Lisa Smalley v. Eric C. Smalley, Independent Administrator of the Estate of John Hubert Smalley, III

399 S.W.3d 631, 2013 WL 1278415, 2013 Tex. App. LEXIS 4038
CourtCourt of Appeals of Texas
DecidedMarch 28, 2013
Docket14-11-00787-CV
StatusPublished
Cited by12 cases

This text of 399 S.W.3d 631 (Lisa Smalley v. Eric C. Smalley, Independent Administrator of the Estate of John Hubert Smalley, III) 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
Lisa Smalley v. Eric C. Smalley, Independent Administrator of the Estate of John Hubert Smalley, III, 399 S.W.3d 631, 2013 WL 1278415, 2013 Tex. App. LEXIS 4038 (Tex. Ct. App. 2013).

Opinion

*634 OPINION

KEM THOMPSON FROST, Justice.

An ex-wife appeals from the trial court’s order granting summary judgment in favor of the administrator of the estate of her ex-husband and denying the ex-wife’s motion for summary judgment. The ex-wife also challenges the trial court’s final judgment awarding attorney’s fees to the administrator. We affirm.

I. Factual and Procedural Background

John Hubert Smalley, III, was a federal employee covered by the Federal Employees’ Retirement System. John participated in a Thrift Savings Plan, a type of retirement savings account for federal employees that is administered by the Federal Retirement Thrift Investment Board (“Board”). 1 In February 1993, prior to John’s marriage to appellant Lisa Smalley, John designated Lisa as the beneficiary of John’s Thrift Savings Plan; it is undisputed that John’s designation was valid and made in accordance with federal regulations. John and Lisa were married in September of that same year. John also designated Lisa as the “payable on death” beneficiary of 150 United States Savings Bonds, which were issued between August 2003 and June 2008 (“Savings Bonds”).

John and Lisa were divorced in September 2008. The agreed final divorce decree incorporated terms of a signed mediation agreement; the parties stipulated that their written agreement contained in the divorce decree was enforceable as a contract. The divorce decree provides, in relevant part, as follows:

IT IS ORDERED AND DECREED that the husband, John Hubert Smalley, III, is awarded the following as his sole and separate property, and the wife is divested of all right, title, interest, and claim in and to that property:
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H-4. Any and all sums, whether matured or unmatured, accrued or unac-crued, vested or otherwise, together with all increases thereof, the proceeds therefrom, and any other rights related to the following:
a. The Thrift Savings Plan U.S. Government Retirement Account in the name of the husband, subject to any indebtedness thereon; and
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H-6. The following stocks, bonds, and/or securities, together with all dividends, splits, and other rights and privileges in connection therewith:
a. The U.S. Treasury Savings Bonds, Series 1, EE, E and Savings Notes in the name of either or both parties.

It is undisputed that John did not change the beneficiary for his Thrift Savings Plan following his divorce from Lisa, and that no contingent beneficiary was named. It is undisputed that John did not have the Savings Bonds reissued and did not change the beneficiary designation for the Savings Bonds following the couple’s divorce.

John died intestate in February 2010. Following John’s death, Lisa submitted a request for the funds from John’s Thrift Savings Plan, claiming to be the beneficiary of this plan. The Board determined that Lisa was the beneficiary of one-hundred percent of the proceeds from this plan. The Board distributed these proceeds, amounting to over $300,000, to Lisa, *635 who transferred the funds into an inherited Individual Retirement Account. No other sums remained in John’s Thrift Savings Plan account following the distribution. Following John’s death, Lisa obtained possession of the Savings Bonds, which had a redemption value in excess of $20,000 as of June 2011.

Appellee Eric Smalley, in his capacity as independent administrator of the estate of John Hubert Smalley, III, deceased (the “Administrator”) filed a petition in the probate court below seeking to enforce the terms of John and Lisa’s agreed final divorce decree as it pertained to the Savings Bonds and proceeds distributed from the Thrift Savings Plan. The Administrator asked the trial court to order Lisa to deliver to the Administrator the proceeds from John’s Thrift Savings Plan and the Savings Bonds. The Administrator also sought to recover his reasonable attorney’s fees.

The parties filed cross-motions for summary judgment. Lisa, by traditional motion for summary judgment, sought the following relief from the trial court:

• a declaration that Lisa is the legal owner of the proceeds from John’s Thrift Savings Plan,
• a declaration that Lisa is the legal owner of the Savings Bonds,
• dismissal of the Administrator’s claims on the grounds that the Administrator’s waiver theory based upon the divorce decree is either preempted by federal law or violates an anti-alienation statute applicable to the Thrift Savings Plan, and
• an award to Lisa and against the Administrator of Lisa’s reasonable and necessary attorney’s fees.

In the alternative, Lisa asserted a no-evidence ground claiming that there was no evidence of Lisa’s intent to relinquish her rights to the proceeds from John’s Thrift Savings Plan and the Savings Bonds.

In his motion, the Administrator sought judgment as a matter of law on his claims. The Administrator asserted that the agreed divorce decree operated as a waiver of all Lisa’s rights to the proceeds from the Thrift Savings Plan and to the Savings Bonds. The Administrator also argued, that neither federal preemption nor the anti-alienation statute applicable to the Thrift Savings Plan prevent enforcement of the waiver in the agreed final divorce decree.

Following a hearing on the motions, the trial court granted the Administrator’s motion, ruling that (1) the divorce decree was an enforceable contract; (2) under the terms of the divorce decree Lisa waived her right to the proceeds from John’s Thrift Savings Plan and to the Savings Bonds; and (3) Lisa breached the contract by obtaining and retaining the Savings Bonds and the proceeds from the Thrift Savings Account. The trial court ordered Lisa to deliver to the Administrator the Savings Bonds and all proceeds from the Thrift Savings Account. The trial court denied Lisa’s motion for summary judgment. Following a bench trial on attorney’s fees, the trial court rendered final judgment, incorporating its prior summary-judgment order and awarding the Administrator reasonable and necessary attorney’s fees for trial as well as conditional awards of reasonable and necessary appellate attorney’s fees.

II. Standards op Review

Lisa challenges the trial court’s summary judgment in favor of the Administrator and the trial court’s denial of her motion for summary judgment. In a traditional motion for summary judgment, if the movant’s motion and summary-judgment evidence facially establish its right to *636 judgment as a matter of law, the burden shifts to the nonmovant to raise a genuine, material fact issue sufficient to defeat summary judgment. M.D. Anderson Hosp. & Tumor Inst. v. Willrich, 28 S.W.3d 22, 23 (Tex.2000).

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399 S.W.3d 631, 2013 WL 1278415, 2013 Tex. App. LEXIS 4038, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lisa-smalley-v-eric-c-smalley-independent-administrator-of-the-estate-of-texapp-2013.