In Morgan v. Morgan, 2018 Pa. Super. LEXIS 828, the Pennsylvania Superior Court confronted the issue of what occurs when a spouse provides false information during the negotiations which culminated in a Marital Settlement / Property Settlement Agreement. In Morgan the Husband and Wife divorced and during the divorce process entered into a Marital Settlement Agreement. The agreement in pertinent part agreed that the Husband would pay the Wife $5,000.00 per month in alimony for a period, after which the parties could petition the Court to modify the payments. As part of the agreement they entered into a formal “low agreement” which stated that the minimum payment the Court could reduce the alimony to was $1,000.00 per month.
The Settlement Agreement was incorporated into the divorce decree in Maryland. After the agreed upon period had passed the husband, who had moved to Pennsylvania filed a Petition to Modify the Alimony to its lowest possible amount under the Agreement, $1,0000.00. Wife filed her own Petition to Modify and asked for more than $5,000.00. The trial Court agreed with the Husband and dropped the alimony to $1,000.00. The Husband had won.
The Wife, of course, did not agree with the Court and appealed the decision. During the appeal, the Wife found out that the Husband had provided the trial Court totally false and doctored information regarding his income included faked tax returns. The Wife then filed a Motion to Reopen the Record of the original trial Court and alleged that the Husband had provided false evidence and forged tax returns. Frighteningly, the Superior Court denied these motions and affirmed the decision of the trial Court. See Morgan v. Morgan, 40 A.3d 194 (Pa. Super. 2011) (unpublished memorandum) (“MORGAN II”). Given what Husband had done, it seems difficult to believe that her motion was denied.
Thereafter the Wife filed with the trial Court a Petition to Modify Alimony based on Husband’s fraud. At the hearing, the parties stipulated that Husband’s income was, in fact, higher than Husband had presented at the January 2011 Hearing – which was frankly tantamount to an admission by Husband of Fraud. The parties also stipulated that Wife’s 2015 annual income was $43,200.00.
The Superior Court indicated that Husband’s fraudulent production and testimony is “within the purview of the unclean hands doctrine.” The doctrine of unclean hands generally operates only to deny equitable, and not legal, remedies. This Court has concluded that the Divorce Code specifically states that “[I]n all matrimonial causes, the Court shall have full equity power and jurisdiction and may issue injunctions or other orders which are necessary to protect the interests of the parties or to effectuate the purposes of this part and may grant such other relief or remedy as equity and justice require.” 23 Pa.C.S. § 3323(f) (emphasis added).
We first consider whether the trial Court abused its discretion when it determined that application of the doctrine of unclean hands to this case would be inequitable and refused to apply it. It is well settled that a party “who comes into a Court of equity must come with clean hands. The doctrine of unclean hands requires that one seeking equity act fairly and without fraud or deceit as to the controversy at issue.” Lee v. Lee, 2009 PA Super 135, 978 A.2d 380, 387 (Pa. Super. 2009). Finally, the doctrine of unclean hands “gives wide range to the equity Court’s use of discretion in refusing to aid the unclean litigant” and in exercising this discretion, the equity Court is free to refuse to apply the doctrine if consideration of the record convinces the Court that application of the doctrine will cause an inequitable result. The facts of this case fall squarely within the doctrine of unclean hands. The Court found that the Husband’s actions violated the unclean hands doctrine and would not let the previous decision awarding less alimony stand.
The takeaway here is that it is not a good idea if you want to win your case, to lie to a Court about your income (or anything else for that matter)!