Ethics Opinion 340

By Committee on Professional Ethics

NEW YORK STATE BAR ASSOCIATION
Committee on Professional Ethics

Opinion #340 – 04/25/1974 (17-74)

Topic: Dual Practice; Conflict of Interest
Digest: Lawyer whose spouse is a real estate salesperson working on a commission basis should not accept as client a party to a real estate transaction in which lawyer’s spouse has participated as salesperson, but may act as attorney for clients who have used the brokerage agency employing the spouse, provided spouse has not participated in the transaction or benefitted therefrom
Code: Canons 9, 5; EC 9-6; EC 5-2; DR 2-103

QUESTION

May a lawyer, whose spouse is a real estate salesperson working on a strictly commission basis, represent a party to a real estate transaction in which the lawyer’s spouse has participated as salesperson with full disclosure of the facts to the client and may the lawyer represent a person who has used the brokerage agency employing the spouse provided the spouse has not participated in the transaction or benefitted therefrom?

OPINION

A lawyer may not act as the lawyer and broker for a client in the same real estate transaction. N.Y. State 208 (1971). His personal interest as broker should not be allowed to dilute his loyalty to his client. EC 5-1. The intimate relationship and economic interests of husband and wife are inseparable; the acts of one directly affecting the other. The representation by the attorney of customers of the spouse’s brokerage firm has been disapproved. N.Y. State 244 (1972). For the same reasons the representation by the attorney of customers of the spouse salesperson is disapproved.There would not, however, be any impropriety in the attorney representing customers of the brokerage firm which employs the spouse where the spouse has not participated in and will not benefit from the transaction. Attention is directed to DR 2-103 concerning the recommendation of professional employment.

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