Division of Marital Property Upon Divorce Flashcards
Court-ordered Alimony not valid in TX
TX does not recognize court-order alimony for the support of a spouse after the divorce
An agreement between the parties for contractual alimony is valid and may be incorporated in to the court order
Court may order period future payments for property that is not easily divisible
A alimony judgment from another state is enforceable in TX via the full faith and credit clause
*Prerequisites for receiving spousal maintenance
The court may order maintenance for either spouse if the spouse seeking maintenance will lack sufficient property, including the spouse’s SP, on dissolution of the marriage to provide for the spouse’s minimum reasonable needs and:
Four Options:
10+ Year Marriage: The spouses were married for 10 or more years and the spouse seeeking maintenance lacks the ability to earn a sufficient income to meet her minimum reasonable needs. Also, a spouse seeking maintenance under this method must show diligence in seeking employment or obtaining special training.
Family Violence:The spouse ordered to pay maintenance (obligor) was convicted of family violence or deferred adjudication during the marriage or within the past 2 years against the spouse or the spouse’s child.
Spousal Disability: The spouse seeking maintenance is unable to earn a sufficient income to provide for her minimum reasonable needs because of an incapacitating physical or mental disability.
Child Disability:The spouse seeking maintenance is the custodian of a child who requires personal supervision and substa
*Spousal Maintenance Amount Limitation
The amount of spousal maintenance may not exceed the lesser of $5,000 per month or 20% of the obligor spouse’s monthly gross income
*Factors to be considered in setting maintenance amounts
- each spouse’s ability to provide for his or her minimum reasonable needs independently
- education and employment skills of the spouses
- duration of the marriage
- age, employment history, earning ability, and physical emotional condition of the spouse seeking maintenance
- excessive or abnormal expenditures or destruction, concealment or fraudulent disposition of CP
- the contribution by one spouse to the education, training, or increased earning power of the other spouse
- the property brought to the marriage by either spouse
- the contribution of a spouse as a homemaker
- marital misconduct
- any history or pattern of family violence
*Diligence in earning sufficient income
There is a rebuttable presumption that maintenance is not warranted when spouses have been married for 10+ years unless the spouse seeking maintenance has exercised diligence in earning sufficient income to provide for his or her minimum reasonable needs during the separation
*Duration of maintenance order - 5 years
No more than 5 years if:
- the spouses were married to each other for less than 10 years and eligibility is under family violence requisite; or
- the spouses were married to each other for at least 10 years but not more than 20 years
*Duration of maintenance order - 7 years
No more than 7 years if:
1) the spouses were married to each other for at least 20 years but no more than 30 years
*Duration of maintenance order - 10 years
No more than 10 years if: the spouses were married for 30 years or more
*Durational General Rule
Courts are usually required to limit the duration of maintenance to the shortest reasonable period that allows the spouse seeking maintenance to earn sufficient income to support their needs
Shortest reasonable time will not apply if 1) spouse has a physical or mental disability, 2) has duties of the custodian of a child, or 3) another compelling impediment to earning (but can still not exceed caps)
generally not allowed for spousal maintenance to be ordered for an indefinite time
*Termination of maintenance order
on death of either party, on remarriage of the spouse seeking maintenance, or if the spouse seeking maintenance cohabits with another person who they have a dating or romantic relationship with
*Downward Modification of maintenance order
Paying spouse may seek a reduction if there is a material and substantial change in circumstances
Can be decreased but not increased
Affirmative Defenses to not paying maintenance
To avoid contempt:
1) payee lacked ability to pay the amount ordered
2) payee lacked property needed to support, raise the funds needed to support
3) payee attempted unsuccessfully to borrow the funds, AND
4) did not know of a source for which the money could have been borrowed or otherwise legally obtained
*Just and Right Division of Community Property
upon divorce, court must divide the CP (but not SP obv) as it deems just and right; court has wide discretion to do so subject to rules
This does not mean that the division must be equal
Presumption that trial court properly exercised its discretion. Will only be reversed if finding the it was manifestly unjust
*Factors court considers for “Just and Right” division
-Disparity of income and earning capacities,
- relative business opportunities, financial conditions, and obligations
- relative education and abilities
- physical conditions,
- size of each parties SP,
- length of marriage
- whether one party wasted community assets
Income during year of divorce is separate property if spouses agree
On written agreement of the spouses, the court may treat income in the year in which the divorce took place as SP, so that the divorcing spouses can file separate tax returns for the entire year
No tort cause of action for wasting or depleting community assets
Instead this will be factored into when determine the “Just and Right” division
Acceptance of Benefits
Under the acceptance of benefits doctrine, a litigant may be estopped from appealing a judgment after voluntarily accepting its benefits
If party accepts benefits due to financial distress not intent to accept the benefits
Quasi Community Property
Is property that is acquired while the couple was domiciled in another state that would have been CP if acquired under the same circumstances in TX
Such property is subject to the “just and right” equitable division power upon divorce under the same rules that apply to CP
Division on divorce- treated as CP
Division at death- treated as SP
Property not subject to division
- good will of professional practice
2. professional degrees
Lifetime Gifts
Either spouse has an unrestricted power to make gifts or her separate property without the other spouse’s consent
One spouse can give his one-half CP interest in an asset to the other spouse, making the asset the donee spouse’s SP
One spouse allowed to make “reasonable”gifts of community property without the other spouse’s consent and participation - unless fraud
Illusory Trust
If one spouse uses CP to create a revocable trust and also retains the power to control the trustee in selling, encumbering, and investing the trust assets, the trust is illusory and can be set aside by the other spouse
Property Acquired during Bigamous marriage
1/2 of the property acquired during a second marriage is the CP of the 1st spouse and the twice-married spouse. The other half of such property belongs to the second spouse, unless the 2nd spouse know of the preexisting marriage, in which case all the property would simply be the CP of the 1st marriage
*if asset is a business entity, what can other party show to get a piece of it if it is separate property?
pierce the corporate veil (use the closely held business interests)
- Statute of Limitations for Enforcing the Just and Right Division of Property
No SOL for clarify order dividing property
Enforcing judgments: 10 year SOL
when statute calls for payment to be made upon certain conditions being met, SOL begins when each payment is due
2-year SOL applies to enforcing the division of tangible personal property in existence at time of the divorce.
2-year SOL for for enforcing the division of future property from the date the right of property matures.
*Temporary Orders Pending Appeal
After notice and hearing, court can make temporary orders while an appeal is pending to protect property and persons
e.g. order support payments give one party exclusive access to residence,
Court can modify its temporary order if the circumstances of one party have materially and substantially changed and the modification is equitable and necessary to protect property or persons.
*Revising Divorce Decree (just and right division of property)
A divorce decree is final as far as disposition of property and is not subject
to modification.
- Community Property Not Partitioned In Divorce (e.g. parties forgot to include it in their inventories or appraisals so judge could partition)
if community is not properly partitioned in the court proceeding is subject to just and right equitable division in a later proceeding (NOT a revision of the original proceeding)
Action to divide the property must be brought within two years after the other spouse repudiates the community ownership claims.
*Presumption of Community Property upon Just and Right Division
on dissolution of marriage, there is a presumption that whatever assets are on hand are community property.
- If party asserts that something is separate property (or separate property to just that person instead of separate property to both spouses; e.g. gift), it must prove that by clear and convincing evidence.
- Generally, for funds in an account, this is done by tracing funds back to amounts held before marriage or received through gift or inheritance.
*Can court offset reimbursement claims with child support?
No. Court cannot consider child support in determining what a just and right division of the community property is.
