Every Nevada Supreme Court justice has a conflict of interest on the Foreclosure Mediation Program

Yet all indications are the court is preparing to rule on the program it administers

By Victor Joecks
  • Wednesday, November 16, 2011

Imagine that, less than three years ago, you helped create a new government program.  

On multiple occasions, you testified before legislative committees on how to set it up. You  contributed an amendment to the legislation establishing the program. Once the bill was passed, you and your colleagues mobilized to implement the program, from scratch, in less than 30 days.

Then, your office ran the program and collected fees from it for the next 2½ years — as you do still today. Prominently, on your website, you feature a link to the program.

Frequently, you've gone on television, proclaiming the program a success (Oct. 31, 2011 edition of Nevada Newsmakers, 16-minute mark) and boasting how many people the program has helped. One of your colleagues proclaimed it probably the "most financially stable government program in the state."

Now, imagine that another organization challenges the program's constitutionality and appeals to the Nevada Supreme Court.

Wouldn't you and your colleagues be inclined to vigorously defend your handiwork?

Why, no ... supposedly.  Not if the challenged law is the Foreclosure Mediation Program and you're a justice on the Nevada Supreme Court.

In that case, you'd be the ones ruling on the constitutionality of the program!

Yes, you read that right.

The individuals who administer the program, who helped craft the original law, who implemented the program from scratch, who advertise the program on the Supreme Court website, who have frequently and publicly bragged about how many people the program has helped, who collect fees from the program — they are going to be the impartial arbitrators of the program's constitutionality?

Yep. That is exactly what the Supreme Court is preparing to do.

The conflict of interest is so obvious that recently, Assemblyman Marcus Conklin publicly wondered just what level of bias the Supreme Court has toward the program, given that the court administers the program and collects fees from it.

Of course, Conklin — as a sponsor of AB149, which created the Foreclosure Mediation Program — didn't think the court's bias was a problem. On the contrary, he expected the justices to uphold the program precisely because they're running it and collecting money from it!

Consider the exchange beginning at the 3:45 mark of the Nov. 1, 2011 edition of Nevada Newsmakers:

Conklin: It [the Supreme Court ruling the FMP unconstitutional] would be kind of odd, because the court administers the mediation program, and the court system retains all the fees. So sometimes you wonder what, you know, what level of bias there might be, you know, in that process, but I would suspect that they would uphold it.

Host Sam Shad: You're concerned about bias from the Supreme Court due to the fact that they collect fees from the program?

Conklin: I'm not concerned about it, but the fact still remains that they administer that program, so, because they administer that program and they know it in detail, you know, I would assume it's awfully hard to argue against.

Not to mention the fact that members of the court were there to testify in support and participate in the drafting of the law in the first place. So, I would hope if there's a constitutionality question, we would have addressed it during the legislative session when we had members of the Supreme Court present.

Shad: OK, I'm sorry to stay on this, but it seems to me like you're making an accusation here about the bias of the Supreme Court. That would be a very serious issue, don't you think?

Conklin: No, no, no. There's not a bias in a negative sense.

The Supreme Court justices have a huge conflict of interest, and they are poised to, once again, make Nevada's high court into America's judicial laughingstock. They've directly demonstrated their bias in behalf of the program by running it!

And, of course it's a serious issue. Facing the challenge to the constitutionality of the Foreclosure Mediation Program, every justice is hopelessly compromised.

Here's what Nevada's Code of Judicial Conduct — issued by the court itself — says about when a judge should "disqualify" himself or herself.

Rule 2.11. Disqualification
(A) A judge shall disqualify himself or herself in any proceeding in which the judge's impartiality might reasonably be questioned, including but not limited to the following circumstances:
      (1) The judge has a personal bias or prejudice concerning a party or a party's lawyer, or personal knowledge of facts that are in dispute in the proceeding.
      (2) The judge knows that the judge ... is:
            (a) a party to the proceeding or an officer, director, general partner, managing member, or trustee of a party; ...
           (c) a person who has more than a de minimis interest that could be substantially affected by the proceeding; (Emphasis added.)

Administering the very program being challenged certainly qualifies. While comment 3, Rule 2.11, says "the rule of necessity may override the rule of disqualification," the court can appoint a panel of senior judges to rule in its place (Supreme Court Rules, 10.8). And even if the justices do not, the court's own judicial code demands that every justice disclose his conflict on the record.

Finally, this entire need for the Supreme Court to recuse itself grows directly out of the unconstitutionality of the Foreclosure Mediation Program that the court and the Nevada Legislature, together, crafted: The program explicitly violates the clear separation-of-powers clause found in Article 3, Section 1 of the Nevada Constitution:

The powers of the Government of the State of Nevada shall be divided into three separate departments,—the Legislative,—the Executive and the Judicial; and no persons charged with the exercise of powers properly belonging to one of these departments shall exercise any functions, appertaining to either of the others, except in the cases expressly directed or permitted in this constitution. (Emphasis added.)

"A judge shall act at all times in a manner that promotes public confidence in the independence, integrity, and impartiality of the judiciary and shall avoid impropriety and the appearance of impropriety," says the Nevada Code of Judicial Conduct.

Ruling on the constitutionality of a program you implemented and administer, as the Supreme Court appears ready to do, will seriously damage any public confidence that remains in the impartiality of the Nevada judiciary.

Supreme Court justices should — at the very least — recuse themselves from this case.

Victor Joecks is the communications director at the Nevada Policy Research Institute. For more visit http://npri.org.

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