AND MORE RE FRAUD ON THE COURT

October 18, 2012 § Leave a comment

Only last week I posted here about what it takes to trigger relief from fraud on the court. There was yet another case dealing with fraud on the court handed down by the COA last week, and it’s one you need to add to your notes on the subject.

Dogan v. Dogan, decided October 9, 2012, by the COA, is an involved equitable distribution/alimony case that covers many familiar financial issues that arise in the course of a high-dollar divorce. David Dogan was a partner in a law firm and had earnings as much as $35,000 a month. The firm lost a major client, Durabla, to bankruptcy, though, which negatively impacted his earnings. The chancellor wrestled with calculation of David’s income and concluded that it was $19,000 a month. David’s wife, Barbara, charged that David committed a fraud on the court because, although he reported the lower income figure on his 8.05 statement, he had filed a home loan application stating his income as $35,000. Keep in mind that, under the general principle of Trim, knowingly submitting a false financial statement to the court is fraud on the court.

The COA, by Judge Roberts, beginning at ¶14, upheld the chancellor’s decision as to David’s income:

In Mississippi, the general rule is that fraud will not be presumed but must be affirmatively proven by clear and convincing evidence. See Hamilton v. McGill, 352 So. 2d 825, 831 (Miss. 1977); Taft v Taft, 252 Miss. 204, 213, 172 So. 2d 403, 407 (1965). Further, on appeal, there are four requirements to vacate a decree due to fraud:

(1) that the facts constituting the fraud, accident, mistake or surprise must have been the controlling factors in the effectuation of the original decree, without which the decree would not have been made as it was made; (2) the facts justifying the relief must be clearly and positively alleged as facts and must be clearly and convincingly proved; (3) the facts must not have been known to the injured party at the time of the original decree, and (4) the ignorance thereof at the time must not have been the result of the want of reasonable care and diligence.

Manning v. Tanner, 594 So. 2d 1164, 1167 (Miss. 1992). Barbara has failed to meet these requirements. First, the chancellor did not make his decision solely on David’s Rule 8.05 financial statement; therefore, the amount in his statement was not a controlling factor in the decree as is required under the first prong. Barbara also fails under prongs three and four because, assuming the discrepancy on the Rule 8.05 financial statement and loan application to be true, Barbara was aware of it at the time of the original decree. Additionally, the chancellor addressed the discrepancy and found that the amount of the loan application was an average of the last two federal tax returns and did not take into consideration the bankruptcy of Durabla and its financial impact on the firm.

Thus the COA continued to flesh out how Trim will affect our case law. Before you cry “Fraud” to the trial court, make sure you can support your claim with proof in the record of the four Manning factors.

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