality (see 22 NYCRR 100.2[A]). Therefore, a judge must disqualify him/herself in any case where the judge’s impartiality might reasonably be questioned (see 22 NYCRR 100.3[E][1]).

         The Committee previously has advised that a judge need not disqualify him/herself where the bank holding a mortgage on the judge’s personal residence or has granted the judge an auto loan appears as a party in the judge’s court (see Opinion 04-50; 92-126 [Vol. X]). In the Committee’s view, “the ubiquitous and routine nature” of such loans and the fact that they are “rarely predicated on a special or personal relationship between the borrower and the institutional lender,” warrants neither recusal nor disclosure where the lender appears before a judge as a party (Opinion 04-50). However, because the inquiring judge currently is negotiating a mortgage loan with a bank that also may be the undisclosed seller of the property the judge is buying, he/she should disqualify him/herself, subject to remittal (see 22 NYCRR 100.3[F]), when the bank or its subsidiary appears before the judge. Once the mortgage negotiations and the purchase of the property is concluded, the judge no longer needs to disclose or disqualify him/herself when the bank or its subsidiary appears, unless of course the judge believes he/she cannot be impartial (see 22 NYCRR 100.3[E][1][a][i]).