Opinion ID: 4661344
Heading Depth: 2
Heading Rank: 1

Heading: Fraud, Misrepresentation, or Misconduct

Text: [¶11] Belgarde argues the divorce judgment should be vacated under N.D.R.Civ.P. 60(b)(3) because Paulson deliberately misrepresented his reasons for the divorce to fraudulently induce her to sign a one-sided agreement favoring his interests. The party seeking relief from a judgment based on fraud has the burden of proof and must establish fraud by clear and convincing evidence. Dvorak, 329 N.W.2d 868, 872 (citations omitted). When the judgment sought to be set aside was entered pursuant to a stipulation of the parties, the party challenging the judgment has the additional burden of showing a justification under the law of contracts. Terry, 2002 ND 2, ¶ 4. Relief under N.D.R.Civ.P. 60(b)(3) for fraud, misrepresentation, or other misconduct is extraordinary relief that should only be granted in exceptional circumstances. Id. “Rule 60(b), N.D.R.Civ.P., is not to be used to relieve a party ‘from free, calculated, and deliberate choices he or she has made.’” Id. at ¶ 7 (quoting Fleck v. Fleck, 337 N.W.2d 786, 791 (N.D. 1983)). A stipulation will not be rescinded on the grounds of mistake or fraud if a party had the opportunity to read the agreement without being misled as to its contents. Eberle, 2009 ND 107, ¶ 26. [¶12] Belgarde argues Paulson promised that there would be reconciliation, that her name would be restored to the home title, and that he would help her when she needed it. Belgarde alleged Paulson repeatedly denied having an affair prior to divorce, but she discovered text messages and call logs between Paulson and another woman after she signed the agreement. Belgarde argues this is evidence of an affair demonstrating that Paulson misrepresented his intentions regarding a future reconciliation with her and his reasons for 4 wanting a divorce. Paulson argues Belgarde misconstrued his statements as promises, and maintains he did not have an extramarital affair. [¶13] The district court considered the submissions and arguments of the parties and noted both parties are well-educated adults with advanced degrees, with the full ability and capacity to enter contracts freely. The court noted Belgarde submitted no evidence to suggest she did not understand the finality of a divorce decree. The court concluded there was nothing enforceable about a discussion, or even an agreement, to reconcile in the future. The court stated the risk of relying on such an agreement was apparent and foreseeable at the time she agreed to the stipulation. The court also found Belgarde had time to read and understand the stipulation. Regarding the alleged extramarital affair, the court noted Belgarde suspected Paulson was having an affair prior to signing the settlement agreement, while Paulson has continuously denied the allegation. The court found Belgarde had sufficient suspicion of the conduct for her to factor it as a possibility when reaching a settlement agreement. Therefore, it was not new information unknown to her at the time the parties negotiated their stipulation. The court concluded that Belgarde’s “belief that [Paulson] engaged in an extramarital affair does not constitute and would not constitute false pretenses, fraud, newly discovered evidence, duress, misrepresentation, or misconduct by [Paulson], even if [her] allegations were true.” [¶14] We are concerned with the district court’s last conclusion. If Paulson made false statements about the alleged affair prior to execution of the settlement agreement, “the suppression of the truth with intent to induce another to enter into a contract is fraud.” Dvorak, 329 N.W.2d 868, 872 (citation omitted). However, the court here did not find an extramarital affair occurred, likely because the evidence in the record was conflicting and inconclusive. The court concluded that Belgarde’s “belief” that Paulson engaged in an extramarital affair did not constitute false pretenses, fraud, newly discovered evidence, misrepresentation, or misconduct. “Generally, no abuse of discretion will be presumed or inferred where there are conflicting affidavits.” Haugo v. Haaland, 349 N.W.2d 25, 27 (N.D. 1984). The conflicting affidavits in the record here do not provide clear and convincing evidence that 5 an affair occurred; therefore, Belgarde has not met her burden. On this record, we cannot say the court abused its discretion in denying the motion to vacate based on fraud, misrepresentation, or misconduct for the alleged affair or any other alleged misrepresentation.