Burden of Proof for a Legal Fraud Claim Is Confused and Unsettled

Overview: Legal fraud consists of (1) a material representation of a presently existing or past fact, (2) made with knowledge of its falsity and (3) with the intention that the other party rely thereon, (4) resulting in reliance by that party (5) to his or her detriment. Until the mid-1980s, the case law had provided that a party’s burden of proof on. Until the mid-1980s, the case law had provided that a party’s burden of proof on a fraud claim was dependent on whether the claim was for legal fraud or equitable fraud. In the federal courts, there is a split in authority, with the better-reasoned cases honoring the dichotomy between legal fraud and equitable fraud and the differing burdens of proof. The recent decisions in the federal court in New Jersey reflect a split in authority between requiring clear and convincing evidence and a preponderance of the evidence. The burden of proof for a legal fraud claim is not entirely clear and convincing; it is confused and unsettled. Until a definitive ruling is made by the Supreme Court or the Appellate Division, the law will continue to be unsettled, and a strong argument can continue to be made that a mere preponderance of the evidence, and not clear and convincing evidence, is what is required to prove a legal fraud claim.

(Is this item miscategorized? Does it need more tags? Let us know.)

Format: PDF | Size: 502KB | Date: Oct 2002 | Pages: 3