Francesca Blackard, Author at Texas Divorce Attorney Blog

Supreme Court of Texas Addresses Several Property Division Issues in Divorce Case

Published on: January 14, 2025 | by Francesca Blackard

The Supreme Court of Texas recently considered the property division in a Texas divorce case involving a complex estate, including an outstanding employee bonus, claims of separate property, and a retirement plan.

The parties got married in 2020 and were divorced in late 2019, with litigation regarding the property division continuing beyond the divorce.

Bonus

During the marriage, the husband worked for a large bank. He received an annual cash and stock bonus contingent on the bank’s and his own performance. The bonus was paid around February 15 each year.

Texas Appeals Court Rules on Separate Property Equity in Real Estate

Published on: January 6, 2025 | by Francesca Blackard

The property division in a high net worth Texas divorce may require one party to convey their interest in certain assets to the other spouse. In some cases, the parties may agree to liquidated damages in the event one party fails to cooperate and take the actions necessary to transfer their interests. In a recent case, a former spouse challenged a liquidated damages judgment against him.

The parties, S.K.F. and K.J.W., entered into a mediated settlement agreement, which included an agreement incident to divorce (“AID”). The agreed final divorce decree incorporated the AID and ordered the parties to do the things necessary to effectuate their agreement.

The AID confirmed as K.J.W.’s sole and separate property two condominiums in Puerto Vallarta. It awarded S.K.F. $550,000 for the condominiums, as his sole and separate property. The AID set out the payment schedule of: a check for $150,000 the date the MSA was signed, a check for $275,000 on the date the agreed final divorce decree was signed, and $125,000 paid to a law firm to be held in trust to ensure S.K.F. signed the deeds for the condos. It further provided if K.J.W. did not submit a formal written request to sign the deeds within 12 months after the divorce, he was to instruct the firm to pay S.K.F. half of the funds. If he did not make a formal request between the 12^th and 24^th month after the divorce, K.J.W. was to instruct the firm to pay S.K.F. the other half. If, however, S.K.F. signed the deeds as required to transfer his interest in the condos at any point during the 24 months after the divorce, K.J.W. was to instruct the firm to pay the entire balance of the funds to S.K.F. immediately. S.K.F. agreed that, upon receiving the written notice, he would have 90 days to arrange travel to Puerto Vallarta and sign the deeds on the date specified. K.J.W. agreed to pay for his reasonable travel expenses up to $1,300. S.K.F. further agreed that if he failed to sign the deeds within 24 months, K.J.W. would be awarded $600,000 in liquidated damages. The AID also included a general cooperation provision in which both parties agreed “to sign any and all additional documents necessary to effectuate the transfer of any asset, liability or interest in any entity or stock(s) to the other party.”

Texas Appeals Court Finds Wife Failed to Meet Purchase Option Requirements on Marital Residence in Divorce Decree

Published on: December 21, 2024 | by Francesca Blackard

In a property division of a complex estate in a Texas divorce, one party may be given the option to purchase the other spouse’s interest in real property or a business. The divorce decree may include terms regarding the purchase option, including deadlines, contingencies, and requirements that the other spouse cooperate by signing documents. In a recent case, a former wife sought a bill of review after she did not complete the purchase of the marital residence from the former husband by the deadline stated in the decree.

The trial court signed a Final Decree of Divorce Nunc Pro Tunc in March 2020. Both parties “approved and consented to” the form and substance of the decree. The decree gave the wife the right to purchase the marital residence, which was in the husband’s name. However, if she failed to purchase the property and close by September 1, 2020, she would waive any interest in the property and it would remain the husband’s sole and separate property.

On August 27, 2020, she sent a letter and real estate contract with a September 24 closing date to the husband. He did not respond and the wife failed to buy the property and close by the deadline.

Texas Court Requires Ex-Husband to Continue Paying Taxes on Property Where Ex-Wife Lives

Published on: December 7, 2024 | by Francesca Blackard

Texas spousal maintenance is only awarded under certain specific circumstances. The Texas Family Code sets out guidelines for the duration of a spousal support order, but the obligation to pay future maintenance also terminates on the death of either party, remarriage of the former spouse receiving maintenance, or upon a finding the former spouse receiving maintenance is cohabiting with a romantic partner. Tex. Fam. Code § 8.056.

In a recent case, a Texas appeals court considered whether a former husband’s obligation to pay property taxes should have been terminated with the monthly spousal maintenance when the former wife was cohabiting with a romantic partner.

Divorce Decree

The 2014 final divorce decree awarded the former husband as separate property “all rights, title, and interest” in a particular piece of real estate in San Antonio. It also awarded the former wife a life estate in that property. The husband was ordered to pay $1,500 in monthly spousal support, as well as the mortgage payments as “an additional spousal support obligation.”

Texas Court Appoints Receiver in Divorce with Complex Estate and International Assets

Published on: November 27, 2024 | by Francesca Blackard

During a Texas divorce case, the court may appoint a receiver to preserve and protect the parties’ property. Tex. Fam. Code § 6.502(a)(5). The receiver’s role is to receive and preserve property for all of the parties, not just the party who applied for a receiver. Protecting assets can be particularly important in a complex estate involving business interests, real property and other assets under the control of one spouse. A husband recently appealed appointment of a receiver in his divorce case.

According to the appeals court’s opinion, the parties had been married for about 12 years when the wife petitioned for divorce. The wife requested appointment of a receiver, alleging the husband had transferred community assets. The husband argued that some of the assets were his separate property and that a receiver should not be appointment when there was another available remedy. He argued the wife had filed a lis pendens on the real property.

The Hearing

At the hearing, the wife’s attorney argued the husband was a successful doctor who had transferred assets worth millions to Lebanon and Syria. She argued he had cancelled the credit card and closed the joint bank account. She stated they did not know where the money went because the husband did not answer discovery. The attorney argued the hearing was urgent because it would be hard to enforce the orders once the funds were in Syria or Lebanon, noting there had been previous injunctions against transfers of money and sales of property.

Determining Law Governing Pre-Marital Agreement in High Net Worth Divorce

Published on: November 13, 2024 | by Francesca Blackard

A pre-marital agreement can be a valuable way to protect assets in a high net worth Texas divorce. A pre-marital agreement can help protect a spouse’s interest in a business, identify property that will remain separate, or describe how a complex estate will be divided in the event of a divorce. In some cases, however, a party may challenge the validity of the pre-marital agreement. The Texas Family Code sets forth the circumstances under which a pre-marital agreement will not be enforced, but matters may become more complicated if the agreement was signed in another state. A wife recently challenged an order applying Louisiana law to the validity and enforceability of a pre-marital agreement.

The Pre-marital Agreement

The parties got married in Louisiana in 1990. They purportedly signed a pre-marital agreement pursuant to Louisiana law a few days before the marriage. The agreement provided that only the husband’s salary from a particular company would be community property. All other income generated by his efforts would remain his separate property. All revenue generated by the wife’s efforts would be her separate property.

Applicable Law

The wife petitioned for divorce in Texas in 2019. The husband asked the trial court to enforce the agreement. The wife asserted a number of defenses to enforcement of the agreement under Texas law.

Divorce Decree Entered by Submission Thrown Out For Failure of Court to Conduct Trial

Published on: October 30, 2024 | by Francesca Blackard

In a high net worth divorce, the parties may want to reach an amicable resolution of property division. In a recent Texas divorce case, a husband challenged the final divorce decree that upheld the parties settlement agreement without giving him notice and a hearing.

The parties got married in March 2021 and stopped living together in January 2023. The entered into a Mediated Settlement Agreement (“MSA”) shortly thereafter.

Proceedings

The wife petitioned for divorce in 2023, asking the court to divide the estate according to the terms of the MSA. The MSA was signed by both parties and notarized. Additionally, both parties had initialed each page. The MSA addressed the division of the community property and liabilities, including personal property, real property, business interests, and debt.

Texas Court May Classify Attorney’s Fees Awarded in Divorce as Non-Dischargeable in Bankruptcy

Published on: October 13, 2024 | by Francesca Blackard

“Domestic support obligations” as defined by the U.S. Bankruptcy Code are generally exempt from discharge in bankruptcy. Therefore, child support or spousal maintenance generally cannot be discharged in bankruptcy and must be paid. The treatment of other types of awards that may be granted in a Texas divorce, however, may not be so clear. In a recent case, a former wife appealed a divorce decree that expressly stated that an award of attorney’s fees against her was a domestic support obligation pursuant to the U.S. Bankruptcy Code.

The parties got married in September 2021 and the wife filed for divorce that December. The husband subsequently filed a counterpetition, alleging adultery by the wife. He asked the court to order the wife to pay his attorney’s fees and costs and classify them as a domestic support obligation for purposes of bankruptcy.

The court granted the divorce based on adultery and awarded attorney’s fees to the husband. The court granted an award of $38,306 to the husband’s attorney and the firm. The divorce decree stated that the attorney’s fees would be “considered a domestic support obligation. . .”

Reconstitution of Community Estate Due to Waste or Fraud in Texas Divorce

Published on: September 30, 2024 | by Francesca Blackard

A court dividing property in a Texas divorce may consider a number of factors, including fraud or waste of community assets by a party. A spouse may commit constructive fraud or waste by unfairly depriving the other spouse of the benefit of community assets. There is a presumption of constructive fraud when a spouse disposes of the other’s interest in community property without their knowledge or consent. A former husband recently challenged a property division after the court found he had committed fraud and waste on the community estate.

The parties married in February 2011 and the wife petitioned for divorce in July 2018. Both parties alleged constructive fraud and wasting of community assets by the other and sought reconstitution and a disproportionate share of the community estate.

The court granted divorce and ultimately confirmed $46,000 in an IRA as the husband’s separate property. The court found the husband committed fraud on the community estate and reconstituted the community estate. Included in the reconstitution was $71,483.33 for depletion of an IRA, $81,321.98 for dissolution of the husband’s interest in a limited liability company, and $17,000 for unpaid medical expenses for the children. The court also awarded the wife a disproportionate share of the community estate.

Judicial Admissions in Texas Custody Modification Case

Published on: September 13, 2024 | by Francesca Blackard

Generally, to obtain modification of a Texas custody or child support order, a parent must show that there has been a material and substantial change in circumstances since the prior order. Texas courts have held that a parent alleging a material and substantial change of circumstances in their counter-petition has judicially admitted the existence of a material and substantial change in circumstances. In a recent case, a mother appealed an order granting the father’s counterpetition request for modification after granting summary judgment against her modification petition.

Proceedings

The parties got divorced in 2017 and entered into a mediated settlement agreement (“MSA”). The MSA named the parties joint managing conservators of their child and placed a geographic restriction of Lubbock County on the child’s residence. It stated that if either party moved out of the county, the parent who remained would get the exclusive right to designate the child’s residence in Lubbock County.

The mother got married again and moved to Indiana in September 2020. The father stayed in Lubbock County. The mother petitioned for modification giving her the right to designate the child’s primary residence with no geographic restriction and additional child support.