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socrateaser
socrateaser, Lawyer
Category: Family Law
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Experience:  Retired (mostly)
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Need Family law expert to respond. Situation: person A and

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Need Family law expert to respond.
Situation: person A and person B get married. both have been married before and the are 3 children by the previous marriages. One has a boy the other has two girls. After the marriage person A's mother gives 6 acres of land. It is decided by person A, who takes the lead in marriage to construct a large 4 bedroom family home on the 6 acres. the land is used as a down payment. During the course of the 13 years the followed both people work and pay the mortgage. also during the 13 years that followed a bull dozer, trailer to haul the bull dozer and a truck to pull the trailer are pruchased with marrital assets. 2 lakes are constructed on the property as well as a playground for the kids and a large out building with a contrete floor. When person B asked person A why the property was put in person A's name only, person B was told by person A that it was community property, that person B owned half interest by reason of the marriage. This was told to person B repeatedly over the course of the 13 yr marriage by person A. during the 14th year the marriage breaks down and both file for divorce. Person A now claims the land was a gift and only person A has ownership. Person A's lawyer want the court to award person A the land and the house and give person B one half of the paydown of the mortgage over the 13 yr period. This amount to about $10,000. The sum of the payments made by both parties is over $90,000. Most of the payments went to interest. The property is worth about $150,000 now, with the inprovements. The mortgage balance is $55,000.
QUESTION: Does person B have a case for fraud. Person B believed the property was community under the marriage laws of the state of Indiana and was told repeatedly by person A that person B had a half interest in the property.

The kind of annswer I need: Although opinions are helpful, what is I need is Indiana statute or Indiana case law. I need this question answered by an Indiana lawyer who is an expert in family law
Submitted: 1 year ago.
Category: Family Law
Expert:  socrateaser replied 1 year ago.
Hello,

Indiana is a pure equitable division jurisdiction. IC 31-15-7-4 authorizes the court to divide all marital property in a "just and reasonable manner," regardless of when or how acquired by either spouse.

IC 31-15-7-4 creates a presumption that an equal division is "just and reasonable." However, it also provides that where property was acquired by gift or inheritance, the presumption may be overcome and the court can make an unequal division of property.

Your facts suggest that the money necessary to construct the home on the property gifted to your husband was secured by the underlying land. This suggests that the court would value that portion of the entire property as your husband's, because title was conveyed in his name only from his mother (or, so I presume). This leaves the contributions to the mortgage payments. The question here is not only how much each spouse contributed to the payments, but whether or not the lender looked to the combined income of the spouses to make the loan in the first place. If yes, then it could be argued that the entire value of the loan is actually marital property, because without both spouse's income, there would not have been a loan.

Frankly, I like the above argument a lot better than trying to prove a fraud, and here is why: Even if it were proved that your husband had intentionally misrepresented Indiana law concerning the distribution of property rights between the two of you, this doesn't mean that your husband made a gift to you of one half of the property that he received. The result of your knowing about the misrepresentation would have had to have resulted in your refusing to contribute to any mortgage payments (or, to sign onto the mortgage -- if you did). And, it could be difficult to prove that had you known that Indiana is not a community property state, that you would have done anything differently during the marriage.

So, while you can certainly allege that you were defrauded into signing up as a coborrower (if you did), or to contribute to the mortgage payments, you may have a furiously difficult time proving that you did so, and moreover, proving that your husband ever told you that the property was a "community" asset, unless he did so in writing.

Because, as I'm sure you're aware already, when it comes to divorce, you can expect that the other party will not tell the truth under oath, if he can gain an advantage by lying -- as long as there is no contradictory evidence to prove the lie.

Hope this helps.

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Customer: replied 1 year ago.

Follow up question: First, only party A borrowed the money. Only party A signed the mortgage. Since party B contributed finances and labor to inprove the property( helped purchase the equipment, helped clear the land, paid on the mortgage) party B spent a great deal on money. If this occured outside of marriage, the fraud I mean, there would be no question that an actionable tort had been commited by Party A. For years Party A told Party B that the property was owned equally. Party B made the mistake of believing one's life time best friend and partner in marriage. Someone that presumibly was deeply in love with Party B.


What I am asking is not the degree of difficulty in proving the fraud but if the fraud is actionable. Would it be legal for a judge to consider the fraud in the divorce settlement. I am not saying that Party A gave the land as a gift to party B as u suggested but that he knowing used Party B and lied to Party B so Party B would act in a manner that was not in Paty B's best interest. If the judge awards the bulk of the assest to party A, would a separate civil suit have any chance of sucess? And in final follow up question, would you work 13 years and pay $50,000 on someones house if you knew you had no interest in the property?

Expert:  socrateaser replied 1 year ago.

Follow up question: First, only party A borrowed the money. Only party A signed the mortgage. Since party B contributed finances and labor to improve the property( helped purchase the equipment, helped clear the land, paid on the mortgage) party B spent a great deal on money. If this occurred outside of marriage, the fraud I mean, there would be no question that an actionable tort had been committed by Party A. For years Party A told Party B that the property was owned equally. Party B made the mistake of believing one's life time best friend and partner in marriage. Someone that presumably was deeply in love with Party B.

 

A: Fraud requires a fairly complex proof:  "1) the fraud feasor must have made at least one representation of past or existing fact;  2) which was false;  3) which the fraud feasor knew to be false or made with reckless disregard as to its truth or falsity;  4) upon which the plaintiff reasonably relied;  5) and which harmed the plaintiff." Scott v. Bodor, Inc., 571 N.E.2d 313 (5th Dist. App. 5/16/1991). Attorneys who plead fraud do so with other fallback complaints, and the fraud action may be as much a tactic to help make the client happy that the attorney is as outraged as the client, as it is a colorable cause of action. In ordinary civil actions, most fraud claims fail, because of the lack of objective proof, and the case ends up as a straight breach of contract. So, when you say that the fraud would be clear outside of the marital relationship, you may be setting yourself with unreasonable expectations by considering what may ultimately be a false premise.


What I am asking is not the degree of difficulty in proving the fraud but if the fraud is actionable.


A: Yes, and it is actionable within the scope of the divorce action. Ehle v. Ehle, 737 N.E.2d 429 (Ct. of App. 10/25/2000)("Although Indiana Law no longer recognizes a presumption of superiority or dominance by one spouse over another, a spouse is not precluded from proving the superior knowledge or status of the other spouse to justify reliance for constructive fraud purposes."); Mullen v. Cogdell, 643 N.E.2d 390 (5th Dist. App. 9/30/1994)("In constructive fraud, law infers fraud from relationship of parties and circumstances which surround them.")


Would it be legal for a judge to consider the fraud in the divorce settlement.


A: If you prove the fraud, then the judge can consider it in making the final judgment for property division purposes (see above).


I am not saying that Party A gave the land as a gift to party B as u suggested but that he knowing used Party B and lied to Party B so Party B would act in a manner that was not in Paty B's best interest. If the judge awards the bulk of the assest to party A, would a separate civil suit have any chance of success?


A: No. A separate lawsuit would be barred by the doctrine of res judicata. A plaintiff must raise all legal and equitable claims arising from the same transactions or occurrence as part of the same action, or be forever barred from subsequent action.


And in final follow up question, would you work 13 years and pay $50,000 on someones house if you knew you had no interest in the property?

 

A: If you were to ask this in court, I would object to the question as irrelevant and argumentative. If you were to ask the question in an office consult, I'd say, "Of course not, let's get the bas****!" And, you would get all excited and cut me a check for my $7,500 retainer. But as you are asking me here, my answer is that it really doesn't matter what I think or what I would do in similar circumstances. This is your case and so only you can answer the question. My suggestion is simply that you do not put all your eggs into the fraud basket, because, as previously mentioned, fraud usually turns out to be the claim that can't be proved. If you have a lawyer, try to come up with an alternative argument to fraud, just in case the fraud is not getting any traction.

 

In a divorce, the court only needs to divide the property in a just and reasonable manner. Convince the court that your claims are just and reasonable and you don't need to prove fraud to get what you want.

 

Hope this helps.

 

NOTICE: My goal here is to entertain while educating the public about the law. I hope my answer is useful and informative to you. During our conversation, the website may ask you to rate my answer. If you rate my answer lower than the middle rating, then the website retains your entire payment, and I receive nothing. It is entirely your choice as to how you rate my answer. However, because your payment to me is in the nature of a donation/gift, rather than as compensation for any services rendered, you are entitled to know how your rating affects the final distribution of your donation.

If you need to contact me again, please put my user id at the beginning of your question ("To Socrateaser"), and the system will send me an alert. Please Click the following link for IMPORTANT LEGAL INFORMATION. Thanks and best wishes!

socrateaser, Lawyer
Category: Family Law
Satisfied Customers: 33381
Experience: Retired (mostly)
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