COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 2-04-230-CV
MARY
ESTELLE WILLIAMS APPELLANT
V.
CLIFFORD
LOREN WILLIAMS APPELLEE
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FROM
THE 324TH DISTRICT COURT OF TARRANT COUNTY
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MEMORANDUM OPINION1
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In
seven issues, Appellant Mary E. Williams appeals from a divorce and from the
related division of the community estate. The couple has no children, and the
main issues on appeal concern real property and reimbursement. Because we hold
that the trial court abused its discretion in awarding Appellee Clifford L.
Williams reimbursement for $80,000 in separate property monies he allegedly
expended on the community estate, we reverse and remand the case to the trial
court for a new trial on the division of the community estate but affirm the
divorce as modified.
Background
Facts
After
their marriage in 1986, the parties bought approximately 6.58 acres in 1987 and
another adjoining acre in 1993. They built a two-story shop building on the
acre, and they repaired the fence and added a tank, a well, utilities, storage
sheds, and landscaping to the entire property before building a house. There is
no evidence about the value of the approximately 7.58 acres including
improvements before the parties began building the house. While the house was
being completed, the couple lived in their shop. They made periodic payments to
the contractor while the new house was being completed. At the time they closed
on the house, they financed the remaining amount due on the house as well as the
purchase price of five additional adjoining unimproved acres, giving them total
acreage of about 12.58 acres (“the Jaybird Lane property”). Later, when the
couple was contemplating divorce, Clifford refinanced the note. The trial court
found:
• During
the marriage, the couple acquired a house and land at 1291 Jaybird Road,
Springtown, Texas, worth $220,000 with a net equity of $161,700.
• The
value of Clifford’s Prudential Account before the marriage is unknown.
• On
the date of divorce, the mortgage balance for the real property located at 1291
Jaybird Lane, Springtown, Texas was $58,300.
• The
real property located at 1291 Jaybird Lane, Springtown, Texas was purchased for
approximately $172,000 on March 15, 2001.
• Mary
paid a down payment of $13,000 from her Prudential Funds for the real property
located at 1291 Jaybird Lane, Springtown, Texas.
• “CLIFFORD
LOREN WILLIAMS MARY ESTELLE WILLIAMS” [sic] paid a down payment of
approximately $80,000 and a down payment of $13,000 from his separate funds for
the real property at 1291 Jaybird Lane, Springtown, Texas.
• The
original mortgage balance for the real property located at 1291 Jaybird Lane,
Springtown, Texas was $66,000 on March 15, 2001.
• Mary’s
separate estate has a claim of economic contribution with respect to the
Springtown property for $13,000 representing her contribution and $27,850
representing her community interest in the property.
• The
division of the community estate results in a 50/50 division of the community
estate, with each party receiving $99,549 worth of the community estate.
Market Value of
the Jaybird Lane Property
In
her third issue, Mary contends that the evidence is legally insufficient to
support the trial court’s finding that the market value of the Jaybird Lane
property was $220,000. The trial court's findings of fact are reviewable for
legal sufficiency of the evidence to support them by the same standards that are
applied in reviewing evidence supporting a jury's answer.2
But a court of appeals cannot make findings of fact; it can only “unfind”
facts.3 An appellant attacking the legal
sufficiency of an adverse answer to an issue on which she had the burden of
proof must overcome two hurdles.4 First, the
record must be examined for evidence that supports the finding, while ignoring
all evidence to the contrary. Second, if there is no evidence to support the
finding, then the entire record must be examined to see if the contrary
proposition is established as a matter of law.5
The issue should be sustained only if the contrary proposition is conclusively
established.6
The
documentary evidence shows that the combined acre and 6.58 acres were appraised
for tax purposes at $220,000, and the additional five acres, bought for $20,000
at the same time that the couple closed on the house, was appraised for tax
purposes at $30,000. Mary testified that the market value of the Jaybird Lane
property is $250,000. But she also testified that her private appraisal was
lower. The fair market value of the Jaybird Lane property listed on Clifford’s
inventory, which was admitted into evidence, is $200,000, and Clifford testified
that the property is worth $200,000. Clifford also testified that he determined
the fair market value listed on his inventory from the tax appraisal values,
that he thought those values were “fairly accurate,” and that he agreed with
the appraisals. The market value determined by the trial court falls between the
parties’ numbers. We cannot say that Mary established the market value of the
Jaybird Lane property at $250,000 as a matter of law.7
We overrule Mary’s third issue in part. Because of our disposition of this
appeal, we do not reach the remainder of the third issue, which challenges the
factual sufficiency of the evidence to support the finding.8
Reimbursement
to Clifford
In
her first issue, Mary contends that the trial court’s finding that Clifford
paid a down payment of approximately $80,000 and $13,000 from his separate funds
for the Jaybird Lane property is not proved by clear and convincing evidence. In
her second issue, Mary contends that Clifford did not prove his claim of
reimbursement by clear and convincing evidence. We agree.
The
judge’s letter to the parties demonstrates that he awarded Clifford 100%
reimbursement for the $93,000. To the extent that the trial court erred in
awarding Clifford reimbursement for the $13,000 he allegedly took out of his
Prudential Financial 401(k) fund to pay for part of the construction costs, an
equal, offsetting error occurred when the trial court awarded Mary reimbursement
for $13,000 she allegedly took out of her Lockheed Martin savings plan or her
401(k) fund to pay for construction costs because our review of the record shows
that neither party demonstrated by clear and convincing evidence that the funds
were not community property.9 We will
therefore focus on the $80,000 figure.
The
parties already owned the land before they built the house, and Clifford’s own
testimony shows that payments for the completion of the house were made
periodically; there was no down payment. Specifically, Clifford testified that
he deposited proceeds of $90,500 from the sale of his separate property into his
Prudential account, which was connected to his IRA. He testified that the only
monies that went in to the Prudential checking account were those proceeds. He
also testified that the only checks written as periodic payments for the house,
except for the withdrawals allegedly made equally from each spouse’s 401(k)
fund, were written on his Prudential checking account. Finally, he testified
that the Prudential checking account no longer exists and that he must have
misplaced the checks. He did not produce the checks in discovery. A copy of the
check he received for the sale of his separate property is in evidence; however,
no documentary evidence, such as checks, deposit slips, withdrawal slips, or
bank statements, was admitted to show that the check was deposited into a
segregated account or that checks were written from a segregated account to the
contractor. Similarly, no documentary evidence shows that the couple was
billed by a contractor.
Mary
conceded that Clifford paid some of the separate property proceeds into the new
house but disagreed that he paid $80,000. She also testified that the
$90,500 check was not deposited into any account that she had possession of or
wrote checks on. Additionally, she testified that they lived in the shop
while they built the house and continued to work and draw their salaries during
that time. Finally, she testified that Clifford wrote some of the checks
to pay for the house and that she wrote some of the checks to pay for the house,
and that a large portion of the house was paid for out of community funds in her
possession.
Documentary
evidence that Clifford received money from the sale of his separate property
does not tend to prove that he expended that separate property for the
community’s benefit. Consequently, we hold that Clifford failed to prove
how much of his separate property, if any, went toward the building of the new
house. We sustain Mary’s first issue.
Further,
even if Clifford had proved that he spent $80,000 of his separate property on
the house, he still failed to prove the amount of his reimbursement claim.
When funds from one marital estate are used to make payments on or capital
improvements to the property of another marital estate, the proper measure of
reimbursement is the enhancement in value of the receiving estate.10 A house added to land already owned by an estate
is a capital improvement.11 The enhancement
in value is the difference between the fair market value of the receiving estate
before the improvements or payments from the giving estate are made and
the fair market value of the receiving estate after the payments or
improvements are made; it is not the actual cost of the payments or
improvements.12 The party claiming
reimbursement bears the burden of establishing the net benefit to the payee
estate.13 No evidence was admitted that
indicated the fair market value of the property before the house was built, but
evidence was admitted that the couple had added improvements to the property
before building the house. Clifford specifically testified that he did not know
what the value of the admittedly improved property was at the time the house was
built. Consequently, Clifford failed to meet his burden of showing the fair
market value of the property before the house was added. Without that figure,
the proper amount of the reimbursement claim cannot be determined. We sustain
Mary’s second issue.
Abuse of
Discretion in Dividing Community Estate
In
her fifth issue, Mary contends that the property division was manifestly unfair
and an abuse of discretion. We agree. A trial court is charged with dividing the
community estate in a “just and right” manner, considering the rights of
both parties.14 If there is any reasonable
basis for doing so, we must presume that the trial court exercised its
discretion properly.15 We will not
disturb the trial court’s division unless the record demonstrates “that the
division was clearly the result of an abuse of discretion.”16
That is, we will not reverse the case unless the record clearly shows that the
trial court was acting arbitrarily or unreasonably.17
The complaining party has the burden of proving from the record that the
division was so unjust that the trial court abused its discretion.18
The values of individual items “are evidentiary to the ultimate issue of
whether the trial court divided the properties in a just and right manner.”19
By
awarding Clifford reimbursement of $80,000, the trial court drastically reduced
the size of the community, which according to the trial court’s calculations
was worth about $199,100, excluding the reimbursement amounts. Because Clifford
was awarded the entire $80,000 as his separate property, Mary was awarded much
less than the fifty percent share of the community that the trial court’s
letter to the parties and the findings of fact and conclusions of law indicate
that the trial court intended to award her. We sustain Mary’s fifth issue.20
Name Change
In
her seventh issue, Mary contends that the trial court abused its discretion by
failing to change her name to Mary Estelle Lindsey under Texas Family Code
section 6.706(a).21 Mary requested the name
change in her petition. Clifford agrees that her name should be
changed. We sustain Mary’s seventh issue.
Conclusion
Accordingly,
we (1) modify the divorce decree to order that Mary’s name be changed to Mary
Estelle Lindsey and (2) affirm as modified the portion of the divorce decree
granting the divorce but (3) reverse and remand the case for a new trial on the
division of the community estate.
LEE
ANN DAUPHINOT
JUSTICE
PANEL
A: LIVINGSTON, DAUPHINOT, and WALKER, JJ.
DELIVERED:
May 26, 2005
NOTES
1.
See Tex. R. App. P. 47.4.
2.
Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996); Catalina v. Blasdel,
881 S.W.2d 295, 297 (Tex. 1994).
3.
Tex. Nat'l Bank v. Karnes, 717 S.W.2d 901, 903 (Tex. 1986).
4.
Victoria Bank & Trust Co. v. Brady, 811 S.W.2d 931, 940 (Tex. 1991).
5.
Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001); Sterner v.
Marathon Oil Co., 767 S.W.2d 686, 690 (Tex. 1989).
6.
Dow Chem., 46 S.W.3d at 241-42.
7.
See In re Marriage of Scott, 117 S.W.3d 580, 585 (Tex. App.—Amarillo
2003, no pet.) (stating that “authority has long recognized that values
reflected by the tax rolls do not reflect actual value”) (quotations omitted).
8.
See Tex. R. App. P. 47.1.
9.
See Tex. Fam. Code Ann. §
3.003 (Vernon 1998).
10.
Penick v. Penick, 783 S.W.2d 194, 197 (Tex. 1988); Anderson v.
Gilliland, 684 S.W.2d 673, 675 (Tex. 1985).
11.
See, e.g, In re the Marriage of Morris, 12 S.W.3d 877, 881-82
(Tex. App.—Texarkana 2000, no pet.); Leighton v. Leighton, 921 S.W.2d
365, 367 (Tex. App.—Houston [1st Dist.] 1996, no pet.).
12.
See Anderson, 684 S.W.2d at 675.
13.
Vallone v. Vallone, 644 S.W.2d 455, 459 (Tex. 1982); Zeptner v.
Zeptner, 111 S.W.3d 727, 737 (Tex. App.—Fort Worth 2003, no pet.) (op. on
reh’g).
14.
Tex. Fam. Code Ann. § 7.001
(Vernon 1998).
15.
Pletcher v. Goetz, 9 S.W.3d 442, 446 (Tex. App.—Fort Worth 1999, pet.
denied) (op. on reh'g).
16.
Id.
17.
See Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42
(Tex. 1985), cert. denied, 476 U.S. 1159 (1986).
18.
Pletcher, 9 S.W.3d at 446.
19.
Finch v. Finch, 825 S.W.2d 218, 221 (Tex. App.—Houston [1st Dist.]
1992, no writ); see Wallace v. Wallace, 623 S.W.2d 723, 725 (Tex. Civ.
App.—Houston [1st Dist.] 1981, writ dism’d).
20.
Because of our disposition of this case, we do not reach Mary’s fourth and
sixth issues. See Tex. R. App. P.
47.1.
21.
See Tex. Fam. Code Ann. §
6.706(a).