Opinion ID: 1677477
Heading Depth: 1
Heading Rank: 2

Heading: Summary JudgmentHieb and Bank

Text: Tucek asserts that the trial court erred in granting an order for summary judgment dismissing her claims of fraud and deceit against Hieb and Bank. Questions of fraud and deceit are generally questions of fact and as such are to be determined by the jury. Garrett, 459 N.W.2d at 847. However, when considering a motion for summary judgment, the issues presented in the pleadings are not controlling and a party may not rest upon the mere allegations contained therein. Breen v. Dakota Gear & Joint Co., Inc., 433 N.W.2d 221, 223 (S.D.1988). The party opposing a motion for summary judgment must be diligent in resisting the motion, and mere general allegations and denials which do not set forth specific facts will not prevent issuance of a judgment. Id. We must determine whether there exists any basis supporting the trial court's ruling. Id. One who willfully deceives another, with intent to induce him to alter his position to his injury or risk, is liable for any damage which he thereby suffers. SDCL 20-10-1. To prove fraud, there must be a representation that was: (1) made as a statement of fact, which was untrue by the party making it, or else recklessly made; (2) made with intent to deceive and for the purpose of inducing the other party to act upon it; and (3) relied on by the innocent party, inducing that party to act to his injury or damage. Croes Family Trust v. Small Business Admin., 446 N.W.2d 55, 57 (S.D.1989). See also Sperry Corp. v. Schaeffer, 394 N.W.2d 727, 730 (S.D.1986). Hieb's notarization of the release form was a representation that was made as a statement of fact which was untrue. Hieb's notarization represented that Tucek had signed the release form in his presence when, in fact, she had not. The notarization thus violated SDCL 18-1-11 [2] and qualifies as a misrepresentation under the first element of fraud. The second element of fraud is that the misrepresentation be made with intent to deceive and for the purpose of inducing the other party to act upon it. Croes Family, 446 N.W.2d at 57. Fraudulent intent is an essential element of deceit under South Dakota law. SDCL 20-10-1. Tucek's complaint itself asserts that Hieb knowingly and intentionally participated with Mueller in effecting a fraud against Tucek. However, no facts were presented to indicate any fraudulent intent on the part of Hieb in the underlying settlement transaction. In fact, Tucek's sworn testimony clearly indicates that there is no genuine issue of material fact regarding intent to deceive her or reliance by her. [3] When Mueller presented the unsigned release form to Hieb at Bank, Hieb informed Mueller that Tucek would need to sign the form before he could notarize it. Mueller said that Tucek was outside in his van. Hieb looked out his window and believed he saw Tucek in the van. In his deposition, Hieb states that it was his intention to accompany Mueller to the van to obtain Tucek's signature. Unfortunately, Hieb was interrupted at this time. When he returned to Mueller, the release form bore what he assumed to be Tucek's signature. Believing that it bore Tucek's signature, Hieb notarized the release form even though it had not been signed in his presence. Hieb's actions may have been negligent and in violation of SDCL 18-1-11, but they do not rise to the level of intentional fraud. Summary judgment is proper if there is no evidence of deceitful intent on the part of the defendant. Garrett, 459 N.W.2d at 847; Famous Brands, Inc. v. David Sherman Corp., 814 F.2d 517, 522 (8th Cir.1987). These facts, which are not disputed, clearly provide the basis for upholding the trial court in this case. Moreover, the third element of fraud is not met. Tucek did not rely on Hieb's misrepresentation. Adjuster, Adjusting Company and Insurer are the parties who relied on the validity of the notarization. Hieb's notarization of the release form resulted in Adjuster providing the $70,000.00 settlement check to Mueller, but it did not cause Tucek to cash the check nor did it cause Mueller's subsequent conversion of those funds. Tucek, in fact, accepted and deposited her $70,000 settlement check from Insurer. She was not upset with the settlement until more than six months later when she discovered that Mueller had subsequently converted a portion of the settlement funds in her account to his own use. This was discovered after she had reviewed her monthly bank statements. Tucek's initial reaction was to advise Mueller to refrain from making any further withdrawals. Finally, Tucek asserts that Hieb and Bank worked with Mueller in perpetrating the fraud against Tucek. However, Tucek admits in her deposition that she has no facts to support her accusation of Hieb and Mueller working together. Rather, Tucek said she just believed they were probably working together, but did not know for sure. Tucek cannot claim a better version of facts than what she testified to. Parsons v. Dacy, 502 N.W.2d 108 (S.D.1993). Tucek asserts that every person who assists another in the perpetration of fraud is liable to the injured party citing Kaas v. Privette, 12 Wash.App. 142, 529 P.2d 23 (1974). However, in Kaas, each of the liable stockholders had made an active misrepresentation to the injured party unlike the facts before us. More than a mere participation is necessary to be liable for fraud; that participation must be knowing with the intent to induce the other party's actions. SDCL 20-10-1; Sperry Corp., 394 N.W.2d at 730. Although Hieb notarized the release form and Bank established joint accounts for Mueller and Tucek, there is no evidence that Hieb or Bank were active knowing participants in Mueller's fraudulent conversion of Tucek's funds.