Does signing a contract after explaining it was not legally binding count as contract fraud?
<p>An individual recently claimed to have run into a situation where he was charged with "fraudulent contract activities" in a situation that my (admittedly quite limited) understanding of contract law says should not have violated any laws.</p>

<p>The individual in question was donating sperm as a known sperm donor to a lesbian couple.  The couple wanted to sign a contract saying that the resulting child would be legally theirs and he wouldn't file for child support etc.  The individual claims he informed the couple that in his state there is already legal precedent that states these sort of contracts are unenforceable as void, but since the couple was insistent on signing the contract anyways he eventually agreed to do so, even while telling them it was not legally binding.</p>

<p>He claims he was sued for "fraudulent contract activities" (his exact words).  Supposedly because he admitted he knew the contract was meaningless he was now guilty of fraud by signing it.  However, he gained no benefit from the contract, as the same scenario would have happened exactly as it is without a contract, and he claims he clearly explained the contract was worthless.  I find it odd that he could be charged with anything under such a situation.  He makes it sound like this is a criminal charge, as opposed to some sort of civil case, and he says the judge chose to 'charge' him.</p>

<p>Again, common law, and contract in particular, has always seemed to apply common sense so I was a little skeptical.  Of course the individual making the claim also has a history of questionable truthhoods as well, and is making claims that further his personal agenda, so I'm not quite willing to take his words as 100% true.</p>

<p>Would this scenario warrant any kind of potential fraud charges, civil or criminal?  The individual in question lives in Oklahoma so probably that's where the contract was signed.</p>

<blockquote>
  <p>Does signing a contract after explaining it was not legally binding
  count as contract fraud?</p>
</blockquote>

<p>No. However, depending on the details of the contract, the circumstances, and the parties' subsequent conduct, the donor's ability to prove he actually disclosed it to the couple would strengthen his position.</p>

<p>The <em>prima facie</em> elements of fraud are listed in <a href="https://www.leagle.com/decision/inokco20160427772" rel="noreferrer"><em>Key Finance, Inc. v. Koon</em>, 371 P.3d 1133, 1137 (2015)</a>:</p>

<blockquote>
  <p>(1) a material misrepresentation; (2) known to be false at the time
  made; (3) made with specific intent that a party would rely on it; and
  (4) reliance and resulting damage.</p>
</blockquote>

<p>The donor's disclaimer to the couple "<em>telling them [the contract] was not legally binding</em>" strikes elements (1) and (2). That preempts the relevance of (3). No matter how bizarre it is that the donor eventually bowed to the couple's pressure, that does not change the fact that elements (1) and (2) are stricken.</p>

<p>Your description does not reflect whether or how the couple incurred any losses, but the requirement of the couple's <em>reliance</em> is preempted by virtue of the donor's disclaimer. Furthermore, the donor's "<em>history of questionable truthhoods</em>" can only weaken the couple's position of "reasonable" reliance on any representation the donor makes (in case the couple shared back then your concept of donor's reliability).</p>

<p>The donor's questionable assertions "<em>[to] further his personal agenda</em>" seems to be irrelevant in this matter because, as you say, "<em>he gained no benefit from the contract</em>". Also, it is unclear from your description whether or not the donor has been sued/charged at all. The donor's mere allegation that he was sued has no legal effect --such as defamation or malicious prosecution-- unless one adds intricate assumptions into this matter.</p>

<p>As for "<em>he says the judge chose to 'charge' him</em>", it is possible that he was charged for something else and he is (whether unintentionally or on purpose) mischaracterizing whatever proceedings in which he was involved.</p>

<p>The sole act of signing that contract upon proper disclaimer <strong>does not</strong> render the donor liable for fraud.</p>

<p>This seems odd, I'm not sure why he's being sued if he fulfilled the obligations of the contract and didn't break it. Criminal charges would only arise if the contract itself involved illegal activity. In terms of the precedent, yes that would make the contract null in void provided the facts were sufficiently similar, but again there would be no reason to sue if there was no breach of contract. A judge cannot charge a person so I don't know what he is on about there, more detail is needed to determine the actual legal question that needs to be answered. </p>

contract-law fraud