You are a Judge for ABC County.
You ask whether it would violate the conflict of interest law, M.G.L. c. 268A, for the Commonwealth of Massachusetts to lease office space for the state agency DEF in a building beneficially owned in part by your five children under a Massachusetts Realty Trust which you serve as sole trustee.
The Commission concludes that it would.
According to the Declaration of Trust and other information you have provided to the Commission, title to the property in question is held by you as sole trustee for The Children's Realty Trust, created in 1969 for the benefit of your five children, four of whom are minors and all of whom you currently support.[1] As trustee, you are entitled to reasonable compensation for your services. The trust is revocable under certain conditions set forth in the Declaration of Trust. As a Judge, you are a state employee for purposes of the conflict of interest law. See Attorney General Conflict Opinion No. 657. Accordingly, section 7 of Chapter 268A prohibits you from having a direct or indirect financial interest in a contract made by a state agency. The proposed lease arrangement would be a contract made by a state agency, the DEF. EC-COI-80-121. Also see, EC-COI-80-68; M.G.L. c. 221, s.34D. Your children, as beneficiaries of the realty trust, would have a direct financial interest in and benefit from any lease of the trust property. Under section 1 of General Laws Chapter 273, you have a duty to support your minor children. To the extent that your minor children would derive financial benefit from the lease of the trust property, your duty of support would be commensurately lessened. Thus, as their parent, you would have an indirect financial interest in such a lease, and such an interest would violate the conflict of interest law.[2] You may also have another indirect interest in the lease, since under the Declaration of Trust, the trustee is entitled to reason able compensation from the trust. Although section 7 contains several exemptions, none of them applies to your situation. Specifically, clause (b)[3] is not applicable because the direct and indirect interests of your immediate family in the lease amount to more than ten percent of the total proprietary interests.
Section 23 of Chapter 268A is also relevant to your situation. Specifically, section 23(f) prohibits you from pursuing a course of conduct which will raise suspicion among the public that you are likely to be engaged in acts that are in violation of [your public] trust. Because as trustee you control and hold title to the trust property, and both you and the potential lessee of the property are within the same branch of state government (i.e., the judiciary), a lease between you might create the appearance of inside dealing. In particular, it might give rise to suspicion on the part of the Public that the DEF chose this office space because you hold the property as trustee. For this reason, such a lease agreement would also be prohibited by section 23 (f).
In sum, under Chapter 268A, you may not as a state employee lease property, which you hold as trustee for the benefit of your minor children, to a state agency.[4]
