When dividing property in divorce proceedings, courts will distinguish between separate property and community property. Separate property represents any property or assets that one person has held since before they were married. Conversely, community property constitutes property or assets shared between spouses. Typically, only community property is subject to division among the former spouses. Texas courts presume that property either spouse possesses during marriage or upon the end of the marriage is community property. To overcome this presumption, a spouse must present clear and convincing evidence that they held the property separately. A recent decision from the Texas Supreme Court shows the importance of presenting adequate evidence of separate property to avoid division following a divorce.
Facts of the Case
As the Texas Supreme Court opinion explains, the Wife filed for divorce after 14 years of marriage. At trial, the Husband presented evidence that two investment accounts in his name existed before his marriage. Specifically, an expert witness testified that the Husband did not mix his accounts with community property. The expert further testified about a four-month gap in the investment statements he received. However, he concluded that the missing statements did not detract from the “established pattern of activity” over 15 years. Agreeing with the expert, the trial court found that the accounts were the Husband’s separate property, meaning they were not subject to division.
The Wife appealed, and the appeals court reversed. First, it found “no evidence” of what happened during those four months. Based on this gap in the record, it found that the Husband’s expert could not rely on an “established pattern” of account activity to adequately characterize accounts as separate property. Therefore, it reversed that portion of the trial court’s decision and sent the case back to divide the account balances. The Husband appealed to the Texas Supreme Court.
The Court’s Decision
At the Texas Supreme Court, the Husband argued that the appeals court overlooked evidence showing that the four months of statements were in fact in the record. After reviewing the record, the Texas Supreme Court agreed, finding that the evidence included all investment statements. Rather than dispute this finding, the Wife argued that the appeals courts’ analysis turned on whether the expert reviewed the missing statements. The Texas Supreme Court rejected this argument. Instead, it found that the appeals court primarily took issue with the mistaken view that the statements were missing. Because the appeals court was incorrect, the Supreme Court sent the case back to the appeals court to address any challenges to the characterization of the investment accounts as separate property.
Speak to a Qualified Texas Family Lawyer Today
In a divorce proceeding, your former spouse may attempt to subject your separate property to division. In these situations, presenting sufficient evidence of separate property is crucial to retaining your assets. At Guest and Gray, we possess an intimate understanding of the Texas laws governing property division at divorce. Through our skills and experience, we can help you gather evidence and make a strong showing at trial that a court should not divide your separate property with your former spouse. If you have questions about property division in divorce proceedings, give us a call today or a free consultation at 972-564-4644 or use our online form.