Leticia Loya v. Miguel Angel Loya , 473 S.W.3d 362 ( 2015 )

Reversed and Remanded and Majority and Dissenting Opinions filed July 28,
2015.
In The
Fourteenth Court of Appeals
NO. 14-14-00208-CV
LETICIA LOYA, Appellant
V.
MIGUEL ANGEL LOYA, Appellee
On Appeal from the 257th District Court
Harris County, Texas
Trial Court Cause No. 2012-32502
MAJORITY OPINION
In this appeal, a wife asserts that the trial court erred in granting summary
judgment to her husband on her post-divorce proceeding to divide an employment-
related bonus the husband received nine months after their divorce. Because we
conclude that the bonus was not considered, divided, or partitioned in the divorce
proceedings and the wife raised a fact issue concerning the characterization of this
bonus, we reverse and remand for further proceedings.
BACKGROUND
Miguel Angel Loya and Leticia B. Loya married in July 1980. In April 2008,
Leticia filed for divorce. During their marriage and afterward, Miguel worked for
Vitol, Inc. As an employee of Vitol, Miguel was eligible for, but not entitled to, a
discretionary bonus:
You will continue to be considered for an annual bonus based on
various performance parameters considered by [Vitol]. Bonuses are
completely at the discretion of [Vitol] and, if paid, are typically paid
in March/April each year.
During the couple’s marriage, Miguel earned this discretionary bonus regularly.
According to Miguel, his bonus paid in 2010 was awarded to him shortly before
the divorce and was placed into a bank account that was awarded to Leticia in the
parties’ Mediated Settlement Agreement (MSA). Thus, before executing the MSA,
Miguel contends that Leticia was aware of the potential that Vitol would pay
Miguel a bonus in 2011.
On June 13, 2010, the parties signed the MSA, which also served as “an
immediate partition”:
Agreement Supersedes Prior Agreements and Serves as an Immediate
Partition. The provisions of this Agreement shall be effective
immediately as a contract, shall supersede any temporary orders or
other agreements of the parties (except the parties’ partition
agreement of September of 2009 and orders or agreements concerning
the children & trust, which shall remain in place) with respect to the
subject matter hereof, and shall serve as a partition of all property set
forth herein to the person to whom such property is awarded. All
future income of a party and/or from any property herein awarded to a
party is portioned to the person to whom the property is awarded. All
future earnings from each party are partitioned to the person
providing the services giving rise to the earnings. These partitions are
to be effective pursuant to Section 4.102 of the Texas Family Code,
and in this respect, each party waives further disclosure of property
2
and debts of the other party. Any spouse holding title to property
herein awarded or confirmed to the other spouse shall hold such
property as a constructive trustee until such time that tile or other
muniment to the property can be transferred to the spouse to whom
such property is awarded or confirmed.
(emphasis added). On June 14, Leticia presented the MSA to the trial court and
requested that it be entered. The trial court orally announced the parties’ divorce
that day on the record. The court also set an entry date and ordered the parties to
draft their final documents.
Shortly thereafter, Leticia filed a motion to set aside the MSA. In this
motion, she urged that the MSA should be set aside because there was no mutual
assent or meeting of the minds because the parties “did not reach an agreement as
to the division of . . . the community’s interest in Miguel Angel Loya’s bonus to be
paid in 2011, nearly half of which pertains to [Miguel]’s services through June 13
2010.” 1 Leticia urged that the MSA “did not address or divide the community’s
portion of the bonus.” On June 22, 2010, the trial court denied Leticia’s motion and
signed the parties’ final decree of divorce, which incorporated an agreement
incident to divorce (the AID) setting out the terms of the MSA. 2 The AID and the
divorce decree both provided that any community assets of the parties not divided
by the parties’ agreements would be subject to future division. 3 Leticia did not
appeal from the final divorce decree. 4
1
Leticia also asserted there was no division of jewelry valued at nearly $400,000 located
in Miguel’s office that was not included in his sworn inventory and appraisement.
2
Neither Leticia nor Miguel signed the decree of divorce or the agreement incident to
divorce. But the trial court found in the divorce decree that “the unsigned agreement incident to
divorce sets forth the parties’ division of property and other matters contained in their mediated
settlement agreement signed on June 13, 2010[,] and approved and rendered as a final judgment
of this Court on June 14, 2010.”
3
The AID was not signed by either party; thus, it has no effect as a partition agreement.
See Tex. Fam. Code Ann. § 4.105(a) (providing that a partition or exchange agreement is not
3
On March 15, 2011, Miguel received a bonus from Vitol in the gross amount
of $4.5 million; the amount received net of taxes and retirement was slightly over
$2.85 million. In June 2012, Leticia filed an original petition for post-divorce
division of property, seeking to divide Miguel’s 2011 bonus.5 Miguel moved for
partial summary judgment on Leticia’s claim on grounds that: (1) the bonus was
not community property subject to division by the trial court; (2) if the bonus was
subject to division, it was partitioned to Miguel pursuant to the MSA; and
(3) Leticia’s claim was barred by principles of res judicata because the trial court
considered the division of the bonus through Leticia’s motion to set aside the
MSA. Leticia responded, asserting that genuine issues of material fact exist
concerning whether (a) the bonus was community property subject to division,
(b) the bonus was awarded to Miguel in the divorce, and (c) Leticia’s suit was
barred by res judicata.
The trial court considered the partial summary judgment motion on October
29, 2012. It signed an interlocutory order granting Miguel partial summary
judgment on December 7, 2012, which left open the issue of Miguel’s claim for
attorney’s fees and sanctions. The trial court signed a final take-nothing order on
Leticia’s petition for post-divorce division of property on January 6, 2014, after
enforceable if the party against whom enforcement is requested proves, inter alia, that he or she
did not sign the agreement voluntarily).
4
Leticia additionally filed a motion to modify, correct or reform the judgment or
alternatively, motion to clarify the judgment. In this motion, Letitia asserted that Miguel failed to
include jewelry valued at nearly $400,000 on his sworn inventory and appraisement and that the
final divorce decree should be modified to state that this jewelry was not included in the MSA
division granting Miguel all the jewelry in his “possession, custody, or control.” The trial court
denied the motion to modify because this property had already been partitioned in the MSA and
imposed sanctions on Letitia in August 2010. These sanctions, however, were reversed by this
court on appeal. See Loya v. Loya, No. 14-12-00385-CV, 2013 WL 830940, at *1 (Tex. App.—
Houston [14th Dist.] 14-10-00864-CV, Mar. 5, 2013, no pet.) (mem. op.).
5
Leticia originally sought division of other alleged community property, but later
amended her petition to include only division of the bonus.
4
Miguel abandoned his claim for attorney’s fees. Leticia filed a motion for new
trial; our record contains no ruling on this motion. This appeal timely followed.
ANALYSIS
Leticia challenges the summary judgment in four issues. In her first two
related issues, she asserts that Miguel failed to conclusively prove that the bonus
was his separate property; alternatively, she asserts that there is a fact issue
concerning the characterization of the bonus. In her third issue, Leticia urges that
the bonus was not partitioned in the decree of divorce. Finally, in issue four, she
contends that res judicata does not apply because the divorce decree did not award
the bonus to anyone. Because we conclude that the bonus was not considered,
disposed of, or partitioned in the divorce decree, and that Leticia raised a fact issue
concerning the characterization of the bonus, we reverse the summary judgment
and remand to the trial court for further proceedings.
A. Standard of Review and Applicable Law
We review summary judgments de novo, and where, as here, the trial court
grants the judgment without specifying the grounds, we will affirm if any of the
grounds presented are meritorious. FM Props. Operating Co. v. City of Austin, 22
S.W.3d 868, 872 (Tex. 2000). The movant for a traditional summary judgment
must show that there is no genuine issue of material fact and that it is entitled to
judgment as a matter of law. Tex. R. Civ. P. 166a(c); Mann Frankfort Stein & Lipp
Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009). To be entitled to a
traditional summary judgment, a defendant must conclusively negate at least one
essential element of each of the plaintiff’s causes of action or conclusively
establish each element of an affirmative defense. Sci. Spectrum, Inc. v. Martinez,
941 S.W.2d 910, 911 (Tex. 1997). “Evidence is conclusive only if reasonable
people could not differ in their conclusions . . . .” City of Keller v. Wilson, 168
5
S.W.3d 802, 816 (Tex. 2005). Once the defendant establishes its right to summary
judgment as a matter of law, the burden shifts to the plaintiff to present evidence
raising a genuine issue of material fact. Walker v. Harris, 924 S.W.2d 375, 377
(Tex. 1996). We review the summary judgment evidence in the light most
favorable to the nonmovant, crediting evidence favorable to the nonmovant if
reasonable fact finders could, and disregarding contrary evidence unless reasonable
fact finders could not. Mann Frankfort, 289 S.W.3d at 848; see also Joe v. Two
Thirty Nine Joint Venture, 145 S.W.3d 150, 156 (Tex. 2004).
Community property consists of the property, other than separate property,
acquired by either spouse during marriage. Tex. Fam. Code Ann. § 3.002. Property
possessed by either spouse during or on dissolution of marriage is presumptively
community property. Id. § 3.003(a). Further, “earnings during marriage, even
during the pendency of divorce proceedings, are community property.” Marriage
of O’Brien, 436 S.W.3d 78, 84 (Tex. App.—Houston [14th Dist.] 2014, no pet.). A
spouse’s separate property consists of the property owned or claimed by the spouse
before marriage, acquired by the spouse during the marriage by gift, devise, or
descent, and the recovery for personal injuries sustained by the spouse during
marriage (except for recovery for loss of earning capacity). Tex. Fam. Code Ann.
§ 3.001. Finally, “[e]ither spouse may file a suit . . . to divide property not divided
or awarded to a spouse in a final decree of divorce.” Id. § 9.201(a). In an action to
divide community property post-divorce, the petitioner bears the burden to prove
that the trial court did not consider or dispose of the property at issue. See Brown v.
Brown, 236 S.W.3d 343, 348–49 (Tex. App.—Houston [1st Dist.] 2007, no pet.).
B. Application
We first consider Leticia’s third and fourth issues, in which she challenges
the summary judgment on res judicata and partition grounds, before turning to the
6
question of whether she raised a genuine issue of material fact as to the
characterization of Miguel’s bonus.
1. The bonus was not considered, divided, or partitioned in the divorce
decree or other agreements of the parties.
“Res judicata precludes re-litigation of claims that have been finally
adjudicated or that arise out of the same subject matter and could have been raised
and litigated in the prior action.” Appleton v. Appleton, 76 S.W.3d 78, 83 (Tex.
App.—Houston [14th Dist.] 2002, no pet.). But community property not awarded
or partitioned by a divorce decree is subject to later partition between the ex-
spouses. See Tex. Fam. Code Ann. § 9.201(a); Appleton, 76 S.W.3d at 83 (citing
Harrell v. Harrell, 692 S.W.2d 876 (Tex. 1985); Busby v. Busby, 457 S.W.2d 551,
554 (Tex. 1970)). Res judicata does not apply to post-divorce partitions where the
divorce decree has not disposed of an asset; partition is appropriate in such a
situation. Appleton, 76 S.W.3d at 83 (citing Busby, 457 S.W.2d at 554).
The MSA, the divorce decree, and the AID do not mention the 2011 bonus.
Leticia filed a motion to set aside the MSA based in part on the failure of the
parties to divide the bonus. Miguel asserts that the trial court thus “considered” the
bonus, and res judicata prevents Leticia from re-litigating the division of this
property. Importantly, however, Leticia did not seek to divide this property in her
motion; instead, she asserted that the MSA should be set aside because of a lack of
mutual assent. Indeed, as noted above, Leticia averred that the MSA “did not
address or divide the community portion” of the bonus. Because nothing in our
record indicates that the trial court considered or disposed of the bonus, Leticia is
not barred by res judicata principles from bringing this suit. See Tex. Fam. Code
Ann. § 9.201(a); Appleton, 76 S.W.3d at 83.
7
Further, the MSA—the only valid partition agreement in this case—provides
as follows:
Income Tax Returns for the Year 2010. For 2010, each party shall file
an individual income tax return in accordance with Internal Revenue
Code section[] 66(a) as if they were divorced on 12:01 a.m. on
January 1, 2010. This [MSA] shall serve as a partition of community
income, setting aside to each spouse all income earned by each such
spouse and/or attributable to property awarded to each such spouse or
confirmed as each such spouse’s separate property herein. For the
entire year 2010, each spouse shall be solely entitled to take on his/her
return any deductions attributable to properties awarded herein to
him/her or confirmed as his/her separate property. All overpayments
from 2009, all estimated taxes paid relative to the parties’ tax liability
for 2010, all withholding relative to the parties’ tax liability for 2010,
plus any other tax deposits made otherwise credited relative to the
parties’ tax liability for 2010 are allocated solely to Miguel . . . .
Miguel asserts that this language from the MSA partitions his 2010 income to
him. 6 We must disagree. First, this provision of the MSA is related to filing of
income tax returns: it states that the parties must file individual income tax returns
“as if they were divorced” on January 1. It does not expressly partition the parties’
income earned in 2010 to that party. And the MSA previously expressly partitioned
only all “future earnings” to the “person providing the services giving rise to the
earnings.” This partition of future earnings has no impact on the characterization of
earnings prior to the execution of the MSA; instead, these earnings are properly
characterized as community property. See O’Brien, 436 S.W.3d at 84.
6
Miguel cites Sheshunoff v. Sheshunoff, 172 S.W.3d 686, 689 (Tex. App.—Austin 2005,
pet. denied), for the proposition that “income to be partitioned for ‘tax purposes’ under the Texas
Constitution and the Texas Family Code . . . must be portioned for all purposes, as Texas law
does not permit a conditional or selective partition for one purpose but not for another.” We find
no support for Miguel’s proposition in this case, however. See id. Indeed, Miguel’s reference to
Sheshunoff is to the background facts in that case; the primary focus of the analysis in that case is
on whether Mr. Sheshunoff raised a fact issue concerning the voluntariness of his execution of a
post-marital property agreement. See id. at 692–701.
8
For the foregoing reasons, we conclude that Miguel’s 2011 bonus was not
considered, divided, or partitioned in the MSA, the AID, or the divorce decree.
Thus, summary judgment was not proper on these grounds, and we sustain her
third and fourth issues.
2. Leticia raised a fact issue as to the characterization of the bonus.
In Sprague v. Sprague, this court considered whether bonuses awarded
during a marriage for work performed at least partially before the marriage could
be established as a spouse’s separate property. 363 S.W.3d 788, 801–02 (Tex.
App.—Houston [14th Dist.] 2012, pet. denied). Evidence of the characterization of
these bonuses was improperly excluded from the fact finder. See id. We
determined that that the exclusion of this evidence probably caused the rendition of
an improper judgment because the spouse was entitled to present evidence that
portions of these bonuses were awarded based on work performed before the
marriage; i.e., this spouse should have been permitted to present evidence that
portions of these bonuses were separate property. See id. In other words, there is no
bright line rule for bonuses: a bonus paid during marriage may be based in part on
work performed prior to the marriage, which would make that portion of the bonus
a spouse’s separate property. It follows from our analysis in Sprague that a bonus
paid post-divorce, but alleged to be based in part on work performed during the
marriage, could be subject to proof that some portion of this bonus is community
property.
Here, through his summary judgment evidence, Miguel established that the
2011 bonus was paid to him in March 2011, nine months after he and Leticia were
divorced. In response to this evidence, Leticia provided an affidavit in which she
stated that the MSA “did not address or divide the community portion of Miguel’s
bonus for services performed between January 1, 2010 and June 13, 2010, to be
9
paid in 2011” (emphasis added).7 She further stated that she did not intend that “all
income that Miguel earned from January 1, 2010 through June 13, 2010, including
his bonus, would be considered his separate property and not subject to division.”
Viewing this evidence in the light most favorable to Leticia,8 we conclude that
Leticia brought forth some evidence that Miguel’s bonus, although paid in 2011,
was based in part on work he performed before the parties divorced. Cf. Sprague,
363 S.W.3d at 801–02. And Miguel did not establish that the 2011 bonus was not
earned, at least in part, based on services he provided during the parties’ marriage.
See, e.g., Bell v. Moores, 832 S.W.2d 749, 752 (Tex. App.—Houston [14th Dist.]
1992, writ. denied) (“Personal earnings are community property if earned during
the marriage.”); see also Tex. Fam. Code Ann. § 7.003 (“In a decree of divorce or
annulment, the court shall determine the rights of both spouses in a pension,
retirement plan, annuity, individual retirement account, employee stock option
plan, stock option, or other form of savings, bonus, profit-sharing, or other
employer plan or financial plan of an employee or a participant, regardless of
whether the person is self-employed, in the nature of compensation or savings.”
(emphasis added)). Under these circumstances, we conclude that Leticia raised a
genuine issue of fact concerning whether some portion of Miguel’s bonus could be
7
Miguel relies on Echols v. Austron, Inc., 529 SW.2d 840, 846 (Tex. App.—Austin
1975, writ ref’d n.r.e.), for the proposition that a bonus paid post-divorce is separate property. In
Echols, a wife claimed that the trial court “erred in not granting judgment for her for an
additional $1,000.00 as the undisputed evidence was that Austron, Inc. paid [her husband] a
$2,000.00 bonus that was community property.” First, this case is not binding authority on this
court. Second, this case was determined based on the proposition that “the rights of the parties
were fixed as of the time of the rendition of the judgment.” See id. More recent cases and
changes to the Texas Family Code indicate that this approach to so-called “vested” property
rights has been abrogated. See, e.g., Cearley v. Cearley, 544 S.W.2d 661, 662, 665–66 (Tex.
1976) (unpaid military retirement benefits that accrue during marriage are subject to
apportionment in divorce even though not “vested”); see also Tex. Fam. Code Ann. § 7.003.
8
In reviewing a summary judgment, we must consider the evidence in the light most
favorable to the non-movant. See Mann Frankfort, 289 S.W.3d at 848; see also Two Thirty Nine
Joint Venture, 145 S.W.3d at 156.
10
based on services he provided while the ex-spouses were still married; i.e., whether
some portion of the bonus is community property.
Our dissenting colleague appears to urge that “future earnings” are measured
solely by the ex-spouse’s receipt of the “earnings.” This construction ignores the
plain language of the MSA, which, as excerpted above, partitions future earnings
to the “person providing the services giving rise to the earnings.” Thus, if Miguel’s
services during the marriage gave rise, in part, to the 2011 bonus, then some
portion of the 2011 bonus could be characterized as community property. We
express no opinion as to whether any portion of the 2011 bonus was based on
services Miguel provided during his marriage to Leticia. Instead, we conclude that
Miguel has not established as a matter of law that his 2011 bonus was based
entirely on services he provided after the parties’ divorce.
For the foregoing reasons, on this record, summary judgment was not proper
on the characterization of Miguel’s bonus, and we sustain Leticia’s second issue.9
CONCLUSION
Having sustained Leticia’s second, third, and fourth issues, we reverse the
trial court’s judgment and remand for further proceedings.
/s/ Sharon McCally
Justice
Panel consists of Chief Justice Frost and Justices Boyce and McCally (Frost, C.J.,
dissenting).
9
Our resolution of Leticia’s second, third, and fourth issues makes it unnecessary to
address her first issue. See Tex. R. App. P. 47.1.
11