Most divorces in Illinois are resolved by agreement. The steps leading to that agreement should be fair if both parties are adequately represented by competent counsel. However, if one party explicitly lies in order to get the agreement they want, that agreement may be reformed or vacated.
Lying to convince someone to enter into a contract is fraudulent inducement.
Final Agreements In An Illinois Divorce
Before we analyze fraudulent inducement as an attack on a final agreed divorce judgement, we must understand that final agreements in an Illinois divorce usually stay final.
The purpose of the Illinois Marriage and Dissolution of Marriage Act is “[t]o promote amicable settlement of disputes between parties to a marriage attendant upon the dissolution of their marriage, the parties may enter into an agreement containing provisions for disposition of any property owned by either of them, maintenance of either of them, support, parental responsibility allocation of their children, and support of their children as provided in Sections 513 and 513.5 after the children attain majority.” 750 ILCS 5/502(a)
“The terms of the agreement, except those providing for the support, custody, and visitation of the children, are binding on the court unless it finds after considering the circumstances of the parties and any other relevant evidence provided by the parties, on their own motion or on the request of the court that the agreement is unconscionable.” 750 ILCS 5/502(b)
“A settlement agreement can be set aside if it is shown that the agreement was procured through coercion, duress or fraud, or if the agreement is unconscionable.” In re Marriage of Gorman, 284 Ill. App. 3d 171, 180 (Ill. App. Ct. 1996)
The “burden [of vacating an agreement due to fraud] is even more onerous when a party seeks to vacate or modify a property settlement incorporated in a divorce decree, all presumptions being in favor of the validity of the settlement.” Lagen v. Lagen, 302 NE 2d 201 – Ill: Appellate Court, 1st Dist. 1973
Fraud In An Illinois Divorce
Fraud is one of the only ways an agreed final divorce judgement and its terms can be reviewed. There are many kinds of fraud. For example, switching out a different Marital Settlement Agreement at the last minute is “fraud in the factum.” More common for former couples who have lost all trust in each other is fraud in the inducement.
Fraudulent inducement or fraud in the inducement is “Fraud occurring when a misrepresentation leads another to enter into a transaction with a false impression of the risks, duties or obligations involved; an intentional misrepresentation of a material risk or duty reasonably relied on, thereby injuring the other party without vitiating the contract itself, especially about a fact relating to value or the ability to perform.” Black’s Law Dictionary (11th ed. 2019)
“Fraudulent inducement is a form of common-law fraud, the elements of which are (1) a false statement of material fact; (2) knowledge or belief by the defendant that the statement was false; (3) an intention to induce the plaintiff to act; (4) reasonable reliance upon the truth of the statement by the plaintiff; and (5) damage to the plaintiff resulting from this reliance.” Avon Hardware Co. v. Ace Hardware Corp., 2013 IL App (1st) 130750, ¶ 15.
These 5 elements required to establish fraudulent inducement should be easy to satisfy in an Illinois divorce. Facts are facts. False statements are false. The knowledge and intention of the fraudulent inducer can be inferred as can the reliance and the damages of the induced.
Upon realizing that you have been tricked, you can return to court and simply explain the trick.
“The court may in its discretion…may on motion filed within 30 days after entry thereof set aside any final order or judgment upon any terms and conditions that shall be reasonable.” 735 ILCS 5/2-1301(e)
After 30 days, a higher standard of proof is required to vacate an agreed Illinois divorce settlement.
“Relief from final orders and judgments, after 30 days from the entry thereof, may be had upon petition as provided in this Section…All relief…shall be available in every case, by proceedings hereunder, regardless of the nature of the order or judgment from which relief is sought or of the proceedings in which it was entered.” 735 ILCS 5/2-1401
“To be entitled to relief under section 2-1401, the petitioner must affirmatively set forth specific factual allegations supporting each of the following elements: (1) the existence of a meritorious claim or defense; (2) due diligence in presenting that claim or defense in the original action; and (3) due diligence in presenting the section 2-1401 petition.” Cavitt v. Repel, Docket No. 1-13-3382, 13 (Ill. App. Ct. 2015)
Fraudulent inducement is the “meritorious claim or defense.”
If fraud is the “meritorious claim or defense” it must be plead with specificity (more on this later in the article).
“A high standard of specificity is imposed on pleadings asserting fraud. The facts constituting the alleged fraud must be stated with sufficient specificity, particularity, and certainty to apprise the opposing party of what he is called upon to answer. The pleading must contain specific allegations of facts from which fraud is the necessary or probable inference, including what representations were made, when they were made, who made the misrepresentations and to whom they were made.” CHATHAM SURGICORE v. HEALTH CARE SERVICE, 826 NE 2d 970 – Ill: Appellate Court, 1st Dist., 4th Div. 2005
As for the other required elements for a 735 ILCS 5/2-1401 vacating of an agreed Illinois divorce order. You could not have presented that claim or defense in the original action (the divorce) because you were tricked.
However, you must present your motion to vacate based on fraudulent inducement almost immediately after you realize that you have been tricked.
Defenses To Fraudulent Inducement In An Illinois Divorce
Liars are rarely so explicit in their fraudulent statements. Liars mix the lies with the truth and rely on confusion to allow for implication.
In such cases where the fraud is not explicit, a final Illinois divorce agreement will not be reformed or vacated.
“An indefinite statement will not qualify to support an action for fraud.” Marriage of Bower, 87 Ill. App. 3d 324, 326 (1980)
When “[t]he alleged statements by the respondent are too vague and indefinite to form a reasonable basis for one’s reliance…as a matter of law, the allegations do not amount to a representation of a fact on which petitioner had a right to rely.” Marriage of Bower, 87 Ill. App. 3d 324, 326 (1980)
Fraudulent statements must be statements of fact. If the statement is merely one of opinion, that will not sufficiently induce a fraud claim as a matter of law.
“A representation is one of opinion rather than fact if it only expresses the speaker’s belief, without certainty, as to the existence of a fact.” Marino v. United Bank of Illinois, 484 NE 2d 935 – Ill: Appellate Court, 2nd Dist. 1985
Likewise, promises about the future are not material facts yet.
“[F]alse representation must be one of an existing or past fact, and not a mere promise to do some act in the future.” Polivka v. Worth Dairy, Inc. (1974), 26 Ill. App.3d 961, 966, 328 N.E.2d 350.
One-off lies about the future will not constitute fraudulent inducement. Lies have to be part of a scheme in order to constitute a proper fraudulent inducement claim.
“An exception, however, exists to th[e] general rule [that a false promise to do some act in the future does not constitute fraudulent inducement] : where the false promise or representation of future conduct is alleged to be the scheme employed to accomplish the fraud, a claim in fraud is actionable. Distinguishing between the general rule and the exception to the rule, however, is not an easy task. Ordinarily, a scheme to defraud occurs when a representation is made with intent to induce [the other] party to rely on it and the [the other] party relies on it to his detriment. Additionally, to support an action in fraud, the statement (representation) must be certain and definite. To fall within the exception, a party must allege sufficient facts from which a scheme can be inferred.” Com. Eastern Mortgage Co. v. Williams, 516 NE 2d 515 – Ill: Appellate Court, 1st Dist. 1987
The specificity required to properly claim fraudulent inducement is exacting. How is someone who was tricked supposed to adequately prove the trickery when they didn’t know the truth in the first place. Won’t the trickster still be hiding their misdeeds?
Luckily for the fraudulently induced, “a scheme can be inferred.” Com. Eastern Mortgage Co. v. Williams, 516 NE 2d 515 – Ill: Appellate Court, 1st Dist. 1987
A scheme’s inference must be based on some specifically pled facts, however. A claim of fraudulent inducement must “identify specifically what representations were made, when they were made, who made them and to whom they were made. These allegations cannot be inferred or implied from [the fraudulent inducement] complaint because they must be pled with specificity.” CHATHAM SURGICORE v. HEALTH CARE SERVICE, 826 NE 2d 970 – Ill: Appellate Court, 1st Dist., 4th Div. 2005
Without these specifically pled facts, a fraudulent inducement claim must fail and the agreement will be upheld.
Fraudulent Inducement Vs. Fraudulent Concealment.
Finally, fraudulent inducement must be distinguished from its close cousin, fraudulent concealment which is effectively, fraud in the omission. Fraudulent concealment is the failure to reveal an asset or a source of income. Fraud by omission is only a valid claim if the other party asked about the asset or income (which they almost always effectively do via the mandatory financial affidavit).
“Fraud may consist in the concealment of what is true as in the assertion of what is false, but mere passive concealment of pertinent facts during a business transaction does not necessarily constitute a fraud” Lagen v. Lagen, 302 NE 2d 201 – Ill: Appellate Court, 1st Dist. 1973
“[T]he petitioner must show the new evidence was not known to [him or] her at the time of the proceeding and could not have been discovered by the petitioner with the exercise of reasonable diligence. Stated another way, the evidence must be such as could not reasonably have been discovered at the time of or prior to the entry of the judgment.” In Re Marriage Of Brubaker v. Brubaker, 2022 IL App (2d) 200160 – Ill: Appellate Court, 2nd Dist. 2022 (citations and quotation omitted)
Fraudulent concealment is an important claim to investigate if you are pursuing fraudulent inducement because if your ex-spouse lied to your face…imagine what they did NOT tell you.
To learn more about making a claim of fraudulent inducement or defending a claim of fraudulent inducement, contact my Chicago, Illinois family law firm to speak with an experienced Illinois divorce attorney.
