in the Matter of the Marriage of Steven W. Ard and Marsha Ard-Phillips

Affirmed and Memorandum Opinion filed July 14, 2016.
In the
Fourteenth Court of Appeals
NO. 14-14-00808-CV
IN THE MATTER OF THE MARRIAGE OF STEVEN W. ARD AND
MARSHA ARD-PHILLIPS
On Appeal from the 311th District Court
Harris County, Texas
Trial Court Cause No. 2006-47105
MEMORANDUM OPINION
Marsha Ard-Phillips appeals from a final decree of divorce dissolving her
marriage to Steven W. Ard. Marsha complains that the trial court erred: (1) in
determining that the attorney’s fee provision of the couple’s post-nuptial agreement
was unconscionable, (2) in permitting the intervention of one of Marsha’s previous
divorce attorneys, (3) in determining reimbursement claims, (4) in dividing the
marital estate, and (5) in sustaining the contests to Marsha’s affidavit of indigence.
Marsha also invokes Federal Rules of Civil Procedure 52(a) and 60(b)(6) for relief.
Because none of Marsha’s contentions presents reversible error that materially affects
the trial court’s determination, we affirm the divorce decree.
I. FACTUAL AND PROCEDURAL BACKGROUND
Marsha and Steven married in July 1995. In July 1997, they entered into a
post-nuptial agreement (PNA). The PNA was premised on Steven’s admission that
he had made false statements about not having any sexual diseases or problems.
Under the PNA, Steven agreed to various payments, partitions, or exchanges of
property as damages for Marsha’s injuries.1
Despite the parties’ attempts at counseling and various treatment methods to
address their sexual issues, Marsha filed for divorce in 2001. The case went to jury
trial in 2003. During the trial, the parties agreed to attempt reconciliation and the
case was nonsuited.
Steven filed for divorce in 2006. The case was bifurcated into two parts—
enforceability of the PNA and property division. Enforceability was tried to a jury in
July 2009.2 Both Steven and Marsha moved for summary judgment as to the
enforceability of the PNA. The trial court denied both motions. Before the case went
to the jury, the trial court issued its legal ruling regarding the unconscionability of the
PNA:
[T]he agreement is in part conscionable and in part unconscionable. The
part that is unconscionable is all of the actual contractual provisions that
1
In part I, sections A.1 through 8, Steven agreed that various items of community property
tied to the two-year period from July 1995 to July 1997 would be Marsha’s separate property. In
part II, sections B.1 through 6, Steven agreed that Marsha would receive one-half of various items
of his separate property and one-half of his earned income. In part III, which only applied in the
event they remained married through Steven’s death, he agreed that Marsha would receive various
property as her sole property and as sole beneficiary. Steven also agreed that he would not make a
contrary will, and that he would pay reasonable attorney’s to Marsha’s counsel or to Marsha herself
if she enforced the PNA.
2
See Tex. Fam. Code Ann. § 4.006(a) (West 2006) (marital property agreement not
enforceable if either (1) party did not sign it voluntarily or (2) agreement was unconscionable when
signed and, before signing, party was not provided fair and reasonable disclosure of property or
financial obligations of other party, did not waive right to disclosure, and did not have adequate
knowledge of other party’s property and financial obligations).
2
are in Part II under categories—Sections B-1 through 6. And also on
Part III, all of C-1 through 7, as well as the other contractual provisions
that are contained on Page 5 and 6 that may or may not be a part of Part
III. And I’m finding that the section on Part I, A[-1] through . . . 8 are
conscionable.[3]
The jury was instructed that a partition or exchange agreement is not enforceable if
the party resisting enforcement did not voluntarily sign it. The jury returned an
answer of enforceable. The jury was further instructed that a partition or exchange
agreement is also not enforceable if the party resisting enforcement was not provided
a fair and reasonable disclosure of the other party’s property or financial obligations,
the party did not voluntarily and expressly waive in writing any right to those
disclosures, and the party did not have and reasonably could not have had adequate
knowledge of the other party’s property or financial obligations. The jury returned an
answer of not enforceable. As a result of the jury’s verdict, Marsha could only
enforce the conscionable portion of the PNA—part I, sections A.1 through 8—in
which Steven agreed that Marsha was entitled to certain payments, partitions, or
exchanges as her sole property as compensation for some of her injuries. The
property division portion of the trial was to continue before the court.
In September 2009, Marsha’s trial counsel withdrew and filed a petition in
intervention seeking attorney’s fees. Marsha moved to strike such intervention. In
October 2009, Marsha filed for Chapter 7 bankruptcy, staying the divorce
proceedings.
In July 2014, the trial continued. The trial court filed findings of fact and
conclusions of law on August 14, 2014, including an exhibit regarding the court’s
division of property. The trial court signed a final decree of divorce on August 29,
2014. Marsha filed a request for findings of fact and conclusions of law on
3
See id. § 4.006(b) (court decides unconscionability as matter of law).
3
September 22, 2014. The trial court denied her request as moot and untimely if
considered a request for findings of fact and conclusions of law, see Tex. R. Civ. P.
296 (must file within 20 days of judgment), or untimely if considered a request for
additional or amended findings and conclusions, see id. 298 (must file within 10 days
of findings and conclusions). Marsha also filed a motion to modify, correct, or
reform the judgment. The record does not reflect that the trial court heard or ruled on
this motion.
Marsha filed her notice of appeal. Marsha claimed that she was unable to pay
for the appellate record and requested that Steven pay the costs. The Harris County
District Clerk, the court reporter, and Steven opposed Marsha’s affidavit of
indigence. The trial court sustained the contests to Marsha’s affidavit and denied her
request that Steven pay for the record.
II. ANALYSIS
To begin, we address Steven’s argument that Marsha waived every issue due to
briefing waiver. See Tex. R. App. P. 38.1(i). Steven contends that Marsha’s “brief
has numerous contentions throughout, is very difficult to follow, does not refer to
citations in the record and lacks citations to authorities.”
Although this court is obliged to construe the rules of appellate procedure
“reasonably yet liberally,” see Republic Underwriters Ins. Co. v. Mex–Tex, Inc., 150
S.W.3d 423, 427 (Tex. 2004) (quoting Verburgt v. Dorner, 959 S.W.2d 615, 616
(Tex. 1997)), we also may not apply a different set of rules to pro se litigants like
Marsha, see Mansfield State Bank v. Cohn, 573 S.W.2d 181, 184–85 (Tex. 1978).
Marsha outlines seven issues in her “issues presented for review per TRAP 38(1)(f)”
and includes an “argument and authori[tie]s” section that does cite to the record and
legal authorities. Accordingly, we do not adopt Steven’s position that Marsha’s
briefing is wholly inadequate. However, liberally construing Marsha’s issues, we
4
note numerous, oftentimes wide, gaps in her analysis. We address Marsha’s issues,
keeping in mind that we have “no duty, or even the right, to perform an independent
review of the record and applicable law to determine whether there was error.”
Canton-Carter v. Baylor Coll. of Med., 271 S.W.3d 928, 930 (Tex. App.—Houston
[14th Dist.] 2008, no pet.).
A. Unconscionability of the attorney’s fee provision of the PNA4
In her first issue, Marsha argues that the trial court erred with regard to its
ruling that the attorney’s fee provision of the PNA was unconscionable as a matter of
law. According to Marsha, the trial court erred by severing the unconscionable
attorney’s fee provision from the enforceable portion of the PNA (part I).
The attorney’s fee provision states:
In the event Marsha Ard-Phillips needs to retain counsel to enforce this
contract, [Steven Ard] agree[s] to pay reasonable attorney’s fees for the
enforcement of this contract. . . . In the event Marsha Ard-Phillips (a
licensed attorney) chooses to enforce this contract herself, [Steven Ard]
agree[s] to pay her reasonable attorney’s fees for the enforcement of this
PostNuptial Contract.
In part I, sections A.1 through 8, of the PNA, Steven agreed that certain items would
be Marsha’s sole property in an attempt to compensate her for some of her injuries.
Marsha’s sole property was to include:
(A.1) all equity in their Bellaire house up to July 21, 1997;
(A.2) monetary contributions and growth thereof in Steven’s Texaco
401(k) and in Marsha’s City of Houston deferred compensation
plan from July 21, 1995 to July 21, 1997;
(A.3) accumulated home furnishings to July 21, 1997;
(A.4) monetary contributions and growth to any of Steven’s and
Marsha’s annuities or IRAs during the past two years to July 21,
4
This provision was included on page 6 of the PNA.
5
1997;
(A.5) the full value accumulating in Steven’s regular Texaco retirement
plan from July 21, 1995 to July 21, 1997; and
(A.6) the full value accumulating in Marsha’s Plan A or B of her City of
Houston retirement plan from July 21, 1995 to July 21, 1997.
Also, under part I: (A.7) Steven has no interest in Marsha’s 1995 Honda and Marsha
has no interest in Steven’s 1993 Pontiac; and (A.8) if they divorced, Steven has sole
responsibility for the loan against his Texaco 401(k) taken out for the down payment
on their Bellaire house.
Generally, courts may sever an illegal or unconscionable portion of a contract
as long as it does not constitute the essential purpose of the agreement. In re Poly-
Am., L.P., 262 S.W.3d 337, 360 (Tex. 2008). Marsha contends that she “wouldn’t
have agreed to a PNA without an enforcement clause.” We conclude, however, that
the attorney’s fee provision was severable. Marsha’s cited cases—In re Poly-
America, 262 S.W.3d at 360, and Patrizi v. McAnich, 269 S.W.2d 343, 348 (Tex.
1954)—support the trial court’s severance. Like in In re Poly-America, which upheld
the severability of unconscionable portions of an arbitration agreement, Marsha and
Steven could have entered part I of the PNA without the attorney’s fee provision
because they were not mutually dependent promises. 262 S.W.3d at 360. Excising
the unconscionable attorney’s fee provision would not defeat or undermine the
essential purpose of part I of the PNA, Steven’s waiver of certain property rights as
compensation for Marsha’s damages. See id. Regardless of any unconscionable fee
agreement, Marsha was free to seek legal redress to enforce part I. And unlike in
Patrizi, where the very face of the contract reflected that the illegal provisions “were
a vital part thereof,” see 269 S.W.2d at 347–48, the PNA here contains a severability
clause expressing the parties’ intent that if any provision of the PNA is not valid, such
invalidity does not affect other provisions which can be given effect without the
6
invalid provision. See In re Poly-Am., 262 S.W.3d at 360 (severability clause
supported excision of unconscionable provisions).
We next consider the trial court’s underlying legal determination that the
attorney’s fee provision was unconscionable.5 The term “unconscionable” carries no
precise legal definition. Arthur’s Garage, Inc. v. Racal–Chubb Sec. Sys., 997 S.W.2d
803, 815 (Tex. App.—Dallas 1999, no pet.); Marsh v. Marsh, 949 S.W.2d 734, 739–
40 (Tex. App.—Houston [14th Dist.] 1997, no writ). In general, the term
“unconscionable” describes a contract that is unfair because of its overall one-
sidedness or the gross one-sidedness of its terms. Arthur’s Garage, 997 S.W.2d at
815. Proof of unconscionability considers two broad questions: (1) the procedural
aspect of how the parties arrived at the terms in controversy and (2) the substantive
aspect of whether legitimate commercial reasons justify inclusion of the terms. See
id. at 815–16.
Unconscionability is ultimately a legal question to be determined in light of a
variety of factors and on a case-by-case basis. See In re Poly-Am., 262 S.W.3d at
348. Because this determination is dependent on the existence of facts that allegedly
illustrate unconscionability, we do not disturb facts impliedly found by the trial court
as long as they are supported by the record. See Besteman v. Pitcock, 272 S.W.3d
777, 788 (Tex. App.—Texarkana 2008, no pet.). The unconscionability of a marital
property agreement depends on various considerations, such as the maturity and age
of the individuals, their business backgrounds, their educational levels, their prior
marriages, and other motivations. See Marsh, 949 S.W.2d at 741; Williams v.
Williams, 720 S.W.2d 246, 249 (Tex. App.—Houston [14th Dist.] 1986, no writ).
At the time of the PNA, Marsha was a trained and licensed attorney, working
5
Although the trial court determined that several provisions of the PNA were
unconscionable, Marsha only specifically challenges the attorney’s fee provision on appeal.
7
in business litigation for the City of Houston. Steven had a bachelor’s degree in
computer science and was working in IT for Texaco. Marsha had been married and
divorced three previous times. Steven had been married and divorced once before,
and had no experience with a post-nuptial agreement. Although Steven had been
working to address his alleged sexual performance issues through counseling and
medical treatment, Marsha threatened divorce. In addition, Marsha threatened that
she would ensure “everybody” knew about Steven’s secret sexual proclivities and
sexual problems, and that she would sue him. Marsha drafted the PNA and pressured
Steven to sign it because she indicated she was approaching the statute of limitations
for fraud. Steven felt that he did not have sufficient time to have an attorney review
the PNA. Steven indicated that he would do “anything” to avoid a divorce and he felt
that he “had no choice.” Steven was “totally devastated” because Marsha no longer
wanted to be married to him and was taking antidepressant medication when he
signed the PNA. Moreover, the substance of the attorney’s fee provision—Steven
agreed to pay attorney’s fees directly to Marsha if she decided to choose herself to
enforce the agreement that she drafted—reflects its extremely one-sided nature.
Under the circumstances of this case, we conclude that the trial court did not
err in its finding of unconscionability as to the attorney’s fee provision of the PNA.
See Sheriff v. Moosa, No. 05-13-01143-CV, 2015 WL 4736564, at *4 (Tex. App.—
Dallas Aug. 11, 2015, no pet.) (concluding based on record that trial court did not err
in refusing to enforce unconscionable prenuptial agreement) (mem. op.).
We overrule Marsha’s first issue.
B. Intervention
Next, Marsha contends that the trial court erred by permitting Marsha’s former
8
trial counsel’s intervention despite Marsha’s motion to strike.6
Texas Rule of Civil Procedure 60 provides that any party may intervene by
filing a pleading, subject to being stricken out by the trial court for sufficient cause on
any party’s motion. Tex. R. Civ. P. 60. An intervenor is not required to secure the
court’s permission to intervene. Guar. Fed. Sav. Bank v. Horseshoe Operating Co.,
793 S.W.2d 652, 657 (Tex. 1990). Under rule 60, a person or entity has the right to
intervene if the intervenor could have brought the same action, or any part thereof, in
his own name, or, if the action had been brought against him, he would be able to
defeat recovery, or some part thereof. Id. The rule authorizes a party with a
justiciable interest in a pending suit to intervene in the suit as a matter of right. Id.The asserted interest may be legal or equitable. Id. The trial court has “broad
discretion” in determining whether an intervention should be stricken. Id.Our review of the record reveals Marsha’s former trial counsel alleged that
Marsha hired her to provide legal services in her pending divorce, counsel provided
those services, Marsha accepted those services and became bound to pay counsel’s
reasonable and necessary fees under their contract, counsel demanded that Marsha
pay the outstanding balance, and Marsha did not pay it. Marsha’s former trial
counsel pleaded alternative claims for a suit on sworn account and quantum meruit.
Because this intervention comports with rule 60, we conclude that the trial court did
not abuse its broad discretion in permitting the intervention.
Next, Marsha argues that the trial court erred by refusing to void a rule 11
agreement entered into between her former trial counsel and Steven. However,
6
We note that Marsha incorrectly contends that the intervention was required to meet what
she asserts is a three-prong test. Marsha does not present, and we have not located, any authority
for such a test. The Texas Supreme Court has mentioned similar factors in the context of
determining whether a trial court abused its discretion by sua sponte striking an intervention. See
Guar. Fed. Sav. Bank v. Horseshoe Operating Co., 793 S.W.2d 652, 657–58 (Tex. 1990). Since the
trial court did not strike the intervention, the factors from Guaranty Federal do not apply.
9
Marsha does not cite to the record or to any legal authority to support this assertion.
We conclude that Marsha has waived this subissue. See Tex. R. App. P. 38.1(i);
Cantu v. Maher, No. 14-07-00584-CV, 2009 WL 2589253, at *3 (Tex. App.—
Houston [14th Dist.] Aug. 25, 2009, pet. struck) (mem. op.) (“[A]n issue not
supported by authority is waived.”); San Saba Energy, L.P. v. Crawford, 171 S.W.3d
323, 338 (Tex. App.—Houston [14th Dist.] 2005, no pet.) (finding waiver where
appellants did not cite to any part of the record).
It is not clear how Marsha’s next argument that Steven could have filed his
own motion to strike the intervention challenges any particular action or ruling by the
trial court. Finally, we also fail to grasp how Marsha’s contention that the bankruptcy
court erroneously allowed Steven to file a proof of claim reflects any error by the trial
court here.
We overrule Marsha’s second issue.
C. Property division issues
1. Standard of review
Section 7.001 of the Texas Family Code provides that the trial court must
divide community property in a “just and right” manner, having “due regard for the
rights of each party.” See Tex. Fam. Code Ann. § 7.001 (West 2006). A trial court
may exercise wide discretion in ordering a property division. See Zieba v. Martin,
928 S.W.2d 782, 786 (Tex. App—Houston [14th Dist.] 1996, no writ) (citing Murff v.
Murff, 615 S.W.2d 696, 698 (Tex. 1981)). “Equal division of property is not
required, but the division must be equitable.” Marin v. Marin, No. 14-13-00749-CV,
2016 WL 1237847, at *2 (Tex. App.—Houston [14th Dist.] Mar. 29, 2016, no pet.)
(mem. op.); see Murff, 615 S.W.2d at 698–99 & n.1; Nowzaradan v. Nowzaradan,
No. 01-05-00094-CV, 2007 WL 441709, at *6 (Tex. App.—Houston [1st Dist.] Feb.
10
8, 2007, no pet.) (mem. op.) (“Well-settled law, however, recognizes that community
property need not be equally divided.”).
Under the abuse-of-discretion standard, sufficiency of the evidence, whether
legal or factual, is a relevant factor in assessing the trial court’s discretion. See
Marriage of O’Brien, 436 S.W.3d 78, 82 (Tex. App.—Houston [14th Dist.] 2014, no
pet.) (citing In re T.J.L., 97 S.W.3d 257, 266 (Tex. App—Houston [14th Dist.] 2002,
no pet.)). To prevail on a complaint about property division, an appellant bears the
burden to demonstrate, based on the evidence in the record, that the division was so
unjust and unfair as to constitute an abuse of discretion. See id.We review the trial court’s findings of fact for legal sufficiency of the evidence
by the same standards by which we review the evidence supporting a jury’s finding.
See Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). When reviewing legal
sufficiency, we consider the evidence in the light most favorable to the challenged
finding and indulge every reasonable inference that would support it. Harrison v.
Harrison, 321 S.W.3d 899, 901 (Tex. App.—Houston [14th Dist.] 2010, no pet.)
(citing City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005)).
When reviewing factual sufficiency, we weigh all of the evidence in the record
and only may overturn findings if they are so against the great weight and
preponderance of the evidence as to be clearly wrong and unjust. Graves v.
Tomlinson, 329 S.W.3d 128, 142 (Tex. App.—Houston [14th Dist.] 2010, pet.
denied) (citing Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996) (per curiam)).
We employ a two-pronged analysis to review the division: (1) whether the trial
court had sufficient information on which to make its determination and (2) whether
the trial court abused its discretion by making a manifestly unjust or unfair property
division. See Evans v. Evans, 14. S.W.3d 343, 346 (Tex. App.—Houston [14th Dist.]
2000, no pet.). A trial court abuses its discretion when it rules without supporting
11
evidence. Id. “An abuse of discretion does not occur where the trial court bases its
decision on conflicting evidence or where some evidence of a substantial and
probative character exists to support the trial court’s division.” Zieba, 928 S.W.2d at
786. A trial court is authorized to consider a variety of factors, commonly referred to
as the “Murff” factors. See Murff, 615 S.W.2d at 699 (relative earning capacity,
business opportunities, relative financial condition and obligations, education, size of
separate estates, probable need for future support). We may reverse the trial court’s
division only if the court clearly abused its discretion and if the error materially
affects the court’s just and right division of the property. Jacobs v. Jacobs, 687
S.W.2d 731, 732–33 (Tex. 1985).
Former section 3.408, in effect at the time of Steven’s August 2006 divorce
filing, and section 3.409 of the Family Code govern claims for reimbursement here.
See Act of May 18, 2001, 77th Leg., R.S., ch. 838, § 2, 2001 Tex. Gen. Laws 1679,
1682, amended by Act of April 30, 2007, 80th Leg., R.S., ch. 51, § 1, 2007 Tex. Gen.
Laws 48, 48, repealed by Act of May 19, 2009, 81st Leg., R.S., ch. 768, § 11(5),
2009 Tex. Gen. Laws 1950, 1953; Tex. Fam. Code Ann. § 3.409 (West 2006). The
trial court determines the rights of both spouses in a claim for reimbursement, applies
equitable principles to determine whether to recognize the claim after taking into
account all the relative circumstances of the spouses, and orders a division of the
claim, if appropriate, in the manner that the court considers just and right, having due
regard for the rights of each party. Act of May 18, 2001, 77th Leg., R.S., ch. 838,
§ 2, 2001 Tex. Gen. Laws 1679, 1683–84 (amended 2007) (current version at Tex.
Fam. Code § 7.007). The rule of reimbursement is purely an equitable one. Vallone
v. Vallone, 644 S.W.2d 455, 458 (Tex. 1982). It arises when the funds or assets of
one estate are used to benefit and enhance another estate without itself receiving
some benefit. Id. at 459. The party claiming the right of reimbursement has the
12
burden of pleading and proving that the expenditures were made and that they are
reimbursable. Id. Reimbursement is not available as a matter of law, but lies within
the broad discretion of the court. Penick v. Penick, 783 S.W.2d 194, 197–98 (Tex.
1988); Vallone, 644 S.W.2d at 459. A trial court may not recognize a marital estate’s
claim for reimbursement for the payment of child support, alimony, or spousal
maintenance; the living expenses of a spouse or child of a spouse; contributions of
property of a nominal value; the payment of a liability of a nominal amount; or a
student loan owed by a spouse. Tex. Fam. Code Ann. § 3.409.
2. Reimbursement
In her third issue, Marsha argues that the trial court erred in allowing various
invalid claims for reimbursement. She contends that the impermissible
reimbursements were: $160,000 for living expenses and attorney’s fees; (2)
$76,925.85 for spousal support; (3) $34,251.75 in educational loans, (4) $4,5007 from
the sale of separate property, (5) $30,090.95 for her professional goodwill, (6)
$3,502.20 for a 2006 income tax credit sent to her as a refund, (7) $398.77 for a 20058
property tax refund, and (8) $300 for an economic stimulus paid for her benefit.
The trial court issued a finding that the parties acquired community property
during the marriage—listing the property with values determined by the court in its
Exhibit A. The trial court issued another finding that “The Court’s Division of
Property, attached as Exhibit A, lists the Court’s decision on how to divide the
Community Estate.” The court found that “The Court’s Division of Property,
attached as Exhibit A, also lists the liabilities of the community estate and
reimbursements due to the Parties, with balances determined by the Court.”
7
Marsha claims this amount is $5,400. However, the record reflects that the trial court was
assigning proceeds from the sale of a vehicle in the amount of $4,500.
8
Marsha claims this was a 1998 property tax refund. However, the record reflects that the
trial court was assigning a 2005 property tax refund in the precise amount of $398.77.
13
According to Exhibit A, only one of the items that Marsha challenges—her law
school loans—was expressly treated by the trial court as a reimbursement to the
community. Steven testified that the law school loans were Marsha’s separate debt
prior to marriage and that the community estate paid off those debts. Steven
requested that the community estate be reimbursed for Marsha’s separate law school
loan debt.
Steven now acknowledges that repayment of a student loan is not a proper
ground for reimbursement. See Tex. Fam. Code Ann. § 3.409(5). However, Steven
contends that even if the trial court made an error in the characterization of the loan
debt as a reimbursable claim, the error did not materially affect the just and right
division of property. We agree that we are not required to remand here. See Jacobs,
687 S.W.2d at 733. The total assets in the community estate were valued at almost
$1.17 million. Removing the amount of $34,251.75 provided in reimbursement as an
asset to the community estate (divided equally between Steven and Marsha) and
recalculating the percentage of each party’s share of the community estate (net assets)
leaves the percentage division virtually unchanged—50.01 (instead of 49.99) percent
to Steven and 49.99 (instead of 50.01) percent to Marsha.
The other items Marsha challenges were not treated as reimbursement claims
to the community from her separate estate, but rather were characterized as
community assets and then assigned 100 percent to Marsha. Steven testified that he
was not claiming any reimbursement for the court-ordered temporary spousal support
he paid to Marsha, but rather a credit. Steven also presented evidence of and
requested credit for court-ordered amounts paid to Marsha out of the court registry
(funded from the sale of their Bellaire house) for living expenses and attorney’s fees.
In making a division of community property, the trial court may consider and make
adjustments for the effect of temporary court orders. See In re Marriage of Hammett,
14
No. 05-14-00613, 2016 WL 3086126, at *7 (Tex. App.—Dallas June 1, 2016, no pet.
h.) (mem. op.); Herschberg v. Herschberg, 994 S.W.2d 273, 278 (Tex. App.—Corpus
Christi 1999, pet. denied); Baccus v. Baccus, 808 S.W.2d 694, 700 (Tex. App.—
Beaumont 1991, no writ). We find no abuse of discretion in the trial court’s
adjustments here.
Steven further presented evidence of and requested credits based on Marsha’s
receipt of a property tax refund on their house, Marsha’s sale of a community vehicle
(a 2006 Toyota Solara) without his permission, and Marsha’s receipt of an income tax
refund and a stimulus payment. Given the record in this case, we cannot say the trial
court abused its discretion by awarding these community credits in favor of Steven in
the final decree. See Marriage of Hammett, 2016 WL 3086126, at *7.
With regard to the business interest in Marsha’s law practice, Steven presented
evidence of commercial value based on tax returns and Marsha’s income. Marsha
testified to gross annual revenue from her practice of approximately $32,000.
Although Marsha describes the interest at stake as her professional goodwill, the trial
court described the amount of $30,090.95 as the value of the community asset for the
closely held business interest “Marsha Phillips Attorney & Counselor at Law.” The
record does not reflect that the trial court considered Marsha’s professional goodwill
as part of this valuation. Steven requested that the trial court award such business
interest to Marsha as her separate property; the court instead assigned such interest to
the community and assigned the asset 100 percent to Marsha. We do not find any
abuse of the trial court’s discretion in making a “just and right” division of this asset.
See Nowzaradan, 2007 WL 441709, at *8 (no abuse of discretion where nothing in
record suggested trial court’s valuation of medical practice as part of community
estate was erroneously premised on husband’s professional goodwill); see also Finn
v. Finn, 658 S.W.2d 735, 740–41, 746-47 (Tex. App.—Dallas 1983, writ ref’d n.r.e)
15
(husband’s commercial goodwill in law firm, independent of personal ability, was
asset of community estate).
Finally, Marsha asserts error in connection with Steven’s reimbursement claim
for certain attorney’s fees related to the parties’ first divorce proceeding. However,
neither the decree nor the findings and conclusions indicate that the trial court
awarded any reimbursement claim for attorney’s fees. Instead, the trial court issued
an express conclusion of law that neither party should recover on his or her claims for
attorney’s fees. In the final decree, the trial court ordered that each party was
responsible for his or her own attorney’s fees in the case.
We overrule Marsha’s third issue.
3. Property division
Next, Marsha takes issue with the trial court’s property division. Several of
Marsha’s complaints concern “the property” or “the assets” generally. Also, Marsha
simply refers this court to her motion to modify the judgment for “most of the issues”
she has regarding the “improper division of the assets” instead of providing clear and
concise argument and authorities in her brief. See Tex. R. App. P. 38.1(i).9 To the
extent that Marsha presents arguments regarding specific characterizations or
divisions of property contained in the trial court’s findings, we address them.
Separate property is defined as that property owned or claimed by a spouse
before marriage, acquired during the marriage by gift, devise, or descent, or as a
recovery for personal injuries sustained during the marriage. Tex. Fam. Code Ann.
9
Marsha cites Texas Rule of Civil Procedure 299, but fails to provide any explanation of
what trial court findings may have been omitted, included, or should or can be presumed. Marsha
also cites Tedder v. Gardner Aldrich, LLP, 421 S.W.3d 651 (Tex. 2013), in connection with her
argument that attorney’s fees cannot be reimbursed from community property. Again, the trial
court did not permit any reimbursement for attorney’s fees, but rather concluded that no party
should recover on claims for attorney’s fees and ordered that each party pay his or her own fees.
16
§ 3.001 (West 2006); Barnett v. Barnett, 67 S.W.3d 107, 111 (Tex. 2001).
Community property consists of the property, other than separate property, acquired
by either spouse during marriage. Tex. Fam. Code Ann. § 3.002 (West 2006);
Barnett, 67 S.W.3d at 111. All property possessed by either spouse during or upon
dissolution of the marriage is presumed to be community property. Tex. Fam. Code
Ann. § 3.003(a) (West 2006); Barnett, 67 S.W.3d at 111.
“The spouse claiming that certain property is ‘separate’ must trace and clearly
identify the property claimed to be separate.” Zagorski v. Zagorski, 116 S.W.3d 309,
316 (Tex. App.—Houston [14th Dist.] 2003, pet. denied). Tracing involves
establishing the separate origin of the property through evidence showing the time
and means by which the spouse originally obtained possession of the property. Id.“Property established to be separate remains separate property regardless of the fact
that it may undergo mutations or changes in form; its separate character is not altered
by the sale, exchange, or substitution of the property.” Barras v. Barras, 396 S.W.3d
154, 167 (Tex. App.—Houston [14th Dist.] 2013, pet. denied).
To overcome the community property presumption, a spouse claiming assets as
separate property must establish their separate character by clear and convincing
evidence. Tex. Fam. Code Ann. § 3.003(b); Stavinoha v. Stavinoha, 126 S.W.3d 604,
607 (Tex. App.—Houston [14th Dist.] 2004, no pet.). “Clear and convincing”
evidence means the measure or degree of proof that will produce in the mind of the
trier of fact a firm belief or conviction as to the truth of the allegations sought to be
established. In re J.F.C., 96 S.W.3d 256, 264 (Tex. 2002); Stavinoha, 126 S.W.3d at
607; see also Tex. Fam. Code Ann. § 3.003(b). The clear and convincing standard is
not satisfied when characterizing the property at issue as separate requires surmise or
speculation by the court. Zamarripa v. Zamarripa, No. 14–08–00083–CV, 2009 WL
1875580, at *3 (Tex. App.—Houston [14th Dist.] June 30, 2009, pet. denied) (mem.
17
op.). Any doubt as to the character of property should be resolved in favor of the
community estate. Id.First, Marsha disputes the characterization and division of Steven’s Texaco
401(k) and Van Kampen (now Invesco) IRA. Marsha does not dispute that Steven
initiated his Texaco 401(k) over a decade before they married, that he rolled funds
over from the Texaco 401(k) into the Van Kampen IRA, and that she was granted
only a portion of Steven’s Texaco 401(k) tied to the two-year period of July 21, 1995
to July 21, 1997 pursuant to the PNA. Nevertheless, she contends that improper
characterization and division resulted in “double and excessive awards to [Steven]
with an arbitrary award of only 3.5% division community to [Marsha].”10 Marsha
also contends that the trial court permitted erroneous or no tracing of this asset.
With regard to assets and liabilities of the various estates, Steven submitted a
financial information statement, a third amended inventory and appraisement, and a
divorce inventory summary sheet. Steven testified that he initiated his Texaco 401(k)
in 1979, prior to his marriage to Marsha; he resigned from Texaco in May 2000; and
in June 2000, he rolled money from his Texaco 401(k) over into the Van Kampen
IRA. Pursuant to part I, section A.2, of the PNA, Steven agreed “that all the
monetary contributions and the growth thereof in [his] Texaco 401(k) plan . . . from
July 21, 1995, through July 21, 1997, are [Marsha’s] separate property.”
Steven submitted his Texaco 401(k) statements as backup. Steven, who has a
minor in mathematics, prepared a tracing spreadsheet based on those statements to
10
Marsha does not explain how she arrived at this “3.5% division community.” The record
reflects that the trial court did not attribute any of the Texaco 401(k) assets to the community and
awarded Marsha zero percent of the community funds from the Van Kampen IRA. Marsha also
states, “The amount during the two year period of the PNA was 47.75/52.26% split of the total
account,” presumably referring to the Texaco 401(k) since the Van Kampen IRA did not exist until
2000. She provides no citation for this contention, and nothing within part I of the PNA requires or
supports such a division.
18
track the various property interests, including Marsha’s separate property under the
PNA.11 The spreadsheet included information regarding name changes and amounts
over time in Steven’s Texaco (now Chevron) 401(k) account. The spreadsheet
contained columns showing the date; the community’s, Steven’s, and the PNA part
I’s balances; the community’s, Steven’s, and part I’s total percentages; contributions;
company employee stock ownership plan and awards; dividends/capital gains;
unrealized gain/loss minus fees; loan payments and loan balance; 12 withdrawals; and
total balance. Steven explained:
To start with, I had the balance as effective July 1, 1995. I had my
separate balance was $305,382.35. As I made additional contributions
from my paycheck, the Part 1 of the postnup awarded those first two
years from ‘95 to ‘97 to [Marsha].
So I—as dividends and capital gains and gains and losses were
occurring, I altered the percentage ownership that was my separate and
what was her separate.
And then when it got rolled over, also there was—after ‘97, then
the contributions became community contributions. So I started then
having percentage changes across all three types of values. And then
when we rolled it over into the Van Kampen IRA on June 20th of 2000,
the—all the community came out and then the rest of it that rolled over
was my separate.
So that the remaining balance of a little over, you know, $50,000
was her value plus my remaining separate.
And then I’ve traced it from there on.
At the time of the Van Kampen IRA rollover, Marsha’s separate balance in the
Texaco 401(k) attributable to monetary contributions from July 1995 to July 1997
11
Marsha objected to “the accuracy” of the spreadsheet and objected that Steven was not a
CPA. The trial court overruled these objections.
12
Steven borrowed $50,000 against his Texaco 401(k) as a down payment for the parties’
Bellaire house. In part I, section A.8, of the PNA, Steven agreed that he would have sole
responsibility for this loan. Accordingly, the trial court found that the remaining loan balance in the
amount of $24,258.60 was Steven’s separate liability.
19
was $15,993.52. This amount plus $38,367.81 of Steven’s separate balance (for a
total of $54,361.33) was not rolled over into the Van Kampen IRA as of June 2000
and remained in the Texaco 401(k). However, the community balance of $9,828.05
from the Texaco 401(k) was rolled over to the Van Kampen IRA, leaving a
community balance of zero in the Texaco 401(k). As of June 30, 2014, the total
Texaco 401(k) contained funds totaling $256,342.35, of which $221,529.84 was
Steven’s separate property and $34,812.51 was Marsha’s separate property.
Steven also prepared a tracing spreadsheet for the Van Kampen IRA and
submitted backup account statements.13 The spreadsheet included information
regarding name changes and amounts over time of the two base funds—a growth
fund and a technology fund—in the account. The spreadsheet contained columns
showing the date, the community’s and Steven’s separate balances, the community’s
and Steven’s total percentages, the community’s and Steven’s separate shares, the
share price, capital gains and fees, total number of shares, and total balance.
To produce his tracing spreadsheet, Steven “went through each statement and
pulled the information from it” so there would be “no breaks in the dates and the
amounts of money.” As of June 20, 2000, $701,240.89 was rolled over from
Steven’s Texaco 401(k), which consisted of $691,412.84 of Steven’s separate
property and $9,828.05 of community property. These amounts were split equally
between the growth and technology funds. Steven testified that he did not add or
withdraw any funds from the Van Kampen IRA. As of June 30, 2014, the total Van
Kampen IRA contained funds totaling $482,970.10, of which $476,208.52 was
Steven’s separate property and $6,761.58 was community property. Steven stated
that these numbers were accurate.
13
Marsha again objected to “the accuracy” of the spreadsheet and objected that Steven was
not a CPA. The trial court overruled these objections.
20
The trial court found that Steven’s separate property included $476,208.52 in
assets in the Van Kampen IRA and $221,529.84 in the Texaco 401(k). The trial court
also found that the community estate included $6,761.58 in assets in the Van Kampen
IRA and awarded Steven 100 percent of this amount. The trial court found that
Marsha’s separate property included $34,812.51 in assets in the Texaco 401(k)
pursuant to part I, section A.2, of the PNA.
Looking at all the evidence in the light most favorable to the separate property
findings with regard to the Van Kampen IRA and the Texaco 401(k), we conclude
that it sufficiently satisfies the clear and convincing standard; the trial court
reasonably could have formed a firm belief or conviction that Steven and Marsha
were entitled to the separate property amounts at issue.14 See Barras, 396 S.W.3d at
172. Nor does the record reflect that the trial court’s findings were against the great
weight and preponderance of the evidence. See id. at 173. To the extent that Marsha
complains about the “division community” of the Van Kampen IRA, while the trial
court awarded Steven 100 percent of those community assets, the court awarded
Marsha 100 percent of other community assets, including funds in three defined
contribution plans. Moreover, if any funds remained in the Texaco 401(k) after
distribution of Steven’s and Marsha’s separate property, the court characterized such
14
Marsha points to, and we have located, no authority for her assertion that the trial court
erred by allowing Steven’s “[n]on-expert testimony . . . on the tracing of the Invesco, Texaco,
VanKampen, and the AXA IRA accounts.” As long as the spouse claiming the separate nature of
the property overcomes the presumption of community property by clear and convincing evidence,
such as by clearly identifying the origin of and tracing funds into or out of a particular account, we
uphold the trial court’s findings awarding that spouse such amount. See, e.g., Lindsey v. Lindsey,
564 S.W.2d 143, 146 (Tex. Civ. App.—Austin 1978, no writ); Skinner v. Skinner, 202 S.W.2d 318,
319 (Tex. Civ. App.—San Antonio 1947, no writ). Marsha provides no specific argument with
regard to any other account besides the Van Kampen IRA and the Texaco 401(k). In any event,
Steven provided similar testimony and backup account documents for his AXA IRA and his Texaco
retirement plan, as well as a spreadsheet for the AXA IRA, to trace the various estates’ balances,
including Marsha’s separate balances attributable to the two-year period covered by the applicable
sections of the PNA.
21
balance as a community asset and awarded it equally between them. And, as
discussed above, the trial court’s division of community property (net assets) was
very, almost exactly, evenly split. We conclude that Marsha has not met her burden
to demonstrate that the trial court’s division was so unjust and unfair as to constitute
an abuse of discretion.15 See Marriage of O’Brien, 436 S.W.3d at 82.
We overrule Marsha’s fourth issue.
D. Contests to Marsha’s affidavit of indigence
In her fifth issue, Marsha argues that the trial court erred in connection with
allowing a hearing on, and thereafter sustaining, contests to Marsha’s affidavit of
indigence. Marsha also contends that the trial court erred because it did not
simultaneously hear her motion for appellee to pay appellate records costs.16
Here, the reporter’s record from the 2009 enforceability portion of the trial was
filed on March 27, 2015. The reporter’s record from the property division portion of
the trial was filed on April 16, 2015. The clerk’s record also was filed on April 16,
2015. A supplemental clerk’s record was filed on July 31, 2015. The complete
appellate record was filed, and Marsha filed both original and reply briefs on her own
behalf. Therefore, we conclude that any error in the trial court’s rulings regarding
Marsha’s indigence and payment of records costs has been rendered moot. See In
Interest of R.H., No. 01-14-00874-CV, 2015 WL 4594557, at *10 (Tex. App.—
Houston [1st Dist.] July 28, 2015, no pet.) (mem. op.).
We overrule Marsha’s fifth issue.
15
Marsha reasserts that the trial court erroneously considered her professional goodwill as
part of the community estate. Again, the record does not reflect such treatment here.
16
The record, however, reflects that the trial court’s hearing on October 22, 2014 considered
and ruled on both the contests and Marsha’s request that Steven or the community pay records
costs.
22
E. Federal Rule of Civil Procedure 52(a)
Marsha argues that the trial court erred under Federal Rule of Civil Procedure
52(a) with regard to its findings of facts and conclusions of law.17 Rule 52 governs
findings and conclusions in actions tried on the facts without a jury in federal court.
Fed. R. Civ. P. 52(a); see id. 1 (federal rules of civil procedure govern civil actions
and proceedings in United States district courts). We conclude that the state trial
court could not have run afoul of rule 52(a) because it did not apply.
In addition, Marsha includes various additional complaints in an argument
section entitled, “Errors in weighing evidence.” We already have addressed and
rejected Marsha’s “legal sufficiency” challenges in connection with her
reimbursement and property division issues. Marsha has waived her other “legal
sufficiency” arguments by failing to cite to the record or to any particular legal
authority. Likewise, for most of her contentions described as “factual sufficiency,”
Marsha fails to include any citations to the record or to legal authority. Therefore,
Marsha has waived these arguments. See Tex. R. App. P. 38.1(i); Cantu, 2009 WL
2589253, at *3; San Saba Energy, 171 S.W.3d at 338.18
We overrule this issue.
F. Federal Rule of Civil Procedure 60(b)(6)
In her seventh issue entitled, “Errors in managing the trial,” Marsha asserts that
she is entitled to equitable relief under Federal Rule of Civil Procedure 60(b)(6)
because mishandling of the case denied her due process, led to an improper judgment,
and deprived her of her rights. Rule 60(b)(6) provides that a federal court may
17
Marsha does not expressly include a rule 52(a) issue within her “argument and
authori[tie]s” section, but does list it as her sixth issue presented.
18
Marsha also argues in her sixth issue that “[t]he Judgment is sufficiently extraordinary and
compelling to warrant relief” under Federal Rule of Civil Procedure 60(b)(6). We address this
contention in her seventh issue.
23
relieve a party from a final judgment, order, or proceeding for “any other reason that
justifies relief.” Fed. R. Civ. P. 60(b)(6). We conclude that rule 60(b)(6) does not
apply to this case to allow for, much less entitle Marsha to, any such discretionary
relief. Nor do the two cases from the Court of Civil Appeals of Arkansas considering
motions filed under Arkansas Rule of Civil Procedure 60(b)(6) that Marsha cites
persuade us otherwise.
Marsha also cites certain sections of the Americans with Disabilities Act
governing such act’s enforcement, as well as the Fourteenth Amendment, to support
her position that the trial court’s proceedings and Marsha’s inability to participate in
them (due to lawsuit abuse post-traumatic stress disorder) deprived her “of rights
necessary for equal access to justice.” In addition, Marsha cites “the MHDDCA.” If
“the MHDDCA” refers to Illinois’s Mental Health and Developmental Disabilities
Act, such act governs the confidentiality of communications between recipients of
mental health services and therapists providing mental health services in the state of
Illinois. We cannot conclude that the trial court’s proceedings failed to afford Marsha
with due process or any other alleged rights under any of these authorities.19
Marsha also cites section 312.005 of the Texas Government Code, but fails to
link the consideration of legislative intent when interpreting statutes to any particular
statute, much less to one applicable in this case.
Finally, Marsha includes various additional complaints about the trial
proceedings, but fails to include any citations to the record or to legal authority.
Therefore, Marsha has waived these arguments. See Tex. R. App. P. 38.1(i); Cantu,
2009 WL 2589253, at *3; San Saba Energy, 171 S.W.3d at 338.
We overrule Marsha’s final issue.
19
Marsha includes this particular argument in her sixth issue, but we choose to address it in
her rule 60(b)(6) issue.
24
III. CONCLUSION
Having considered and overruled all of Marsha’s issues, we affirm the trial
court’s final decree of divorce.
/s/ Marc W. Brown
Justice
Panel consists of Justices Jamison, Donovan, and Brown.
25