Key Property Division Valuation Issues in Texas Divorce

Published April 9, 2013 | By

for-sale-signThe typical procedure for Texas divorce lawyers to analyze property division in a divorce case is to put all the assets and liabilities on a spreadsheet and fill in the values.  At that point the division usually starts to make sense as you assign certain assets and liabilities to each of the parties.  Often these assignments are relatively simple and agreed to.  For example, everyone may agree that the wife should get the house and be responsible for the mortgage so you automatically fill in your spreadsheet that way on that particular asset and debt.

Sometimes the parties may have a dispute over how the overall split should be done. For example, one party may want a 50/50 division while the other side believes it should be a disproportionate division. I will save that topic for anther blog post.  Today I will address the other common issue that arises in property divisions, that of valuation disputes.  Below I will outline some of the more common asset types that result in valuation disputes and how they are each addressed.

Real Estate Valuation Issues

Probably the most common big asset valuation issue that arises involves the house.  In most divorces (at least the ones I deal with) the parties own a house.  Sometimes clients will come to me at the beginning of the case and say that the house won’t be an issue because they already have an agreement on it.  Later I learn that they agree on who gets the house but they very definitely do not have an agreement on the value of the house.

Typically, the party getting the house has a very low value on the house and the party not getting it has a very high value.  In situations like this the issue is normally addressed by one or both parties hiring an appraiser to do an appraisal of the property.  Occasionally, both parties will hire an appraiser.  The resulting dualing appraisals may have a valuation gap but normally this gap will be much smaller than the original gap the parties had.

Valuation of a Vehicle

Vehicle values are another potential area of dispute but obviously the values are a lot less than a house value, so there is less incentive to actually pay for and hire an appraiser.  Instead the parties typically will do an online valuation of the vehicle using a website like Edmunds.com or Kelly blue book.  While there are still some subjective components to the valuation such as whether the vehicle is in “excellent” or “average” condition, after doing an online valuation there should be a much smaller gap between what the parties believe the vehicle is worth.

Business Valuation

Here is where it gets really interesting.  When the parties are business owners things can get very complex in a hurry.  It is very common in these cases for the spouse who runs the business and is very involved in it to expect to be awarded the business and for the other spouse to agree to this.  But when the parties assign values for the business they may have a huge differential in their numbers.  Often the business owner spouse will have a very low value and the non-involved spouse will believe the business is worth an astronomically high amount.

In these cases it is almost mandatory that a business valuation expert be hired by at least one of the parties to prepare a valuation report.  The business valuation industry has standards and ratios that are used based on the financial condition and history of the business.  They will evaluate the business and its financial records and then determine what the business would be likely to sell for to a third-party buyer.

This analysis is normally done using the assumption that the buyer would not receive a contractual agreement not to compete from the seller for some fixed period of time. In real world sales most buyers will insist on a non-compete provision but this cannot be factored into the valuation in a divorce case analysis.  This is due to case law that very clearly makes the “personal goodwill” portion of the business not divisible community property.  In cases involving professional practices and consulting-type business this can have a dramatic impact on the valuation (i.e., the value is a lot lower).

Hopefully this clarified some of the key valuation issues that arise in Texas property division cases.  If you are considering divorce and have questions about any of these issues feel free to contact our office and schedule an initial consultation.

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Posted in Property Division

Hiding Assets in Divorce – is it Worth the Risk

Published November 14, 2012 | By

While attempting to hide assets in a divorce case is not commonplace, it happens more often than you might imagine.  As an attorney I would never advise a client to attempt to hide assets nor would I help them in their efforts to do so.  Aside from the legal and ethical issues, it is simple wrong and not something I am willing to do.

Hidden Assets Tend to be Found

I have had cases on both sides of the issue.  I have discovered assets that my client’s spouse was attempting to hide and I have discovered assets that my own client was attempting to hide.  When I explain to my client how easy it was for me to uncover the asset and how the other attorney is likely to find it just as easily, the client usually becomes much more reasonable about disclosing all assets.

Here is an interesting article on the consequences of hiding assets in a divorce in Forbes.

Would Someone Really Hide Their Separate Property

I once had a client who was attempting to hide a significant asset that I came across while reviewing the financial records.  When I asked him about it and explained that we would need to disclose the asset or he would ultimately run the risk of being held in contempt by the court and potentially prosecuted for perjury, he remained steadfast that he didn’t want to disclose it.  Only when I threatened to withdraw as his attorney did he relent.  When we discussed the asset further, it turns out he owned it pre-marriage making it his separate property.  In other words, he was putting himself at grave risk to hide an asset that was 100% his anyway.  Very foolish…

What are the Lessons?

So there are two big lessons about hiding assets.  One, don’t do it.  Even if you  feel you have a rock solid ethical argument for way it is simply not fair that your spouse should be entitled to any of the asset, resist the temptation.  It is simply not worth it. Second, if you have a legitimate concern that your spouse may be hiding asset(s), let your attorney know so that they may take the necessary steps to locate any hidden assets.  While there is more work (and thus more cost) involved with this, it is worth it to know whether you are getting your fair share of the community.

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Posted in Property Division

How to Deal with a House in a Divorce

Published October 19, 2012 | By

A common issue in most divorce cases is what to do with the marital residence.  If the parties rent their residence this is not a big issue, but in most divorce cases there will be owned real estate that must be dealt with.

Two Most Common Ways to Handle

While every case is different and there are many unique and unusual sets of circumstances, for most cases there are only two realistic divorce outcomes when it comes to the house. Either the house gets sold and the proceeds from the sale split (usually on some percentage basis) or either the husband or the wife is awarded the house along with the debt attached to the house.

What About the Equity?

When one spouse is awarded a house that has significant equity the other spouse will want an offset from some other asset.  As a simple example, let’s say a couple has a house with $100,000 in equity and their only other asset is a 401k account in husband’s name worth $100,000.  If wife was awarded the house and husband was awarded the entire 401k account, it would be a 50/50 division.  If instead neither party wanted the house and they put it on the market they could then split the net proceeds from the sale of the house 50/50 and also split the 401k 50/50. That would also be a 50/50 division.

What Real Estate Documents are Used to Transfer the House?

If instead of selling one spouse is awarded the house then in a typical case this requires just two real estate transfer documents. These should normally be done at the time of divorce along with the Divorce Decree and other transfer documents.  The first document is a “Special Warranty Deed.” This document is signed by the spouse who is not getting the house and in effect it says that the other spouse is now the 100% owner of the house (subject to the debt secured by the house).

The second document is a “Deed of Trust to Secure Assumption.”  This document is signed by the spouse who is getting the house and in effect it is that party’s promise to pay the existing mortgage in a timely fashion.  If the party who receives the house falls behind on the mortgage payments or in any way defaults on the mortgage, the Deed of Trust to Secure Assumption gives the other party certain recourse against them.  The details of that potential recourse are spelled out in the language of the Deed of Trust to Secure Assumption.

Divorce Transfer Does Not Remove Name from Mortgage

One important issue that is often misunderstood concerns the existing mortgage.  In the scenario described above, the mortgage that is held in both parties names stays in both parties’ names, even after divorce.  Parties sometimes assume that because they have agreed for one party to solely assume responsibility for the mortgage that this agreement is binding on the lender and all they need to do is call the mortgage company to get the name changed on the account.  Not so. The lender will always refuse to do so.

The only way the other party will be relieved of that liability is if the mortage is paid off, either by refinancing it or by selling the property.   In other words, the debt will remain on the credit report of the non-owning spouse until the debt is paid off. If the owning spouse goes into foreclosure then that will impact the credit of not only the owning spouse but also the non-owning spouse.

The bottom line is that if your spouse is being awarded the house in your divorce case, it is very much preferable if at all possible to have them refinance the property in their own name.  Usually the refinancing can happen prior to divorce (or at least pre-approval obtained prior to divorce) or within a set deadline that is included as a term of the Decree.

I hope this helps clarify the issues surrounding how to deal with a house in a divorce case.  If you have questions or comments please feel free to share them below.

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Texas Post-Divorce Alimony

Published October 15, 2012 | By

In this article I will explain the key points in Texas posts-divorce alimony. Please note that alimony is a particularly complicated area and you should consult with a qualified family law attorney about the specifics of your case if you believe you may be entitled to receive or possibly obligated to pay alimony. Also, this post addresses only post-divorce alimony, not temporary alimony.

Contractual Alimony or Spousal Maintenance under Texas Family Code Chapter 8

Texas divorce decrees frequently include provisions for periodic post-divorce payments from one spouse to the other, aside from the more common child-support payments. In general, these payments are based upon the needs of one spouse and the ability to pay of the other. Alimony agreements or orders generally come in one of two forms, either agreed contractual alimony or court ordered spousal maintenance under Texas Family Code Chapter 8.

Contractual Alimony

When the parties reach an agreement for post-divorce alimony payments it is typically structured as contractual alimony. Since this form of alimony is based on an agreement and not a statute there are no restrictions on the amount of the support or the duration, other than those agreed to by the parties. However, the statutory maximums on amount and duration are normally factors considered in the negotiations.

Court Ordered Spousal Maintenance

Chapter 8 of the Texas Family Code provides the court with the authority to order post-divorce spousal maintenance when the marriage has lasted at least 10 years and other requirements are met. Additionally, there is the possibility of spousal maintenance in a marriage shorter than 10 years in certain cases involving family violence. Unless there is a disability of either the party or a child of the parties, the spouse seeking maintenance must prove that he/she is unable to “provide for the spouses minimum reasonable needs.”

Maximum Amount of Maintenance under Statute

Section 8.055 provides that the amount of maintenance the court may order is the lesser of a) $5000/month or b) 20% of the monthly payor’ gross monthly income. Again, it is possible for the parties to agree to an amount higher than the statutory cap but this rarely happens because the caps are factored into the negotiations. In other words, parties rarely agree to what would be worse than there worst-case scenario. It should be noted that the current maximum amount since the 2011 statutory amendment is double the previous maximum of $2500 per month under the old statute.

Duration of Spousal Maintenance under Statute

Section 8.054 provides details on the duration of the spousal maintenance order. For marriages that lasted more than 10 years but less than 20 the maximum duration is five years. If the marriage lasted more than 20 years but less than 30, the maximum is seven years. For marriages lasting more than 30 years, the maximum is 10 years. For cases involving a disability, there is no maximum duration under the statute.

Conclusion

In high net worth or high income divorce cases, alimony is a potential consideration. If this may be an issue in your case, you should definitely consult with a qualified family law attorney about the issue. If you have questions or comments about contractual alimony or post-divorce alimony in Texas please leave your comments below.

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Austin Family Law Attorney Explains Written Discovery

Published October 6, 2012 | By

Not every case is a simple one and it is very common for lawyers to have to conduct and/or respond to written discovery requests.  Usually clients are confused by the process and what it involves so in this post I am going to lay out a basic explanation of the kinds of written discovery requests that typically get made in a Texas divorce case, the purpose of each,  and how difficult and time-consuming each is to respond to. While there are forms of discovery other than written discovery (the most common being the deposition), this post will discuss only written discovery.

What Gives Attorneys the Right to Send Discovery?

The Texas Rules of Civil Procedure are what provides the authority for lawyers in Texas cases (including divorce and other family law cases) to conduct written discovery.  In general, the purpose of written discovery is to gain information about the case in order to help you evaluate the case for settlement purposes as well as to prepare for trial.  If you have done an effective job in obtaining discovery from the other side then you should be fully prepared to negotiate a settlement of the case if possible, or try the case if necessary.

Interrogatories

Interrogatories are basically questions that you get to ask the other side.  While each case has its own nuances and facts, there are basic interrogatories that most lawyers ask in every divorce case.  These might include who the party knows that may testify in the case (basically, a potential witness list), what assets exist, what liabilities exist, what a party’s income is and information about their employment history, and details about that party’s contentions in the case.  Depending on the issues in the case there are likely to be questions about other issues like child support, proposed conservatorship and visitation issues, spousal support, reimbursement, etc.

Frequently one side will not like some of the answers given by their spouse.  I have often been asked by clients what we can do about some claim made by the other spouse, in other words how can we make them retract that statement.  Generally, the answer is that we cannot do anything about it.  They are allowed to take whatever position in the case they care to.  Our job is to prove to the court that our position is the proper and correct position.

Depending on what is asked the Interrogatories can be fairly complicated and time-consuming to answer.  Your attorney should help you in answering the questions and making any objections that are necessary and appropriate.

Request for Disclosure

These are somewhat similar in nature to Interrogatories, but they are very limited.  The rule that allows for Requests for Disclosure limit the questions asked in the Request to only questions that are explicitly laid out in the rule.  Neither party is entitled to ask additional questions or to modify the questions.  They are basic questions that should get asked in every case, such as identity of individuals with knowledge of relevant facts, identity of any expert witnesses, and contentions about the various issues in the case.

Answering Requests for Disclosure is relatively straight forward and one of the simpler discovery documents to respond to.  No objections are permitted so you and your lawyer simply answer the questions.

Request for Production

A Request for Production is a request to produce written records of various kinds. The person responding to the request is required to compile all the responsive documents and “produce” them.  Depending on the issues in the case, the amount of records that might be at issue can be huge.  Sometimes this is necessary because an issue in the case requires a great deal of documentation to evaluate and to prepare for trial.  However, this is one of the more abused areas in the discovery process, as it is sometimes used simply to force the other side to do a lot of work and incur a lot of expense on the case.

Your lawyer should give you significant guidance in terms of what documents to compile and also what requests should be objected to, either entirely or in part.  Responding to the Request for Production is one of the more time-consuming issues in discovery and can add significantly to your overall attorneys fees expense in the case.

Request for Admission

A Request for Admissions is essentially one party asking the other to answer a series of yes/no questions.  The idea behind sending a Request for Admissions is to get the other side to admit to certain facts that will help you limit the issues and thus reduce the number of things that you are required to prove.

For example, if you were seeking a court finding that a piece of real estate was your separate property because it was given to you as a gift by your parents your lawyer might send a Request for Admission asking the other party to “admit or deny that the 101 Jackson Street property was given to husband by his parents.”  Requests for Admission are not typically done in divorce cases but they sometimes are an effective tool and are used occasionally.  Due to the yes/no nature of the Request for Admission they are not usually very time-consuming to answer.

Conclusion

Those are the key areas of written discovery.  If you getting divorced and are fortunate enough to be certain that you have all the necessary information already readily available to you and your spouse, then discovery may not be necessary.  However, if you are in the position of not knowing exactly what assets or liabilities are involved or information about any other issue in the case, then written discovery can be a very effective way to get information and documents to help you analyze the case.

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What Effect Does Adultery Have on a Texas Divorce Case

Published October 3, 2012 | By

This post will discuss the legal and practical implications of extramarital affairs on a Texas divorce case.

Adultery is a Statutory Grounds for Divorce in Texas

The Texas Family Code has long held that adultery is a grounds for divorce. See Section 6.003 of the Texas Family Code. Its use as a grounds for divorce has become far less significant since Texas became a no-fault divorce state many years ago. Nonetheless, it is frequently pled as a grounds for divorce and a judge can find that the grounds for divorce was adultery, not the much more commonly used irreconcilable differences.

Adultery Can Have an Impact on Property Division in a Texas Divorce

The Texas Family Code also provides that the court can consider fault in the divorce in dividing property. See Section 7.001 of the Texas Family Code. This gives the court the authority to make a disproportionate division if it believes that one side was more to blame for the divorce than the other party. Consequently, adultery can be a factor that leads to one spouse being awarded more property in the divorce case. How much of an impact it makes in any given case is highly dependent on the specific facts of the case and the predilections of the judge. To some judges affairs are a significant factor in a divorce case, to others they are more a symptom of an unhealthy marriage.

Adultery Generally Does Not Impact Custody or Access to Children

While affairs can have an impact on property division, they generally have no impact on custody or access issues. The court’s determination of custody and other access provisions are still governed by the overriding principle of “best interests of the children” as well as a number of specific statutes in the Family Code.

Thus, adultery is typically a non-issue in a custody case with one major exception. If the affair occurred or is ongoing in some way that the court deems to be harmful to the children, this can have a major impact. An example of this would be having the children in the presence of the paramore (boyfriend or girlfriend) prior to the divorce being finalized.

Adultery Can Complicate a Divorce and Create Hostility

So far we have discussed the specific legal issues in detail, but in my experience the practical implications of affairs on a divorce case are often much more impactful. I personally have seen many cases that initially appeared to be relatively calm, civil divorce cases that look like they would be resolved amicably turn into contentious, ugly battles after one spouse learned of an affair. This is especially true when that spouse believes that their marriage was “broken up by this homewrecker” and that there was nothing wrong with their marriage until the affair occurred. Situations like this can cause a divorce to turn into a lengthy, expensive nightmare of a battle.

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Austin Divorce Attorney Debunks The Biggest Misconception in Texas Family Law

Published August 17, 2012 | By

As a Texas family law attorney for my entire career I have seen client after client be surprised by how the Texas Family Code requires that property be divided in Texas divorces. Most clients have heard that Texas is a community property state. While this is correct most people misunderstand what that means.

Texas Family Code Gives Court Broad Discretion in Property Division

Clients will say that they already know that since Texas is a community property state the property will be divided 50/50. The reality is that while Texas is a community property state, unlike many other community states the community property is not automatically divided evenly between the parties. The Family Code requires the trial court to divide the property in a “fair and just” manner. If you ask a qualified Austin family law attorney what this means they will tell you that a separate statute gives the court a list of factors that it can consider in making a disproportionate division (meaning that one side gets more than the other, such as 55/45).

The factors are many but the one that factors in most often is disparity of earning capacity. When one spouse makes significantly more than the other the court will often give the spouse with the lower earning capacity a larger share of the community property. The reasoning is that if the court were to make an equal division at the time of divorce it wouldn’t be equal for very long, due to one spouse greatly out earning the other spouse for a few years after the divorce.

Other factors courts can consider in dividing community property in a divorce include (but are not limited to) needs of the custodial parent, amount of separate property a spouse has, and fault.

Most Common Factor in Disproportionate Division: Income Disparity

A very common scenario that occurs in divorces is for the couple to consist of a primary breadwinner (frequently but not always the husband) and a spouse who works part time or not at all and is primarily responsible for taking care of young children. In this situation a court is likely to consider a disproportionate division in favor of the custodial parent. Part of the reasoning behind this is that being primarily responsible for raising children is likely to reduce one’s ability to advance their career and earn a high income.

Another Factor in Property Division: Amount of Separate Property

Another factor that courts can consider in deciding whether to make a disproportionate division is how much separate property a spouse has. Let’s use as an example a couple who got married at the time of marriage one of the spouses had a million dollars of separate property while the other spouse has no separate property. The marriage then created $200,000 of net community property for the court to divide at divorce. The court may very well consider making a disproportionate division in favor of the spouse who has no separate property.

Fault Can Also Play a Role

Lastly, the court can consider fault as a factor in making a disproportionate division. While fault does have an impact in some cases, it is far less frequently a significant factor in a disproportionate division than disparity of earning capacity or some of the other more commonly applied factors.

The main point here is that while Texas is a community property state that does not mean that the community property will be divided 50/50 in a divorce and there are a lot of variables that need to be considered. This is just another in the long list of reasons why everyone going through a divorce needs to be represented by a knowledgeable Austin family law attorney.

Posted in Divorce, Property Division, Separate Property | Taged , , , ,

A Tale of Two Divorce Clients

Published August 15, 2012 | By

Please note that the clients and lawyers referenced in the video and transcript are purely hypothetical and not based on actual people.  If you prefer reading to watching, please see the transcript below:

TRANSCRIPT:
Deciding whether your marriage is over and you need a divorce is a gut wrenching, emotionally-draining experience. For those who conclude that it is the appropriate course of action, reaching that point is often a relief because you’ve made a decision. It feels like it’ll be over soon and you can begin rebuilding your life. But far too often the divorce case begins and you discover that things are far from over.

Selecting a lawyer who is going to effectively handle your divorce is extremely important, but most people have no idea how to pick the right lawyer for their case. 

What you need is a divorce firm that specializes in divorce and that has a track record of satisfied and happy clients. A firm that focuses on what should be the main objective in every divorce case: getting the client a fair result as early in the process as possible.

Lets do a hypothetical comparison of two men who have decided to get divorced. 

One, lets call him Bill, mentions to a co-worker that he and his wife have separated and that he’ll be getting divorced. His co-worker enthusiasticly tells him about his lawyer nephew who handles divorces. Bill, thinking his case will be simple and his spouse will agree, ends up hiring the nephew even though he is primarily criminal lawyer. Bill thinks to himself, ‘how hard can a divorce be, right?’ 12 months later, a frustrated Bill is still not close to being divorced.

Lets compare Bill’s situation to Steve’s. Steve had heard plenty of nightmare stories from his divorced friends and knew that he didn’t want to take any chances. He wanted an excellent divorce lawyer. Steve asked these same friends for recommendations, but none of them gave what you would describe as a “ringing endorsement” of their attorney.

So Steve went online looking for the right divorce lawyer for his case. He was looking for experience, a focus on family law, and a firm that had a track record of satisfied clients. When he found a firm that fit this description he scheduled an initial consultation to meet with the lawyer and see if his experience in person would match what he found online. When it did, he hired that firm. Even though his case involved children and some complex assets, four months later Steve was divorced and very satisfied with the result. 

Why were these two outcomes so different? Let’s examine what happened.

Bill’s attorney, not having much experience in divorce cases, was never entirely sure how to proceed. He was frequently hesitant to push forward on the case because he was afraid that he might miss something. He spent a lot of time on issues that turned out to be not that important, while he neglected to focus on issues of extreme importance. He just never was confident that he was handling the case correctly, so he moved very slowly and indecisively.

In contrast, Steve’s attorney knew from experience exactly what needed to be done. He focused on the steps that needed to be taken to get a fair result for Steve as soon as possible. The steps required vary depending on the particulars of each case, but what is crucial here is that Steve’s attorney remained focused throughout the case on the primary overriding objective: get Steve a fair result as soon as possible.

These two men had very different experiences. One had a divorce case filled with frustration, delay, and unnecessary expense. The other experienced a smooth, efficient process handled by a true professional.

While divorce is always an emotionally difficult and painful situation, it shouldn’t be made more difficult by having an attorney who is not qualified or experienced enough to get you an excellent result in a reasonable amount of time. 

If you’re interested in working with a divorce firm that knows exactly what it takes to get a fair result in the minimum time required, then feel free to call the Morgan Law Firm. We would be happy to schedule a consultation to discuss your situation in detail along with your options. Just fill out the form below and we will review it and get back to you to schedule a consultation. If you prefer, just call our office and you can schedule a consultation right away. We look forward to helping you in any way we can.

Posted in Alimony, Child Support, Divorce, Parent-Child Issues, Property Division, Separate Property, Videos | Taged , ,

Should You Get a Lawyer for Your Travis County Divorce?

Published July 19, 2012 | By

When confronted with a Travis County divorce case (or any other location for that matter) many people will choose not to hire a lawyer, even if their spouse has hired one. Some make this decision out of a sense of guilt or a desire to not turn it into an “ugly” divorce. Others don’t really think a lawyer will make much difference in the outcome of their case. There are also those who think they cannot afford to hire a divorce lawyer. Hopefully, this article will show that you cannot afford to not have a quality divorce attorney represent you in your divorce case.

Don’t Face Divorce on Your Own

As an experienced Texas divorce attorney I have done many consultations with people who previously appeared in court or settled cases without representation and were hoping that I could undo the damage that had already been done. With a few exceptions, there was nothing I could do to improve their bad outcome. It is unfortunate because most of the damage could have been avoided with a good divorce attorney.

A Bad Decision in Your Divorce Today Can Have Long-Lasting Effects

Examples of bad outcomes include getting a bad property division. I once met with a man whose ex-wife had been represented in their divorce by a very good board certified family law attorney. The husband felt the divorce was entirely his own fault (in my experience, this is rarely true) and out of a feeling of guilt he had signed off on a Divorce Decree that not only gave his wife 100% of the community property but also obligated him to pay alimony far in excess of what a court would have ordered. About a year after the divorce his business suffered a severe down turn and his income dropped dramatically. There was very little I could do to help him at that point. This was unfortunate and unnecessary as any competent divorce attorney would have advised him strongly against accepting the settlement terms.

How Good Advice Can Make a Difference

Here is an example with a happier outcome. The client came to see me early in the process. He had been married for several years and had two children in elementary school. His wife had been talking about divorcing him for quite a while. Near the end of the summer she told him that she was taking the children and going to another city to stay with her parents. She planned on enrolling the children in school there. He told her he disagreed but she packed the kids up and left anyway. Although he didn’t want a divorce he was smart enough to realize he needed the advice of an experienced divorce attorney.

It was explained to him that if let her enroll the children in school out of town and waited, hoping that she would come back, it would greatly damage his case and likely result in her being able to get a final order making the children’s primary residence the new city. If he wanted the kids to live in the same town as him he needed to act promptly to avoid creating the appearance that he willingly allowed wife move to the children. He understood the gravity of the situation and immediately filed for divorce, allowing him to get in front of a judge and very quickly get an order requiring wife to return the children home. Had he not quickly gotten good advice and quality representation the outcome (and thus his relationship with his children) would likely have been very different.

As you can see, it is extremely important that you get sound advice and a good divorce lawyer when confronted with the possibility of divorce. If you face the possibility of divorce make sure you get advice and representation. It is money well spent.

Posted in Divorce, Parent-Child Issues, Property Division | Taged , , ,

What is Separate Property in Texas?

Published July 8, 2012 | By

This video explains the basics of separate property in Texas.  If you prefer, you can read the transcript below:

TRANSCRIPT

My name is Scott Morgan, I am a board certified family law attorney. In this video I am going to give an overview of separate property in Texas.

Texas is a community property state. In a Texas divorce case all property owned by either spouse is presumed to be community property. The court is required to divide the community property in a fair and just manner.

However, you can rebut this presumption if you can prove that an asset meets the definition of separate property. In that case the asset is confirmed as your separate property and not factored into the community property division. The court has no authority to award one parties separate property to the other spouse.

Under the right circumstances this can make a huge difference in the overall outcome of a property division.

So what is separate property? There are three types. First, certain types of personal injury recoveries are separate property, but this is quite rare. Second, gifts and inheritances are separate property. Finally, property that was owned by a spouse prior to marriage is that parties separate property.

A common complication is that separate property is not always easy to prove.

You must prove that an asset is your separate property by clear and convincing evidence. This evidentiary standard is significantly higher than the usual preponderance of evidence standard.

Additionally tracing the asset back to its origin can also be challenging.This is especially true with financial assets that have mutated and grown and moved into different accounts during the marriage.

The bottom line is that if you’re getting divorced and have significant assets that you believe might be separate property, you should get a very good family law attorney to help you prove those claims.

I hope this video has been helpful and informative. If you have any questions comments or suggestions for future videos please feel free to comment below.

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