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Missouri Supreme Court reverses, remands divorce judgment on millions not disclosed at dissolution

ST. LOUIS RECORD

Sunday, December 22, 2024

Missouri Supreme Court reverses, remands divorce judgment on millions not disclosed at dissolution

State Court
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David Eisenberg | provided

The Missouri Supreme Court vacated and remanded a Jackson County Circuit Court ruling that would have mooted and abated a wife’s motion to set aside a dissolution judgment based on fraud.

In her underlying lawsuit, Jeanne Olofson alleged that fraud resulted in her getting less than a proper share of divorce proceedings upon the death of her ex-husband Todd Olofson.

“If the case isn’t settled upon remand and goes to trial, fraud is fairly hard to prove and so the wife will certainly have her opportunity to prove that there was a fraud that led to her being shortchanged in the valuation but that's a fairly high standard,” said attorney David Eisenberg, of Baker Sterchi Cowden & Rice and editor of the firm's Missouri Law Blog.


Eisenberg

Three months after Jeanne and Todd Olofson's marriage was dissolved in March 2016, Epiq stock options that belonged to Todd were acquired and as part of the sale, he received $16 million in golden parachute benefits and payouts for his outstanding stock options and restricted stock awards, according to the July 22 opinion. It was then that Jeanne alleged the husband misrepresented and failed to disclose facts about Epiq during the dissolution of their marriage.

The state’s highest court decided 4-3 that Jeanne’s claims are not procedurally barred, and Todd's death did not abate her motion in an action concerning property or property interests.

“The precedent is that if there is evidence that somehow a judgment was procured as a result of fraud, a party can go back into court and try to prove it if they bring up the issue promptly and properly,” Eisenberg told the St. Louis Record. “That's the issue that is preserved and the overall moral of the story is that even in matrimonial cases involving allocation of property, you can even have those cases reopened if there is a properly asserted claim that there was fraud in connection with the distribution of property.”

Judge Zel M. Fischer and Judge W. Brent Powell dissented separately, indicating the court struggled to reconcile statutes, procedural rules, and policy considerations concerning the finality of judgments, according to Eisenberg

“It’s interesting to see that two very smart, careful, thorough, and analytical judges came out on opposite sides on this opinion,” he said. 

Judges Powell and Fischer found that the Jackson County circuit court’s judgment dividing and disposing of the marital property is not subject to an appeal or a motion for a new trial.

“You had seven Supreme Court judges facing the same issue,” Eisenberg said. “You had three different opinions covering 40-some odd pages, and you had a 4-3 vote and so these are very complicated issues involving quite a few different considerations.”

Among the considerations was whether an exception to the rule against modifying court orders applied to personal claims as well as disputes over distributing marital property.

"Judge Patricia Breckenridge is careful to say this exception relates only to disputes over property and not personal claims,” Eisenberg added. “You can re-adjudicate only the portions of a judgment that have to do with fraud and reduced property value but you cannot reopen a marital case to go into things like custody, child support, or visitation. Those are more of the personal issues.”

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