Matrimonial Property Law – 2017 Brian L. Webb The Webb Family Law Firm Dallas, TX

The Big Four of Texas Matrimonial Property 1. The definition of Separate Property is Constitutional 2. There is a strong presumption of Community Property 3. Separate Property cannot be divested 4. Property is characterized based on Inception of Title

Briefly define Separate Property FC § 3.001 Art. XVI, § 15 TX Constitution 1) The property owned or claimed by the spouse before marriage; 2) The property acquired by the spouse during the marriage by gift, devise, or descent; and 3) The recovery for personal injuries sustained by the spouse during marriage, except any recovery for loss of earning capacity during marriage.

Appreciation of value of separate property = separate property

Income from separate property = community property

Briefly describe the Presumption of Community Property FC § 3.003 Property possessed by either spouse during or on dissolution of marriage is presumed to be community property. The degree of proof necessary to establish that property is separate property is clear & convincing evidence.

Briefly describe the concept of Inception of Title Evans v. Ingram (Waco 1926) Where title had its origin in some right acquired by a spouse before marriage, it will be deemed separate & such title, when perfected, relates back to the time of inception of such right. Likewise, if inception is during the marriage, it will be deemed community. “Acquired” when obtained a right to the property superior to all others.

Briefly describe the holdings in the Eggemeyer & Cameron cases regarding the treatment of separate property Division "of the estate" refers to the community estate only. The Court cannot divest a spouse's real or personal separate property.

Briefly describe the holding in the Marshall case regarding the effect on separate property when it is contributed to a partnership Generally stands for the proposition that when separate property is contributed to a partnership it becomes the property of that entity & therefore, since it no longer belongs to the contributing spouse, it loses its character as separate (or community) property. As a result, distributions from the partnership are community property during marriage.

What are the factors the Murff case said the court may consider in making a disproportionate division of property? Spouse's capacities & abilities; Benefits the spouse not at fault would have derived from continuation of the marriage; Business opportunities; Education;

Relative physical conditions; Relative financial condition & obligations; Disparity of ages; Size of separate estates; Nature of the property; Disparity in earning capacities.

Briefly describe the holding in the Nail case regarding personal goodwill Personal goodwill which is based on a spouse's personal skill, experience & reputation is not property subject to division on divorce. It does not possess value or constitute an asset separate and apart from that spouse's person, or from the spouse's individual ability to practice his or her profession. Personal goodwill (or its value) is not divisible on divorce.

What are the elements required to establish an informal (common law) marriage? FC § 2.401(2) Man & woman agreed to be married (presently married, not to be married later) & after the agreement, they lived together in Texas as husband and wife, and there (Texas) represented to others that they were married.

Once established, treated just as if it were a formal/ceremonial marriage & rules apply as in a formal/ceremonial marriage. Present agreement that they are married Cohabit in Texas Hold out to others (in Texas) that they are married

What are the elements necessary to create a pre-marital agreement? FC § 4.001 through 4.006 An agreement between prospective spouses made in contemplation of marriage and to be effective on marriage; Property means all property existing or to be acquired in the future (including income & earnings);

Enforceable without consideration; Becomes effective on marriage; May not adversely affect child support.

How can you show that an agreement is not enforceable as a pre-marital agreement? Not enforceable if not executed voluntarily or unconscionable AND no fair & reasonable disclosure of property or obligations AND did not waive disclosure AND did not or could not have had adequate knowledge of property or financial obligations. Burden of proof on person trying to defeat the premarital agreement.

Briefly describe the rules regarding Management, Control & Disposition of community property During marriage each spouse has the sole management, control, and disposition of the community property that he or she would have owned if single. Rights of management, control, and disposition can be altered by power of attorney in writing or other agreement (no writing required). Liability of separate & community property "generally follows management power"

Briefly describe the rules regarding Homestead exemptions applicable to real property Homestead real property is exempt from execution unless the debt sought to be enforced is for: 1) Purchase money mortgage & 2nd lien 2) Taxes 3) Valid mechanics & material means – Lien based on a written contract signed before the work began Proceeds from sale (or insurance proceeds from loss) of homestead retain exempt status for 6 months.

Briefly describe the rules regarding tracing of Separate Property Separate property can be traced through changes & mutations and still remain separate property so long as it can be clearly & indisputably traced & identified (clear & convincing).

Briefly describe the difference between a Defined Contribution Plan and a Defined Benefit Plan Defined Contribution – employee contributes and benefit received is based on those contributions. CAN BE TRACED Defined Benefit – employer contributes – get a benefit based on formula (time) with no direct contributions by employee. NOT TRACEABLE