Ask the County Law Librarian — Affirmative Defenses to Fraud
Q. What are some affirmative defenses to fraud?
For those readers who aren’t familiar with the phrase, an affirmative defense “sets forth facts from which it results that, notwithstanding the truth of the allegations of the complaint, no cause of action existed in the plaintiff at the time the action was brought.” Goddard v. Fulton, 21 Cal. 430, 436 (1863). In plain English, the defendant in a case can present information or evidence that reduces or eliminates his liability, even if the allegations in the complaint are true. Affirmative defenses are the legal reason why, even if everything happened just as described by the plaintiff, the defendant should not be held liable.
There are too many affirmative defenses available to list here. We have a very useful set at the law library that may help you determine appropriate affirmative defenses in your situation called California Affirmative Defenses.
There are some that can be used in almost all case types, and others that are specifically counter allegations of fraud. In order to assert the proper affirmative defenses, you will need to carefully review the complaint and the plaintiff’s allegations.
A common affirmative defense for many types of cases is a violation of the Statute of Limitations, or failure to file an action within a certain period of time after the “wrong” involved was committed. The Statute of Limitations for Fraud is three years. California Code of Civil Procedure § 338(d).
Statute of Limitations questions are always tricky, but particularly so with fraud, because the statute does not start to “accrue,” or start running, until the aggrieved party discovers the facts constituting the fraud. California Code of Civil Procedure § 338(d). You can read more about the statute of limitations for fraud at the Law Library in California Practice Guide: Civil Procedure Before Trial: Statutes of Limitations.
A common affirmative defense for fraud cases is failure to plead a cause of action with specificity. A little explanation of this defense may be helpful. A cause of action for fraud must be pled with “specificity,” meaning that allegations of fraud must be described in a complaint with much more detail than other causes of action. This is to “give defendants notice of the particular misconduct . . . so that they can defend against the charge and not just deny that they have done anything wrong.” Neubronner v. Milken, 6 F.3d 666, 672 (9th Cir. 1993). Each element in a cause of action for fraud must be factually and specifically explained–the “who, what, when, where, and how” of the misconduct must be listed. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003).
To determine if the complaint is pled with specificity, you will need to carefully review all allegations, and determine if all elements are adequately described. The elements of fraud are (1) a misrepresentation, concealment, or nondisclosure by the defendant; (2) the defendant’s knowledge of the falsity of the misrepresentation; (3) the defendant’s intent to deceive the plaintiff; (4) justifiable reliance upon the misrepresentation by the plaintiff; and (5) resulting damage to the plaintiff. California Civil Code § 1709. In order to describe the first element, for example, a “plaintiff must set forth what is false or misleading about a statement, and why it is false.” Decker v. GlenFed, Inc , 42 F.3d 1541, 1548 (9th Cir. 1994).
There are further affirmative defenses to fraud, of course, but without knowing more about the specific fraudulent act you are interested in, it is hard to say which would be most relevant to your situation. If you visit the Law Library in person we’d be happy to show you the references mentioned above and more, based upon the facts of your situation.
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