Opinion
NO. 02-15-00208-CV
07-07-2016
DONALD JASON MCCOY APPELLANT v. ELENA K. MCCOY APPELLEE
FROM THE 231ST DISTRICT COURT OF TARRANT COUNTY
TRIAL COURT NO. 231-538847-13 MEMORANDUM OPINION
See Tex. R. App. P. 47.4.
Appellant Donald Jason McCoy appeals from a final decree of divorce, arguing in two points that the trial court abused its discretion by denying his claim for reimbursement and by awarding Appellee Elena K. McCoy appellate attorney's fees. We will affirm.
Jason and Elena began dating in May 2009 while they were both living and working in Dallas. They became engaged sometime around March 2010, and later that year, Jason moved to Lubbock to begin law school in the fall. Elena moved to Lubbock by the end of that September, and the two lived together in a rental house.
The couple married in March 2011. Elena worked full time during Jason's first year in law school, but in the summer of 2011, she began attending the same law school as Jason. Over the next two years, both Jason and Elena relied principally upon student loans to cover their tuition and living expenses.
Regarding finances while they were both attending law school, Jason recalled that he and Elena had an agreement whereby Elena would pay Jason $700 per month and pay for groceries and gas. But according to Jason, due to Elena's "poor budgeting," she paid her portion of the expenses only part of the time, typically when her loans were disbursed, leaving Jason to obtain supplemental student loans to cover the deficit. Jason and Elena kept the proceeds from their respective law school loans in different checking accounts.
Jason pleaded that Elena's "average contribution to the couple's joint living expenses was around $300-400 per month as opposed to the $700 she agreed to."
The couple experienced difficulties in their marriage, and in June 2013, a month after Jason graduated from law school, Elena filed for divorce. Jason filed a counterpetition, alleging, among other things, that he was entitled to reimbursement from Elena for using his separate property student loans to pay for her living expenses, or "necessaries." After a bench trial, the trial court signed a final decree of divorce that divided the marital estate by awarding each spouse the property that was in his or her possession and by ordering each spouse to pay the student loans and debts that were solely in his or her name. The trial court entered findings of fact and conclusions of law, concluding in part that Jason's "plea for reimbursement was not supported by a preponderance of the evidence at trial."
After Jason timely filed a notice of appeal, Elena filed a motion for temporary orders pending appeal seeking an award of appellate attorney's fees. See Tex. Fam. Code Ann. § 6.709(a)(2) (West 2006). Within thirty days of the date that Jason filed his notice of appeal, the trial court rendered a temporary order—after a hearing—requiring Jason to pay Elena "$8,000 on or before August 31, 2015 for an Appeal to the Court of Appeals."
Jason unsuccessfully challenged the temporary order in a mandamus petition filed in this court. See In re McCoy, No. 02-15-00273-CV, 2015 WL 5168111, at *1 (Tex. App.—Fort Worth Aug. 28, 2015, orig. proceeding) (mem. op.).
In his first point, Jason argues that the trial court abused its discretion by denying his claim to reimburse his separate estate for a portion of the student loan proceeds that he used to cover Elena's living expenses while they were both attending law school. He contends that the proceeds from his student loans were his separate property, that he spent $26,683.69 of those proceeds for the benefit of Elena's separate estate, and that his claim is both recognized at common law and not barred by statute. Jason's reimbursement claim fails for at least two separate, yet equally dispositive, reasons.
Reimbursement is an equitable right that arises when the funds or assets of one estate are used to benefit and enhance another estate without itself receiving some benefit. Vallone v. Vallone, 644 S.W.2d 455, 458-59 (Tex. 1982). Reimbursement claims are governed by section 3.402 of the family code and can arise from a variety of expenditures or contributions. See Tex. Fam. Code Ann. § 3.402(a) (West Supp. 2015) (identifying nine grounds for reimbursement). The party claiming the right of reimbursement has the burden of pleading and proving that the expenditures were made and that they are reimbursable. Vallone, 644 S.W.2d at 459. "A trial court's discretion in evaluating a claim for reimbursement is equally as broad as that discretion exercised by a trial court in making a just and right division of the community estate." Barras v. Barras, 396 S.W.3d 154, 174 (Tex. App.—Houston [14th Dist.] 2013, pet. denied).
Jason's reimbursement claim expressly hinges upon the characterization of his student loans as separate, rather than community, property. Community property consists of all property, other than separate property, acquired by either spouse during marriage. Tex. Fam. Code Ann. § 3.002 (West 2006). Property owned before marriage, or acquired during marriage by gift, devise, or descent, is separate property. Id. § 3.001 (West 2006). Property possessed by either spouse during or on dissolution of the marriage is presumed to be community property. Id. § 3.003(a) (West 2006). The community property presumption applies to both assets and liabilities. Richardson v. Richardson, 424 S.W.3d 691, 697 (Tex. App.—El Paso 2014, no pet.). Thus, "[d]ebts contracted during marriage are presumed to be community debt and therefore become community obligations at divorce unless there is evidence that the creditor agreed to look solely to a party's separate estate." Marie v. Velasquez, No. 04-08-00271-CV, 2008 WL 5082989, at *1 (Tex. App.—San Antonio Dec. 3, 2008, pet. denied) (mem. op.). To overcome the community property presumption, the complaining party must rebut the presumption by clear and convincing evidence. Tex. Fam. Code Ann. § 3.003(b).
Jason and Elena married in March 2011. The proceeds for which Jason sought reimbursement stem from loans that he secured on June 27, 2011, August 12, 2011, August 28, 2012, and October 16, 2012—all during his marriage to Elena. The loans are therefore presumed to be community obligations; the proceeds are presumed to be community property. See id. § 3.002; Richardson, 424 S.W.3d at 697.
Without any supporting authority, Jason argues that the loan proceeds were his separate property because the funds "were consistently kept separately in his own bank account and not com[m]ingled with the property or accounts associated with [Elena] or the community." But community property will not unilaterally assume a separate property character merely because it is maintained in different accounts. See Villarreal v. Villarreal, 618 S.W.2d 99, 100 (Tex. App.—Corpus Christi 1981, no writ) ("Under the inception of title doctrine, the character of property, whether separate or community, is fixed at the time of acquisition."). Jason failed to demonstrate by clear and convincing evidence that the proceeds from his law school loans were his separate property.
The trial court also could have reasonably concluded that Jason was not entitled to reimbursement because his claim is statutorily foreclosed. Jason seems to acknowledge that his claim is unlike any of the nine grounds for reimbursement that are set out in family code section 3.402, but he argues that section 3.402's list is not exhaustive and that the "common law establishes [his] right to be reimbursed for paying the living expenses of [Elena]." Whether or not section 3.402 is exhaustive, an issue we do not reach, we cannot ignore that the legislature went out of its way in section 3.409 to identify five types of claims that are expressly "[n]onreimbursable." See Tex. Fam. Code Ann. § 3.409 (West 2006). Under section 3.409, a "court may not recognize a marital estate's claim for reimbursement for" "the living expenses of a spouse." Id. At trial, Jason agreed with his own attorney that he was seeking reimbursement for "just everyday living expenses."
Jason attempts to sidestep section 3.409's prohibition by arguing that it irreconcilably conflicts with section 7.007's requirement that courts use equitable principles in determining claims for reimbursement, but section 7.007 begins by stating that "the court shall determine the rights of both spouses in a claim for reimbursement as provided by Subchapter E, Chapter 3." Id. § 7.007 (West Supp. 2015). Also, the statues are easily reconcilable. Jason argues that an exception applies to the general rule that prohibits reimbursement for living expenses, but the expenses for which Jason sought reimbursement are all of the same kind for which reimbursement is plainly prohibited. See In re Marriage of Case, 28 S.W.3d 154, 161 (Tex. App.—Texarkana 2000, no pet.) (addressing general rule and exception thereto).
"Each spouse has a duty to support the other spouse." Tex. Fam. Code Ann. § 2.501(a) (West 2006). Family code section 3.409 implicitly reflects the legislature's policy decision in section 2.501(a) and thus itself embodies the very same principles of equity that are embraced by section 7.007 and that Jason seeks to invoke.
Unlike in Case, Jason did not expend separate funds to purchase community property. See Case, 28 S.W.3d at 161. Rather, according to his own trial exhibit, he sought reimbursement for rent, food, groceries, utilities, and insurance expenses.
The trial court did not abuse its discretion by denying Jason's claim for reimbursement. We overrule his first point.
Jason argues in his second point that the trial court abused its discretion by ordering him to pay Elena attorney's fees pending appeal because she presented no evidence to support her motion. See Tex. Fam. Code Ann. § 6.709(a)(2). However, as Jason himself acknowledges, no reporter's record was made during the hearing on the temporary orders, and without a reporter's record upon which the trial court based its ruling, we will presume that the evidence supports the trial court's order.See, e.g., Heckendorn v. First Mortg., Co., No. 13-12-00451-CV, 2013 WL 5593520, at *4-5 (Tex. App.—Corpus Christi July 29, 2013, no pet.) (mem. op.) (citing numerous authorities reasoning similarly); Oxford v. Tex. Dep't of Family & Protective Servs., No. 03-11-00261-CV, 2012 WL 987789, at *2 (Tex. App.—Austin Mar. 21, 2012, no pet) (mem. op.) (same). We overrule Jason's second point and affirm the trial court's judgment.
Jason makes several statements in his brief about events that he says occurred at the hearing on Elena's motion for attorney's fees, but in the absence of a reporter's record, we refuse to consider those statements. He also appears to suggest that we can consider the reporter's record from the hearing on the final trial, but at that point, Elena had not yet filed her motion for attorney's fees. --------
/s/ Bill Meier
BILL MEIER
JUSTICE PANEL: LIVINGSTON, C.J.; WALKER and MEIER, JJ. DELIVERED: July 7, 2016