SBM - State Bar of Michigan

NOTE: Effective January 1, 2000, the "180-day Fundraising Period" in MCJC 7B(2)(c) has been replaced by a fund-raising period starting on February 15 of the year of the election.


December 18, 1992


    A judicial candidate who receives a refund due to an overcharge for campaign services, which refund arrives after accounts for the judicial campaign have been closed, may apply the late-arriving refund to any unsatisfied campaign debts.

    References: MCJC 6, 7B(2)(c), 7B(2)(e), 7C; MCL 169.204(1), MSA 4.1703(4).


During the course of a judicial campaign, a candidate's campaign committee contracted for broadcasting services from an out-of-state company. The broadcasting company billed for the services and the bill was paid within the required time period for settlement of all campaign debts from funds collected within the permitted campaign fund solicitation period. During the campaign family members had loaned money to the campaign, and there were insufficient funds remaining in the campaign treasury to fully repay those loans.

The candidate advises that now, two years after the campaign, the broadcasting company has sent a refund check for an overcharge to the campaign committee. The candidate asks whether the refund check may be applied to the balance of the loans made by family members, or what other disposition is required.

MCJC 7B(2)(c) and (e) state in part:

    "(c) . . . A [judicial] candidate's committee may solicit funds for his campaign no earlier than 180 days before a primary or nominating convention and may not solicit or accept funds after the date of the general election. A candidate should not use or permit the use of campaign contributions for the private benefit of himself or members of his family.

    ". . .

    "(e) Any candidate or his committee having funds remaining after payment of all campaign expenses shall either return such funds to the contributors thereof or donate said funds to the Client [Protection] Fund of the State Bar of Michigan, not later than January 1 following the election." Emphasis added.

MCJC 7C states in part:

    "Except as provided in 7B(2)(b) and (c):

      ". . .

      "(2) No judge or other person, party, committee, organization, firm, group or entity may accept any contribution of money or of a tangible thing of value, directly or indirectly, to or for a judge's benefit for any purpose whatever, including but not limited to, contribution for a campaign deficit, expenses associated with judicial office, testimonial, honorarium (other than for services, subject to Canon 6) or otherwise."

Reading these provisions literally, one may conclude that the late-arriving refund check should not be accepted [MCJC 7B(2)(c)], or that at the very least it should be sent to the Client Protection Fund [MCJC 7B(2)(e)]. MCJC 7C warns that a judge may not "accept any contribution of money or tangible thing of value," even to retire a campaign deficit.

We do not think the situation posed in this inquiry fairly falls within those prohibitions. MCJC 7B(2)(c) must be read to prohibit acceptance of campaign funds after the date of the election; a refund on a paid expense is not a "campaign fund." MCJC 7B(2)(e) stipulates disposition of excess campaign funds after payment of all campaign expenses; in this inquiry, all campaign expenses were not covered by available campaign funds, and there was no excess. MCJC 7C prohibits contributions of anything of value and specifically mentions campaign deficits, but a refund due to an overcharge cannot fairly be categorized as a "contribution." The refund is legally due the candidate under the contract for the broadcast services; nothing in the ethics rules prohibits a judge or a candidate from receiving benefits derived from a contract.

Since carry-over of excess judicial campaign funds to subsequent campaigns is prohibited, the campaign committee must be disbanded, and the judicial campaign accounts must be closed out by January 1 following the election, any outstanding campaign debts that are not covered by timely campaign contributions become the personal obligation of the candidate. If the candidate had received a bill after January 1 following the election for an expense incurred during the campaign, the candidate would have been personally obligated to pay the bill, regardless of whether the candidate had already returned excess campaign funds to contributors or to the Client Protection Fund.

Pursuant to MCL 169.204(1); MSA 4. 1703(4), family loans to the campaign are recorded as "contributions"; loans from a commercial lending institution are recorded as "other receipt." If the loans from family members were properly recorded, and subsequently became the personal obligation of the candidate, we do not see that ethics principles are violated by applying the late-arriving refund check to the balance on those outstanding loans. If the loans have subsequently been fully repaid, the candidate may retain the refund, since if the refund had been timely received, the loan amount the candidate would have had a personal obligation to repay would have been reduced by the amount of the refund.

Whether the candidate must amend any campaign filings or report receipt of the refund is a question resolved under statute. The receipt of the refund is not "compensation" or "reimbursement of expenses" required to be reported under MCJC 6.