What intent is required for fraudulent nondisclosure claims in Utah? Jensen v. Cannon Explained

In Jensen v. Cannon, the Utah Court of Appeals addressed the critical question of what mental state a plaintiff must prove in fraudulent nondisclosure claims, providing important guidance for practitioners handling post-divorce asset disclosure disputes.

Background and Facts

Jodi Jensen and Gary Cannon divorced in 1998 with a settlement agreement dividing their marital assets. Years later, Jensen discovered Cannon may have failed to disclose certain properties during the divorce: a 3.89-acre parcel called the Riverton Corners property and an option agreement to purchase the Green property. In 2016, Jensen filed an independent action seeking relief from the divorce decree, alleging fraudulent nondisclosure, breach of covenant of good faith and fair dealing, negligent misrepresentation, and other claims.

Key Legal Issues

The case centered on two primary issues: (1) whether Jensen could prove the elements of fraudulent nondisclosure by clear and convincing evidence, particularly the knowledge element, and (2) whether negligence-based claims can support an independent action for relief from judgment under rule 60(d) of the Utah Rules of Civil Procedure.

Court’s Analysis and Holding

The court of appeals affirmed the district court’s rulings on both issues. Regarding fraudulent nondisclosure, the court emphasized that this is an intentional tort requiring “willful intent to deceive.” The court found that even though Cannon knew about the properties, he credibly testified that he did not know they were “assets” requiring disclosure. Without knowledge that disclosure was required, Cannon lacked the necessary fraudulent intent. The court distinguished this from negligent nondisclosure, which does not require proof of intentional misconduct.

For the non-fraud claims, the court held that while rule 60(d) permits independent actions on grounds other than fraud, negligence-based theories are inadequate for collateral attacks on judgments. The court relied on Christensen v. Christensen to conclude that alleged negligent misrepresentation during divorce proceedings cannot justify overturning a stipulated property settlement.

Practice Implications

This decision clarifies that fraudulent nondisclosure requires more than mere knowledge of undisclosed information—plaintiffs must prove the defendant knew disclosure was required and intended to deceive. For practitioners, this means developing evidence of the defendant’s understanding of their disclosure obligations and their subjective intent. The ruling also confirms that independent actions under rule 60(d) should be limited to exceptional circumstances involving fraud or other egregious conduct, not routine negligence claims.