Time to Modify the ‘In Re Wilson’ Rule | Ediitorial // New Jersey Law Journal

In a recent decision The New Jersey Supreme Court censured an attorney for a negligent misappropriation of trust account funds to the benefit of another client.

The recent attorney disciplinary case of In Re Karina Lucid is the case on point. Ms. Lucid is an attorney who has an unblemished record and undisputedly has exemplary personal and professional character. She was a law clerk to a judge of the New Jersey Appellate Division and a chief judge of the U.S. Bankruptcy Court. She worked at two prominent law firms before she started a solo practice with an emphasis on consumer bankruptcy cases where she charges clients flat fees. She had no prior experience with attorney bookkeeping prior to starting her own practice.

But the Court, in opting for censure, offered no analysis of the facts.  The result is surprising because the Court has long had a bright line automatic disbarment rule for trust account violations.

But Bar groups have long been skeptical of the harsh rule from which the Court appears to have departed. - GWC

Editorial Time to Modify the ‘In Re Wilson’ Rule | New Jersey Law Journal

Thirty-two years ago, the New Jersey Supreme Court issued In Re Wilson, a decision that decreed knowing misappropriation of client funds by an attorney must invariably result in a disbarment because of the need to maintain the public confidence in the integrity of the bar and the judiciary. Since then, the “Wilson Rule” has been interpreted by the court, the Office of Attorney Ethics and the Disciplinary Review Board to require permanent loss of a license to practice law without consideration of the circumstances, mitigation in the case or the character or intent of the lawyer. There has not been a single published case where a finding of knowing misappropriation where disbarment was not the penalty.

If there was ever a time to reevaluate this harsh mandate, that time is now. Our Supreme Court’s own order in a recent disciplinary case—which appears to have gone largely unnoticed—appears to undercut the rule. While we agree with the result of no disbarment, we believe that order has created a welcome exception to the rule and that it is incumbent on this court to codify and clarify that exception for the bar. And with good reason.

The unforgiving nature of the rule is even more onerous because New Jersey is one of a handful of States that does not under any circumstance permit the reinstatement of lawyers who have been disbarred. The American Bar Association adopted model rules for lawyer disciplinary enforcement that allow for reinstatement after five years from the date of the disbarment. Even so, the hurdles for a disbarred lawyer to obtain a reinstatement are high. But in New Jersey there has been no yielding. In 2001 the New Jersey State Bar Association made an unsuccessful recommendation that the court open the door to allow a limited form of reinstatement after disbarment.

While the rule does not apply to negligent misappropriation of trust or fiduciary funds, the line between what is a knowing or negligent misappropriation is a blur which has resulted in unequal attorney discipline.

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