Redistribution of Assets Was Modification and Not Enforcement of Texas Divorce Decree

A trial court may vacate, modify, correct or reform its judgment or grant a new trial within 30 days after the judgment is signed.  Tex. R. Civ. P. 329b.  Additionally, if a party files a timely motion, the trial court has the power to take those same actions until 30 days after any timely motions are overruled by an order or operation of law.  The court’s plenary power generally expires 30 days after the final judgment is filed if there is not a timely post-judgment motion.

Courts generally retain continuing subject-matter jurisdiction to clarify and enforce the property division set forth in a Texas divorce decree.  The court has the authority to render additional orders to enforce, assist in the implementation of, or clarify the property division.  It may specify the manner of the property division more precisely, but may not change the substantive property division.  A court may order delivery of specific property through its enforcement power.  If a party has not delivered property awarded pursuant to the divorce decree and delivery is not an adequate remedy, the court may award damages. Additionally, a court may render judgment against a party who fails to make monetary payments as awarded in a decree.

A former husband recently challenged a court order purportedly enforcing the property division in his divorce decree, arguing that it instead improperly modified the division.

Divorce Decree

The April 6, 2021 final decree appointed a realtor to sell the parties’ marital residence and a shop, as well as a receiver to sell personal property.  It awarded each party 50% of the net proceeds from those sales.  The wife was awarded the title to her vehicle and certain personal property in the husband’s possession.  The husband’s bankruptcy proceeding resulted in excess funds, of which the court awarded the wife 55.5%.

The decree included a provision for liquidated damages if a party failed to deliver property awarded to the other party or ordered to be sold by the realtor or receiver.  According to the provision, failure to deliver property “shall result in the award of damages (including a redistribution of cash or other assets) and attorney’s fees to the other party.” The decree required the parties to deliver the property at the specified time in an undamaged condition.

Enforcement Action

In May 2021, the parties jointly moved to sign qualified domestic retirement orders, requesting the motion be considered a motion for a new trial and that the court retain its plenary power until the motion was heard and considered.  The qualified domestic retirement orders were signed on May 7.  The wife moved for contempt and enforcement on May 13.  The husband then filed his own motion for enforcement by contempt.  The court held five hearings between June 3, 2021 and October 6, 2022.

While the motions were being litigated, the court’s registry received payments from excess funds from the husband’s bankruptcy, proceeds from the sale of the residence, proceeds from the sale of the shop, and proceeds from the sale of personal property.

The trial court granted the wife’s motion for enforcement, finding that the husband violated the agreed final divorce decree and order for the appointment of a receiver in a number of ways, including failure to deliver property and delivering property in a damaged condition.  The trial court applied the liquidated damages provision and awarded the wife $722,725.33, including 100% of the proceeds from the sale of the house, reimbursement of part of the receiver’s fees, court costs, and $251,225.58 in attorney’s fees.  The court ordered the remaining funds in the registry by disbursed to her toward the judgment.

The Husband’s Appeal

The husband appealed, arguing the trial court redistributed marital assets that had previously been awarded after its plenary power expired.

The trial court granted the enforcement motion more than 20 months after the decree was signed.  The appeals court concluded the trial court’s plenary power had expired.

The issue before the appeals court was therefore whether the trial court’s order was actually an enforcement action or if it instead substantively changed the property division in the decree. While the court maintained continuing jurisdiction to grant an order of enforcement, the court could not make a substantive change to the property division because its plenary power had expired.

The wife argued that the order was a proper enforcement action. She argued there was an agreed provision for liquidated damages in the divorce decree and the court’s order just enforced the decree by applying that provision.

The appeals court, however, rejected her argument.  The appeals court pointed out that the liquidated damages provision was intended to penalize the husband for noncompliance, without consideration of the actual damages the wife suffered.  The appeals court noted that the language in the decree allowed a post-decree award for the fair market value of property that was not delivered in the condition it was in at the time of the separation, regardless of the extent of the damage.

The appeals court concluded that the trial court’s application of the liquidated damages provision modified the decree’s property division that awarded the husband 50% of the proceeds of the property by awarding the wife 100% of the net proceeds of the sale of the house.  This award was not based on the actual damages resulting from the husband’s failure to comply with the decree and deliver the property.  The appeals court concluded the order “completely divested” the husband of the portion of the proceeds from the home that had been awarded to him, noting that the order indicated the husband’s behavior justified a “redistribution” of assets.

The appeals court concluded that the trial court’s order went beyond enforcement because it completely divested the husband of the proceeds of the home.  The appeals court concluded the trial court’s action was void because its plenary power had expired.

The appeals court held the trial court’s order was a modification of the decree’s property division rather than an enforcement action.  The appeals court further concluded that the modification was made well after the expiration of the trial court’s plenary jurisdiction.  The order was therefore void.

The appeals court vacated the trial court’s order granting the wife’s enforcement motion and dismissed the case.

Seek Experienced Legal Counsel

A knowledgeable Texas divorce attorney can fight to protect your rights during the divorce case and in subsequent proceedings.  Set up a consultation with McClure Law Group by calling 214.692.8200.



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