On this date in 1981, the Supreme Court decided In re Wilson, 81 N.J. 451 (1979), one of the landmark attorney discipline cases. In a unanimous opinion by Chief Justice Wilentz, the Court held that an attorney who misappropriates client funds will “almost invariabl[y]” be disbarred, and that the Court foresaw “no significant exceptions to this rule.”
Prior to Wilson, as Chief Justice Wilentz observed, “results in misappropriation cases have varied because of circumstances which the Court has regarded as mitigating: the economic and emotional pressures on the attorney which caused and explained his misdeed; his subsequent compliance with client trust account requirements; his candor and cooperation with the ethics committee; his contrition; and, most of all, restitution. The presence of a combination of these has occasionally resulted in suspension, ranging from six months to three years, rather than disbarment.” But the principal reason for discipline– “to preserve the confidence of the public in the integrity and trustworthiness of lawyers in general” — was “only rarely stressed in the past.” Wilson stated that the Court is “now inclined to view it as controlling in these cases.” Accordingly, “anything less than strict discipline in cases like this would be a disservice to the bar, the judiciary and the public.”
The Court discussed further the “mitigating factor” of restitution. Restitution “may compensate an individual complainant for the financial loss suffered …. [but] it does not, however, significantly retard the subtle but progressive erosion of public confidence in the integrity of the bench and bar.” Moreover, only lawyers with the financial means to make restitution can benefit from the mitigating factor. “Judicial consideration of restitution as a mitigating factor in disciplinary proceedings creates the impression that sanctions are proportioned in accordance with ability to pay, rather than gauged against the seriousness of the misconduct. Furthermore, according significance to restitution leads to an obvious and substantial possibility of unjust discrimination.”
The Court recognized that a disbarred attorney is almost never permitted to be reinstated. Disbarment “is so terribly harsh as to require the most compelling reasons to justify it. As far as we are concerned, the only reason that disbarment might be necessary is that any other result risks something even more important, the continued confidence of the public in the integrity of the bar and the judiciary.”
Cases since Wilson have applied this rule strictly, and the Court has repeatedly rejected suggestions that the Wilson rule be softened. The Court has clarified, however, that the Wilson rule applies only to “knowing” misappropriation, not negligent bookkeeping or the like. Nonetheless, Wilson remains a pillar of the attorney disciplinary system.