| Texas is a community property state. That means that upon divorce, all
property acquired during the marriage is presumed to
belong to the parties’ marital estate, even if the title to the property is
placed only in the name of one of the parties.
COMMUNITY PROPERTY PRESUMPTION
All property on hand at the time of
divorce is presumed to be community property. A divorcing party may only overcome this community property presumption by
presenting clear and convincing evidence that the property is his
or her separate property.
Separate property is the separate property of one spouse only
if the property was:
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owned or claimed before marriage
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acquired as a gift
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received as proceeds or income from a gift from one spouse to the other
spouse
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received by inheritance
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partitioned between the parties in a pre-marital or post-marital partition
agreement
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recovered for personal injuries (not including loss of earning capacity
during marriage)
The characterization of property as either
separate or community is one of the few issues that can be decided by a jury if
a party requests a jury trial. Characterization involves proving when and how
the property was acquired, and it may also involve tracing the property, if
separate property was mixed with community property or if separate property
money or assets were used to purchase other assets. If part of the purchase price was paid with other funds or
if
improvements on the property were made with other funds, such payments or
improvements may result in a claim for reimbursement, but it does not
change the character of the property.
The distinction between separate and community property is important because
a divorce court can only divide the community property and cannot give one party
property that is clearly the separate property of the other spouse. After the
characterization of property is decided, the Judge has broad discretion to
divide the community property between the spouses in any manner that the Judge
determines is "just and right."
A just and right division does not have to be
equal. Texas law allows the Court to consider many in
determining a just and right division. Among them are:
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benefits the innocent spouse may have derived from the continuation of the
marriage;
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disparity of earning power of the spouses and their ability to support
themselves;
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education and future employability of the spouses;
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tax consequences of the division of property;
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nature of the property involved in the division;
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wasting of community assets by the spouses;
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gifts to or by a spouse during the marriage;
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reimbursement claims;
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attorney’s fees to be paid; and
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any other factor the judge deems to be important.
In addition to dividing community property assets, the Judge will also divide
the marital liabilities (debts) in a manner the court believes is just and
right. Courts will normally assign to each party any debts that are held solely
in that person’s name. In most cases, however, many of the debts are held
jointly in both parties’ names. Since those creditors are not parties to the divorce
case, the divorce assignment of the debt to one spouse does not relieve
the other spouse from liability for the jointly held debts. If the spouse who
was assigned the debt does not pay it, the creditor may still be able to pursue
payment from both parties. If a creditor takes legal action against the parties
after divorce, a post-divorce enforcement lawsuit may be needed for
reimbursement from the spouse who failed to pay the assigned debt.
A family law specialist attorney is needed for complex
property disputes and will help you determine the value of assets, your cash
flow needs, and the tax consequences of property division alternatives.
Contact an experienced family law attorney at The Guerra Law Firm to help you
resolve your disputes about marital property and to help you arrive at a fair
property division.
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