The presiding justice of the Appellate Division, First Department, who is facing accusations of mortgage fraud and nepotism after an article was published in the New York Post, has hired two prominent attorneys to represent him.

Presiding Justice Luis A. Gonzalez (See Profile) has retained Paul Shechtman of Stillman, Friedman & Shechtman, a former chief of the criminal division of the Southern District U.S. Attorney’s Office; and Ben R. Rubinowitz, a partner at Gair, Gair, Conason, Steigman, Bloom & Rubinowitz, a plaintiff’s personal injury firm, both lawyers confirmed.

The lawyers also confirmed that the New York State Commission on Judicial Conduct has opened a preliminary inquiry by asking Justice Gonzalez to answer questions about all aspects of the March 27 Post article.

As to the prospects of a criminal probe, Mr. Shechtman said, “It is unimaginable to me that any prosecutor’s office, after reviewing the relevant documents, would not close an investigation within days of opening it.”

The Post article also reported that Justice Gonzalez authorized the hiring of relatives of several First Department employees, including his ex-wife, Vivian Gonzalez, as a clerk. The Office of Court Administration has confirmed that a Vivian Gonzalez was hired in December as an associate appellate clerk at an annual salary of $65,000 (NYLJ, April 13).

The hiring of relatives of court employees, as claimed in the Post article, is not a crime and would not be the subject of a criminal inquiry, Mr. Shechtman said.

“Time will show that everyone who was hired was qualified for their post,” Mr. Rubinowitz said.

Though Mr. Rubinowitz is known as a plaintiff’s lawyer, he has developed a sub-specialty representing close to “a dozen” judges in matters before the conduct commission. Many of the judges who retained him, he said, knew him through his trial work before them.

Timeline of Events

Dec. 27, 2000: Justice Gonzalez signs a lease for a rent-stabilized apartment in the Bronx for a term starting on Jan. 1, 2001.

March 14, 2002: He is appointed to the Appellate Division, First Department, from Bronx Supreme Court.

Nov. 27, 2002: Gonzalez buys a home in Brooklyn.

Aug. 31, 2007: He moves from the Bronx to Brooklyn and notifies his landlord, terminating the lease on the Bronx apartment.

Jan. 13, 2009: First Department Presiding Justice Jonathan Lippman is nominated as chief judge.

Feb. 6, 2009: Gonzalez refinances the mortgage on his Brooklyn home with a federally insured mortgage for $510,276; submits a required affidavit stating he “now occupies” the Brooklyn home.

Feb. 12, 2009: Lippman is confirmed as chief judge.

March 1, 2009: Gonzalez rents a different apartment in the same Bronx building where he had signed the earlier lease.

March 6, 2009: He applies to become presiding justice of the First Department.

March 24, 2009: He is appointed presiding justice.

The Post reported that Justice Gonzalez had simultaneously claimed a rent-stabilized apartment in the Bronx and a home he owns in Brooklyn as primary residences. But he said on a 2008 application for a mortgage on the Brooklyn property that he “now occupies” the property.

Mr. Shechtman agreed that lying on an application for a federally insured mortgage would be a crime, but he insisted that his client had not lied about his residence. He explained in an interview that Justice Gonzalez lived in the Bronx for several years, moved to Brooklyn, and then moved back to the Bronx.

But Mr. Shechtman acknowledged that when Justice Gonzalez moved back to the Bronx shortly after taking out a $510,276 mortgage on the Brooklyn house, he did not notify New York City that he was no longer using the Brooklyn home as a primary residence.

The omission was inadvertent, Mr. Shechtman said, because under the terms of the mortgage the bank paid the property tax and received all correspondence from the city concerning it.

Because of the oversight, Mr. Shechtman said, Justice Gonzalez has repaid the $560 he was mistakenly paid under the STAR tax exemption program.

Mr. Shechtman provided a detailed rebuttal of the claims in the Post that Justice Gonzalez “really resided” in a rent-stabilized apartment in the Bronx when he took out the $510,000 federally insured mortgage on the Brooklyn home, which he had purchased from his aunt in 2000.

Mr. Shechtman made available to the Law Journal a copy of the lease Justice Gonzalez signed for a rent-stabilized apartment in the Bronx starting in January 2001. At the time, he was the administrative judge of the Bronx Supreme Court.

Mr. Shechtman also showed the Law Journal a copy of a notice that the judge gave his Bronx landlord stating he would be terminating his lease effective Aug. 31, 2007.

It was at that time, Mr. Shechtman said, that Justice Gonzalez moved to the house in Williamsburg, Brooklyn.

The judge lived in a basement apartment while his daughter and her child occupied the rest of the two-bedroom home, Mr. Shechtman said.

Mr. Shechtman also said that the house was in need of major repairs when Justice Gonzalez purchased it, and that the work had proceeded slowly. He decided to move to Brooklyn “for purely economic reasons” because he could no longer pay for both properties, the lawyer said.

The $510,000 mortgage, one of several he received on the property, closed on Feb. 6, 2009. Justice Gonzalez had submitted his application for the mortgage “at the latest” on Nov. 25, 2008, Mr. Shechtman said.

On Feb. 12, 2009, the First Department’s then presiding justice, Jonathan Lippman, was confirmed as the state’s chief judge.

Justice Gonzalez, who had been on the First Department bench since 2002, moved back to the Bronx shortly after the chief judge appointment so he could apply for the presiding justice slot.

In anticipation of the possibility that he might be appointed, Mr. Shechtman said, Justice Gonzalez rented a different rent-stabilized apartment in the same Bronx building where he lived previously. The lease, a copy of which was shown to the Law Journal, was for two years starting on March 1, 2009.

Associate justices of the Appellate Division are not required to live within their departments, but presiding justices must. For the First Department, that means Manhattan or the Bronx. Brooklyn, where Justice Gonzalez’s house is located, is in the Second Department.

Mr. Shechtman said he is charging Justice Gonzalez at the same rate he bills the city and state, rather than charging his normal rates. According to the New York City Corporation Counsel’s Office, Mr. Shechtman’s billing rates for city work have ranged from $250 to $350 an hour.

Mr. Shechtman has argued three cases before the First Department since Justice Gonzalez joined the court. Justice Gonzalez did not sit on any of those panels, according to a Westlaw search. Mr. Rabinowitz has only argued one appeal during that time, and Justice Gonzalez was not a member of the panel.