Opinion
No. C9-02-961.
Filed January 28, 2003.
Appeal from the Hennepin County District Court, File No. DC218952.
Lawrence H. Crosby, Jay D. Olson, Crosby Associates, (for appellant)
Stevan S. Yasgur, Stevan S. Yasgur, P.C., (for respondent)
Considered and decided by Randall, Presiding Judge, Harten, Judge, and Stoneburner, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2002).
UNPUBLISHED OPINION
Appellant challenges the district court's denial of her motion to reopen on the ground of fraud, the property division and spousal maintenance provisions of the parties' 1996 stipulated dissolution judgment. Because the district court did not abuse its discretion in denying appellant's motion to reopen the judgment and did not clearly err in rejecting appellant's claim of fraud, we affirm.
FACTS
Respondent Albert Tsai, a physician, and appellant Lorna Marks, an author, were married for 15 years. They have one son, who was age 13 in 1996, when the parties' marriage was dissolved by a judgment based on a joint petition and stipulation (the stipulation). Appellant was unrepresented during the dissolution; respondent's attorney drew up the stipulation and submitted it to appellant for her review and corrections.
The stipulation provided that appellant waived spousal maintenance, that respondent received title to the parties' homestead, and that appellant would remain in the parties' homestead through June 2000, when the parties' son would finish high school. It also provided that respondent would pay (1) principal, interest, taxes, and insurance on the homestead through June 2000, even though this amount ($1,844.54) exceeded maximum guideline child support of $1,250; (2) the son's education expenses of $12,000 annually for the five years remaining until the son finished high school; (3) the son's private college or university expenses of $100,000; (4) the son's clothing expenses, (5) the son's health and dental insurance, and (6) long-term marital debts of about $300,000.
The stipulation reads:
The total net worth of the parties' marital property subject to division is just over $578,000.00, creating a presumptive division of approximately $289,000.00 to each party. [Appellant] having been fully advised of her presumptive entitlement to such a disbursement and having been fully advised of her right to review this property division with independent counsel of her choosing, having been advised that [respondent's attorney] in no way represents her but represents only [respondent], has nonetheless indicated not only her approval of, but her desire for, the division made herein.
She has requested only a vehicle, a residence while she completes the book she is writing (a work now in progress for the last seven years), and that [respondent] assume the long-term marital debt of nearly $300,000.00. She does this so that [the parties' son's] lifestyle may continue through college. Many of these costs exceed payments which could be compelled under a more conventional property division. [Appellant] has made an independent judgment that her son's present and future lifestyle, her own surroundings, and the ability to continue her writing without interruption from her present routine have enormous intangible value. When her work is completed in December, 1995, she anticipates working part-time outside the home during [the son's] school hours and is fully capable of supporting herself.
This language reflects both appellant's testimony and her additions to the draft of the stipulation.
The judgment was entered 27 February 1996. Respondent continued to pay appellant's bills for two years, through March 1998.
Appellant, acting pro se, moved the district court to re-open the property division segment of the judgment. Her motion was denied as "without legal basis" by the district court judge who had presided over the dissolution.
In 2001, appellant, represented by counsel, sought to reopen not only the property division but also the spousal maintenance provision, alleging that respondent had committed fraud because the transcript of the 1996 hearing indicated that he reported his income was $80,000 when it was in fact $180,000. A different district court judge was assigned to the case.
Before the hearing on this motion, the court reporter who had prepared the transcript wrote a letter to both counsel and the court, stating,
My court reporter notes clearly state, "About $180,000 a year." So it is a transcription error and [respondent's] answer to the Court's question * * * "What do you make?" should be corrected to read, * * * "About $180,000 a year."
Despite this letter, at the motion hearing appellant persisted in her allegation that respondent had fraudulently represented his income to the court and requested an evidentiary hearing. The district court denied appellant's motion to reopen the property award, but reserved her motion to reopen spousal maintenance. Shortly before the evidentiary hearing, however, appellant conceded that respondent had not misrepresented his income to the court. The district court then denied the motion to re-open the spousal maintenance award.
Appellant now challenges the denials of both motions.
Appellant raises other issues, but they are moot absent fraud by respondent.
DECISION
The district court's decision whether to reopen a judgment will be upheld unless the court abused its discretion, and the district court's findings as to whether the judgment was prompted by mistake or fraud will not be set aside unless clearly erroneous. Hestekin v. Hestekin, 587 N.W.2d 308, 310 (Minn.App. 1998).
1. Property Division
Appellant's affidavit reflects that she knew the approximate size of the marital estate before the parties' stipulation was approved, and the evidence includes both a letter she wrote giving a breakdown of how her $300,000 was to be spent for the support and education of their son and a draft stipulation that was annotated and corrected in her handwriting. Thus, there is support for the district court's finding that
when [appellant] stood before [the district court] on February 15, 1996 and asked the Judge to approve the Decree, [appellant] understood full well that she was foregoing a substantial amount of marital property, even if she did not know the exact amount down to the penny.
The district court also asked whether a party, having obtained one judge's approval of a stipulation, should be entitled to have another judge revoke that approval, and whether appellant, having failed to allege fraud when she tried to reopen the judgment in 1998, was entitled to allege it in another attempt in 2001. We recognize the validity of these questions, but decline to address them because our opinion renders them moot.
In light of this finding, the district court concluded that, in regard to the property settlement, "[appellant] has not presented a prima facie case that fraud or non-disclosure by [respondent] made the 1996 property settlement `grossly unfair.'"
Fraud in the context of marital dissolution property settlements is "an intentional course of material misrepresentation or non-disclosure, having the result of misleading the court and opposing counsel and making the property settlement grossly unfair." Maranda v. Maranda, 449 N.W.2d 158, 165 (Minn. 1989). Appellant does not identify what respondent misrepresented or failed to disclose to mislead the court or her. Nor does appellant show how the district court judge who approved the settlement was misled as to the value of the estate. She does argue that the property settlement is "grossly unfair," but, even assuming that to be true, the record is clear that the settlement resulted not from respondent misleading appellant or the court but from appellant's unequivocal and repeated insistence that her share of the parties' property was to be used to support the lifestyle and education of their son.
Appellant does not contend that the figures in the stipulation were not roughly accurate: even in her reply brief on appeal, she calculates the worth of the estate and indicates, "Admittedly, this number is close to the number identified in the Joint Petition and Stipulation."
Appellant has alleged no fraud that would provide a basis for reopening the property settlement. Accordingly, the district court did not abuse its discretion in rejecting appellant's motion to reopen.
2. Spousal Maintenance
The district court did not accept appellant's waiver of spousal maintenance without questioning her on the record.
Q.Well, if you are not going to receive any direct child support nor any spousal maintenance, how are you going to meet expenses beyond the mortgage, taxes and insurance on the house?
A. At this moment [respondent] has been meeting the bills since he moved out last September.
Q. But these papers [the stipulation] make no provision for that to continue so what is going to happen now?
A. Well, it is my intention [that] I had asked [respondent] specifically until such time as I got this final rewrite [of my book] done and I asked would he meet the bills and he said he would, that was a mutual agreement between us. At this stage I am going to start looking for work in my own editorial field.
Q. So the rewrite is done?
A. It is almost done. I am about 1000 words away. * * * I don't have more than maybe 30 hours more of rewrit[ing;] that is how close I am towards the end.
* * * *
Q. Do you anticipate that [the book] will generate revenue for you?
A. Yes, I do.
* * * *
What I am quite confident about is that no matter what I work at, you know, I would be more than capable of, in answer to your question, Judge, having the means to support myself.
* * * [Respondent] was exceptionally good to me in the years prior to my mother's death. She kind of fell on hard times and he helped me to purchase a home for her and several other things that I wouldn't want now to take anything from him. And even though I am fully aware [that] I am entitled to 50 percent of what he has but if he provides for [our son] and he does do that very capably as do his parents and I just — I have always been perhaps of the two of us I am the stronger one, I don't want to brag here, or the more intelligent one or whatever so.
* * * *
Q. Okay. [Then] I would grant the Judgment and Decree pursuant to your agreement and based on [appellant's] testimony that she is going to be able to take care of herself and that basically what she is asking from her husband is to provide for their son and pick up the housing and education costs until he is through school.
A. Un-huh, yes.
In light of this testimony, the district court approved appellant's waiver of spousal maintenance in the stipulation. Although in some circumstances an argument might be so unfair as to require the district court to reject it, this is not such a case.
Five years later, appellant brought the instant litigation to have the issue reopened, arguing that the district court's acceptance of her waiver of spousal maintenance was based on its fraud-induced misapprehension that respondent's annual income was $80,000 rather than $180,000. The district court noted:
The matter was set for an evidentiary hearing but on the eve of the hearing [appellant] withdrew her opposition and admitted that [respondent] had in fact represented his income at $180,000 per year rather than $80,000 per year. This means that [appellant] was not missing key information when she knowingly waived maintenance (and a large chunk of property) in return for [respondent's] agreement to a very substantial upward deviation in child support and the assumption of certain debts. [The district court judge at the time of dissolution] understood that [appellant] was giving up some substantial claims to gain the child support deviation, but approved the settlement when she found that it was knowingly entered into with [appellant] fully aware of what she was giving up.
Again, appellant fails to show any fraud. We conclude that the district court's finding that the spousal maintenance provision of the stipulation was not shown to be the product of respondent's alleged fraud is not clearly erroneous.