In Texas, property acquired by either spouse during the marriage is presumed to be community property. However, property acquired prior to marriage is not community property. In a recent case, the parties disputed the ownership of a piece of property they bought before marriage.
Before the parties married, they bought a property in Floresville with both names listed as “Grantee” on the warranty deed.
The wife petitioned for divorce in August 2023. She testified that the property was purchased with money from their joint account. She said that proceeds from the sale of a property owned by the husband were in the joint account but said they had both contributed funds to the joint account.
The husband testified, however, that the proceeds from the sale of his separate property were the only funds used to buy the new Floresville property. He said the wife set up the joint account and transferred funds from his account into it while he was incapacitated. He said the joint account was closed soon after the property was purchased. He stated he did not intend to gift her the funds and only added her to the deed so she could handle things in the event “something bad” happened due to his medical issues.
At the end of the trial, the court asked if the parties had tried a partition suit by consent. The wife’s counsel said that they did, but the husband’s attorney responded that they did not try it by consent because it was the husband’s position that the property was his sole and separate property. The wife’s attorney moved for a trial amendment and the court granted it.
Modification, Correction, and Reform of the Judgment
In the final divorce decree, the court confirmed the property as the husband’s sole and separate property. The wife moved for modification, correction, and reform of the judgment. She argued the husband had failed to assert a verified plea that the deed had been executed without consideration or that the consideration failed and the affirmative defense of failure of consideration.
The trial court granted the motion and ordered the husband to transfer her a share of the proceeds from the sale of the property.
The Husband’s Appeal
The husband appealed, arguing the issue of partition of the property had not been tried by consent and amendment was not required.
Trial Amendment
Pursuant to Tex. R. Civ. P. 66, a court may allow amendment of pleadings if it is made aware of “any defect, fault or omission in a pleading” during trial. The court is to allow amendment “freely when the presentation of the merits of the action will be subserved thereby” and there will not be prejudice against the objecting party. If a requested amendment is just procedural, a trial amendment is mandatory. The court has discretion to grant or deny a substantive amendment. It is mandatory for a court to grant a trial amendment to conform the pleadings to the evidence when the parties have tried an unpleaded issue by consent.
The husband argued the partition issue had not been tried by consent. The appeals court noted that the first time the issue was expressly mentioned was when the court asked the attorneys if they “tried this as a partition suit by consent[.]” The husband had argued the property was his separate property and the wife argued it was community property. Neither had expressly pleaded for partition before trial.
The appeals court noted a court generally does not have discretion to deny a trial amendment unless the amendment asserts a new cause of action or defense to which the other party objects or the other party has evidence of prejudice or surprise.
The appeals court noted the husband had not submitted any evidence of surprise or prejudice. The appeals court then considered whether the amendment was facially prejudicial.
An amendment is facially prejudicial if it asserts a new substantive matter the changes the nature of the trial; the new matter could not be anticipated by the other party; and it would detrimentally affect the other party’s presentation of its case.
The appeals court pointed out that there were common elements between the partition issue and issues that were pleaded, including the husband’s claim the property was his separate property. The appeals court determined the trial court could have reasonably concluded the husband could have anticipated the partition issue based on how the case had developed.
The wife had identified the property as community property in her sworn inventory. On the second day of the trial, she took the position that the parties owned an undivided one-half separate property share of the property. The husband maintained his position the property was solely his separate property throughout the trial. Both parties acknowledged it was bought before the marriage. The husband testified that wife had not contributed financially to the purchase. He also presented evidence tracing the funds through his own accounts and the joint accounts. A factfinder could conclude the evidence rebutted the presumption the parties owned the property equally. The appeals court noted there was nothing in the record indicating the husband would have presented different evidence if the wife’s position had changed before it did. The trial court could have reasonably determined the trial amendment would not detrimentally affect the husband’s presentation of the case.
The appeals court found no abuse of discretion by the trial court and affirmed the judgment.
Seek the Advice of a Dallas Divorce Lawyer
The property division in a Texas divorce involving a complex estate can be complicated and contentious. If your estate includes complex real estate holdings, a knowledgeable Texas divorce attorney can advise you of your options and advocate for you. Schedule a consultation with McClure Law Group by calling 214.692.8200.