Penick v. Penick

750 S.W.2d 247, 1988 Tex. App. LEXIS 587, 1988 WL 23930
CourtCourt of Appeals of Texas
DecidedMarch 24, 1988
DocketA14-87-349-CV
StatusPublished
Cited by8 cases

This text of 750 S.W.2d 247 (Penick v. Penick) 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
Penick v. Penick, 750 S.W.2d 247, 1988 Tex. App. LEXIS 587, 1988 WL 23930 (Tex. Ct. App. 1988).

Opinion

OPINION

ROBERTSON, Justice.

Appellant’s sole complaint in this appeal from a divorce decree is that the trial court erred in failing to order reimbursement to the community estate for community funds disbursed during the marriage to reduce the principal indebtedness on appellee’s separate real estate. We reverse and remand.

Appellant’s petition requested that the community estate be reimbursed for community funds expended for note payments on a separate property indebtedness. Prior to trial appellant and appellee entered into and signed a written stipulation concerning various real estate properties owned by appellee prior to the marriage, setting forth therein the date of purchase, the market value, the amount owed on each and the net value. Concerning that real estate, the parties agreed that “[djuring the marriage of the parties, there was a principal reduction, paid from community funds, of $104,500.00 to the principal balance on the Respondent’s [appellee’s] separate real property listed in Paragraph I above.” The stipulation was introduced into evidence, but the trial court did not order reimbursement of such sum to the community estate.

In response to appellant’s request for findings of fact, the trial court made the following findings concerning the issue before us:

10) The separate property of Robert J. Penick was used to benefit the community estate by enhancing, improving and increasing the value of the community estate and by extinguishing the community debts.
11) The separate property of Robert J. Penick and the borrowing power it allowed, played a large part and was the foundations [sic] in his ability to build the community estate.
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14) During the marriage of Petitioner and Respondent, there was a principal reduction of $104,500.00 to the principal balance owed on the Respondent’s separate real property.
15) Over 90% of all income received by the community, during the marriage of the parties, was from the rent derived from the separate estate of the Respondent.
16) The community estate of the parties benefited from the separate estate of the Respondent by use of the depreciation of the Respondent’s separate estate to reduce the community estate tax liability.

Appellant timely filed objections to Findings of Fact 10, 11, 15 and 16 as not being supported by the evidence, and as to Finding of Fact 14 she objected because it was contrary to the parties agreed stipulation that the indebtedness was paid out of community funds and contrary to the undisputed evidence. Appellant requested the judge to make “Findings of Fact consistent with the evidence” and timely called the objections and request to the court’s attention, but the court denied both.

Various appellate courts have held that the trial court ordinarily has the discretion to modify or set aside a stipulation. Uvalde County Appraisal Dist v. F.T. Kincaid Estate, 720 S.W.2d 678, 681 (Tex.App.—San Antonio 1986, writ ref’d n.r.e.); Allen v. Allen, 704 S.W.2d 600, 605 (Tex.App.—Fort Worth 1986, no writ); New v. First Nat’l Bank of Midland, 476 S.W.2d 121, 124 (Tex.Civ.App.—El Paso 1971, writ ref’d n.r.e.); Thompson v. Graham, 318 S.W.2d 102, 105 (Tex.Civ.App.—East land 1958, writ ref’d n.r.e.). Other courts have held that a stipulation is conclusive as to the facts stipulated and as to all matters necessarily included therein, Handelman v. Handelman, 608 S.W.2d 298, 301 (Tex.Civ. App.—Houston [14th Dist.] 1980, writ ref’d *249 n.r.e.), and that a stipulation constitutes a contract between the parties and is binding upon them and the trial court. Gulf Constr. Co. v. Self, 676 S.W.2d 624, 630 (Tex.App.—Corpus Christi 1984, writ ref’d n.r.e.). We believe the latter cases properly construe the effect of a stipulation. However, even if the stipulation in this case was not binding on the trial court, there is absolutely no evidence contradicting the agreed stipulation that $104,500 in community funds were used to reduce the principal owed on appellee’s various parcels of real estate. Nor does it appear from the record that the trial court made an attempt to modify or set aside the stipulation made between the parties. In this state of the record, it would have been an abuse of discretion for the trial court not to have been bound by the stipulation.

It seems clear, therefore, that the trial court erred in refusing to order reimbursement to the community estate for community funds expended during the marriage to reduce the principal on appellee’s separate property. Although the cases are somewhat unclear as to the proper measurement for reimbursement of the community estate for funds paid on the principal of separate estate property, the best rule appears to be that when community funds are used as purchase money for a spouse’s separate real estate, the other spouse is entitled to reimbursement for his or her share of the community funds actually spent,, and reimbursement is not limited to the amount of enhancement of the value of the separate property. Nelson v. Nelson, 713 S.W.2d 146, 148 (Tex.App.—Texarkana 1986, no writ). Also, if the community funds are spent solely to pay the purchase price or to discharge encumbrances against the separate property, reimbursement should be allowed without the necessity of proof that the expenditures exceeded the benefits received by the community. Fyffe v. Fyffe, 670 S.W.2d 360, 361 (Tex.App.—Texarkana 1984, writ dism’d); Cook v. Cook, 665 S.W.2d 161, 164 (Tex.App.—Fort Worth 1983, writ ref'd n.r. e.); Brooks v. Brooks, 612 S.W.2d 233, 238 (Tex.Civ.App.—Waco 1981, no writ); Pruske v. Pruske, 601 S.W.2d 746, 748 (Tex.Civ.App.—Austin 1980, writ dism’d). See Colden v. Alexander, 171 S.W.2d 328, 334 (Tex.1943); Dakan v. Dakan, 125 Tex. 305, 83 S.W.2d 620, 628 (1935).

The Pruske court gives the following reasoning in adhering to the rule which we follow in this case:

This rule is more logical since, as in the case at bar, the rental income from Mr. Pruske’s separate real property was community property, and would have remained so whether the debt was reduced by separate or community funds. Mrs. Pruske was absolutely entitled to her share of the rental income, and her right to reimbursement should not require a balancing of the equities.

Pruske, 601 S.W.2d at 748.

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Cite This Page — Counsel Stack

Bluebook (online)
750 S.W.2d 247, 1988 Tex. App. LEXIS 587, 1988 WL 23930, Counsel Stack Legal Research, https://law.counselstack.com/opinion/penick-v-penick-texapp-1988.