NJSBA HQ New Jersey State Bar Association headquarters. Credit: Google

Capitol Report

NJ Supreme Court orders censure for attorney in misappropriation case

Just one day after oral arguments concluded in the matter of In re Lucid, Disciplinary Action D-141-20, the New Jersey Supreme Court issued a swift resolution to censure an attorney who was recommended for disbarment for knowing misappropriation of trust funds. The New Jersey State Bar Association (NJSBA) submitted an amicus curiae brief urging a clarification of the automatic disbarment rule for knowing misappropriation of a client's trust funds established in In re Wilson, 81 N.J. 451 (1979), known as the Wilson Rule. Past NJSBA Presidents Robert B. Hille and Miles S. Winder III authored the brief.

In this case and a second case—In re Wade—the NJSBA urged the Court to clarify that the Wilson Rule is applicable only where there is clear and convincing evidence of "knowing" action coupled with purposeful conduct that results in actual theft or fraud committed against a client in connection with property held in trust for that client. The NJSBA further argued that all facts should be considered in analyzing a disciplinary matter where the Wilson Rule may apply, including motive and intent, to determine if they are consistent with a finding of conduct tantamount to theft or fraud.