Seeking Dissolution May Be Better Path Than Annulment

Los Angeles Daily Journal, Vol.118, Issue 170, September 2, 2005

Sometimes a party to marriage feels that they have been “misled” by the other party, and sometimes they may feel that based upon the “fraud” committed upon them by their spouse that they are desirous of getting “out” of the marriage by obtaining an annulment.  The advantage to an annulment would be that the marriage is voidable and the party would then return to an unmarried status and a terrible mistake would be corrected (see Family Code Sections 2210 and 2212). There would be no community property ever acquired and none to be divided. The court would have no jurisdiction over the awarding of spousal support.

However, as the First District of the Appellate Court recently showed in In re Marriage of Meagher/Maleki, obtaining a judgment of nullity based on fraud requires a very substantial and specific showing.

Anna Marie Meagher was a licensed psychiatrist employed by the City and County of San Francisco.  Malekpour Maleki was a real estate broker and investor, who may or may not have been substantially wealthy.  Meagher and Maleki met in October 1997, at which time Maleki created the impression in Meagher that he was a well-educated millionaire with substantial experience in finance and real estate.  The parties become engaged in February 1998 and married in August 1999.  Between the date of engagement and marriage, the parties entered into a series of convoluted real estate transactions that included Meagher transferring some of her separate property real estate into both parties names.

The parties separated in May 2002 and Meagher filed a Petition for Dissolution of Marriage.  In November 2002, Meagher, with Maleki’s consent, amended her Petition to allege nullity based upon fraud.  A trial related to the nullity was heard on January 2004.  The Trial Court found that Meagher had reasonably believed Maleki’s representations to her and that the marriage was based upon Meagher’s reliance that Maleki had great wealth and expertise in real estate.  Based upon these findings, the Court granted a nullity.  The Court awarded Meagher her costs and attorney’s fees and ordered Maleki to repay the temporary spousal support and interim attorney’s fees that he had received early in the proceedings.  Maleki timely appealed and the Appellate Court reversed.

The Appellate Court found that Maleki’s actions, which may or may not constitute civil fraud, did not rise to a level sufficient to nullify a marriage. The Court succinctly stated:

“..Accordingly, we agree with Maleki that the fraud established in this case, as a matter of law, was not of the type that constitutes an adequate basis for granting an annulment.”…

“As a matter of law, a prospective spouse’s fraud regarding financial matters is not a proper basis upon which to order an annulment.”

The Court found that long-standing California law and the policy of the state was that to have an annulment of a marriage based upon fraud, the fraud must go to the heart or essence of the marital relationship.  As the Court cited Williams v. Williams (1960) 178 Cal.App.2d 522, 525, the Court concurred that

“…the fraud relied upon to secure a determination of the existing status must be such fraud as directly affects the marriage relationship and not merely such fraud as would be sufficient to rescind an ordinary civil contract.”

The Appellate Court gives a long list of cases, some going as far back as 1845 as to what types of fraud would be the basis for the granting of an annulment of marital status:  a secret not to engage in sexual relationships after marriage with the spouse; the secret intention of one spouse to never live as husband and wife in the same residence; the concealment by a party at the marriage that they were pregnant by another party; concealment of sterility; or intention to continue a romantic affair with a third person.

As the Court states:

“As these cases illustrate, annulment on the basis of fraud are generally granted only in cases where the fraud related in some way to sexual or procreative aspects of the marriage.”

The Court then distinguished the only reported California case that grants an annulment based on fraud for matters not involving sex or procreation.

Douglass v Douglass (1957) 148 Cal.App2d 867. involved a party who had represented to his future spouse that he only had one child from a prior marriage and that child was well taken care of.  However, three months after the marriage, Mr. Douglass was arrested for failure to support his “two” children from his prior marriage.  The Trial Court granted an annulment in that matter which was ultimately upheld.  As this Appellate Court stated:

“The facts of Douglass make clear, however, that the court did not grant an annulment based merely on the husband’s general untrustworthiness.  In holding the wife entitled to an annulment, the court relied in part on the fact that she already had two children from a former marriage, and that because of this, the ‘essentials of the marital relationship,’ from the wife’s perspective, necessarily included having ‘husband of honorable character whom she could respect and trust,…and who would be a suitable stepfather for her children.”

Citing from Douglass the court noted that:

When the wife learned about the truth about the husband’s failure to provide for his own children, her “hopes were shattered and her purposes defeated” (Douglass at p. 870)

Thus, even in Douglass, the fraud that the court found to be sufficient grounds for an annulment had some nexus with the childrearing aspects of marriage.  As the Appellate Court succinctly states:

“In the absence of fraud involving the party’s intentions or abilities with respect to the sexual or procreative aspect of marriage, the long-standing rule is that neither party ‘may question the validity of the marriage upon the ground of reliance upon the express or implied representations of the other with respect to such matters as character, habits, chastity, business or social standing, financial worth or prospects, or matters of similar nature.’”  (Schaub v. Schaub, 71 Cal.Appl2d at 476.)

The Court further referenced a case reversing an annulment to a wife who discovered after the marriage that her husband had concealed the fact that he  had not intend to work for a living, and that he had a severe drinking problem. In re Marriage of Johnston (1993) 18 Cal.App.4th 499.  In Johnston the wife has also alleged that the couple’s sex life after marriage was “unsatisfactory”, which the court also found was not a sufficient basis for an annulment.

Although Maleki may have misrepresented certain underlying facts to his future spouse, which may be evidence of a fraudulent intent to deprive Meagher of property and give rise to a civil fraud under California law, the Court stated:

“…the parties began living together even before their marriage and continued to do so for well over two years thereafter, and Meagher cites to no evidence in the record that she ever expressed any dissatisfaction with the intimate aspects of their relationship. …She cites no authority…for the proposition that annulment can be granted based on fraud or misrepresentation of a purely financial nature..

As such, the Appellate Court reversed the decision and remanded the matter back to the Trial Court.

Some of the actions of Maleki after his marriage raise questions as to possible fiduciary violations to his spouse pursuant to Family Code Section 721.  If a practitioner is confronted with a fact pattern that suggests a series of frauds prior to, and during the marriage (as in Meagher/Maleki), the better practice would be to seek a dissolution of marriage as alternative relief so that if in the event that the standard for annulment is not reached, then the parties can still get divorced and the “fraud” can still be addressed in the context of a breach of the marital fiduciary obligations.

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