Dallas Divorce Lawyer Blog

When parties divorce the Court, according to Texas Family Code Section 7.001, makes a "just and right division" of the community estate. For most parties, this typically means an equal split of the community estate as to the assets and debts. However, there are some instances in which the Court could award a disproportionate share of the community estate and the statute allows for such as it does not mandate an equal division. In fact, the trial court has a lot of discretion in dividing the community estate.

For a disproportionate share of the community estate, the controlling opinion was issued in 1981 by the Texas Supreme Court in Murff v. Murff. There, the Court set out several factors for the courts to consider when they are making a just and right division of community property and debts. The factors are: the disparity of incomes or earning capacities of the spouses; the spouses' capacities and abilities; benefits which the party not at fault would have derived from a continuation of the marriage; business opportunities of the spouses; spouses' educations; spouses' relative physical and financial conditions; spouses' separate estates (if any); nature of property to be divided; fault in the breakup of the marriage (adultery, cruel treatment, other spouse is convicted of felony and imprisoned for at least one year, abandonment for a year or more, living apart for at least three years, other spouse is confined to a mental hospital for at least one year); or parties' attorneys fees.

In addition to these factors, there are also additional causes of action in divorces which would allow or create argument for a disproportionate share of the community estate.

As discussed, a spouse's "fault" in the breakup of the marriage can be considered by the trial courts when it is dividing the community estate between the parties. The key word here is "may" consider as the Texas Supreme Court and many appellate courts after it have adjudicated that the trial courts in Texas are not necessarily required to consider the other party's fault. In fact, seemingly, trial courts have a wide discretion when it comes to fault grounds and division of the community estate. That is, in addition the above referenced wide latitude, if a party pleads for a fault divorce, the Court can hear evidence of fault, enter a divorce on no-fault grounds (that is a divorce would be granted based upon insupportability--as defined in Texas Family Code Section 6.001), and still award a disproportionate share of the community estate. In fact, the Beaumont Court of Appeals in Phillips v. Phillips held that in addition to or even excluding fault, there is a nonexclusive list of factors that a court can consider in determining whether or not to award a disproportionate share of the community estate.

The fault grounds are listed above and the most common used is adultery. In Abernathy v. Fehlis, the Austin Court of Appeals held that the husband's adultery caused the breakup in the marriage and thus justified a disproportionate share of the community estate. Interestingly, the Houston 1st District Court of Appeals in Bell v. Bell held that the adultery does not end at separation and includes any adultery committed after separation.

The Texas Supreme Court in Young v. Young held that in addition to considering fault of one spouse, if argued concurrently, the trial court can also consider benefits the innocent spouse would have received if the marriage continued. For example, in Hopkins v. Hopkins, the Corpus Christi Court of Appeals the medical benefits a wife would have been entitled to had she been or continued to be a wife of a retired Air Force officer. Therefore, in pleading fault, also consider any benefits that you currently receive or would receive if the marriage continued.

The Eastland 11th Court of Appeals in Duncan v. Duncan said it best--"the circumstances of each marriage dictate what factors should be considered in the properly division upon divorce."

When parties divorce the Court, according to Texas Family Code Section 7.001, makes a "just and right division" of the community estate. For most parties, this typically means an equal split of the community estate as to the assets and debts. However, there are some instances in which the Court could award a disproportionate share of the community estate and the statute allows for such as it does not mandate an equal division. In fact, the trial court has a lot of discretion in dividing the community estate.

For a disproportionate share of the community estate, the controlling opinion was issued in 1981 by the Texas Supreme Court in Murff v. Murff. There, the Court set out several factors for the courts to consider when they are making a just and right division of community property and debts. The factors are: the disparity of incomes or earning capacities of the spouses; the spouses' capacities and abilities; benefits which the party not at fault would have derived from a continuation of the marriage; business opportunities of the spouses; spouses' educations; spouses' relative physical and financial conditions; spouses' separate estates (if any); nature of property to be divided; fault in the breakup of the marriage (adultery, cruel treatment, other spouse is convicted of felony and imprisoned for at least one year, abandonment for a year or more, living apart for at least three years, other spouse is confined to a mental hospital for at least one year); or parties' attorneys fees.

In particular, disparity of earning power has become a major factor in divorces especially those in which one spouse has been the breadwinner of the family. For instance, the Houston 1st District Court of Appeals held in Robbins v. Robbins that the trial court was correct in its decision to award the wife 58% of the community estate and the husband 42% of the community estate. The Court concluded this was because the wife had been out of the working community for quite some time and the husband had a much greater earning capacity than the wife.

Therefore, it is not always as we say "50/50" in a divorce. There are some instances, such as earning power, capacities or abilities that necessitate an unequal division of the community estate. At the same time, there are also instances in which despite the disparity in earning power, an equal division of the community estate is justified. In fact, the Houston 14th District Court of Appeals held in Hanson v. Hanson that while it could award a spouse with less education and earning power a disproportionate share, it does not necessarily have to if the community estate is large enough that an equal division would satisfy the requesting spouse's financial needs. Thus, as with all divorces, no case is the same and it will truly depend on the circumstances in front of the court on that particular day.

When parties divorce the Court, according to Texas Family Code Section 7.001, makes a "just and right division" of the community estate. For most parties, this typically means an equal split of the community estate as to the assets and debts. However, there are some instances in which the Court could award a disproportionate share of the community estate and the statute allows for such as it does not mandate an equal division. In fact, the trial court has a lot of discretion in dividing the community estate.

For a disproportionate share of the community estate, the controlling opinion was issued in 1981 by the Texas Supreme Court in Murff v. Murff. There, the Court set out several factors for the courts to consider when they are making a just and right division of community property and debts. The factors are: the disparity of incomes or earning capacities of the spouses; the spouses' capacities and abilities; benefits which the party at fault would have derived from a continuation of the marriage; business opportunities of the spouses; spouses' educations; spouses' relative physical and financial conditions; spouses' separate estates (if any); nature of property to be divided; fault in the breakup of the marriage (adultery, cruel treatment, other spouse is convicted of felony and imprisoned for at least one year, abandonment for a year or more, living apart for at least three years, other spouse is confined to a mental hospital for at least one year); or parties' attorneys fees.

In addition to these factors, there are also additional causes of action in divorces which would allow or create argument for a disproportionate share of the community estate.

Fraud is a separate economic tort in a divorce action and is either actual or constructive and is also known as fraud on the community. Actual fraud is defined in Stone v. Lawyers Title Insurance Company by the Texas Supreme Court as (1) a material representation was made; (2) it was false; (3) the speaker knew it was false or was reckless in making it without knowledge of its truth; (4) the speaker made the false material representation with the intent that the other party act on it; (5) the party did act on it in reliance of that representation; and (6) the party therefore suffered. Constructive fraud on the other hand is a breach of a legal or equitable duty. For instance, husbands and wives have fiduciary duties to one another and when that is breached, it is constructive fraud or a fraud on the community. An example would be if your husband just gave away property or charged a large sum of money on the credit card without your knowledge.

The Texas Supreme Court more recently defined fraud on the community in Schlueter v. Schlueter "as a wrong committed by one spouse which may be considered by the trial court in its division of the community estate and which may justify a disproportionate division." Therefore, a trial court can award the requesting spouse a disproportionate share of the community estate to make up for the wrong of the other spouse. But, if it is so bad that there is not enough community estate to compensate the requesting spouse, then the trial court can choose to award a money judgment in the requesting spouse's favor to make up for the loss. In the above referenced Murff case, the Court awarded a money judgment to the wife against the husband because he had a substantial amount in savings before the parties separated and those savings disappeared by the time the final trial rolled around.

Considering this, Schlueter removes the ability of the requesting spouse to have a separate cause of action for damages because the statutory remedy for the tort is already in place (fraud on the community). However, the requesting spouse can still sue the other spouse independent to the divorce action for actual fraud if the fraud was committed on the requesting spouse's separate estate (property acquired before marriage or that which was acquired during the marriage by gift, devise or descent) and if proven, the requesting spouse can receive punitive damages.

Therefore, if you feel as though your spouse has committed fraud on the community estate, you must discuss this at the outset with your attorney so that they can properly plead for such cause of action with the divorce. You do not have two bites at the apple so make sure you plead for it when you have the chance because you cannot, as adjudicated in Schlueter, seek an additional cause of action beyond the divorce action.

Community property is defined as anything acquired during the marriage. Separate property, however, is anything acquired before marriage and anything acquired during the marriage by gift, devise, or descent. Your separate property is just that--yours. If you are married and you divorce your spouse, your separate property remains yours. In fact, Texas courts are prevented from dividing separate property between spouses.

If you are married with separate property and you love and trust your spouse to the point that you would like for them to also share in the interest of your separate property, to ensure that this is a legal interest, you must convert the separate property into community property. If you fail to do so, then the spouse you love and trust is out of luck when it comes to the separate property that has not been properly converted. This is demonstrated by the Dallas 5th District Court of Appeals in In Re the Estate of Olen F. Cunningham, Deceased. There, the husband had entered into an "Agreement to Establish Right of Survivorship in Community Property" with his wife. The problem was, as the Court held, the agreement did not meet the requirements of Texas Family Code Sections 4.203 and 4.205.

Per Texas Family Code Section 4.203, if you want to convert your separate property into community property, the agreement must "be in writing and be signed by the spouses; identify the property being converted; and specify that the property is being converted to the spouse's community property; AND it is enforceable without consideration." You may think (as well as several other unknowing persons) "I have put the home that I brought into the marriage in both of our names so surely that means it is our community property." However, according to the statute and only caselaw on the subject, you are wrong. That is, the statute goes on further in subsection (b) and states "the mere transfer of a spouse's separate property to the name of the other spouse or to the name of both spouses is not sufficient to convert the property to community property under this subchapter."

Furthermore, even with this agreement, a court must then determine if it is enforceable. The enforceability of such agreements is determined in Texas Family Code Section 4.205. In particular, the statute states that the agreement is not enforceable if the converting spouse "did not execute the agreement voluntarily; or did not receive a fair and reasonable disclosure of the legal effect of converting the property to community property." In subsection (b) the legislature sets out a verbatim disclosure that can be included in agreements that would satisfy the issue of fair and reasonable disclosure of the legal effects of the conversion.

Therefore, if you want to voluntarily and legally make "what is mine is ours", then you must follow the statute. Otherwise, for now according to the Dallas 5th District Court of Appeals, your agreement will be just a piece of paper without any legal effect.