Iowa Supreme Court opens door to paternity fraud claims

Earlier ruling had asserted such cases weren't allowed in Iowa

UPDATE: The Iowa Supreme Court ruled Friday that a Grundy County man can sue his former lover for paternity fraud, even though there is no such law on the books.

Relying on common law, as opposed to statutory law, the court ruled that Joseph Dier’s lawsuit against Cassandra Jo Peters should not have been dismissed by a lower court.

Dier sought back child support that he paid to Peters for her daughter, Oliva Dier.

“Because we conclude that such a cause of action is consistent with traditional concepts of common law fraud, there is no prevailing public policy reason against recognizing such a cause of action, and Iowa’s statutes do not speak to the issue, we hold that a cause of action may be pursued,” Judge Edward Mansfield wrote in the unanimous decision, which included a special concurrence from Chief Justice Mark Cady.

The court reluctantly opened the door to claims of paternity fraud, a controversial and particularly messy area of litigation that had not been recognized in Iowa. Cady warned litigants to use caution in bringing such cases, saying they would be hard to prove, emotional and embarrassing.

"In the end, it becomes painfully obvious that parties pushed into the justice system over a paternity fraud claim could never leave it unscathed, and the standards of justice will certainly be stretched to their limits, even if justice is attainable," Cady wrote in the concurrence to the 7-0 decision. "This consequence may cause many reasonable, caring people to simply leave the claim dormant for the betterment of others."

TEXT of Supreme Court's ruling (story continues below document)

Iowa Supreme Court ruling in paternity fraud case

Dier claimed that Peters fraudulently allowed him to think that Oliva was his daughter — her last name is Dier — even though, he said, Peters knew the girl wasn’t his. Dier said he found out that Oliva wasn’t his biological daughter only when paternity test results were revealed when he attempted to get full custody of the child.

Under Iowa law, Dier has no claim on the child because the parties were never married and the child is not his biological daughter.

Dier took Peters to court in Grundy County for reimbursement, but Iowa does not have a paternity fraud law, and his case was dismissed. Dier has since married.

“In the end, it’s not what we originally wanted,” Dier said in a telephone interview Friday. “What we had originally wanted was to be a part of (Olivia’s) life. We had tried to adopt her, and we had tried to work out visitation.”

He said he last saw Olivia on Father’s Day 2011. He said subsequent attempts to visit the child were rebuffed by Peters. He added he does not know if he’ll be able to see her again “because I have no legal right to.”

Although the court gave Dier the right to continue his suit against Peters, Mansfield cautioned that “alleging paternity fraud is not the same as proving it … That is certainly true with paternity fraud where sufficient proof will have to be advanced as to both Peters’ state of mind when she made the representation and Dier’s justifiable reliance thereon.”

Cady expounded on the last point in his concurring opinion, saying there are “inherent difficulties and challenges presented by opening the courthouse doors to paternity fraud.”

In his 4 ½-page concurrence, Cady writes about the difficulty in untangling the complex motivations and emotions tied up in relationships between adults and children.

“Fact finders are entrusted with the important task of weighing the value that each fact contributes in proving the elements of fraud. This is a process we trust time and time again and a process I am confident will continue to strike the appropriate balance between the competing interests involved in disclosing such sensitive information,” Cady concluded. “At the same time, the process may be one made better by its infrequent use.”

Judge David Staudt threw out the case in September, ruling that the "current status of the law demands that this case be dismissed."

Friday's ruling overturns Staudt's decision, sending the case back for a trial. To prevail, Dier would have to prove Peters knowingly lied when she told him he was the father and that he was justified in relying on her claim. Dier can recover only the out-of-pocket expenses he spent supporting them and not legal fees, the court ruled.

Peters' attorney, Lynn Wiese, said Peters and Dier assumed Dier was the father and his client did not commit fraud. He had urged justices to bar lawsuits between misidentified fathers and mothers. He argued instead they should sue the biological fathers, who had gotten off without paying support.

"This sort of case won't come without a price," Wiese said, warning that young children could be forced to testify. "These will not be pleasant lawsuits."

Dier's attorney did not immediately return a call seeking comment Friday.

Justices said courts in other state have split on whether to allow paternity fraud claims. The Iowa Supreme Court had deadlocked 3-3 in 2004 on the issue, a split that upheld a lower court's decision barring such claims on policy grounds.

Courts in states such as Nebraska have barred the lawsuits by arguing they are too harmful for children and families. Judges in other states, such as Illinois, have found that allowing fraud victims to recover money outweighs the potential harm.

The Iowa justices sided with the latter camp Friday, ruling that paternity fraud claims "fit comfortably within the traditional boundaries of fraud law." Allowing such cases could also deter lying by mothers, they found.

"It is true that Dier's success in the litigation could diminish the resources that Peters has available in the future to support (the daughter), but this would be true of any lawsuit against Peters," Justice Edward Mansfield wrote. "We have never afforded parents a general defense from tort liability on the ground they need all their money to raise their children."

Iowa law says a man cannot recover past child support he paid once establishing he is not a child's biological father but is relieved from pending and future obligations. Mansfield said that law applies only to court-ordered child support and not voluntary payments, such as the ones made by Dier.

Cady said paternity fraud cases would be extremely difficult, not unlike divorce and custody disputes.

"The proceedings that ultimately unfold in a courtroom are not easy or pleasant for anyone involved," he wrote, "but the court is nevertheless necessary to provide a forum for addressing an alleged wrong that has already occurred within a family unit."

The Associated Press contributed to this story.

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