Francesca Blackard, Author at Texas Divorce Attorney Blog

Texas Appeals Court Upholds Separate Property Characterization

Published on: April 27, 2023 | by Francesca Blackard

2018_10_agreement-300x165 Property possessed by either spouse at the time of a Texas divorce is generally presumed to be community property, but that presumption can be rebutted by clear and convincing evidence. A number of other rules and presumptions may affect the characterization of property during the property division. A husband recently appealed characterization of property purchased by the wife before the marriage as her separate property.

HISTORY OF THE PROPERTY

The wife bought a residential property before her relationship with the husband. After the parties got married, the husband and his children moved in with the wife. Both parties testified they frequently argued about money and finances. When they argued, the wife would say the house was hers.

Texas Appeals Court Upholds Denial of Spousal Maintenance

Published on: April 21, 2023 | by Francesca Blackard

iStock-1331374129-300x200 Texas spousal maintenance is intended to give temporary support to a spouse whose ability to support themselves has diminished and whose assets are insufficient to support them. After 10 years of marriage, a spouse who shows they lack sufficient property or the ability to earn sufficient income to provide for their “minimum reasonable needs” may be entitled to spousal maintenance. Tex. Fam. Code § 8.051(2)(B). They must, however, overcome the rebuttable presumption that maintenance is not warranted by showing they have exercised diligence in earning sufficient income to provide for their reasonable needs or developing the necessary skills to do so during separation and the pendency of the divorce case. Tex. Fam. Code 8.053. In a recent case, a wife appealed a trial court’s denial of her request for spousal maintenance.

The appeals court’s opinion stated the parties got married in 2009 and separated in 2018. The husband lived in Texas and the wife lived in a vacation condominium they bought in Illinois in 2018. The husband petitioned for divorce in 2019 and the final hearing occurred in February 2021.

The husband requested an equal property division and no spousal maintenance.

The wife asked for a 60/40 split of the assets and $5,000 per month in spousal maintenance for five years. She had not worked during the marriage or during the divorce case. Her mother testified she loaned her $37,500 during the separation. The husband had also transferred about $50,000 worth of assets to the wife during the case. The wife testified her monthly living expenses were about $12,000. She had last worked as a medication aide in 2008. She testified she previously worked as a certified nursing assistant but did not want to do so again. She testified her dental assistance certification did not transfer to Illinois. She also testified she had photography certifications but had not tried to earn income from them. She started a real estate course in 2019, but had not passed part of the test. She also admitted she had “not done anything” to become employed since the divorce case commenced. She said businesses were closed due to the pandemic and she did not have time to seek employment due to the divorce case.

Considerations in Texas Divorces Involving Complex Business Assets

Published on: April 20, 2023 | by Francesca Blackard

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For many business owners and entrepreneurs, their business is not only imperative to their financial well-being but is also a large part of their identity. This can raise obvious concerns when divorce is on the horizon. And when a couple owns a large business or corporation, or the business assets are complex in nature, the thought of dividing business assets can be overwhelming. Nonetheless, dividing complex business assets is often required, and, therefore, it is imperative that spouses understand how Texas law handles these situations.

WHAT ARE COMPLEX BUSINESS ASSETS?

Complex business assets are assets that belong to or are associated with a business that do not necessarily lend themselves to simple valuation or division. For example, the monetary value of a business’s goodwill or intellectual property rights are two common examples of complex business assets.

ARE BUSINESS ASSETS DIVIDED BETWEEN SPOUSES IN A TEXAS DIVORCE?

The short answer is it depends. Texas is a community property state. So, any assets that are acquired by either spouse during the marriage are presumed to be community property, which is subject to division upon divorce. However, determining whether complex business assets are community property is not always a straightforward endeavor. And even then, this is only the first question courts must answer when hearing a divorce involving complex business assets.

Texas Divorce Decree Must Comply with Material Terms of Parties’ Rule 11 Agreement

Published on: February 21, 2023 | by Francesca Blackard

Insurance agent checking policy documents in office.

Parties to a Texas divorce may enter into a Rule 11 agreement to resolve issues in their case. The agreement must be made in open court and entered into the record, or be in writing, signed, and filed with the court. A Rule 11 agreement must be complete in material details and contain all of the essential elements of the agreement. It is an abuse of discretion for a court to enter a judgment that is not in compliance with material terms of the agreement. A mother recently appealed a final divorce decree that she claimed did not comply with the terms of the Rule 11 agreement.

Parties Enter into Rule 11 Agreement

According to the appeals court’s opinion, the parties’ Rule 11 agreement provided they would be joint managing conservators of the two minor children, with the mother being primary for determining their residence with a geographic restriction. The father would continue picking up the daughter from school. The father would have a standard possession order for the son. The son had the option to have dinner at the father’s on Thursday. No alcohol was to be consumed during or for four hours prior to the father’s possession. Child support would be calculated according to the guidelines based on the father’s 2019 Schedule C “unless Schedule C gross receipts are higher for 2020 as filed.”

The parties both moved to enter the final decree, with the mother indicating they had not agreed regarding child support. At the hearing, she argued the parties intended child support to be calculated without subtracting expenses from the gross receipts if the 2020 gross receipts were higher. The father argued different language would have been used if that was the intent. He argued the language required the child support to be calculated according to the guidelines, which require calculation of net income before determining child support.

The Potential Property Division Issues That Can Come Up in a Texas High-Net-Worth Divorce

Published on: February 13, 2023 | by Francesca Blackard

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Texas is one of just a handful of states that follows that “community property” doctrine. Under Texas Family Code § 3.003, all property obtained by either spouse during the marriage is presumed to be community property, meaning both spouses have an equal ownership interest. And while disagreements related to how a couple’s assets are divided are common in all Texas divorces, this is especially the case in high-net-worth divorces.

WHAT IS A HIGH-NET-WORTH DIVORCE?

While there is no official definition of what constitutes a high-net-worth divorce in Texas, the consensus among Texas divorce attorneys is that any divorce involving liquid assets of $1 million or more is considered a high-net-worth divorce.

WHAT ISSUES COMMONLY ARISE IN HIGH-NET-WORTH DIVORCES?

High-net-worth divorces can involve all the typical aspects of a divorce, including child custody, child support, division of assets, and spousal support. However, due to the value and complexity of the assets, high-net-worth divorces tend to raise other issues, especially as they relate to property division. For example, a high-net-worth divorce may require the court to determine how the following classes of assets should be distributed:

401(k)s, IRAs and other retirement accounts;
Stocks, bonds, cryptocurrency and other investment holdings;
Real estate and property holdings;
Shared ownership in a business;
Pensions and benefits; and
Artwork and other collections.

Showing a Material and Substantial Change of Circumstances for Texas Custody Modification

Published on: February 9, 2023 | by Francesca Blackard

iStock-902725964-300x200 A court may modify a Texas custody order if doing so is in the child’s best interest and there has been a material and substantial change in circumstances. The party seeking modification must show the conditions at the time of the prior order and the subsequent changes. To determine if there has been a substantial and material change, the factfinder must be able to compare historical and current evidence. A mother recently challenged a custody modification, arguing the father had not presented evidence of the circumstances at the time of the divorce.

According to the appeals court’s opinion, the 2018 agreed divorce decree appointed the parents joint managing conservators and gave the mother the exclusive right to designate the children’s primary residence.

The father petitioned for modification and the exclusive right to designate the children’s primary residence after the mother’s nanny told him the stepfather was abusing them.

Texas Appeals Court Reverses Separate Property Characterization in Divorce Case

Published on: February 7, 2023 | by Francesca Blackard

In a Texas divorce, the trial court must divide the estate in a just and right manner, but the division does not have to be equal. Property possessed by either party during or on dissolution of the marriage is presumed to be community property. To rebut the presumption, a party must generally trace the property back to separate property. Without tracing, a party’s testimony they purchased the property with separate funds will generally not be sufficient to rebut the presumption. However, a presumption of separate property arises if a deed includes a separate property recital stating the property is transferred as separate property. If a spouse is party to a transaction, they may not contradict the deed’s express recitals with parol or extrinsic evidence without evidence of fraud, accident or mistake. If a spouse is not party to the transaction, however, they may use parol evidence to contradict the recitals.

A husband recently challenged the characterization of property in his divorce.

Both parties requested a disproportionate share of the community estate. The husband also requested reimbursement based on alleged waste and actual fraud by the wife.

Texas Court Denies Wife’s Request for Name Change in Divorce

Published on: January 20, 2023 | by Francesca Blackard

How-to-Improve-Your-Mental-Health-300x200 In some Texas divorce cases, how a party requests something can determine if they are successful. A wife recently challenged part of the property division and the court’s denial of her name change after a second trial.

The appeals court’s opinion states the wife informed the court the parties had agreed two pensions would be divided with “a 50 percent shared interest per each party as of the date of divorce.” The husband’s attorney agreed that was their understanding of the agreement.

In a memorandum ruling, the trial court granted the divorce and accepted the parties’ agreement as to the fifty-fifty division of pensions.

Texas Appeals Court Upholds Child-Custody Modification

Published on: January 12, 2023 | by Francesca Blackard

judge-and-gavel-in-courtroom-171096040-583b48533df78c6f6af9f0e3-300x225 A Texas conservatorship order may be modified if doing so is in the child’s best interest and there’s been a material and substantial change in circumstances. When a parent seeks modification, the other parent may file a counter-petition seeking their own modification. In a recent case, a mother appealed a modification order in favor of the father after she had petitioned for modification.

According to the appeals court’s opinion, when the parties divorced, the trial court approved their agreement to be joint managing conservators with 50/50 custody. The mother petitioned for modification, seeking primary custody and educational decision-making. The father also sought appointment as primary conservator. He asked for modification allowing him to impose reasonable discipline and to limit the mother’s phone contact during his possession.

The mother pointed to the father’s allowing the son to stay alone, behavior at sporting events, storage of a gun, and a text message asking her to pick up the children because “he was done” with them.

Documentary Evidence in Texas Divorce

Published on: December 31, 2022 | by Francesca Blackard

iStock-1214358087-300x169 Although testimony can be important evidence in a Texas divorce, documentary evidence is needed for some claims. A wife recently challenged a number of issues in her divorce based on insufficiency of evidence.

According to the appeals court’s opinion, the parties acquired several rental properties during their marriage. The husband petitioned for divorce in July 2020. The trial was originally scheduled for October 7, 2020, but the wife moved for a continuance and asked for mediation.

The trial date was reset for April 28, 2021, but the wife moved for another continuance the day before. The trial was rescheduled for May 6, 2021, and she again requested a continuance. The trial court denied the motion.