Daniel v. Daniel

779 S.W.2d 110, 1989 Tex. App. LEXIS 2550, 1989 WL 119722
CourtCourt of Appeals of Texas
DecidedOctober 12, 1989
Docket01-88-00420-CV
StatusPublished
Cited by26 cases

This text of 779 S.W.2d 110 (Daniel v. Daniel) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Daniel v. Daniel, 779 S.W.2d 110, 1989 Tex. App. LEXIS 2550, 1989 WL 119722 (Tex. Ct. App. 1989).

Opinions

OPINION

EVANS, Chief Justice.

This is an appeal from a divorce decree that confirmed the validity and enforceability of a post-nuptial property agreement and, pursuant to said agreement, effected a division of the parties’ marital estate.

The parties to this action, Mr. and Mrs. James Daniel, married in February 1981. After five years of marriage, they entered into a “Property Agreement,” dated February 14, 1986, which is the principal subject of this dispute. In this Property Agreement, which covered properties owned, both separate and communal, each spouse agreed that: (1) all income, on and after the date of the Agreement, from a spouse’s separate property (owned then or in the future) would become the separate property of that spouse; (2) all monies earned through a spouse’s personal services and efforts would become the separate property of that spouse; (3) past and future trust distributions to Mrs. Daniel from any trust created by her prior to the marriage would become her separate property; and (4) trust distributions to Mr. Daniel, from any trust of which he was the beneficiary, would become his separate property. The Property Agreement also provided that each spouse transfer to the other spouse, as the other’s separate property, such rights, claims, and property interests as were consistent with, and in furtherance of, the provisions of the Agreement.

Historically in Texas, a husband and wife could not, by “mere agreement,” change their community property into separate property. See Kellett v. Trice, 95 Tex. 160, 170, 66 S.W. 51, 54 (1902); Cameron, Hoffman & Yutterberg, Marital and Premarital Agreements, 39 Baylor L.Rev. 1095 (1987). In 1980, however, Texas voters approved an amendment to art. XVI, sec. 15 of the Texas Constitution, which allows a [112]*112husband and wife, without prejudice to preexisting creditors, to enter into written agreements for the partition or exchange of their community interests into separately owned properties. To implement this constitutional amendment, the 67th Legislature amended subchapter C of chapter 5 of the Texas Family Code, effective September 1, 1981.1 Six years later, the 70th Legislature again amended subchapter C, designating it “Property Agreements,” and dividing it into two parts.2

In this case, we are concerned only with Part 2, sections 5.52, 5.53, and 5.55, which pertain to post-nuptial agreements. These sections provide:

Sec. 5.52. Partition or Exchange of Community Property.
At any time, the spouses may partition or exchange between themselves any part of their community property, then existing or to be acquired, as they may desire. Property or a property interest transferred to a spouse by a partition or exchange agreement becomes his or her separate property.
Sec. 5.53. Agreements Between Spouses Concerning Income or Property Derived from Separate Property.
At any time, the spouses may agree that the income or property arising from the separate property then owned by one of them, or which may thereafter be acquired, shall be the separate property of the owner.
Sec. 5.55. Enforcement.
(a) A partition or exchange agreement is not enforceable if the party against whom enforcement is sought proves that:
(1) that party did not execute the agreement voluntarily; or
(2) the agreement was unconscionable when it was executed and, before execution of the agreement, that party:
(A)was not provided a fair and reasonable disclosure of the property or financial obligations of the other party;
(B) did not voluntarily and expressly waive, in writing, any right to disclosure of the property or financial obligations of the other party beyond the disclosure provided; and
(C) did not have, or reasonably could not have had, an adequate knowledge of the property or financial obligations of the other party.
(b) An issue of unconscionability of a partition or exchange agreement shall be decided by the court as a matter of law.

Tex. Fam.Code Ann. secs. 5.52, 5.53, and 5.55 (Vernon Supp.1989).

Mrs. Daniel instituted this divorce action on September 23, 1987. By answer and counterclaim to her supplemental petition, Mr. Daniel asserted that the Property Agreement was unenforceable and should be set aside on theories of fraud, uncon-scionability, unjust enrichment, and breach of fiduciary duty.

The case was tried to a jury, and when both sides rested, the court directed a verdict in favor of Mrs. Daniel. In its judgment, the trial court concluded in part:

Only three issues, under the pleadings and evidence, and the stipulation of counsel were in dispute as follows:
(1) the validity and effectiveness of the provisions of the Property Agreement between the parties dated February 14, 1986 concerning:
(a) the retroactive characterization of income;
(b) the transfer of Husband’s interest in accumulated income earned prior to the date of the Agreement on Wife’s separate property, particularly the Jean Warren Young Trust “A”.
(2) the ownership and partition of an IRS refund check for calendar 1986, and the ownership of a claim for refund for calendar 1983; and
(3) the award of attorney’s fees and expenses.
[113]*113The Court was of the opinion that FC § 5.55 is to be utilized in determining the enforceability of the Property Agreement of the parties dated February 14, 1986. The Court finds that there are no pleadings nor any evidence suggesting that Respondent did not voluntarily execute said agreement as provided by FC § 5.55(a)(1). The Court further finds that said agreement is not unconscionable as a matter of law as provided by FC § 5.55(a)(2) and § 5.55(b). The Court further finds that the common law defenses asserted by Respondent have been superseded by FC § 5.55 but, nevertheless, finds there is not sufficient evidence to warrant submission of special issues thereon to the jury. Accordingly, the Court finds that said agreement is valid and enforceable as a matter of law. The Court further finds that it is undisputed that the federal income tax paid by the parties in 1983, 1984, 1985 and 1986 was paid (except for a small payment made by Respondent in the form of withholding) by a trust established by Petitioner in 1959 which, under the Property Agreement dated February 14, 1986, is her separate property.

In separate amended findings of fact and conclusions of law, the court found that Mr. Daniel voluntarily executed the Property Agreement, and that the evidence was insufficient to warrant submission of special issues on any common law defense. The court concluded, as a matter of law, that the agreement was not unconscionable and that it was valid and enforceable.

On this appeal, Mr. Daniel asserts 18 points of error, which are grouped to reflect common issues.

We first consider Mr.

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Bluebook (online)
779 S.W.2d 110, 1989 Tex. App. LEXIS 2550, 1989 WL 119722, Counsel Stack Legal Research, https://law.counselstack.com/opinion/daniel-v-daniel-texapp-1989.