“Quote Unquote”
October 7, 2016 § 1 Comment
“The most certain test by which we judge whether a country is really free is the amount of security enjoyed by minorities.” – Lord Acton
“I call that mind free, which jealously guards its intellectual rights and powers, which calls no man master, which does not content itself with a passive or hereditary faith, which opens itself to light whencesoever it may come, which receives new truth as an angel from heaven. I call that mind free, which sets no bounds to its love, which is not imprisoned in itself or in a sect, which recognizes in all human beings the image of God and the rights of his children, which delights in virtue and sympathizes with suffering wherever they are seen, which conquers pride, anger, and sloth, and offers itself up a willing victim to the cause of mankind.” – William Ellery Channing,
“What constitutes the bulwark of our own liberty and independence? It is not our frowning battlements, our bristling sea coasts, our army and our navy. These are not our reliance against tyranny All of those may be turned against us without making us weaker for the struggle. Our reliance is in the love of liberty which God has planted in us. Our defense is in the spirit which prizes liberty as the heritage of all men, in all lands everywhere. Destroy this spirit and you have planted the seeds of despotism at your own doors. Familiarize yourselves with the chains of bondage and you prepare your own limbs to wear them. Accustomed to trample on the rights of others, you have lost the genius of your own independence and become the fit subjects of the first cunning tyrant who rises among you.” – Abraham Lincoln
No Fraud, No Foul
October 6, 2016 § Leave a comment
A couple of days ago we discussed a case in which a natural mother falsely and fraudulently claimed not to know who was the father of her child, which led a chancellor to enter an adoption judgment that later had to be set aside for fraud on the court.
Fraud on the court was the issue in a recent COA case, but the result was different than that in the adoption case.
Ronald and Belinda Betts were divorced in 2011. Belinda later sued Ronald for contempt several times. In one of those proceedings, Ronald had omitted a debt on his financial statement, and the chancellor noted that such an omission “can amount to a fraud perpetrated on the court and contempt.
When Belinda filed a third contempt action against Ronald, he borrowed a page from the chancellor’s earlier admonition and claimed in defense that the divorce judgment entered the previous year should be set aside per R60(b)(6) because Belinda made a false representation to the court in her divorce-action financial statement by omitting her interest in some property she inherited jointly with her sister. Belinda countered that she did not know or believe the land to be her property at the time.
The chancellor overruled Ronald’s motion and found him in contempt for non-payment of amounts he was ordered to pay under the divorce judgment. Ronald appealed.
In Betts v. Betts, handed down September 13, 2006, the COA affirmed. Judge Griffis wrote for a unanimous court:
¶11. Ronald argues that Belinda’s failure to list the property on her Rule 8.05 financial statement constituted an intentional filing of a substantially false statement and fraud upon the court. Belinda contends that Ronald’s unclean hands bar him from relief.
¶12. Rule 60 provides in part:
(b) Mistakes; Inadvertence; Newly Discovered Evidence; Fraud, etc. On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order, or proceeding for the
following reasons:
. . . .
(6) any other reason justifying relief from the judgment.
“Rule 60(b)(6) provides a ‘catch-all’ provision under which relief may be granted in
exceptional and compelling circumstances, such as for fraud upon the court.” Trim v. Trim, 33 So. 3d 471, 475 (¶7) (Miss. 2010).
¶13. “Relief based on ‘fraud upon the court’ is reserved for only the most egregious misconduct, and requires a showing of ‘an unconscionable plan or scheme which is designed to improperly influence the court in its decision.’” Id. at 477 (¶15). “[S]imply failing to disclose essential facts to the proceedings to the adverse party or the court does not rise to the level of fraud. There must be a finding that the disclosure was intentional.” Finch, 137 So. 3d at 235 (¶23).
¶14. “[A] party’s intentional filing of a substantially false Rule 8.05 financial statement constitutes a fraud on the court.” Trim, 33 So. 3d at 478 (¶17). And “no time limit constrain[s] the chancellor’s ability to modify the divorce judgment to remedy the fraud on the court.” Id.
¶15. The following elements constituting intentional or fraudulent representation must be proven by clear and convincing evidence:
(1) a representation, (2) its falsity, (3) its materiality, (4) the speaker’s knowledge of its falsity or ignorance of its truth, (5) his intent that it should be acted on by the hearer and in the manner reasonably contemplated, (6) the hearer’s ignorance of its falsity, (7) his reliance on its truth, (8) his right to rely thereon, and (9) his consequent and proximate injury.
Id. at (¶19) (citing McCord v. Healthcare Recoveries Inc., 960 So. 2d 399, 406 (¶17) (Miss. 2007)).
¶16. The chancellor declined to set aside or modify the divorce decree after finding that Belinda did not intentionally mislead the court and that Ronald came to court with unclean hands after failing to disclose certain property rights on his Rule 8.05 financial statement. “[T]he trial court is best able to determine whether a fraud has been perpetrated upon it. As a result, the chancellor’s determination of the issue is entitled to great weight.” Tirouda v. State, 919 So. 2d 211, 216 (¶12) (Miss. Ct. App. 2005). “The credibility of the witnesses and the weight of their testimony, as well as the interpretation of evidence where it is capable of more than one reasonable interpretation, are primarily for the chancellor as the trier of fact.” Trim, 33 So. 3d at 479 (¶20).
¶17. The testimony from Belinda supports the chancellor’s conclusion that she did not know of her false representation to the court. She simply did not consider the property her own. She had not paid for the property, and she was not using the property for any purpose. The testimony showed that her mother currently or previously lived on the property, and Belinda considered it her parents’ land. Intentional or fraudulent representation requires that a representation be made, which the speaker knows to be false, with the intent that it should be acted on by the hearer. Fitch, 137 So. 3d at 235 (¶23).
¶18. Belinda’s conduct was not shown to be “the most egregious misconduct, . . . ‘an unconscionable plan or scheme which is designed to improperly influence the court in its decision.’” Trim, 33 So. 3d at 477 (¶15). And even though she failed to list the property in her Rule 8.05 financial statement, “simply failing to disclose essential facts to the proceedings to the adverse party or to the court does not rise to the level of fraud.” Finch, 137 So. 3d at 235 (¶23). “[A] party is not entitled to relief [under Rule 60(b)] simply because he is unhappy with a judgment.” McNeese v. McNeese, 119 So. 3d 264, 272 (¶20) (Miss. 2013).
¶19. Furthermore, Ronald himself failed to list mineral rights in his possession on his Rule 8.05 financial statement, leading the chancellor to find that Ronald came to court with unclean hands. “Mississippi’s chancery courts are courts of equity, and under the clean[-]hands doctrine, anyone that comes before ‘a court of equity . . . must do equity as a condition of recovery.’” Dill v. Dill, 908 So. 2d 198, 202 (¶11) (Miss. Ct. App. 2005). “This doctrine, in effect, prevents a complainant from petitioning the court to modify an original decree absent proof that said complainant has fully performed under the terms of the original decree or, in the alternative, that full performance thereunder has been wholly impossible.” Id. The chancellor noted: “Just as Belinda failed to disclose an asset at the time of their divorce, so did Ronald.”
¶20. This Court finds that the chancellor did not abuse his discretion in denying Ronald relief under Rule 60(b). As such, the substantial evidence supports the chancellor’s discretionary ruling as the fact-finder.
Before you wade off into the shark-infested waters of R60 on a raft of fraud, make sure it is stout enough to support your case.
Not every omission of evidence amounts to a fraud on the court. This case is a good recitation of the law on the point. You should file it away for future reference.
Attorney’s Fees in Contempt Actions
October 4, 2016 § Leave a comment
It’s pretty much a given that, if you are found to be in contempt of a court order, you will be assessed with the other side’s reasonable attorney’s fees.
The point was brought home again recently in the COA case of Dupree v. Pafford, decided September 6, 2016.
In that case, Stephanie Dupree had been found in contempt of court orders for discovery in a contempt/modification action, and for her denial of visitation. Unhappy with the trial court’s rulings, Stephanie appealed. Two of her contentions were (1) that there was no proof that the father of her child, Patrick, was unable to pay his attorney’s fees, and (2) that the court did not adequately address the reasonableness of the fees that were assessed. Judge Fair wrote for the majority:
¶8. Next, Stephanie contends that the chancellor erred in finding the fees to be reasonable. She makes two distinct arguments here, and the first is easily disposed of: Stephanie contends that the chancery court was required to find that Patrick was unable to pay his own attorney’s fees. This is simply not required when a finding of contempt has been made:
When a party is held in contempt for violating a valid judgment of the court,
attorney’s fees should be awarded to the party that has been forced to seek the
court’s enforcement of its own judgment. The award may be assessed against
the offending party without regard to the recipient’s inability to pay.
Caldwell v. Atwood, 179 So. 3d 1210, 1217 (¶26) (Miss. Ct. App. 2015) (citations and
internal quotation marks omitted).
¶9. Stephanie next contends that the chancellor failed to adequately determine the
reasonableness of the fees claimed by Patrick’s attorney. The record reflects that the
chancellor expressly found the fees to be reasonable. While Stephanie faults the chancellor for not going into detail, detailed findings are not required if the award of fees is, in fact, reasonable. West v. West, 88 So. 3d 735, 747 (¶¶57-58) (Miss. 2012). On that point, Stephanie offers nothing other than her assertion that many of the fees were “generated by totally needless litigation” resulting from Patrick’s motion for custody modification, which, according to Stephanie, delayed the hearing on the contempt issue and resulted in multiple contempt motions being filed.
¶10. “An award of attorney’s fees in domestic cases is largely a matter entrusted to the
sound discretion of the trial court. Unless the chancellor is manifestly wrong, his decision regarding attorney[’s] fees will not be disturbed on appeal .” Gaiennie v. McMillin, 138 So. 3d 131, 137 (¶15) (Miss. 2014) (internal citation and quotation marks omitted). Stephanie has failed to show an abuse of discretion regarding the reasonableness of the attorney’s fee awards.
That’s pretty straightforward. As a practical matter, however, it may just be a lot of sound and fury signifying nothing, because the COA sent the case back to the trial court because the chancellor had found Patrick not to be in contempt despite a history of non-payment of child support. The COA held that Patrick’s history of non-payment and late payments should have resulted in a contempt adjudication. That will likely cost him something in attorney’s fees, which will offset — in whole or in part — the award against Stephanie.
A Tragic Fraud on the Court
October 3, 2016 § 1 Comment
It’s hard to imagine a legal proceeding more tragic and heart-wrenching than the setting aside of an adoption. Most chancellors go to extremes to ensure that there are no flaws in the proceeding that might jeopardize the finality of an adoption judgment.
In the recent MSSC case, Doe v. Smith, decided September 22, 2016, the chancellor entered an adoption judgment based on the natural mother’s statement in the Consent and in her sworn testimony that she was unaware of the natural father of her child, Matthew. Stan, the natural father, however, learned of the adoption and filed a R60(b)(6) motion to set the judgment aside for fraud. At the hearing on that motion, the natural mother, Katy, admitted on the witness stand that she had lied, the chancellor set aside the adoption judgment.The adoptive mother appealed. One of her grounds was that the chancellor erred in setting aside the judgment. Justice Maxwell, writing for a unanimous court, addressed the argument this way:
¶14. A fraud upon the court is an intentional misdeed that “vitiates a judgment” because “the court is misled and deceived” about the facts it relies upon when administering the law. Trim [v. Trim], 33 So. 3d [471,]at 477 (¶ 15) [(Miss. 2010)] (quoting Brown v. Wesson, 74 So. 831, 834 (Miss. 1917)). Rule 60(b)(6) gives judges broad authority to set aside judgments entered, resulting from such fraud. Trim, 33 So. 3d at 475 (¶ 7) (citing M.R.C.P. 60(b)(6) and Tirouda v. State, 919 So. 2d 211, 214 (Miss. Ct. App. 2005)). However, to qualify as “fraud upon the court,” there must be exceptional and compelling circumstances and the deceptive act(s) must be material and extreme. Not just any falsity or misstep, even if intentional, is enough for relief.
¶15. “Relief based on ‘fraud upon the court’ is reserved for only the most egregious misconduct, and requires a showing of ‘an unconscionable plan or scheme which is designed to improperly influence the court in its decision.’” [Fn13] Wilson v. Johns-Manville Sales Corp., 873 F. 2d 869, 872 (5th Cir. 1989) (quoting Rozier v. Ford Motor Co., 573 F. 2d 1332, 1338 (5th Cir. 1978)). Mere nondisclosure of pertinent facts to the court “does not add up to ‘fraud upon the court’ for purposes of vacating a judgment under Rule 60(b).” Trim, 33 So. 3d at 477-78 (¶ 16) (quoting Kerwit Med. Prods., Inc. v. N & H Instruments, Inc., 616 F.2d 833, 836 n.8 (5th Cir. 1980)). Furthermore, the fraud must be proved by clear and convincing evidence. Moore v. Jacobs, 752 So. 2d 1013, 1017 (Miss. 1999) (citing Stringfellow v. Stringfellow, 451 So. 2d 219, 221 (Miss. 1984)).
[Fn 13] See also In re Guardianship of McClinton, 157 So. 3d 862, 870 (¶ 17) (Miss.
2015) (Rule 60(b)(6) is a “catch all” provision for exceptional and compelling
circumstances) and Roberts v. Lopez, 148 So. 3d 393, 399 (¶ 12) (Miss. Ct. App. 2014) (the substantial misrepresentation of facts on which a judgment is based constitutes a fraud on the court).
¶16. Here, the chancellor found Katy’s deceptive acts and omissions—which she admitted she knowingly made—met these high marks. Katy had filed a voluntary, sworn joinder and consent to Matthew’s adoption.[Fn 14] And in it, she represented she was unaware of Matthew’s biological father’s name, identity, or address. But under oath at the April 21, 2015, hearing, Katy admitted to lying about Matthew’s father’s identity in her consent. She also admitted she lied when testifying at Matthew’s adoption proceeding. She said she did so because she knew Stan would be a poor parent and caregiver.
[Fn 14] Under Mississippi Code Section 93-17-5, Katy was required to either provide her consent to the adoption or appear and contest it. Miss. Code Ann. § 93-17-5(1), (4) (Rev. 2013).
¶17. We have held that the effective administration of justice requires our chancellors have accurate financial information to distribute marital assets during divorce. See Trim, 33 So.3d at 477-78 (¶¶ 16, 17) (finding a party who filed a substantially false, statutorily required Rule 8.05 statement committed a fraud upon the court). So certainly, an intentional fraud aimed solely to circumvent a natural parent’s statutorily mandated consent [Fn 15] to an adoption undermines the effective administration of justice.
[Fn 15] See Miss. Code Ann. § 93-17-5(1), (4) (Rev, 2013).
¶18. The chancellor found that Katy knew who Matthew’s father was after the first
paternity test excluded her husband. And she withheld this information from the court and all parties involved. He held that Katy knowingly had misled the court and all parties through her testimony, affidavit, and nondisclosures regarding Matthew’s paternity.
¶19. And because the heart of Katy’s actions was designed to deceive the court, by lying about and omitting material facts to trick the court into granting a supposed uncontested adoption, the chancellor properly found that a fraud was committed upon his court. [Fn 16]
[Fn 16] The requirement that fraud, misrepresentation, or other misconduct be proved by clear and convincing evidence is moot here, since Katy admitted her fraud. See Moore v. Jacobs, 752 So.2d 1013, 1017 (¶ 18) (Miss. 1999).
There was nothing in the record to show that either the adoptive parents or their attorney knew of Katy’s false statements.
A few observations:
- Adoption proceedings underwent a change effective April 16, 2016. You need to familiarize yourself with those changes if you are going to handle any adoptions. This decision is under the old adoption procedure.
- The main thing to take away here is how easy it is for parties who are unencumbered by ethical considerations to lie when it suits them. As a lawyer you should be especially diligent and inquisitive when a natural mother claims not to know who was the father.
- This case underscores how ruinous a fraud on the court can be. Imagine the joy of the adoptive parents when they walked out of the courthouse with their new baby; and imagine their devastation when the child was taken away from them some nine moths later. That’s why lawyers should take extra care, as much as they can, to make sure that something like this does not happen.
A similar thing happened in my court. The mother signed a Consent stating that she did not know who was the natural father, and the adoption agency gave the child to the adoptive parents pending the adoption. Before the adoption could be presented, however, the natural father intervened and objected to the adoption. The adoptive parents conceded the inevitable and surrendered the child to the father.
Another issue raised on appeal was whether the natural father had standing to file a R60 motion in the case, since he was not a party. That’s a subject for another post.
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