INTERESTING CASES: June 2, 2021

Sallee S. Smyth

  1. In re Minschke, 2021 Tex. App. LEXIS 3575 (Tex. App. – Corpus Christi May 7, 2021, orig. proceeding) (mem. op.) (Cause No. 13-20-00508-CV)

In May 2020, PGM (mother of putative father) filed a suit in Kleberg County, TX seeking to be named JMC with her son of her granddaughter, ANG, age 7. PGM claimed in her pleadings that ANG had lived with her for the preceding year and that she had provided all care for the child during that time as the Father worked 14 days on and 14 days off in Pennsylvania. The pleading asserted that M lived in Florida and indicated that the child would be returning there to visit M but that the child desired to return to her school in TX when summer was over. M came to TX to pick up the child in May 2020 but was unaware of the suit. She was served with the suit shortly after she and the child returned to Florida. M filed a special appearance, plea to the jurisdiction challenging PGM’s standing and alternative asked the TX court to dismiss based on inconvenient forum. M claimed she had no contacts with TX and that the child had not resided solely with PGM but had been moved around staying with various relatives of F because he did not live in TX but lived and worked in Pennsylvania, arguing that PGM had no standing. M claimed that the child’s presence in TX was based on an agreement between she and F that the child could live with him for 1 school year only to make up for time he missed being around while the child was younger but that the child would be returned to M’s custody at the end of that school year and that the child’s home state was acknowledged to be in Florida. M filed briefing along with supporting affidavits and evidence establishing that TX was an inconvenient forum under the UCCJEA and asked the court to dismiss the suit in favor of FLA. M offered evidence and affidavits establishing that there as litigation already pending between she and F regarding the child in FLA where F had counsel, that the child had lived only in Virginia and Florida during her lifetime, that the child’s presence in TX was only temporary, that the child had not lived solely with PGM during her TX visit, that M could not financially afford to litigate in TX, that M’s witnesses could only provide their evidence in FLA and that there had been issues of domestic violence between she and F and such evidence existed in FLA. PGM filed a reply brief but offered no evidence to support many of her claims and allegations. Considering the matters filed, the court issued an order denying M’s request to dismiss based on inconvenient forum. Upon such ruling, PGM filed a motion for emergency enforcement order seeking return of the child to TX based upon temporary orders issued by the trial court in an earlier hearing wherein the trial court ordered M to return the child to PGM. M received 4 days notice of this hearing and objected and sought a continuance. The court denied any additional time and issued a second order for the child to be returned to TX. M filed a petition for writ of mandamus and a motion to stay the trial court orders. Upon review, the COA analyzed all of the evidence and information submitted by M which addressed each of the “inconvenient forum” factors under TFC 152.207 noting that they all weighed in favor of jurisdiction in FLA. The COA noted that while PGM disputed many of M’s claims (i.e. denying that any domestic violence had occurred), PGM offered no supporting evidence, affidavits or documentation supporting her claims. As such the COA concluded that the trial court could have reached only one conclusion, that TX was an inconvenient forum, and the TX suit should have been dismissed. The COA further found that M failed to receive proper 10 days notice of an enforcement setting and as such she was denied due process since she was unable to prepare for and present a defense in the time allowed. The COA vacated the orders for return of the child to TX. Mandamus granted.

  1. In re Martinez, 2021 Tex. App. LEXIS 3779 (Tex. App. – Houston [14th] May 13, 2021) (mem. op.) (Cause No. 14-19-00250-CV)

H and W married in 2003 and had three children. In 2017 H filed for divorce and W filed a counter petition. Both parties sought to be named SMC of the three children. Issues regarding conservatorship were tried to a jury. During pre-trial the parties agreed that matters regarding a division of property would be tried to the bench. The court advised the parties to be ready for the issues concerning property when the appeared for the jury trial because the court would attempt to entertain those issues during breaks or during jury deliberations. The court further advised that if this could not be accomplished, the court would hear the property issues at a separate but later date. As part of the pre-trial, W’s inventory and proposed property division were pre­admitted into evidence. H did not offer such exhibits in his pre-trial admissions. During the jury trial, the court advised the parties that they had both claimed fraud on the community and asked the jury would be deciding those issues. The parties indicated that the jury would decide on fraud and they would submit that evidence. Both parties rested, subject to their agreement that the remaining issues would be tried to the court. The jury returned a verdict awarding SMC to H. Five months later, the trial court issued a ruling on all other child related matters and further rendered a division of property despite the fact that no hearing had ever occurred in which the parties presented evidence in connection with the property issues. Thereafter the court signed a final judgment. W requested FFCL but none were issued. W also filed a timely MNT which was heard by a different judge. The MNT was denied and W appealed. W complained that the court erred in issuing a division of property without a trial or without completing trial on that issue. W further challenged the jury’s verdict but that issue was waived for inadequate briefing. In response to a dissenting opinion by CJ Christopher, the majority panel first determined that W’s issue challenging the division of property fairly included the sub-issue complaining that trial was incomplete and therefore had not been waived. The majority panel also found that W properly preserved the error by raising her complaints in a timely MNT. The majority panel noted that the record was clear the parties believed there would be a further trial on the property division and the trial court likewise represented that it would happen. The dissent opined that W should have made an offer of proof with her evidence of property division so as to allow the COA to conduct a harm analysis when considering whether the trial court’s actions were error. The majority panel found that a trial court, absent an agreement, is not authorized to render judgment against a party before they have had an opportunity to put on evidence and then rest. Here there was no agreement on property and W’s counsel rested after the jury trial subject to W’s right to try her property issues. Here the trial court prematurely rendered judgment on issues which had not been fully tried. Judgment on divorce and child related matters affirmed; judgment as to property division reversed and remanded for a new trial.

  1. In re Ramirez, 2021 Tex. App. LEXIS 3917 (Tex. App. – Austin May 19, 2021, orig. proceeding) (mem. op.) (Cause No. 03-21-00145-CV)

M and F are the separated parents of one child. For more than a year, up to February 2020, F lived within his own mother, PGM, and the parties’ child. In February 2020 TDPRS filed suit for conservatorship and termination of M’s rights to the child as well as two younger half­siblings when she tested positive for drugs after the birth of her third child. TDPRS placed all three children with PGM. Then in August, TDPRS removed the children from PGM based on accusations of abuse and negligence. Within 90 days of the removal, PGM filed a petition in intervention, claiming standing under TFC 102.003(a)(9) (care, custody and control for more than six months). After hearing the AJ denied standing and PGM filed for a de novo hearing. At the de novo hearing the trial judge conceded that placement of the children with PGM from February to August qualified as five plus months of custody and control and as such, the court limited evidence of PGM’s standing to only the few weeks before the February 2020 placement in order to determine if PGM could fulfill the total six month requirement. PGM offered several witnesses who testified as to her care and control for the older child during the time period in question. F admitted that he was also present but that PGM was in control of the child’s daily care. When PGM’s witnesses were done, the trial court advised that it did not need to hear from witnesses called by the other parties and that PGM had not met her standing burden and that while she had taken care of the child, M and F had not abdicated their duties to her. The trial court dismissed PGM’s intervention and PGM sought mandamus relief. The COA acknowledged that the trial court did not properly apply the law as reflected in the TX Supreme Court opinion in In re H.S., 550 SW3 151, which specifically holds that parents need not abdicate their parental duties to a non-parent as a prerequisite for non-parent standing. Further, the Supreme Court held in H.S. that even in situations where a parent lives with the child and the non-parent, standing for the non-parent is not necessarily precluded. Here, the COA determined that the trial court imposed the wrong standard to determine PGM’s standing, finding that PGM need only prove that she acted in a parent-like role for the requisite period of time. Further the COA found that the record was incomplete as not allowing them to determine PGM’s standing because the trial court shut down the evidence and prevented other witnesses from testifying who might have been able to controvert PGM’s claims. In light of these rulings, mandamus was granted and the trial court was directed to set aside its order denying standing and reconvene the hearing to consider further evidence.

  1. In re Browning, 2021 Tex. App. LEXIS 4054 (Tex. App. – Houston [1st] May 24, 2021, orig. proceeding) (mem. op.) (Cause No. 01-21-00248-CV)

M and F divorced in 2019 and were named JMC of their two children with M having the exclusive right to establish the residence of the child. In August 2020 M filed a petition to modify seeking to limit F’s rights of access to one daughter. In October 2020 the parties signed an MSA for temporary orders, reducing his time with the child, ordering counseling for the child and appointing a parenting facilitator. TO’s were signed. Unhappy with these arrangements, F filed a counter petition to modify in April, requesting ex parte extraordinary relief, including attaching the body of the children, taking them into his sole possession and excluding M from any access until a hearing could take place. The trial court signed an ex parte order allowing F to take possession of the children wherever they were found and excluded M from possession until a hearing. M filed a petition for mandamus relief. The COA initially analyzed the ex parte order to determine if it qualified as an order which “effectively” changed the person who had the right to make domicile decision for the children. Comparing the order to other cases in which the primary JMC had been excluded from exercising their primary rights (i.e. order for kids to attend boarding school, orders placing child in residential treatment), the COA found that an order which excluded M, the primary JMC, from complete possession of the child until a hearing took place effectively changed the designation of the parent who could determine domicile. Because the ex parte order had this effect, the COA found that TFC 156.006 applied (requiring a hearing to determine if the child’s present circumstance significantly impairs their physical health or emotional development before temporary orders can issue changing primary designation). In this case the trial court conducted no hearing whatsoever but issues its orders ex parte which was a clear abuse of discretion. Mandamus granted and ex parte order set aside.

  1. In re Estate of Baker, 2021 Tex. App. LEXIS 4138 (Tex. App. – Waco May 26, 2021) (mem. op.) (Cause No. 10-18-00215-CV)

H died and was survived by W and two daughters from a prior marriage. In his will, H left his W a life estate in the surface of 38 acres of land that he had inherited and was unquestionably his separate property. He left W a 1/3 life estate interest in the mineral interests with the other 2/3 mineral interest to his daughters. During marriage, H and W constructed a home on the H’s s/p acreage with community property funds totaling $106K and other made improvements such as out buildings with community funds. W made a reimbursement claim against H’s estate in probate court for community funds expended to enhance H’s s/p estate. At trial, W offered testimony as to the funds expended and a real estate agent testified as to the overall value of the land with improvements and the value of the land standing alone. The trial court awarded W an equitable reimbursement claim of $101K and placed an equitable lien on the property, specifying that satisfaction of the claim was limited to the equitable lien on the property. The daughters appealed. Initially the COA recognized that there is no specified standard for reimbursement claims asserted in probate proceedings and thus the standards provided in the Family Code upon divorce should apply. The COA noted that reimbursement claims were allowed for c/p contribution to a s/p estate measured by the enhanced value and determined that W’s evidence met the requirements for establishing the existence of a reimbursement claim by the community against H’s s/p estate. The daughters complained that the trial court abused its discretion by disallowing any offset to the claim based on W’s use and enjoyment, but the COA noted that such offsets are not authorized under TFC 3.402(c). Finally, the daughters argued that H’s will had left the s/p land to them after W’s death free and clear, thus the orders which placed an equitable lien on the property and limited satisfaction of the reimbursement claim to that lien was error. The COA held that the reimbursement claim was not a debt that existed at the time of H’s death and as such, unless specified in the will, H’s property passed to his beneficiaries subject to debts. Further TFC 3.406(b) specifically authorizes an equable lien on the benefitted estate in the event a reimbursement claim is asserted by a surviving spouse. However, the COA recognized that nothing in the applicable statutes addressed the priority of claims and payments as relevant to this circumstance, therefore it was improper for the trial court to limit payment of the $106K reimbursement claim only to the lien placed on the real property itself. The judgment for reimbursement was affirmed, but the terms limiting which assets could be used to satisfy the claim was reversed and remanded for further proceedings.

  1. Goyal v. Hora, 2021 Tex. App. LEXIS 4205 (Tex. App. – Austin May 27, 2021) (mem. op.) (Cause No. 03-19-00868-CV)

H and W married in October 2016 and had one child in November 2017. H was a CPA, employed as an auditor making approximately $11,000 per month. W did not work. In April 2017 H and W purchased a house where they lived until separation in October 2018 when W filed for divorce. Before trial the parties agreed on all matters concerning the child except the amount of child support. Other disputed issues at trial included H’s separate property claims and H’s claim for reimbursement. Regarding child support, it was undisputed that H made in excess of the c/s guideline cap, supporting c/s of $1,710 per month. Based on other evidence admitted by W as to day care costs and incidental activity costs, the trial court ordered an additional $1,000 per month, totaling $2,710 in c/s. The trial court found W’s evidence of need above guidelines to be sufficient in addition to her testimony that H exercised only about 2% of his allotted time for possession under the existing orders, thereby increasing her need for support. The COA determined that the amount of c/s was reasonable based on the evidence of need and the undisputed evidence regarding H’s income. As to H’s characterization claims, he asserted that the vast majority of his brokerage and retirement accounts were his separate property. He offered the testimony and report of a forensic account, Turner. W offered her own expert in rebuttal who challenged Turner’s tracing methodology as to the brokerage account and retirement benefits. The trial court ultimately characterized all of these assets as community property and divided the estate in W’s favor finding H had greater earning capacity, business opportunities not available to W, better education than W and H was at fault. H challenged the trial court’s reliance upon the community property presumption in the face of his evidence. The COA reviewed the record and pinpointed specific testimony of H’s expert (both under direct and cross) which suggested that while the expert had the ability in some instances to conduct a specific line item tracing of transactions within a particular account, he chose not to. Further, H’s expert testified that he used a “more likely than not” standard when offering his opinion on separate property character instead of the required “clear and convincing.” Further, H’s expert admitted to a 3 month gap in the statements available to review which period was one of extreme growth in the account, making it impossible to determine what that growth was attributable to in assessing characterization. As to tracing in a brokerage account, H’s expert admitted that he could not identify which stocks in the account at the time of divorce were separate property because he had not traced their origin. H further admitted he was unable to determine what stocks were purchased and traded on margin (debt incurred during marriage) versus what might have been acquired from transactions involving stocks owned prior to marriage. As to H’s retirement accounts the expert did not trace pursuant to TFC 3.007(c) for defined contribution accounts and was forced to admit during cross-examination that using a pro rata methodology for characterization rather than line item tracing could result in grossly inaccurate results. Lastly, the expert’s characterization of one account failed to acknowledge that at one point during the marriage the value of the account dropped to zero, neutralizing almost any s/p claim. W’s expert testified and questioned Turner’s methodology and results. On appeal H claimed that W’s expert failed to rebut his expert but the COA recognized that W and her expert carried no burden to trace anything and thus H’s evidence, including his expert, which was not clear and convincing to trace the s/p claims, was ineffective to overcome the c/p presumption, resulting in no error. Lastly, H challenged the court’s refusal to grant him a reimbursement claim for his “down payment” of s/p funds to purchase the parties’ residence. The COA pointed out that such a down payment does not qualify for reimbursement but would have entitled H to claim an ownership interest in the residence and because H did not claim s/p ownership, finding the residence to be all c/p was correct. Judgment affirmed. COMMENT: The Opinion contains some excellent examples of characterization expert cross examination on various issues lifted from the trial record. It is not known whether H’s expert was just not qualified in marital property tracing particulars (misquoted the law in his report) or was given improper directives (failure to line item trace when he had the records to do so), but either way, the expert clearly hurt H’s claims in the end. Also, depending on the value of the residence, the complete miss on ownership claim vs. reimbursement claim for use of H’s s/p at purchase should create a few restless nights for H’s divorce counsel.