North Texas Family Law Blog : Dallas Divorce Lawyer & Attorney : Verner & Brumley Law Firm : Serving Dallas, Plano, Fort Worth, Texas

There are many things one should do to prepare for divorce.  Vancouver's MacLean Family Law Group has prepared a checklist. Although not every item will apply in every case, it is the most complete checklist we've seen. Here it is:

• MAIL: Review all mail coming into your house and make a list of the sender and return address. It is very important to know the address of stockbrokers, insurance companies, credit issuers, banks, and revenue properties, COPY THESE DOCUMENTS.
• PERSONAL MATTERS: Have your mail sent to an address other than the Matrimonial Home for your privacy and to ensure that you receive it. For example, a post office box or home of a close friend or relative. File a change of address notice with the post office.
• FAMILY FINANCES: Review all monthly bank statements and brokerage statements, credit card statements, property assessments, and COPY THESE DOCUMENTS. Give copies of necessary documents to your lawyer for safekeeping.
• TAX RETURN: Review all tax returns that have been filed by you and your spouse. Demand an explanation as to any item, which may be questionable before signing. Make complete copies of tax returns for the last several years.
• TAXES OWED: Be certain that all taxes owed to the Federal Government or other taxing agencies are paid to date. IF NOT COPY NOTICES OF ASSESSMENT.
• SAFE DEPOSIT BOX: Inventory and review the contents of any safe deposit box. List the contents including cash and jewelry. Be sure that all safe deposit boxes are in joint names. TAKE PHOTOGRAPHS AND COPIES OF THE CONTENTS.
• BUSINESS INTERESTS: Be familiar with your spouse's business interests. Become involved and be aware of financial information regarding the business by getting full information on the business, including bank documents, loan applications, corporate tax returns and financial statements.
• MATRIMONIAL ASSETS: Do not transfer, sign, or make a gift of marital assets in joint names. Credit cards in joint names may discourage large personal purchases by one party. Conversely, you may wish to cancel credit cards to prevent large purchases by your spouse without your permission.
• PENSION PLANS: Obtain copies of your pension plan and your spouse's also with any yearly statements and determine when they vest and benefits become payable, ask for the plan booklets and latest contribution statements. These documents will be useful if you file for divorce in BC.
• WILLS AND TRUSTS: Obtain copies of any wills or trust agreements and be involved in any estate planning.
• LOANS: Review and make copies of all loan documents, mortgage applications, and financial statements.
• SIGNATURE: Do not sign any financial statements if blank. Know what you are signing and always keep a copy.
• MEDICAL: Have a complete medial and dental check up. Be sure that you have medical and dental insurance (if available) in the event of separation.
• CANADA PENSION PLAN: Obtain Canada Pension Plan statements.
• SAVINGS AND PERSONAL FINANCES: Separation generally causes immediate economic hardship. Put away cash or keep money in traveler's checks in order to be able to purchase personal necessities in the event of a divorce.
• AUTOMOBILE: Be sure that your automobile is in good working condition and that it is titled jointly or in your sole name.
• INSURANCE: Review and make copies of all insurance policies relating to the matrimonial residence furnishings, or other assets. This should include any jewelry, silverware, or other valuable. Make copies of any appraisal that have been prepared. These documents will be useful if you file for divorce in BC.
• INDEBTEDNESS: Do not create any additional debts and make no large purchases such as a new boat or car. Keep your assets as liquid as possible.
• LIABILITY: Prepare a complete list of all debts or obligations including credit cards, notes, mortgages, etc. Identify each debts, when it was incurred and the reason for the debt. Identify who has been making payments on them, as well as the monthly or annual amounts.
• ASSETS: Prepare a complete list of all assets in your name and your spouse's. These documents will be useful if you ever file for divorce in BC. Include whether the assets are held individually or jointly and the source of the assets, whether inherited, gifted, or in the name of a third party on your behalf. It is important to determine whether the assets were acquired prior to or during the marriage. Make copies of any documents which show the details and values of all assets and debts.
• INHERITANCES: Keep all inheritances separate from the marital estate. Do not put an inheritance into joint names and do not use proceeds to pay for family expenses or purchases or to pay down debts.
• EMPLOYMENT: Do not quit work if you are employed. It is important to secure your future financial independence and earn enough to maintain assets such as your home and car.
• RESIDENCE: DO NOT MOVE OUT of the family residence without first discussing it with your lawyer.

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This blog entry might be subtitled, "Ah, but what a difference a few words makes!"

Here's the background: When a service member retires, he or she is entitled to receive military retirement pay, either voluntary retirement benefits or disability retirement benefits.  If the service member becomes divorced, his or her spouse might well be awarded a part of the military spouse's retirement pay (if, as and when received) as part of the division of the community estate.

If a service member is disabled, or becomes disabled, he or she may elect to receive Veteran's Administration disability benefits instead of military disability retirement benefits.  Veteran's Administration disability benefits are considered personal to the service member and cannot be divided upon divorce because they are not part of the community estate.

What sometimes happens is that a retired, disabled service member will opt to waive all or part of his military retirement pay for Veteran's Administration disability benefits.  To the extent that the former service member receives Veteran's Administration disability benefits in lieu of military retirement pay, his or her military retirement pay is reduced.  As a result, the amount of military retirement pay the former spouse then receives decreases because there is less of it to split.

Nearly twenty years ago, in Berry v. Berry, 786 S.W.2d 672 (Tex. 1990) (per curiam), the Texas Supreme Court ruled on a case in which this situation occurred.  In that case, the former spouse was to receive a percentage of her ex-husband's "gross Air Force disability retirement pay" which was to be "computed on the gross amount thereof before any deductions."  The retiree elected to receive Veteran's Administration disability benefits; his military retirement pay was reduced accordingly. The Court upheld the former wife's attempt to require the former husband to continue paying her a portion of the former husband's retirement pay based on the amount of his retirement pay before the reduction caused by accepting Veteran's Administration disability benefits because that reduction amounted to a "deduction" from the retirement pay.  Thus, because of the way the divorce decree had been drafted, the former wife continued to receive her full share of the former husband's military retirement pay.

On May 1, 2009, the Texas Supreme Court ruled on another case of this nature, Hagen v. Hagen, in which the divorce decree granted the non-military spouse a portion of "all Army Retirement Pay or Military Retirement Pay" that the service member might receive.  The decree did not mention Veteran's Administration disability benefits or contemplate that the former husband's military retirement pay would be reduced if the husband became disabled and opted to receive Veteran's Administration disability benefits in lieu of military retirement pay.  Accordingly, the Court upheld the reduction in payments to the ex-wife caused by the ex-husband's decision to accept Veteran's Administration disability benefits.

Had the decree in Hagen read like the one in Berry, the result in Hagen would have been the same as in Berry.  But those crucial few words were missing, so the result was different. 

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In Martin v. Martin, the Dallas Court of Appeals ruled that a trial court had erred by granting summary judgment that a marital property agreement was valid. The wife admitted she had signed the agreement, but she said she had signed involuntarily. The court remanded the case to the trial court for further proceedings.

One of the defenses to the validity of a marital property agreement is that "the party did not sign the agreement voluntarily." Tex. Fam. Code § 4.105. An action is taken "voluntarily" when it "is taken intentionally or by the free exercise of one's will," said the court.

This case is notable because of the facts it relied upon to conclude that the wife had signed the agreement involuntarily. In short, the husband told the wife that the agreement was necessary "to protect the family's assets from possible financial ruin in the event of litigation against the business" and that he had no intention of divorcing her.

The wife's attorney advised her not to sign the agreement. The husband

constantly threatened that the family would be financially ruined and would have nothing if [the wife] did not sign the agreement. When [the wife] tried to discuss her attorney's concerns with [the husband], he became outraged and called [wife's attorney] “incapable,” “unqualified,” and insisted that [the wife] ignore [the attorney's] advice. [The wife] said that she had no choice but to sign the agreement because her sole concern was the welfare of the family.

Some years later, the husband filed for divorce. On these facts (as fleshed out in the court's opinion), the Dallas Court of Appeals concluded there was some evidence that the wife signed the agreement involuntarily.

This case appears inconsistent with cases such as Sheshunoff v. Sheshunoff, in which the Austin Court of Appeals held that a husband had voluntarily signed a marital property agreement even though his wife threatened to withdraw her guarantee of his bank loan, which would ruin the husband's business by causing the bank to call its line of credit, if the husband refused to sign; and Nesmith v. Berger, in which the same court upheld a marital property agreement where a husband refused to go on the couple's honeymoon unless the wife signed the agreement. The Dallas Court cited, but did not distinguish, Sheshunoff; the court neither cited nor distinguished Nesmith.   

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Justice Rose Vela of the Corpus Christi Court of Appeals has authored a Memorandum Opinion in which she thoroughly and lucidly discusses contempt of court. The opinion is linked below, but here are some of the statements of law it contains:

• A judgment of contempt may be either civil or criminal.
• The purpose of civil contempt is remedial and coercive. A judgment of civil contempt exerts the judicial authority of the court to persuade the contemnor to obey an order of the court when obedience will benefit an opposing litigant. Imprisonment is conditional upon obedience and therefore the civil contemnor "carries the keys of (the) prison in (his) own pocket." When a relator has committed civil contempt, he may procure his release by complying with the provisions of the court's order.
• Criminal contempt, by contrast, is punitive in nature in that the sentence is not conditioned upon a promise of future performance; rather, the contemnor is being punished for a completed act that affronted the dignity and authority of the court.
• Texas law is clear that a petitioner may not be confined for civil contempt unless he or she has the ability, but refuses, to perform the conditions for release. Stated otherwise, a person cannot be incarcerated indefinitely for civil contempt if he or she does not have the ability to perform the condition required for release. An order of contempt imposing a coercive restraint is void if the condition for purging the contempt is impossible of performance. Similarly, the involuntary inability to comply with an order is a valid defense to criminal contempt.
• The relator bears the burden of proving his inability to comply. We do not weigh the evidence, but determine only if there is no evidence to legitimize the relator's confinement. Thus, the issue in habeas corpus review is whether the relator has conclusively established his inability to comply.

In this case, the relator (the person held in contempt) was imprisoned for failure to pay child support. To avoid a finding of contempt, a child support obligor who fails to pay must prove that he or she:

(1) lacked the ability to provide support in the amount ordered;

(2) lacked property that could be sold, mortgaged, or otherwise pledged to raise the funds needed;

(3) attempted unsuccessfully to borrow the funds needed; and

(4) knew of no source from which the money could have been borrowed or legally obtained.

Tex. Fam. Code Ann. § 157.008(c). All four elements must be proved.

Because the relator did not prove these elements in the trial court, the Corpus Christi Court of Appeals denied his petition for writ of habeas corpus and left undisturbed his 180-day jail sentence. Ex parte Coronado, No. 13-09-00149-CV (Tex. App. - Corpus Christi Apr. 9, 2009).

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Often, after divorce, a former spouse moves the court to increase or to decrease child support. When this occurs, Texas Family Code section 156.401(b) states that when the court ultimately makes a ruling on the modification, the modification can be made to take effect as of the date citation was served in the motion to modify or the date the opposing party appeared in that suit. In other words, the increased or decreased amount of child support can be made payable as of a date in the past.

In In the Interest of R.C.T., the Texas Attorney General moved a trial court to increase the amount of child support a former husband must pay. In September 2006, the trial court ordered that as of April 2005, the former husband's child support should be increased to $1,340 from $828 per month. The trial court calculated that the amount of retroactively unpaid child support from April 2005 to September 2006 equaled $9,024. The trial court ordered the former husband to pay this $9,024 at the rate of $150 per month on top of the new child support amount of $1,340 monthly.

The Attorney General then filed a child support lien for the $9,024 in unpaid child support.* The Attorney General also requested the Treasury Department to withhold the former husband's anticipated federal income tax refund of $3,839 and pay it in partial satisfaction of the $9,024.

The former husband appealed. He argued that (1) the child support lien could not issue because the $9,024 was not "due and owing" as required under the child support lien statute; and (2) his federal income tax refund could not be intercepted because the $9,024 was not "past-due support" under federal law. Both positions were based upon the trial court's order that the $9,024 would be paid at $150 per month.

Houston's Fourteenth Court of Appeals ruled against the former husband on the first issue but for him on the second one. The court reasoned that the $9,024 was "due" because "it is an amount that is presently enforceable." The $9,024 was "owing" because, in fact, the former husband did owe the money. Thus, the child support lien could issue.

On the second issue, the Fourteenth Court of Appeals held that "past-due support" under federal law means that child-support payments are "delinquent." The court followed the lead of a Pennsylvania decision which held that "the federal intercept program does not encompass situations where a parent has continually complied with his child support obligation, but where, nonetheless, arrearages are created as a result of the retroactive effect of an order of support." Therefore, the Attorney General could not intercept the former husband's federal income tax refund and apply it to the $9,024.

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* Why, one might ask, would the Attorney General take this action when the trial court had ordered this $9,024 paid at $150 per month? This is a subject for another post, but suffice it to say that the Attorney General's Office has taken an wide-ranging view of its powers to collect child support.

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When parents are divorced, almost invariably the children stay together if there is more than one minor child. In other words, if one parent has custody of one of the children, that parent almost always has custody of all the children. As the Third Court of Appeals wrote in Stoufflet v. Stoufflet, "There is a long line of jurisprudence in Texas that supports keeping siblings together in the same household absent clear and compelling reasons for separating the children." But once in a while, a court will separate siblings.

Stoufflet is one of those cases. The facts of the case are awful. There were three children, a daughter age 15 and two sons, age 12 and 9, as of the date of the court of appeals' decision. The mother said she left the father after she discovered the youngest child viewing sadomasochistic pornography on a laptop the father gave the child. The mother said she found both sadomasochistic pornography, as well as pornography involving bestiality, on the family desktop computer. The father admitted he viewed sadomasochistic pornography but denied viewing pornographic bestiality. He said he had attempted, but failed, to erase the images from the computer memories.

During the weeks and months following the separation, the mother claimed that the children began to recover memories of abuse by the father. This abuse was said to include choking, pushing, hitting and kicking the children; sexually abusing the two boys; physically and sexually abusing family pets in front of the children; drugging and sexually abusing the mother while she was unconscious; and torturing and killing two young boys in front of two older children and their paternal grandmother. The father denied all allegations of abuse.

Although the testimony at trial was conflicting, much of it concerned the mother's state of mind. The court of appeals observed:

The trial court heard evidence that all three children were harmed by their mother's paranoid delusions and by her practice of speaking ill of the father in front of the children. . . .  The trial court also heard testimony from [the youngest child's] therapist that [the youngest child] needed to be immediately removed from the continuing allegations that permeated his mother's home.

The court of appeals affirmed the trial court's decision that the father should have custody of the youngest child and the mother custody of the older two children:

Based on the evidence before it, the trial court could have reasonably concluded that [the youngest child] would face future emotional danger if he continued to live with his mother and siblings whereas [the older children] would face future emotional danger if they were removed from their mother's care, and that the only way to serve the best interests of all three children was to separate them. Therefore, we conclude that the trial court could have found clear and compelling reasons to separate the children and we overrule [the mother's] first point of error.

One hopes these children will recover from this ordeal.

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This is a case of an interesting idea that didn't work. The community estate owned all the shares in the husband's machine shop. When the wife filed for divorce, the husband transferred 49% of the stock to an employee. The parties entered into a mediated settlement agreement that reserved for trial the issue whether the stock transfer had been fraudulent.

Texas community property law is clear that all property acquired during marriage is community property. Absent exceptions not applicable here, this is true even when the property is titled in the name of only one of the spouses. In this case, the husband held title to all the stock.

At trial - which the Eastland Court of Appeals described as "basically a swearing match between [the husband] and [the employee] on the one hand and [the wife] on the other" - the husband and the employee claimed that the husband transferred the stock to the employee so that the employee would not quit. No money changed hands. The wife agreed that there had been some discussion about giving the employee some of the stock but not 49% of it. The trial court found that the stock transfer was "grossly unfair to the community estate."

The interesting idea? Texas Family Code § 3.102 explains that "each spouse has the sole management, control, and disposition of the community property that the spouse would have owned if single." To paraphrase Texas Family Code § 3.104, a third person who purchases sole management community property from the sole-management spouse takes the property as against the other spouse unless there is fraud involved. The husband argued to the court that section 3.104 authorized him to transfer the stock without the wife's consent.

The court would have none of the husband's argument: "We do not agree that Section 3.104 authorized him to act without [the wife's] consent. As a director, [the wife] was entitled to participate in a decision of this magnitude affecting [the company]. She was entitled to be consulted before [the husband] conveyed almost one-half of their principal company for no consideration."

At the end of its opinion, the court remarked: "This divorce needs to be concluded." Wright v. Wright, No. 11-07-00169-CV (Tex. App. - Eastland Mar. 26, 2009).  

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Collaborative Law:  Two Day Basic Training

by Janet P. Brumley

About the Program:  This two day basic training will cover interest based negotiation, a comparison and contrast of collaborative practice with litigation and mediation, an introduction to the Protocols of Practice for collaborative professionals and techniques for effective practice.  It is open to lawyers, mental health professionals and financial professionals, but is geared primarily toward lawyers.

Dates:  April 23 & 24     May 21 & 22     June 25 & 26

(Begins promptly at 9:00 a.m. and ends at 5:00 p.m. each day)

Location: 3131 Turtle Creek Blvd., Penthouse Suite, Dallas, Texas 75219

Cost:  $500.00 per person - ** Limited to 10 Enrollees for maximum interaction (Cost must be paid upon reservation and is refundable if canceled at least seven days prior to seminar)

About the Trainer:  Janet P. Brumley is the author of Divorce Without Disaster; is board certified in family law by the Texas Board of Legal Specialization; has practiced law for 25+  years in Dallas County, Texas; is a frequent presenter on collaborative law at professional continuing education seminars; is a member of the committee that drafted Texas Collaborative Law Protocols of Practice for Lawyers; has served as chairperson of Dallas Alliance of Collaborative Family Lawyers; was selected as a Texas Super Lawyer and Top 50 Women Attorneys in Texas; has been selected by her peers to be included in The Best Lawyers of America 2007; has conducted collaborative law training in Dallas, Houston and Fort Worth; attended Harvard Law School Advanced Negotiation Workshop; is a member of International Alliance of Collaborative Professionals, Texas Collaborative Law Institute, Dallas Alliance of Collaborative Lawyers and the American Academy of Matrimonial Lawyers.

Please contact Becky Borders to enroll or for further information. 214.526.5234 or bborders@vernerbrumley.com 

The San Antonio Court of Appeals affirmed a trial court's dismissal of all claims in a divorce case except for the granting of the divorce itself. The trial court did not consider conservatorship, possession and access, child support or property division. The trial court stated that it lacked subject-matter jurisdiction over these claims because the wife and child lived in Italy and the parties' property was "not located within the court's jurisdiction."

The court of appeals affirmed the trial court's ruling. But the court of appeals discussed the case in terms of personal and subject-matter jurisdiction when it really was discussing "status" jurisdiction. What is status jurisdiction? A state always has jurisdiction to determine the marital status of its residents, even when a resident's spouse cannot be located or served. This principle holds true even though the court has no jurisdiction to divide marital property, adjudicate custody disputes, award alimony, or require the payment of child support. Because a court might not have the power to grant all relief sought or needed in a divorce case, the case is said to be "divisible."

The "divisible divorce" is rooted in a hoary old United States Supreme Court case called Pennoyer v. Neff, 95 U.S. 714 (1878). The Texas Supreme Court most recently applied the doctrine in Dawson-Austin v. Austin, 968 S.W.2d 319 (Tex. 1998), cert. denied, 525 U.S. 1067 (1999), where the husband moved to Texas to file for divorce while the wife remained in California. The Texas Supreme Court held that the trial court had jurisdiction to grant the husband a divorce but not to divide the parties' property.

Thus, the San Antonio Court of Appeals reached the correct result (assuming that Texas had no jurisdiction over any of the parties' property, including intangible property such as a bank account), but the opinion might have been more clear had the court analyzed the case in terms of status jurisdiction and the divisible divorce.

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