Fraud on the Courts: (June Litigation Quarterly 2008)

June 1, 2008

When it Rises to the Level of Egregiousness Necessary to Warrant Dismissal

 

Trial courts have inherent authority to dismiss lawsuits when one of the parties perpetrates fraud on the court or refuses to comply with court orders.1 However, in application, this is a remedy that is rarely used, “only upon the most blatant showing of fraud, pretense, collusion, or other similar wrong doing.”2 While there is no simple test to establish when courts will dismiss a case for fraud, relevant case law helps provide a guide as to the factors that are influential in that decision.

 

Relevant Case Law

 

Material misrepresentations made in a sworn capacity regarding issues such as the Plaintiff’s identity or medical background have been held to be enough to warrant dismissal based on fraud. In Cox v. Burke,3 one of the leading fraud cases in the Fifth District, the Plaintiff sued two attorneys who had allegedly failed to properly litigate a medical malpractice suit which they had been retained to bring on her behalf. In their defense, the defendants asserted that the Plaintiff had committed fraud on the court by making material misrepresentations about her identity, damage, and prior injuries. The trial court agreed that the Plaintiff had committed fraud on the court, and thus dismissed the Plaintiff’s Complaint based on these material misrepresentations. On remand, the Fifth District Court of Appeals echoed the Federal Court’s ruling in Aoude v. Mobil Oil Corp.,4 that in order to dismiss a case, the requisite level of fraud must be such that “it can be demonstrated, clearly and convincingly, that a party has sentiently set in motion some unconscionable scheme calculated to interfere with the judicial system’s ability to impartially adjudicate a matter by improperly influencing the trier of fact or unfairly hampering the presentation of the opposing party’s claim or defense.”5 Further, the Appellate Court stated that when considering whether a case should be dismissed for fraud, the Court should carefully consider both the public policy of maintaining the integrity of the judicial system as well as the competing policy of maintaining a judicial system which adjudicates cases based on their merits, and use dismissal as a remedy only in the most extreme situations since it is the most severe of all possible sanctions.6 Ultimately, the court held that when considering all of these factors, the fact that the Plaintiff provided several false and misleading answers in sworn discovery regarding material issues such as prior medical history and identity was enough to constitute fraud such that the trial court did not abuse its discretion in dismissing the claim.

Furthermore, in Distefano v. State Farm Mut. Auto. Ins. Co.,7 the Plaintiff in a personal injury suit repeatedly failed to disclose injuries she had sustained both prior and subsequent to the accident in question, as well as the related accidents. As such, the trial court found that the Plaintiff “knowingly concealed the existence of these prior knee injuries with the intent to perpetuate a fraud upon the Court,” and held that based on the number of times the Plaintiff had attempted to conceal the information, the case should properly be dismissed for fraud.8 On remand, the First District Court of Appeals affirmed the trial court’s decisions, and held that the Ms. Distefano’s actions were so egregious and willful as to constitute fraud on the Court.

Likewise in Savino v. Florida Drive In Theatre Mgmt., Inc.,9 the Plaintiff in a premises liability case claimed brain damage and lost wages due to injuries sustained on the Defendant’s premises. In support of the damages element of his claim, the Plaintiff provided false testimony during depositions and false responses to sworn discovery regarding his level of education, claiming he had received a Masters degree in Engineering when no such degree had ever been conferred. Additionally, further evidence suggested that he had also lied to doctors about his previous level of intelligence, pre-injury. The trial court accordingly dismissed the Plaintiff’s complaint with prejudice, based on fraud on the court. On remand, the Fourth District Court of Appeals held that the appellant’s “repeated fabrications undermined the integrity of his entire action,” and upheld the trial court’s dismissal.10

However, lies made under oath have to be proved fallacious and willful to a reasonable degree of certainty before the courts will base dismissal upon them. In Young v. Curgil,11 the Plaintiffs, who were roommates, were both involved in the same automobile accident and sustained no injuries observable at the time of the accident. With the exception of one emergency room visit, neither woman received medical treatment until they saw the same doctor 21 days after the accident, and the treatment each woman eventually received was almost exactly the same as the treatment received by the other. The trial court made the above findings of fact and correspondingly dismissed the Plaintiffs’ case based on suspected collusion and fraud. On remand, the Third District Court of Appeals held that while the trial court’s findings “constitute a basis from which it may be inferred that the plaintiffs’ claimed injuries herein were feigned and their subsequently incurred medical expenses fraudulent, collusive and unnecessary…it is by no means an overwhelming or compelling inference”, and thus overturned the lower court’s dismissal.12

Likewise, in Gehrmann v. City of Orlando,13 the Plaintiff in a personal injury case did not disclose the presence of previous medical treatment or injuries that were minor and did not require follow-up care. Despite the Plaintiff’s arguments that his failure to disclose was unintentional, the trial court dismissed the case based on fraud on the court. On remand, however, the Fifth District Court of Appeals held that there was no evidence that the Plaintiff gave false responses “with the intent to defraud”, and thus reversed the lower court’s ruling.14 Additionally, the appellate court held that mere allegations of false statements or inconsistencies that have not been proven to be intentional should be handled through cross-examination or impeachment, not dismissal.15

Moreover, in Ruiz v. City of Orlando,16 the Plaintiff in a personal injury action failed to disclose previous injuries which had occurred over 35 years before the incident in question. The trial court accordingly dismissed the action based on fraud. On remand, the appellate court reversed this dismissal. The court distinguished the case from Cox by stating that in Cox, the fraudulent information was pervasive, repeated, under oath, and went to the core of the Plaintiff’s identity. In contrast, the court stated that in the current matter there was no evidence to suggest the Plaintiff made a knowing misrepresentation regarding her previous injuries which occurred so long ago. The Court held that “except in the most extreme cases, where it appears that the process of trial has itself been subverted, factual inconsistencies, even false statements, are well managed through the use of impeachment and traditional discovery sanctions.”17

Finally, in Amato v. Intindola,18 the Fourth District Court of Appeals held that possible misrepresentations made during a deposition were not enough to dismiss the Plaintiff’s case for fraud. Here, the appellant brought a personal injury claim against the appellees for injuries sustained in an automobile collision; these injuries included, among other things, a recurrence of previous back problems as well as knee injuries. Thereafter, in his deposition, the appellant stated that at that time he was unable to go up or down stairs without pain, lift excessive weight, get under the car or change a tire, and would further be unable to perform home maintenance activities. A surveillance videotape obtained by the appellee two days prior to the appellant’s deposition show him in his garage, doing work around the house, climbing a ladder to the roof and lifting an electric motor to the roof. A second surveillance video obtained six months earlier showed the appellant working on his truck, moving partially underneath his car, and then changing his tire. As such, the appellee filed a Motion to Dismiss the Plaintiff’s Complaint based on fraud upon the court and the trial court granted the Motion to Dismiss. The Fourth District Court of Appeals held that while the videotape showed the appellant performing some tasks mentioned in his deposition, it does not and cannot show whether he performed those tasks with or without pain. Additionally, what the Plaintiff stated he was unable to do at the time of the deposition did not necessarily bear directly on what he was or was not able to do six months earlier. As such, the court stated that the evidence did not demonstrate “a knowing and unconscionable scheme to interfere with the judicial system’s ability to impartially adjudicate a proceeding” to a reasonable degree of certainity, and reversed the lower court’s ruling.19

Conclusion

 

In conclusion, the various appellate courts’ willingness to dismiss cases based on fraud on the court is very fact-intensive; however, some general rules can be extrapolated from the case law. When a party makes false statements under oath regarding material issues, such as his or her identity, medical history, or other relevant issues that deal with the heart of the litigation, such as in sworn discovery responses or during deposition, the court will generally hold that such statements constitute fraud such that dismissal is warranted. However, mere false statements are generally not enough; there must additionally be some indicia of willfulness or collusion – such as repeated misstatements about facts that are material and highly detrimental to the Plaintiff, or misrepresentations or omissions that are highly unlikely to be caused by poor memory or mistake. Since dismissal is the “death knell of the lawsuit,”20 it is not favored, and if the Court believes that the false statements could be attributed to poor memory or mistake, it will most likely hold that the statements do not rise to the level of egregiousness needed to dismiss the case.

1 Kornblum v. Schneider, 609 So.2d 138 (Fla. 4th DCA 1992).

2 Granados v. Zehr, 979 So.2d 1155 (Fla. 5th DCA 2008).

3 706 So.2d 43 (Fla. 5th DCA 1998).

4 892 F.2d 1115 (1st Cir. 1989).

5 Cox at 46 (quoting Aoude at 1118).

6 Cox at 46 (citing Bird v. Hardrives of Delray, Inc., 644 So.2d 89 (Fla. 4th DCA 1994)).

7 846 So.2d 572 (Fla. 1st DCA 2003).

8 Id. at 576.

9 697 So.2d 1011 (Fla. 4th DCA 1997).

10 Id. at 1012.

11 358 So.2d 58 (Fla. 3d DCA 1978).

12 Id. at 59-60.

13 962 So.2d 1059 (Fla. 5th DCA 2007).

14 Id. at 1062.

15 Id.

16 859 So.2d 574 (Fla. 5th DCA 2003).

17 Id. at 576.

18 854 So.2d 812 (Fla. 4th DCA 2003).

19 Id. at 815.

20 Cox at 46 (quoting Aoude at 1118).


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