Ruben Gamez Hernandez v. Claudia C. Hernandez ( 2009 )

i i i i i i
MEMORANDUM OPINION
No. 04-08-00709-CV
Ruben Gamez HERNANDEZ,
Appellant
v.
Claudia C. HERNANDEZ,
Appellee
From the County Court at Law No. 2, Webb County, Texas
Trial Court No. 2007-CVH-001769-C3
Honorable Jesus Garza, Judge Presiding
Opinion by: Steven C. Hilbig, Justice
Sitting: Rebecca Simmons, Justice
Steven C. Hilbig, Justice
Marialyn Barnard, Justice
Delivered and Filed: June 3, 2009
AFFIRMED
This is an appeal from a final decree of divorce. In a single point of error, Ruben Gamez
Hernandez contends the trial court abused its discretion in dividing the marital estate. We affirm the
trial court’s judgment.
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BACKGROUND
After almost twelve years of marriage, Ruben filed for divorce. Claudia answered and filed
a counter-petition for divorce. Ruben subsequently filed a first amended petition for divorce. Each
petition listed insupportability as grounds for divorce. A trial to the court was held on April 22,
2008. The only disputed issue was the division of the marital estate. Ruben and Claudia were the
only witnesses who testified. The trial court rendered a final decree of divorce and signed findings
of fact and conclusions of law at Ruben’s request. Claiming an improper division of the marital
estate, Ruben filed a notice of appeal.
On appeal, Ruben argues the trial court erred in failing to award him fifty percent “of the
equity and/or enhanced value” of a house, which was determined by the trial court to be Claudia’s
separate property.1 He claims the value of the house was enhanced through the use of community
funds. Ruben thus contends he was denied his right of reimbursement. He further argues the trial
court erred in requiring him to assume and pay off a $7,000.00 loan Claudia took out during the
pendency of the divorce. He contends placing this liability on him “is totally without justification.”
ANALYSIS
Standard of Review
A trial court is charged with dividing the martial estate in a “just and right” manner. Gardner
v. Gardner, 229 S.W.3d 747, 756 (Tex. App.–San Antonio 2007, no pet.); see TEX . FAM . CODE ANN .
1
… Ruben has not raised an issue contesting the trial court’s characterization of the house as separate property.
In fact, he incorrectly states in his brief that the trial court’s ruling does not “show how the court characterized the house
in question.” In its findings of fact and conclusions of law, the trial court concluded the house was Claudia’s separate
property. It is undisputed the house belonged to Claudia’s parents, and that after the death of Claudia’s father and during
the marriage of Ruben and Claudia, Claudia’s mother transferred the property to Claudia by gift deed. Property acquired
during marriage by gift is separate property. Long v. Long, 234 S.W .3d 32, 34, 37 (Tex. App.–El Paso 2007, pet.
denied). Therefore, even if Ruben’s brief could be construed as raising an issue contesting the characterization of the
house as separate property, the issue would be decided against him.
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§ 7.01 (Vernon 2006). In dividing the marital estate, the trial court is not required to divide it
equally, but may order an unequal division when a reasonable basis exists for doing so. Murff v.
Murff, 615 S.W.2d 696, 698-99 (Tex. 1981); Gardner, 229 S.W.3d at 756; Prague v. Prague, 190
S.W.3d 31, 41 (Tex. App.–Dallas 2005, pet. denied). We will not disturb a trial court’s division
absent a clear abuse of discretion. Tenery v. Tenery, 932 S.W.2d 29, 30 (Tex. 1996); Lifshutz v.
Lifshutz, 199 S.W.3d 9, 18 (Tex. App.–San Antonio 2006, pets. denied). There is no abuse of
discretion if the trial court’s decision is based on conflicting evidence. In re Barber, 982 S.W.2d
364, 366 (Tex. 1998) (orig. proceeding). We will “consider every reasonable presumption in favor
of the proper exercise of discretion by the trial court in dividing the community estate.” McSweeney
v. McSweeney, No. 04-06-00461-CV, 2007 WL 247677, at *2 (Tex. App.–San Antonio Jan. 31,
2007, no pet.) (citing Murff, 615 S.W.2d at 699; Prague, 190 S.W.3d at 41). The trial court’s
discretion in deciding and evaluating a reimbursement claim is just as broad as its discretion in
dividing the marital estate. Penick v. Penick, 783 S.W.2d 194, 198 (Tex. 1988).
Reimbursement
Ruben claims the trial court erred in its property division because he was not awarded fifty
percent of the equity or enhanced value of the house in which the couple resided during marriage.
Ruben in essence argues he was entitled to a reimbursement for community funds and effort
expended on enhancing the value of Claudia’s separate property.
The testimony established that after their marriage Ruben and Claudia moved into a house
belonging to Claudia’s parents. The couple lived in the house “rent free” during the entirety of the
marriage except for a six-month period at the inception of the marriage. Claudia testified they were
excused from paying rent in exchange for maintaining the house and paying the taxes. Ruben
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disputed the existence of any such agreement, testifying they moved in at Claudia’s insistence so she
could care for her parents.
After Claudia’s father died, the house passed to her mother. At some later point, the mother
transferred the house to Claudia by gift deed, but reserved a life estate in the house. Fee simple title
to the house did not vest in Claudia until her mother’s death. See Enserch Exploration, Inc. v.
Wimmer, 718 S.W.2d 308, 310 (Tex. App.–Amarillo 1986 writ ref’d n.r.e.) (holding life tenant is
entitled to exclusive possession and control of property comprising life estate and remainderman is
not entitled to possession until life estate terminates); Potka v. Potka, 205 S.W.2d 51, (Tex. Civ.
App.–Waco 1947, writ ref’d n.r.e.) (holding that where mother conveyed property to daughters,
reserving in herself a life estate, daughters or their heirs became cotenants in property immediately
upon mother’s death). In 2005, Claudia’s mother took out a $57,000 loan, using the house as
collateral. The parties agree that $18,000 of the loan proceeds was used for improvements to the
house, $4,000-$5,000 to pay taxes on the house, and the remaining money was used by Ruben and
Claudia for items including vehicles, clothes, trips, etc. The parties apparently agreed Ruben and
Claudia would be responsible for the loan because the money was for their benefit. Claudia testified
the $18,000 expended for home improvements was for the couple’s benefit – to enable them to
comply with the agreement to maintain the house and pay the taxes in exchange for not paying rent.
Ruben testified that before the loan was taken out, he had already made improvements to the
house and the grounds. He claimed he paid someone to make repairs on the home, including
replacing windows and doors, decorating with “custom rocks,” and adding a room. Ruben also
testified he made improvements to the floors, the kitchen, the porch, and the garage. Claudia agreed
Ruben paid for “a little bit of repairs” “out of his pocket,” but testified her mother’s money was also
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used for these pre-loan repairs. The only testimony about the value of the property came from
Ruben. He stated that when he and Claudia moved into the house it was worth “about $60,000.”
When asked about the value of the house after the remodeling, but before the loan, Ruben stated the
loan company valued it at $90,000.
Reimbursement claims are equitable claims that arise when the funds or assets of one estate
are used to benefit and enhance another estate without the financing estate receiving some benefit
to itself. Vallone v. Vallone, 644 S.W.2d 455, 458-59 (Tex. 1982); Garza v. Garza, 217 S.W.3d 538,
546 (Tex. App.–San Antonio 2006, no pet.). A right of reimbursement also arises when the
community receives inadequate compensation for the time, talent, and labor it used to benefit or
enhance one spouse’s separate estate beyond whatever care and expenditures were necessary to
maintain and preserve it. Id. A reimbursement claim is measured by the enhancement value to the
benefitted estate. Anderson v. Gilliland, 684 S.W.2d 673, 675 (Tex. 1985). Enhanced value is
determined by “the difference between the fair market value before and after any improvements
made by the community during the marriage.” Vickery v. Vickery, 999 S.W.2d 342, 371 (Tex. 1999);
Garza, 217 S.W.3d at 546. This measurement is applied whether the situation involves the payment
of a purchase money debt or a capital improvement. Penick, 783 S.W.2d 197; Garza, 217 S.W.3d
at 546.
However, in deciding the value of a claim for reimbursement, the benefits to the payor estate
must be offset against the benefits to the payee estate. Id. In other words, the trial court should not
merely return to the spouse seeking reimbursement the actual amount advanced without regard to
the benefits that spouse might have received by virtue of the advancement. Id. The trial court should
also consider “all the facts and circumstances and determine what is fair, just, and equitable.”
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Penick, 783 S.W.2d at 197. And, it is not simply a “balancing of the ledgers between the marital
estates.” Id. at 198.
Ruben, as the party claiming reimbursement, bears the burden of establishing his claim. See
Garza, 217 S.W.3d at 546. This burden includes establishing the net benefit to Claudia’s separate
estate, Vallone, 644 S.W.2d at 459, and the offsetting benefit to the community estate. Gutierrez v.
Gutierrez, 791 S.W.2d 659, 665 (Tex. App.–San Antonio 1990, no writ).
Ruben has not sustained his burden. He testified that when they moved into the house in
1996 it was valued, in his estimation, at $60,000, and that after he expended funds for improvement
but before Claudia’s mother received the loan in 2005, the loan company valued it at $90,000. He
did not establish the net benefit to Claudia’s separate estate nor the offsetting benefit the
improvements bestowed on the community estate. It is undisputed that Ruben and Claudia lived in
the house without paying rent for almost the entirety of their marriage. This certainly benefitted the
community – it was not required to pay for housing for the duration of the marriage. And, given that
Ruben and Claudia lived in the house after Ruben’s improvements, it was to their benefit to make
it livable and comfortable. Moreover, Claudia testified Ruben expended only “a little bit” money
on the improvements, and her mother’s money was also used to pay for the home improvements.
These were facts and circumstances the trial court was entitled to consider in determining what was
fair and equitable with regard to Ruben’s reimbursement claim. See Penick, 783 S.W.2d at 197;
Garza, 217 S.W.3d at 546. Accordingly, we hold the trial court did not abuse its discretion in failing
to award Ruben reimbursement monies for improvements he allegedly made to the house.
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Unjust Division
Ruben also contends the trial court erred in ordering him to assume the $7,000 loan taken out
by Claudia during their separation. In his brief, Ruben states the ruling was “totally without
justification.” He argues that because the trial court made temporary orders requiring him to pay
Claudia $400 a month for four months as temporary spousal support, and there was no pleading or
evidence he was in contempt of that order or any evidence on the issue of continued spousal support,
there was no basis to support the court’s order that he assume the debt.
We begin by noting there is no indication in the record the trial court ordered Ruben to
assume the debt based on contempt of any temporary order, nor is there anything to support his claim
that the trial court ordered him to assume the debt as spousal support. Rather, the trial court found
the loan was a community debt and, the final decree, which divides the property, simply orders
Ruben to assume the debt as part of the division of the marital estate. We must therefore determine
if the trial court’s division was disproportionate and if so whether it constituted a clear abuse of
discretion according to the “just and right” standard, not whether it erred in ordering Ruben to pay
the debt based on contempt or spousal support.
An evaluation of a trial court’s “just and fair” division typically begins with the values of the
various marital assets. Redeaux v. Redeaux, No. 09-06-084-CV, 2007 WL 274728, at *4 (Tex.
App.–Beaumont Feb. 1, 2007, pet. denied) (mem. op.). Here, however, the record does not include
the value of many of the marital assets such as: an industrial drill, two washer and dryer sets, three
air conditioner units, an aquarium, a desk, items and cash in the parties’ sole control, two computers,
two bedroom sets, a wooden dining room set, a filing cabinet, two flat-bed trailers, the furniture in
Claudia’s house, and a mini bar. Nor is there any evidence in the record about the parties’ credit card
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indebtedness, though the final decree references such debt. Absent these valuations, Ruben cannot
demonstrate from the record that the trial court erred in its division of the marital estate, including
the order that he assume the $7,000 loan. See McSweeney, 2007 WL 247677, at *2 (holding party
who complains of trial court’s division must demonstrate from evidence in record that division was
so unjust as to be abuse of discretion); Prague, 190 S.W.3d 41 (same). Without such evidence we
cannot say the division of the marital estate was disproportionate, much less an abuse of discretion.
See Redeaux, 2007 WL 274728, at *4.
However, assuming the division was disproportionate and favored Claudia, we still cannot
hold the trial court abused its discretion. Only the parties testified at trial. Claudia testified she did
not work until about a month before the final hearing and had to take out the loan for her subsistence
during the pendency of the divorce. According to Claudia, without the loan she would have lost the
house because it was used to collateralize the $57,000 loan taken out by her mother in 2005. It
appears from the record that Ruben supported himself during the separation by working as a school
bus driver and by operating a body shop in which Claudia claimed in interest. Ruben only paid
Claudia two months of the court-ordered temporary spousal support, which amounted to $800,
despite having been ordered to pay her four months of temporary spousal support, which would have
amounted to $1,600.
We hold the trial court, which was the sole judge of the credibility of the witnesses, did not
abuse its discretion in ordering Ruben to assume the $7,000 loan, even if it resulted in an unequal
division of the marital estate. See Murff, 615 S.W.2d at 700 (noting trial court in divorce case has
opportunity to observe parties on stand and determine credibility); see also City of Keller v. Wilson,
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168 S.W.3d 802, 819 (Tex. 2005) (holding reviewing court cannot impose own opinions on
credibility of witnesses and weight to be given their testimony contrary to those of fact finder).
CONCLUSION
We hold Ruben has not established the trial court clearly abused its discretion. Accordingly,
we overrule his issue and affirm the trial court’s judgment.
Steven C. Hilbig, Justice
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