TBD | Glossary | "Fraud"

intentional deception resulting in injury to another. Fraud usually consists of a misrepresentation, concealment or nondisclosure of a material fact, or at least misleading conduct, devices or contrivance.

BADGES OF FRAUD see badges of fraud

CONSTRUCTIVE [LEGAL] FRAUD comprises all acts, omissions and concealments involving breach of equitable or legal duty, or trust and resulting in damage to another. It is thus fraud that is presumed from the circumstances, without the need for any actual proof of intent to defraud.

EXTRINSIC [COLLATERAL] FRAUD fraud that prevents a party from knowing about his or her rights or defenses or from having a fair opportunity to present or litigate them at a trial. It is a ground for equitable relief from a judgment.

EXAMPLE: Loni obtains a court order requiring a company to give her all relevant information concerning a certain product that she claims injured her. At trial, a judge finds her evidence insufficient and dismisses her claim. Afterwards, Loni finds other documents in the company's possession that she never received but that would have proved her case. The extrinsic fraud committed upon her gives rise to both a suit against the company for the fraud and a right for Loni to have a new trial with the new documents.

FRAUD IN FACT [POSITIVE FRAUD] actual fraud; deceit; concealing something or making a false representation with an evil intent [scienter] when it causes injury to another. It is used in contrast to CONSTRUCTIVE FRAUD, which does not require evil intent.

FRAUD IN LAW fraud that is presumed from circumstances, where the one who commits it need not have any evil intent to commit a fraud; it is a CONSTRUCTIVE FRAUD or legal fraud.

FRAUD IN THE FACTUM generally arises from a disparity between the instrument executed and the one intended to be executed, as for example when a blind or illiterate person executes a deed when it has been read falsely to him or her after he or she asked to have it read.

FRAUD IN THE INDUCEMENT intentional fraud that causes one to execute an instrument, or make an agreement, or render a judgment. The misrepresentation does not mislead one as to the paper being signed but rather misleads as to the facts upon which the decision to sign is based.

FRAUD IN THE COURT occurs where it can be demonstrated, clearly and convincingly, that a party has deliberately set in motion some unconsionable scheme calculated to interfere with the judicial system's ability to impartially decide a matter by improperly influencing the trier or unfairly hampering the presentation of the opposing party's claim or defense. Unlike common law fraud on a party, fraud on the court does not require reliance.

INTRINSIC FRAUD fraudulent representation that is considered in rendering a judgment

LEGAL FRAUD see CONSTRUCTIVE [LEGAL] FRAUD (above).

FRAUD

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