Articles Posted in Property Rights

A final unambiguous divorce decree that disposes of all of the marital property should be final.  Under Texas divorce law, such a decree generally cannot be re-litigated.  However, the trial court can issue additional orders to help implement or clarify a prior order if they do not alter the substantive property division.  The court may issue an order of clarification if the decree is ambiguous, as determined by using the rules of contract construction.  A contract is ambiguous if its meaning is uncertain or doubtful, or if it is reasonably subject to more than one meaning.  The court will consider the contract as a whole in light of the circumstances surrounding its formation, including parol evidence and the conduct of the parties.

In a recent case, a wife challenged an order clarifying the division of property.  The parties had signed a mediated settlement agreement.  The settlement included improved property that was described in two ways, a map in Exhibit A and a reference to the metes and bounds descriptions with separate exhibits describing each party’s share.

The parties agreed the husband would be awarded 26 additional acres because the improvements on the wife’s share were of a greater value.  The trial court granted the husband’s motion for clarification of the division of this property, finding the decree was ambiguous.  The clarification stated the map controlled, rather than the metes and bounds descriptions.  The court also entered findings of fact and conclusions of law supporting the order.

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In a recent Texas property division case, an ex-husband appealed a final divorce decree on the basis of five issues. The case arose when a couple married in 1992. The wife filed for divorce in 2013, claiming the husband had cheated on her. She asked for a disproportionate share of the marital estate due to fault for the marriage breaking up, as well as a disparity in the spouses’ earning power and their ability to support themselves.

The husband filed a general denial and counterclaim and also asked for a disproportionate share of the marital estate. The lower court granted the divorce on the ground of adultery. The husband was awarded as separate property an undivided interest in a funeral home business, the land on which it was located, and two adjacent tracts. The wife was also awarded an undivided interest in the funeral home, the land, and the adjacent land. The lower court awarded her the marital home and an insurance check as well. The husband asked for findings of fact and conclusions of law. None were filed, and he didn’t file a notice of past due findings.

He appealed. The appellate court explained that during a divorce, the court must order a division of the estate in a way that is just and right with due respect to each party’s rights under Texas Family Code section 7.001. The appellate court found it should reverse a property division ruling only if the mistake materially affected the lower court’s just and right division of property.

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In a recent Texas property division decision, a woman appealed from a final divorce decree. A couple had been married about 30 years when the husband petitioned for divorce. The wife was incarcerated. At a divorce hearing, she appeared without a lawyer and by telephone because of her incarceration. The lower court gave her 15 days to file exhibits and permitted the husband another 15 days to object. The wife sent copies of her exhibits and also sent a settlement offer to the husband’s attorney. There were no objections to the copy she filed with the court, or any of her exhibits submitted to the court.

Her divorce was granted, and the community real property and other assets were ordered to be sold with the proceeds split between the husband and the wife equally. The wife appealed, complaining of mistakes about how the property was divided.

The appellate court explained that the court can divide the community estate during a divorce under Texas Family Code section 7.001. It cannot divide separate property. The appellate court that reviews property distribution is supposed to look at whether there was enough evidence upon which the lower court could exercise discretion, and whether the lower court erred in applying its discretion.

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In a recent Texas property division decision, an ex-husband tried to reverse a property distribution order issued as part of a divorce. The couple married in 2012, after the husband had bought a tractor and multiple attachments from a dealership. The husband had signed a five-year note to finance a portion of the purchase price of the equipment. The couple separated in 2014 when the wife sued him for divorce.

They both claimed that they owned certain items of property before marrying and that these should be considered separate property. The husband took issue with the court’s treatment of the tractor he’d bought, as well as the characterization of his bonus, received in May 2014 as community property. He argued that he earned the bonus based on a project that started before his marriage.

At trial, the wife gave the court an inventory of community property and her separate property. She listed the tractor as an asset over which she and her husband had a dispute. She said that the husband gave her the tractor as a gift before they married. Documents showed he’d bought the tractor close to a year before marriage, and he made all of the monthly payments since the sale.

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In a recent Texas appellate decision, a wife appealed a judgment dividing a community estate between her and her husband. She argued that the trial court should have ordered the husband to reimburse her for certain expenses.

The couple had married in 2004 and divorced in 2013. The lower court awarded the wife a community residence as separate property. The appellate court court held that this residence was improperly included in the community estate, and it sent the matter back down for a new property division trial.

After that, the wife asked the court to reimburse her for money she’d spent on a house in Fort Worth, as well as what she’d paid to satisfy the husband’s premarital debts and premiums she’d paid on his insurance policies. She asked to be named the beneficiary of the husband’s life insurance policy if she weren’t awarded reimbursement for premiums she’d already paid. The lower court held a hearing on the reimbursement issue.

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In a recent Texas appellate case, a wife appealed from a final divorce decree that incorporated the terms of the couple’s mediated settlement agreement. After she and her husband entered into the agreement, she asked the trial court to set it aside.

The couple had married in 1997 and had no kids. They decided to divorce in 2015 and mediated their differences. They signed an agreement dividing up their property and debts, but it was contingent on a short sale of a house they owned. The husband was awarded the interest in the property, and the wife had to sign certain documents. She would be paid a portion of the proceeds from the sale. Meanwhile, the husband got all of the interest in their two trusts.

A few weeks later, the wife tried to withdraw, and the trial court granted the motion. The husband asked the court to sign a final divorce decree, while the wife tried to quash the agreement. The husband asked a receiver to be appointed, claiming that the wife refused to sign the papers in order to facilitate the property sale.

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A recent Texas appeal concerned property division in a divorce. The case arose when a couple got married in 2004 and then separated in 2011. The wife filed for divorce in 2013, and the husband countersued, alleging fraud, breach of fiduciary duty, conspiracy, and other claims against the wife, some business entities, and the wife’s three adult daughters.

Certain business entities were operated by both the husband and the wife. However, the husband claimed that some of the other business entities were created by the wife in the name of her daughters, using community funds, in order to defraud the community estate.

The daughter asked for summary judgment before trial, and this motion was granted. After a bench trial, the court entered a final divorce decree dividing the marital estate between the parties. The wife appealed. She argued that the husband had been awarded a disproportionate share of the marital estate and that this was an abuse of discretion.

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In a recent Texas appellate decision, a wife appealed from an order that denied her petition to enforce and to clarify the divorce order. The husband and wife had divorced in 1990 and stipulated to the divorce decree. At that time, the husband had retired from the United States Army and got retirement pay on a monthly basis. The divorce decree determined that the community interest in the monthly retirement benefit was 80%, and the cost of living-related increases would be made periodically and would likely need to occur in the future.

The wife was awarded a portion of the retirement benefit. The wife was entitled to 50% of the cost-of-living increases (COLA) to which the husband would become entitled from the date of the divorce to the death of the husband. In 2000, the wife asked the court to clarify the divorce decree and enforce her part of the COLA.

The judge decided she was entitled to $774.02 as her portion of COLA benefits that hadn’t already been paid by the husband. She appealed. The referring court adopted the judge’s finding that she could get clarification of the divorce decree and that she should be given 50% of the COLA benefits. It reversed the exact amount that should be awarded. Specifically, it ordered that she would be entitled to $391 each month of the retirement pay plus half of any COLAs when they were received. She was awarded $7,628 for all of the past COLA payments that the ex-husband had not paid. Nobody appealed this award.

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In a recent Texas appellate case, the court considered the lower court’s division of a marital estate. The couple was married in 1990 and bought two businesses while married, one an insurance agency operated by the wife and the other a livestock auction house operated by the husband. The wife sued for divorce in 2010.

At a bench trial in 2013, the lower court admitted the wife’s testimony, inventory of assets and exhibits related to their value. She offered two experts to testify about their appraisal of property, including the livestock auction house. The experts were supposed to testify on the value of the assets as well as the wife’s theory that the husband had committed fraud on the estate by arranging the sale of cows through the auction house and concealing the proceeds from her.

The husband objected, and the court agreed with him. The court prevented one expert from testifying and found that the other’s testimony wasn’t credible. The wife didn’t challenge these rulings when she appealed. The husband’s exhibits were mostly not admitted. The court deferred judgment after trial and asked the couple to go to mediation.

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One of the best ways to protect your assets during marriage is to enter into a premarital agreement (also known as a prenuptial agreement or prenup) prior to getting married that details all the assets and liabilities of both parties prior to marriage and details each party’s rights and obligations to the other’s income earned during marriage.

You might be thinking that a premarital agreement may cause strain on the marriage before it even begins so you instead plan to protect your assets by setting up separate bank accounts for your separate property and ensuring no community assets are ever commingled into the account during marriage. While this may seem like a suitable alternative, these measures may be insufficient to protect your fortune. Since interest accrued during the marriage, salary earned during the marriage, and cash dividends distributed the marriage will all be community property without a premarital agreement stating otherwise, a premarital agreement will often be necessary.

So how do you ask your fiancé to sign a premarital agreement without causing strain on the engagement? The answer lies in the actual terms of the premarital agreement. The words ‘prenuptial agreement’ are too often associated with misconceptions about one-sided deals with the non-monied spouse getting nothing. In reality, prenups are simply agreements to define the rights and obligations of couples who are about to marry. Additionally, the future spouse who is wealthier should know that the more one-sided the agreement, the more likely it is to be attacked upon divorce. As such, the wealthier future spouse has an incentive to make the agreement attractive to his or her fiancé.

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