Marriage of Miller, In re

• Decision Date: 21 September 1995
• Docket Number: No. 94-465,94-465
• Citation: 273 Mont. 286,52 St.Rep. 977,902 P.2d 1019
• Parties: In re the MARRIAGE OF Andrea Kathryn MILLER, Petitioner and Respondent, and John Stanley Miller, Respondent and Appellant.
• Court: Montana Supreme Court

Page 1019

902 P.2d 1019

273 Mont. 286

In re the MARRIAGE OF Andrea Kathryn MILLER, Petitioner and Respondent and John Stanley Miller, Respondent and Appellant.

No. 94-465.

Supreme Court of Montana.

Submitted on Briefs May 25, 1995.

Decided Sept. 21, 1995.

Mark E. Jones, Missoula, for appellant.

P. Mars Scott, Mulroney, Delaney & Scott, Missoula, for respondent.

NELSON, Justice.

Respondent, Andrea Miller (Andrea), filed a motion with the District Court of the Fourth Judicial District, Missoula County, to modify the parties' Decree of Dissolution and to award her certain property of the marital estate that had been awarded to Appellant, John Miller (John). The District Court issued an Opinion and Order modifying the Decree of Dissolution and re-allocating various debts and property. John appeals. We affirm in part and reverse in part.

We address the following issues on appeal:

1. Did the District Court err when it modified the parties' Decree of Dissolution and Marital Settlement Agreement?

2. Did the District Court err by not awarding attorney fees to either party?

The District Court dissolved the marriage of Andrea and John on September 22, 1992. The parties had previously entered into a Marital Settlement Agreement for Division of Property, Child Custody, Support, Visitation and Maintenance. The District Court found that this agreement was not unconscionable and incorporated the agreement into the Decree of Dissolution.

The agreement set forth the division of property and debts of the parties' marital estate, custody of the parties' minor children, child support, visitation and maintenance. John represented to the District Court that if he were awarded certain income-producing property of the marital estate amounting to approximately $23,650.00, he would pay the $23,389.72 in jointly held debts of the marital estate. The property was so awarded, but John has failed to pay the debts or make arrangements to pay them. Because these debts were joint, the parties' creditors sought, and continue to seek, collection of these debts from Andrea.

On May 17, 1993, Andrea filed a motion with the District Court for an order modifying the parties' Decree of Dissolution containing the Marital Settlement Agreement. At the May 25, 1993 hearing on her motion, Andrea testified she would pay the joint debts of the marital estate if she were awarded the income-producing property that had previously been awarded to John.

John did not appear at the hearing and on June 9, 1993, the District Court awarded Andrea the property she requested and ordered her to pay the joint debts of the marital estate. On July 16, 1993, John moved the District Court for a re-hearing on Andrea's motion alleging that he had not received adequate notice of the May 25th hearing. In addition, John filed a Chapter 13 bankruptcy petition on July 30, 1993, which imposed an automatic stay on his property.

On September 1, 1993, the District Court set aside the June 9, 1993 Findings of Fact, Conclusions of Law and Order and on September 13, 1993, John filed his response to Andrea's Motion to Modify. On February 8, 1994, the Bankruptcy Court dismissed John's Chapter 13 petition for bankruptcy. That same day John filed a Chapter 11 petition in bankruptcy court, reimposing the automatic stay. On February 23, 1994, Andrea filed a motion for the District Court to reissue or reconsider the Motion to Modify the Decree, unaware that John had refiled under Chapter 11.

On May 4, 1994, the Bankruptcy Court lifted the automatic stay on John's property, permitting Andrea to seek modification of the Decree of Dissolution in District Court. On May 12, 1994, Andrea again moved the District Court to renew her Motion to Modify the Decree of Dissolution. A hearing regarding this motion was held on July 12, 1994. Both Andrea and John were present and testified regarding payment of the joint debts.

On July 26, 1994, the District Court issued an Opinion and Order modifying the Decree of Dissolution and re-allocating various debts and property. John appeals this Opinion and Order.

Issue 1

Did the District Court err when it modified the parties' Decree of Dissolution and Marital Settlement Agreement?

The District Court concluded that John's representations that he would pay certain joint debts of the marital estate if he were awarded certain property of the marital estate and his subsequent failure to pay those debts constituted extrinsic fraud. In addition, the court concluded that if extrinsic fraud is committed upon the court in violation of a marital settlement agreement, the power of the court to set aside the agreement is not confined by the terms of the agreement and the court may order such relief as is equitable to the non-fraudulent party.

We review a district court's conclusions of law to determine whether the court's interpretation of the law was correct. In re Marriage of Barnard (1994), 264 Mont. 103, 106, 870 P.2d 91, 93.

John contends that the District Court erred when it allowed Andrea's motion for modification to come before the court since it was filed in excess of the 60-day time limit allowed by Rule 60(b)(3), M.R.Civ.P. Moreover, John argues that the District Court erred in concluding that his actions constituted extrinsic fraud.

In order to modify or revoke a final property disposition, § 40-4-208, MCA, requires in pertinent part:

(3) The provisions as to property disposition may not be revoked or modified by a court, except:

(a) upon written consent of the parties; or

(b) if the court finds the existence of conditions that justify the reopening of a judgment under the laws of this state. [Emphasis added.]

Rule 60(b)(3), M.R.Civ.P., allows, upon motion, relief from a final judgment, order, or proceeding for fraud, whether intrinsic or extrinsic. However, the motion must be made not more than 60 days after the judgment, order or proceeding was entered. In this case, Andrea's original motion to modify the decree was not made until almost eight months after the judgment was entered. Therefore, Andrea's motion was not timely filed to qualify for relief under Rule 60(b)(3), M.R.Civ.P.

Nevertheless, the last sentence of Rule 60(b), M.R.Civ.P., provides several avenues of relief from a judgment whereby no such time limitation is imposed. This residual clause of Rule 60(b), M.R.Civ.P. provides:

This rule does not limit the power of a court to entertain an independent action to relieve a party from a judgment, order, or proceeding, or to grant relief to a defendant not actually personally notified as may be required by law, or to set aside a judgment for fraud upon the court.

Thus, the three separate avenues for relief from a judgment under this clause are: lack of personal notification, fraud upon the court, or an independent action for extrinsic fraud. See Rule 60(b), M.R.Civ.P.; Salway v. Arkava (1985), 215 Mont. 135, 140, 695 P.2d 1302, 1305. Lack of personal notification is inapplicable to the present case and will not be addressed herein. Accordingly, we examine the present case to determine whether sufficient grounds for relief exist under the residual clause for fraud upon the court or for an independent action for extrinsic fraud.

Fraud upon the court embraces only that species of fraud which subverts or attempts to subvert the integrity of the court itself, or fraud perpetrated by officers of the court so that the judicial machinery cannot perform in an impartial manner. Filler v. Richland County (1991), 247 Mont. 285, 289, 806 P.2d 537, 539 (citing Salway, 695 P.2d at 1306). Fraud upon the court includes only the most egregious conduct, such as bribery of a judge or member of the jury; the fabrication of evidence in which an attorney has been implicated; or the employment of counsel to influence the court. Filler, 806 P.2d at 539; Salway, 695 P.2d at 1306. We have repeatedly held that fraud between the parties or perjury at trial is not fraud upon the court. Wise v. Nirider (1993), 261 Mont. 310, 316, 862 P.2d 1128, 1132; Traders State Bank of Poplar v. Mann (1993), 258 Mont. 226, 236, 852 P.2d 604, 610; Brown v. Small (1992), 251 Mont. 414, 421, 825 P.2d 1209, 1213; Salway, 695 P.2d at 1306. Thus, John's conduct does not rise to a level which is egregious enough to be characterized as fraud upon the court.

Courts of general jurisdiction have always possessed the power to entertain independent, equitable actions to set aside judgments, fraud being the chief, although not the exclusive, basis for such an independent action. Salway, 695 P.2d at 1305. Montana adheres to the general rule that the fraud must be extrinsic, as opposed to intrinsic, to support an independent action for fraud under the residual clause of Rule 60(b). Filler, 806 P.2d 537, 539.

Extrinsic fraud has been defined as some intentional act or conduct by which the prevailing party has prevented the unsuccessful party from having a fair submission of the controversy. Salway, 695 P.2d at 1306 (citing Pilati v. Pilati (1979), 181 Mont. 182, 193, 592 P.2d 1374, 1380). Extrinsic fraud is collateral to the matters tried by the court, but does not include fraud in the matters on which the judgment was...