Texas Family Law does not mandate a 50-50 division of property in a divorce. Under Texas Family Law, the Court is charged with a duty to divide marital property in a manner that is “just and right.”
Appellate Courts find in some divorces that 80-20 property division is “just and right.” Depending on the size of the estate, we see disproportionate property divisions falling in the range between 51 percent and 60 percent quite often.
Under Texas Family Law, a divorcing spouse may be entitled to a disproportionately larger share of the community estate depending on the facts of that particular case. Each case is unique and one of the primary factors the Court considers in making a disproportionate property division is disparity in earning capacity. If one party has an earning capacity of $150,000 per year and the other can earn only $30,000 per year, the Court may very well grant a disproportionately larger share of the property to the spouse with the lower earning ability. The law assumes that the higher income earning spouse can recover the difference more quickly than the lower earning spouse
The 1981 landmark case Murff vs. Murff established a total of 23 factors the Court can consider in granting a disproportionate property division, including
- disparity in the age of each spouse ( a significantly younger spouse has more time to replace assets than the older spouse);
- education and future employability of the spouses;
- the size of separate estates of the spouses;
- the relative physical conditions of the spouses;
- the length of the marriage, and
- attorney fees paid by a spouse in the divorce.
Fault may be a factor in divorce property division settlements
Texas is known as a “no fault” state. Many people take this to mean that fault can play no part in a Texas Family Law case. The reference to “no fault” means that a spouse is not required to prove a statutory fault ground in order to obtain a divorce in Texas. The only requirement to obtain a divorce under Texas Family Law is the belief by one of the spouses that the marriage has such irreconcilable differences it cannot continue.
Fault in the breakup of the marriage can be a factor in divorce property division settlements. Fault is a legal term of art and typically refers to a statutory fault ground, including:
- Conviction of a felony
- Breach of fiduciary duty
The Court may consider these or other factors in deciding the division of property in a divorce. A trial court in a Texas Family Law divorce has broad discretion and may see things very differently than one individual party.
Breach of Fiduciary Duty and the Reconstituted Estate
Under Texas Family Law, each party owns an undivided one-half interest in every asset owned by the community estate, whether it be a house, car, bank account or other asset. When two people marry both are entering into a financial partnership and because of this financial partnership, each spouse owes a fiduciary duty to the other to manage the community estate in a manner that protects the assets owned by the other party.
The community estate belongs to both of the spouses. As such, every financial decision made by one spouse impacts the other spouse’s share of the community estate. A spouse is entitled to rely on the other spouse to carefully and responsibly manage the community estate. Unfortunately, some spouses violate that duty by spending community funds in a way that, if the other spouse knew of it, that other spouse would never approve. An example of this would be if a spouse engages in a romantic relationship with someone else, the innocent spouse would certainly not be okay with their spouse spending any of the community money on that other romantic partner.
Texas Family Law provides a method by which the community estate can recover the money spent in this way. The innocent spouse can bring a “Breach of Fiduciary Duty” claim, often referred to as “constructive fraud,” involving secret or unauthorized transfers, which is also referred to as “waste” of the community property. In this way, a court can add any such wasted money or assets to the assets that still remain in the estate.
For example, if you had a $1,000,000 estate, your spouse spent $200,000 on that spouses’ romantic partner, you would be left with an estate worth $800,000. If you can prove a waste claim in the amount of $200,000, the judge can add that $200,000 back into the estate to create what is called under Texas Family Law as a “Reconstituted Estate.” The reconstituted estate is now worth $1,000,000. If the judge then divides that $1,000,000 in half, the innocent spouse would get $500,000 of the remaining assets and the spouse that wasted assets would receive $300,000 of the remaining assets. In such an instance, the judge is simply saying that the spouse at fault already got $200,000 which was spent on the romantic partner.
In this example, if the spouse at fault had wasted $500,000, the innocent spouse would receive everything left in the estate. What if the at-fault spouse wasted $600,000? In such an instance, the innocent spouse could receive all of the remaining community estate ($400,000) plus a judgment against the guilty spouse for $100,000. This presumes a 50/50 division. If the innocent spouse proves that spouse is entitled to more than 50% of the community, that innocent spouse could receive even more of the remaining property or a larger judgment against the guilty spouse.
Sufficient Evidence for Either a 50-50 or a Disproportionate Property Settlement
It is important to select an experienced Family Law attorney and listen carefully to the nuances of these terms and concepts that the courts will follow.
Your attorney must present sufficient evidence in support of your position to convince the court to grant or not grant a disproportionate share of your community property. If you believe a 50-50 division is most appropriate and your spouse’s attorney argues against it, your attorney will need to present evidence to controvert your spouse’s argument.
Many cases have been decided on these factors and that precedent affects how the Judge will listen to and consider your case. An attorney who is experienced in bringing these cases before Texas Family Law courts can help you make the strongest case for either a disproportionate or a 50-50 property division settlement.