In a Texas divorce, the court must divide the property in a just and right manner. The requirement is that the division be equitable, but not necessarily equal. The Texas Supreme Court identified several factors courts should consider in Murff v. Murff. These factors include the parties’ physical conditions, education, financial condition, abilities, and ages. A husband recently challenged a trial court’s division of the marital property following a mediated settlement agreement between the parties.
The parties married in 1999 and the wife initiated divorce proceedings in 2017. Pursuant to a temporary order, the marital home was sold and about $500,000 in sales proceeds were put into an escrow account. The court signed an agreed order allowing disbursement of an equal portion of the proceeds to pay each party’s divorce attorneys. The rest of the proceeds was left in the escrow account.
Husband and Wife Entered Into Partial Settlement Agreement
The parties signed a mediated settlement agreement (MSA) to partially settle the community estate. The MSA gave the husband 50% of the funds still in escrow, but required him to pay the wife $13,875 to buy out her interest in a loan. The wife was to receive 50% of the funds in escrow. She was also to receive 100% of the funds in the husband’s IOLTA account resulting from the sale of certain personal property and the loan disbursements. The husband was to be paid $650 from that amount for the wife’s health insurance. The parties also agreed to leave certain issues to the court to decide, specifically whether the husband was entitled to reimbursement based on his claim that he provided his own separate funds for the purchase of the marital home, how liability and attorney’s fees arising from litigation involving the parties’ dog boarding and training facility should be allocated, and how the husband’s retirement interests should be allocated. The MSA further stated that the parties agreed that the allocation of their remaining assets may have to be adjusted after the court made its determinations.
At the time of trial, the husband had worked for the fire department for 18 years. The experts testified that he could retire immediately and be eligible to receive $2,179.10 each month through the deferred pension plan. He could instead get a refund of contributions. If he worked for the fire department for 20 years, he would be entitled to a supplemental $150 per month and $5,000 in a lump sum. At 20 years, he could participate in the service pension plan that would provide higher monthly payments than the deferred plan. Finally, if he worked for 20 years, he could accrue additional retirement funds through the Deferred Retirement Option Plan.
The court heard testimony that the husband would not be entitled to social security benefits, but the wife would be, with the amount depending on when she retired.
After the conclusion of final trial, the trial court found the husband was entitled to reimbursement from the escrow account, 100% of future payments from the loan, 100% of his future retirement benefits, 60% of any proceeds of the litigation or judgment against the parties or the business, and all legal expenses and fees incurred in the litigation.
The trial court also found the wife was entitled to 100% of the funds left in the escrow account, 100% of the funds in the IOLTA account, 100% of her own future retirement benefits, and 40% of any proceeds in favor of or any judgment against the parties or the business.
Husband Appeals – Argues Judgment Contradicted Settlement Agreement
The husband appealed. He argued the court abused its discretion by redistributing assets allocated in the MSA and failing to recognize the Murff factors in determining the interest in his retirement benefits.
The appeals court noted the language in the MSA that stated that the allocation may need to be adjusted in light of the court’s determination on the issues before it. The appeals court found the language allowed the trial court to eliminate the healthcare premium payment that was in the MSA.
Appellate Court Upholds Trial Court’s Ruling
The appeals court pointed out the husband was awarded 100% of his retirement benefits. The appeals court further found there was sufficient support for the court’s division of the property. The court had allocated $72,059.82 in cash to the husband and $271,690.23 to the wife. The appeals court acknowledged the wife received significantly more cash, but noted the husband had been allocated 100% of his retirement benefits. The wife’s retirement benefits would be quite a bit less than the husband’s. If the husband retired now, he would have received retirement benefits greater than the difference in the cash allocation by the time the wife was even eligible to begin receiving social security benefits. If he waited until he reached 20 years employment with the fire department, “his benefits would far exceed what Wife would be entitled to under social security.”
The appeals court found no abuse of discretion in the trial court’s property division.
Does Your Divorce Involve Complicated Property Issues? Call McClure Law Group Today
The appeals court’s discussion in this case shows how a property allocation could be equitable without being equal. Cases involving a lot of assets or significant retirement benefits can be complex. A skilled Texas divorce attorney can help you get a fair property division. Call McClure Law Group at 214.692.8200.