Isaac Clay v. Vicky Clay

Affirmed and Opinion Filed June 30, 2014
S In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-13-00624-CV
ISAAC CLAY, Appellant
V.
VICKY CLAY, Appellee
On Appeal from the 380th Judicial District Court
Collin County, Texas
Trial Court Cause No. 380-54284-04
MEMORANDUM OPINION
Before Justices Bridges, O'Neill, and Brown
Opinion by Justice Bridges
Appellant Isaac Clay, appearing pro se, appeals from a final order on his motion for
enforcement of final decree of divorce and on appellee Vicky Clay’s motion for sanctions. In
seven issues, appellant alleges the trial court erred in: (1) awarding the marital homestead on
Nightfall Drive to Vicky when no gift was intended; (2) awarding the Ford Explorer to Vicky
when no gift was intended; (3) failing to enter judgment regarding the educational accounts; (4)
failing to enter judgment on Isaac’s claim for economic contribution against Vicky’s separate
estate; (5) ordering Isaac to file a full and unconditional release of the lis pendens on the marital
homestead; (6) ordering Isaac to file a full and unconditional release of all claims to property
asserted in his recorded schedule of separate property; and (7) taxing attorney’s fees against
Isaac on the basis that his claims were groundless and made in bad faith for the purpose of
harassment. We affirm.
Background
Isaac Clay and Vicky Cowan, f/k/a Vicky Clay, were divorced on January 24, 2005.
Isaac had filed the divorce pro se, using pre-printed forms, and had alleged that there was no
community property to divide. The divorce decree also states that there was no community
property to divide.
On March 30, 2011, Isaac and Vicky consented to an Agreed Order declaring that a
promissory note jointly payable to them was Vicky’s separate property, consistent with the
finding in the decree that there had been no community property requiring division. However, in
October of 2011, Isaac filed a pro se contested “motion for enforcement” of the 2005 divorce
decree, in which he alleged that four items of property in Vicky’s possession were his separate
property and should be delivered to him: (a) the real property on Nightfall Drive, where Vicky
resided; (b) a 2002 Ford Explorer pick-up truck; (c) two 529 Qualified Education Program
Accounts; and (d) a timeshare interest in property located in Smith County, Texas. Isaac also
sought reimbursement of funds he claimed to have paid on a debt secured by Oklahoma property
owned by Vicky and asked that it be enforced against the promissory note he had agreed
belonged to Vicky through the March 2011 Agreed Order.
On November 22, 2011, the trial court held a hearing on Isaac’s “motion for
enforcement” and Vicky’s motion for sanctions. During the course of the hearing, Isaac
appeared pro se and stated his motion was not one for enforcement, but actually a motion to
divide undivided property under section 9.201 of the family code. After hearing the testimony of
Vicky, Isaac, and Vicky’s counsel on attorney’s fees and both sides’ arguments, the trial court
entered its order on Isaac’s “motion for enforcement” and Vicky’s motion for sanctions, in
pertinent part, as follows: (1) the real property located on Nightfall Drive was transferred to
Vicky as a gift during marriage, is her separate property, and is awarded to her; (2) the 2002 Ford
Explorer was transferred to Vicky as a gift during marriage, is her separate property, and is
awarded to her; (3) the two 529 Qualified Education Program Accounts established for the
benefit of Vicky’s minor children were fully expended for their intended purpose and are no
longer available for division; (4) Isaac shall cause to be filed a full and unconditional release of
the lis pendens he filed and a full and unconditional release of all claims to property asserted in
the schedule of separate property; (5) Vicky shall recover $3,000.00 for reasonable and
necessary attorneys’ fees incurred in defending the claims found to be groundless and to have
been made in bad faith; and (6) all relief not granted herein is denied.
Analysis
We review a trial court’s division of the estate of the parties for an abuse of discretion.
Murff v. Murff, 615 S.W.2d 696, 698 (Tex. 1981). To constitute an abuse of discretion, the
property division must be manifestly unfair. O’Carolan v. Hopper, 71 S.W.3d 529, 532 (Tex.
App.−Austin 2002, no pet.). The trial court has wide discretion and can take many factors into
consideration in making a just and right division of the community property. Schlueter v.
Schlueter, 975 S.W.2d 584, 589 (Tex. 1998). However, the trial court has no discretion to divest
a spouse of separate property. Eggemeyer v. Eggemeyer, 554, S.W.2d 137, 141-42 (Tex. 1977).
We construe pro se briefs liberally; however, we hold pro se litigants to the same
standards as licensed attorneys and require them to comply with applicable laws and rules of
procedure. Mansfield State Bank v. Cohn, 573 S.W.2d 181, 184-85 (Tex. 1978). In his brief,
Isaac raises seven issues for our review.
1. Real Property
In his first issue, Isaac contends the trial court erred when it awarded the marital
homestead on Nightfall Drive to Vicky when no gift was intended.
Separate property includes the property acquired by the spouse during the marriage by a
gift, devise or descent. TEX. FAM. CODE ANN. § 3.001. “A deed for property from one spouse as
grantor to the other spouse as grantee creates a rebuttable presumption that the grantee spouse
received the property as separate property by gift.” See In re Marriage of Skarda, 345 S.W.3d
665, 671 (Tex. App.−Amarillo 2011, no pet.); Magness v. Magness, 241 S.W.3d 910, 912 (Tex.
App.−Dallas 2007, pet. denied). The presumption may be rebutted by proof the deed was
procured by fraud, accident or mistake. Magness, 241 S.W.3d at 912-13. Whether property
given by one spouse to the other is a gift and the recipient’s separate property is a fact-intensive
decision. In re Marriage of Skarda, 345 S.W.3d at 671. The trial court, as factfinder in this
case, is the sole judge of the credibility of the witnesses and may accept or reject any or all of a
witness’s testimony. Id. at 672; Magness, 241 S.W.3d at 913. The trial court was free to believe
or disbelieve any or all of the testimony. Cardwell v. Cardwell, 195 S.W.3d 856, 859 (Tex.
App.−Dallas 2006, no pet.).
The record before us demonstrates that, in November 2004, Isaac issued a quitclaim deed
in favor of Vicky, deeding her the Nightfall Drive property at issue. The record also includes a
March 31, 2011 email from Isaac to Vicky in which he states: “I know I bought and paid for the
house you live in, then gave it to you.” During the hearing, Isaac testified he paid for the
Nightfall Drive property with funds he received from a settlement, entitling him to the property.
However, his original petition for divorce and the 2005 divorce decree state there is no
community property to divide. Vicky testified, and Isaac agreed, that the first time he made a
claim to the property in question was six years after the final divorce decree was issued. The
only evidence presented to rebut the presumption the Nightfall Drive property was a gift was
Isaac’s testimony that he only intended to give Vicky the house temporarily, though “[a]t the
time, [he] did not have a plan for when [he] would reacquire the property or how it would play
out.” Further, Isaac agreed there was “no written agreement that says that [he was] supposed to
get anything back.”
Given the record before us, we conclude the trial court could have reasonably concluded
Isaac failed to establish fraud, accident or mistake in the execution of the quitclaim deed and,
therefore, failed to rebut the presumption of a gift of the Nightfall Drive property to Vicky. See
Magness, 241 S.W.3d at 913. The trial court did not abuse its discretion. See Schlueter, 975
S.W.2d at 589. We overrule Isaac’s first issue.
2. Ford Explorer
In his second issue, Isaac argues the trial court erred in awarding the 2002 Ford Explorer
to Vicky when no gift was intended. Where the husband furnishes the consideration from his
separate estate and takes title to the property in the name of his wife, it will be presumed that in
taking the title in the wife’s name, he intended to make a gift of the property to the wife. See
Carriere v. Bodungen, 500 S.W.2d 692, 694 (Tex. Civ. App. 1973); Caffey’s Ex’rs v. Cooksey,
47 S.W. 65, 67 (Tex. Civ. App. 1898).
In the March 31, 2011 email from Isaac to Vicky, he also states: “And I know I bought
and paid for a truck for you.” During the hearing, Isaac testified that he “tendered the cash to be
able to purchase the truck,” and he believed the title was “only put in her name.” Again, we note
his original petition for divorce and the 2005 divorce decree state there is no community property
to divide. Vicky testified, and Isaac agreed, that the first time he made a claim to the property in
question was six years after the final divorce decree was issued. The only evidence raised to
rebut the presumption the 2002 Ford Explorer was a gift was Isaac’s testimony that he did not
intend for it to be a gift.
Having reviewed the record before us, we conclude the trial court did not abuse its
discretion and could have reasonably concluded Isaac failed to rebut the presumption the 2002
Ford Explorer was a gift to Vicky. See Magness, 241 S.W.3d at 913; Carriere, 500 S.W.2d at
694. We overrule Isaac’s second issue.
3. Educational Accounts
In his third issue, Isaac contends the trial court erred in failing to enter judgment
regarding the 529 Qualified Educational Accounts. During Isaac’s questioning of Vicky, he
elicited testimony that he had transferred educational funds to Vicky for the benefit of her two
youngest daughters. Vicky testified she used the funds to support her daughters as they went
through college, and the accounts were closed because the “funds were exhausted.” Isaac
testified he believed funds still remained in the accounts, but offered no evidence supporting this
belief.
In its order, the trial court found the educational accounts at issue were fully expended for
their intended purpose and were no longer available for division. The trial court was free to
believe or disbelieve any or all of Isaac’s testimony. Cardwell, 195 S.W.3d at 859. Because
there was nothing to divide, we conclude the trial court did not abuse its discretion. See
Schlueter, 975 S.W.2d at, 589. We overrule Isaac’s third issue.
4. Promissory Note
In his fourth issue, Isaac complains the trial court erred in failing to enter judgment on
Isaac’s claim for “economic contribution” against Vicky’s separate estate. Specifically, Isaac
refers to his right of reimbursement with regard to a 2002 promissory note, payable by Max E.
Henry and Alison Henry to Isaac and Vicky.
Prior to 2009, the Family Code provided for “economic contribution,” a statutory right of
reimbursement for contributions by one marital estate to another. See, e.g., Nelson v. Nelson,
193 S.W.3d 624, 628 (Tex. App.−Eastland 2006, no pet.) (citing former section 3.402). In 2009,
the sections of the Family Code addressing economic contribution were amended to provide
instead for reimbursement and offset between marital estates. See TEX. FAM. CODE ANN. §
3.402; Hinton v. Burns, No. 05-12-01494-CV, 2014 WL 2134555, at *12 n. 6 (Tex. App.−Dallas
May 22, 2014, no pet.). The rule of reimbursement is purely an equitable one. See Vallone v.
Vallone, 644 S.W.2d 455, 458 (Tex. 1982); see also TEX. FAM. CODE ANN. § 3.402(b) (the court
shall resolve a claim of reimbursement by using equitable principles). The party claiming the
right of reimbursement has the burden of pleading and proving that the expenditures and
improvements were made and that they are reimbursable. Vallone, 644 S.W.2d at 459.
Reimbursement is not available as a matter of law, but lies within the discretion of the court. See
id. at 459.
Isaac contends the trial court, in its order on the motion for enforcement and motion for
sanctions, did not address Isaac’s asserted right of reimbursement with regard to the promissory
note. Our review of the record demonstrates Isaac is correct. However, during the hearing, the
trial court stated on the reimbursement claim: “[T]he property in Oklahoma has previously been
settled by an Order that was entered by agreement in which that property was awarded to [Vicky]
in this matter.” The record includes the March 31, 2011 agreed order in which the trial court
ordered the promissory note “is the separate property of Vicky Cowan, and Vicky Cowan is
awarded all rights under and appurtenant” to the promissory note. The trial court further ordered
the payor to make all payments under the promissory note solely to Vicky. Isaac testified that he
agreed and signed the agreed order. Therefore, the promissory note at issue had already been
addressed in a prior order.1 In addition, we note that the trial court’s order is denoted as a “final
1
We further note that nothing in the record demonstrates why Isaac’s claim for reimbursement could not have been asserted in the original
divorce petition.
order” and includes the following “Mother Hubbard” clause: “All relief not granted herein is
denied.” See In re Daredia, 317 S.W.3d 247, 248-49 (Tex. 2010). We, therefore, conclude the
trial court did not abuse its discretion and properly disposed of Isaac’s claim for reimbursement.
See Vallone, 644 S.W.2d at 459. We overrule Isaac’s fourth issue.
5. Lis Pendens
Isaac next contends the trial court erred in ordering Isaac to file a full and unconditional
release of the lis pendens he filed incident to this cause on the marital homestead. Specifically,
he argues the trial court’s order requiring him to file a “release” of lis pendens is not the
appropriate mechanism to remove the cloud to title. We disagree. The filing of a release is both
a customary and proper mechanism for removing the cloud on title.2 See, e.g., Alford v.
Thornburg, 113 S.W.3d 575, 580 (Tex. App.−Texarkana 2003, no pet.); First Nat. Petroleum
Corp. v. Lloyd, 908 S.W.2d 23, 24 (Tex. App.−Houston [1st Dist.] 1995, no writ).
Isaac further argues the lis pendens was valid. However, we have already determined the
Nightfall Drive property is the separate property of Vicky. Therefore, the trial court properly
ordered Isaac to file a release of lis pendens. We overrule Isaac’s fifth issue.
6. Sworn Schedule of Separate Property
In his sixth issue, Isaac asserts the trial court erred in ordering Isaac to file a full and
unconditional release of all claims to property asserted in his recorded schedule of separate
property. Isaac’s sole argument on appeal is that the “[r]esolution of the issues presented herein
in Mr. Clay’s favor will nullify the reasoning for this part of the final order.” However, we have
already resolved the preceding issues against Isaac. Therefore, we overrule Isaac’s sixth issue.
7. Attorney’s Fees
2
Isaac argues the trial court should have, instead, ordered a motion to expunge lis pendens or a motion to cancel lis pendens. However, a
motion to expunge under section 12.0071 of the property code is appropriate only when the lis pendens was improperly filed (i.e. the pleading on
which the notice is based does not contain a real property claim). See TEX. PROP. CODE ANN. § 12.0071. Further, a motion to cancel is proper
only while the case remains pending in the trial court. See TEX. PROP. CODE ANN. § 12.008.
In his final issue, Isaac contends the trial court abused its discretion in taxing attorney’s
fees against Isaac on the basis that his claims were groundless and made in bad faith for the
purpose of harassment. In its order, the trial court ordered Isaac to pay the sum of $3,000.00 out
of the $4,200.00 sought for reasonable and necessary attorney’s fees “incurred in defending
those claims found to be groundless and to have been made in bad faith or for the purpose of
harassing [Vicky].” The trial court found the following: (1) Isaac knew he had given the real
property and the 2002 Ford to Vicky as gifts, and his claims to the contrary contained in his
motion for enforcement were wholly groundless and without support in the evidence and (2)
Isaac’s claims in his motion for enforcement seeking to be awarded the real property and the
2002 Ford, including his filing of a lis pendens and sworn schedule of separate property, were
made in bad faith or for the purpose of harassing Vicky.
In a proceeding to divide property, the trial court has discretion to award reasonable
attorney’s fees. See TEX. FAM. CODE ANN. § 9.205. Here, however, the trial court opted to
award fees as a sanction for Isaac’s assertion of “groundless” claims and claims “made in bad
faith of for the purpose of harassing” Vicky. We review the imposition of sanctions for an abuse
of discretion. See Shilling v. Gough, 393 S.W.3d 555, 560 (Tex. App.−Dallas 2013, no pet.)
(citing Low v. Henry, 221 S.W.3d 609, 614 (Tex. 2007)). We will reverse a trial court’s ruling
only if the court acted without reference to any guiding rules and principles, making its ruling
arbitrary or unreasonable. See Shilling, 393 S.W.3d at 560.
Isaac’s sole argument on this issue is again that the “resolution of the issues presented
herein in Mr. Clay’s favor will nullify the award of attorney’s fees against Mr. Clay.” However,
as already noted, we have resolved Isaac’s issues against him. We conclude the trial court did
not abuse its discretion in awarding attorney’s fees, and we overrule Isaac’s seventh issue. See
id.
Conclusion
Having overruled Isaac’s seven issues, we affirm the judgment of the trial court.
130624F.P05
/David L. Bridges/
DAVID L. BRIDGES
JUSTICE
S
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
ISAAC CLAY, Appellant On Appeal from the 380th Judicial District
Court, Collin County, Texas
No. 05-13-00624-CV V. Trial Court Cause No. 380-54284-04.
Opinion delivered by Justice Bridges.
VICKY CLAY, Appellee Justices O'Neill and Brown participating.
In accordance with this Court’s opinion of this date, the judgment of the trial court is
AFFIRMED.
It is ORDERED that appellee VICKY CLAY recover her costs of this appeal from
appellant ISAAC CLAY.
Judgment entered June 30, 2014