What Do ‘Intrinsic Fraud’ and ‘Extrinsic Fraud’ Mean and How Can They Possibly Affect Your Maryland Divorce Case?

money bagWhen you are going through a divorce and working out the terms of a settlement agreement with your spouse, it is important to make sure that you fully negotiate everything to your satisfaction. Once the agreement is completed and incorporated into your divorce, it becomes increasingly difficult to get a court order making certain changes. If you seek certain types of relief from the judge based upon a claim of fraud, you may be required to prove a very specific type of fraud, as was demonstrated in one recent case from Anne Arundel County. All of these rules, requirements, and potential pitfalls serve as reminders of the importance of having representation from an experienced Maryland divorce attorney during every step of your case.

The couple in the Anne Arundel County case, Michael and Christa, separated in 2011 after 14 years of marriage. The next year, they worked out a marital settlement agreement. Resolving divorce-related issues via agreement as opposed to litigating every item can be a useful way to deal with aspects of your divorce. The agreement stated that it resolved all of the issues in the divorce, including child support, alimony, and the division of marital property.

The agreement required both spouses to “exchange all information relevant or helpful to the recalculation of the Maryland Child Support Guidelines . . . so that the reallocation of alimony and child support . . . can be conducted.” The husband made his disclosures required by the agreement, and they showed that, in one year, he earned $1.5 million, which was unusual because he typically earned between $250,000 and $300,000.

The wife brought an action that she asserted was to enforce the terms of the agreement. She alleged that the husband’s employer allowed him to defer income and that the husband had deferred a massive amount of income that was not paid to him until after the divorce was finalized. Specifically, the wife asserted that the husband deferred almost all of his 2012 income until 2013, after the divorce.

After analyzing the wife’s motion to enforce the settlement agreement, the trial judge determined that the request was, under Maryland law, not a motion to enforce but a motion to revise a judgment. That was a problem for Christa, since Maryland law says that, in order to be entitled to a ruling in your favor on a motion to revise a judgment, you have to give the court proof of extrinsic, rather than intrinsic, fraud. Since the wife had only evidence of intrinsic fraud and did not have proof of extrinsic fraud, the court ruled for the husband.

Christa appealed but lost. The appeals court pointed out that the trial court had incorporated the marital settlement agreement into the divorce decree. When that happens, and you subsequently file an action related to your settlement agreement, that incorporation is going to make your request one seeking to revise the judgment, in the eyes of the law.

The court also explained what constitutes extrinsic and intrinsic fraud in this state. Intrinsic fraud is “fraud related to issues regarding the original action, or issues that were or could have been actually litigated.” Extrinsic fraud is “fraud that prevents ‘the actual dispute from being submitted to the fact finder at all.’” Christa didn’t have evidence of extrinsic fraud, so her case was doomed.

When you are crafting a marital settlement agreement, your interests are often best protected by utilizing the services of a knowledgeable Maryland divorce attorney. Experienced family law attorney Anthony A. Fatemi has been helping spouses with their divorce needs for many years. To find out how this office can assist you, contact us at 301-519-2801 or via our online form.

More blog posts:

Why a Maryland Husband Still Owed Alimony Even After Proving that His Ex-Wife Was Living With Her Romantic Partner, Maryland Divorce Lawyer Blog, Feb. 13, 2018

Maryland Court Upholds Marital Agreement Dividing Pension Benefits, Maryland Divorce Lawyer Blog, July 15, 2015

Photo Credit: OpenClipart-Vectors, [CC0 License], via Pixabay

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