Kyson v. Kyson

596 So. 2d 1308, 1991 WL 163391
CourtLouisiana Court of Appeal
DecidedSeptember 19, 1991
Docket22586-CA
StatusPublished
Cited by13 cases

This text of 596 So. 2d 1308 (Kyson v. Kyson) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kyson v. Kyson, 596 So. 2d 1308, 1991 WL 163391 (La. Ct. App. 1991).

Opinion

596 So.2d 1308 (1991)

Patricia Ann Faust KYSON, Plaintiff-Appellant,
v.
Gene Douglas KYSON, Defendant-Appellee.

No. 22586-CA.

Court of Appeal of Louisiana, Second Circuit.

August 21, 1991.
On Rehearing September 19, 1991.
Writ Denied May 22, 1992.

*1309 Love, Rigby, Dehan, McDaniel & Goode by Kenneth Rigby, Shreveport, for plaintiff-appellant.

A. Richard Snell, Bossier City, for defendant-appellee.

Before NORRIS, HIGHTOWER and STEWART, JJ.

STEWART, Judge.

Plaintiff, Patricia Ann Faust Kyson, appeals from a judgment separating community property of the marriage between plaintiff and defendant, Gene Douglas Kyson. We remand.

FACTS

Patricia Ann Faust and Gene Douglas Kyson were married on January 30, 1981. On February 2, 1982, Gene Kyson executed an affidavit of paraphernality in accordance with LSA-C.C. Art. 2339 which reserved the rents from certain separate property as his separate property. That affidavit was recorded in Bossier Parish, the situs of his separate immovable property, on February 5, 1982.

*1310 On September 24, 1986, Mrs. Kyson filed a petition for divorce from Gene Kyson and was granted a divorce on March 4, 1987.

Defendant filed a petition to partition the community assets on June 26, 1987, attaching a detailed descriptive list thereto. In response, plaintiff filed a set of interrogatories and a request for production of documents and thereafter filed her answer and detailed descriptive list. Plaintiff additionally filed a traverse to defendant's detailed descriptive list of assets and liabilities.

The matter was presented to the district court with testimonial and documentary evidence, including dozens of exhibits entered into evidence by plaintiff and defendant. Plaintiff appeals the district court judgment which held that rental income that her ex-husband, defendant, Gene Douglas Kyson, received from separate property which he owned, managed, repaired, and oversaw was his separate property. She also complains that the district court incorrectly characterized a bank account and an investment account as separate property and that the district court refused to find that defendant's early termination of a ten-year lease violated his fiduciary duty to properly maintain a community asset. Finally, she asks this court to render a judgment in her favor for one-half of the allegedly community income for which Mr. Kyson failed or refused to account.

DISCUSSION

Community property comprises: property acquired during the existence of a legal regime through the effort, skill, or industry of either spouse ... all other property not classified by law as separate property. LSA-C.C. Art. 2338.

However, the natural and civil fruits of the separate property of a spouse, minerals produced or attributable to a separate asset, and bonuses, delay rentals, royalties, and shut-in payments arising from mineral leases are community property. A spouse may reserve them as separate property by declaration made in an authentic act or in an act under private signature duly acknowledged. LSA-C.C. 2339.

Fruits are things that are produced by or derived by another thing without diminution of its substance. There are two kinds of fruits; natural fruits and civil fruits. Natural fruits are products of the earth or of animals. Civil fruits are revenues derived from a thing by operation of law or by reason of a juridical act, such as rentals, interest, and certain corporate distributions. LSA-C.C. Art. 551.

In her first assignment of error, Mrs. Kyson complains that rental funds received by her husband were community property, contrary to the trial court's finding.

Neither party contests the fact that the income in dispute is qualified as rental income received from the separate property of Mr. Kyson. The parties, however, dispute the classification of this income. Gene Douglas Kyson argues that under a clear wording of LSA-C.C. Art. 2339, when he filed an affidavit of separation of property, the rental payments became separate property. Mrs. Kyson, however, argues that the rental income from the separate property was produced primarily as a result of the effort, skill, or industry of Mr. Kyson and therefore the filing of the affidavit under Art. 2339 does not have the effect of rendering the payments separate property.

The testimony of Mr. Kyson indicates that he considered himself a "rental manager." He testified that he handled and managed the property which included responsibilities of finding tenants, collecting the rent, and making repairs and improvements on the property. The total income produced by the rental properties from January 30, 1981 to September 24, 1986 amounted to $99,150.44. The remainder of income not relating to rental properties for the same period of time amounted to $54,714.00.[1]

Spaht and Hargrave discuss the issue in this case in their treatise on Louisiana civil law:

*1311 Fruits are "things that are produced by or derived from another thing without diminution of its substance." Civil code examples of natural fruits are "products of the earth or of animals." Civil fruits include "revenues derived from a thing by operation of law or by reason of a juridical act, such as rentals, interest, and certain corporate distributions." In the simplest case, production of these fruits would not involve labor or industry of a spouse—the typical passive investment. However, it is quite common for many investments to combine one spouse's separate capital with community labor to produce fruits. In such an instance, proration is necessary and an often less than precise allocation is required.

16 K. Spaht and W.L. Hargrave, Louisiana Civil Law Treatise, "Matrimonial Regimes" § 3.5 at 48 (1989) [hereinafter cited as Spaht & Hargrave].

While the money received by Mr. Kyson qualifies as rental revenue, the rental payments were the result of a substantial amount of time spent by Mr. Kyson on managing the rental properties.

In Paxton v. Bramlette, 228 So.2d 161 (La.App. 3d Cir.1969), the Third Circuit Court of Appeal addressed certain issues of whether salaries received by the wife during a marriage were separate or community property. The wife filed a written instrument declaring her intention to administer her paraphernal property for her separate benefit. She formed a realty company and received an annual salary of $1,800 from the corporation in addition to rental payments. She personally performed most of the managerial duties of the operation of the realty company, maintained a desk where the realty company was housed, collected all rents, deposited them in the bank, handled all the maintenance repairs of the various buildings, and generally held most responsibility for the realty company. The wife additionally received a salary of $12,000 from a separate company in which she owned 82 percent of the stock, but received no dividends. She maintained a desk in the building of the corporate offices but had no specific duties. The court held that the $1,800 received from the realty company was community property and also found that the $12,000 paid to her annually were earnings derived from her labor and industry because she performed substantial services to the corporation, in addition to reporting these sums on her federal income tax returns as salary. The court therefore classified the $12,000 as salary which was property of the community.

While Mrs. Kyson cites Paxton for the proposition that the rent received by Mr.

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Bluebook (online)
596 So. 2d 1308, 1991 WL 163391, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kyson-v-kyson-lactapp-1991.