Texas Divorce Attorney Blog
The community estate must be divided in a “just and right” manner in a Texas divorce, but that does not always mean an equal division. In a recent case, a former husband challenged a property division that awarded the wife about 70% of the community estate, along with a money judgment of $365,000.
The parties got married in 1998 and stopped living together in 2021. The husband petitioned for divorce in 2022, alleging insupportability and requesting a disproportionate share of the community estate. The wife also alleged insupportability and adultery by the husband. She also alleged the husband committed fraud on the community estate and requested a disproportionate share of the estate.
The trial court awarded the wife about 70% and the husband about 30% of the community estate.
Each spouse was awarded an equal share of three “grants” from the husband’s employer. The husband’s employer was a Canadian company and the husband testified about how Canadian law affected his pension and employment agreement. The husband’s attorney stated on the record that they were “willing to stipulate that any future grants that he gets for work that was done” during the marriage would be divided equally. He compared the grants to bonuses but said they were not guaranteed. The husband testified the grants were paid three years after being awarded at an amount that could not be determined until shortly before the payment.
The court also awarded the wife a $365,000 judgment with 8.25% interest, paid at $3,500 per month. The husband requested additional findings of fact and conclusions of law addressing the judgment.
Disproportionate Division
The husband appealed, arguing there was insufficient evidence to support the disproportionate division. The trial court found that the 30/70 division was just and right and that the money judgment was necessary for a just and right division. The trial court also stated it had considered the Murff factors. See Murff v. Murff. The Murff factors include the parties’ earning capacity, education, and financial condition, as well as the nature of the property.
The husband did not challenge the court’s underlying findings supporting its disproportionate award. The court found the husband’s supplemental pension plan, which was the largest account and valued at more than $800,000, could not be divided at a greater than 50/50 split pursuant to Canadian law, which governed the pension. The court awarded the husband that account and another investment account based on limitations in his employment agreement that required him to maintain shares worth at least his base annual salary.
The trial court had found the wife was the primary caregiver for the parties’ minor child and their adult child with serious health conditions. The court also found she had cared for the children during most of the marriage and set aside career opportunities to do so. She had not been able to find a job. She had testified she needed liquid assets after the divorce. The parties had a rental property in Canada, but the court found it could not be quickly sold because it needed repairs and had tenants living there. The court found the husband had earned $539,735.43 in 2022, while the wife was unemployed, had been out of the workforce, and was caring for the children. The court also found these facts supported a disproportionate division. The appeals court determined there was some evidence of a substantive and probative character supporting the disproportionate division as a just and right division of the estate.
The husband challenged the percentage awarded to the wife, but the appeals court pointed out that Texas law does not have a specific threshold for the percentages permitted. Furthermore, Texas appellate courts have affirmed property divisions with a spouse receiving greater than 70% of the estate. The appeals court held the trial court had not abused its discretion with the disproportionate property division in favor of the wife because it was supported by evidence of a substantive and probative character.
Characterization of Grants
The husband also challenged the characterization of the grants as community property. Texas law presumes that property possessed by either spouse at the time of the divorce is community property. A party asserting property is their separate property can only overcome the presumption by establishing the property is separate property by clear and convincing evidence. Tex. Fam. Code Ann. § 3.003(a).
The appeals court determined the husband did not overcome the presumption. The trial court found the parties stipulated the grants were community property and stated a value for the grants each year. The husband’s attorney stated they would stipulate that future grants for work done during the marriage would be divided equally. There was also evidence estimating the values of the grants awarded for work done while the parties were married. The husband’s own proposed property division characterized them as community property. The husband had not claimed the grants were separate property during the trial and did not present evidence they were separate property. The appeals court concluded there was more than a scintilla of evidence supporting the court’s finding the grants were community property and the record did not establish they were separate property as a matter of law. The trial court did not err in including them in the division of the community estate.
The appeals court affirmed the judgment.
Contact a Knowledgeable Texas Divorce Lawyer
This case illustrates that a court may make a significantly disproportionate property division if it finds it to be just and right. If you are facing a high net worth Texas divorce with a discrepancy in earnings and assets, call McClure Law Group at 214.692.8200 to set up a consultation.