Randy L. Reimert v. Judy A. Reimert

In The Court of Appeals Ninth District of Texas at Beaumont ____________________ NO. 09-07-418 CV ____________________ RANDY L. REIMERT, Appellant V. JUDY A. REIMERT, Appellees On Appeal from the 9th District Court Montgomery County, Texas Trial Cause No. 05-03-02234-CV MEMORANDUM OPINION Appellant, Randy Reimert, appeals from the trial court's order granting, appellee, Judy Reimert, (1) a divorce and awarding her a judgment for $39,000 with an equitable lien on Reimert's separate property for that amount. Specifically Reimert argues that the trial court abused its discretion in awarding Judy Dean $25,000 for reimbursement or economic contribution and that the trial court erred in imposing an equitable lien on Reimert's separate property for the entire amount of the judgment. We hold that the trial court's award of $25,000 to Judy Dean for economic contribution was proper, but find that the trial court erred in imposing an equitable lien in excess of that amount. We affirm the judgment as reformed. FACTUAL BACKGROUND In April of 1998, Randy Reimert purchased a ten-acre property in Grimes County with a home already built on the property. Reimert purchased the property for $100,000. In making the purchase, Reimert put down $20,000 of his separate funds and the deed was put in his name. Reimert and Dean were married five months later in September of 1998. Dean was, at all relevant times, fully employed. From the time they were married in 1998 until they separated in July of 2004, mortgage payments in the amount of $745 per month were made on the property from community funds out of their joint bank account. In addition, improvements were made to the homestead during the marriage. When Dean left the property in July of 2004 she took only her personal belongings and a three thousand dollar certificate of deposit. PROCEDURAL BACKGROUND In March of 2005 Dean filed for divorce. Reimert filed an answer to the petition in June of 2005. The divorce was called for trial on February 5, 2007. Reimert and his attorney failed to appear at trial. After hearing the evidence presented by Dean, the trial court granted the divorce. The court found the homestead to be the separate property of Reimert. However, the court found that the home had increased in value as a result of community contributions. The court found that Dean was entitled to "some reimbursement for the increase in value of the property, partly due to the contributions that she made as a member of the community." The court found that the property had increased in value by $50,000 and awarded Dean half of this increase in value, $25,000. Additionally, the court awarded a portion of Reimert's retirement benefits, offset by Dean's own retirement benefits, in the amount of $9,000 and an additional $5,000 for Dean's interest in the contents in the home. (2) A final divorce decree was entered on June 22, 2007, ordering Reimert to pay Dean $39,000 "for economic contribution" and imposing an equitable lien on the Grimes County property to secure Dean's claim. On July 18, 2007, Reimert filed a motion for new trial claiming that Dean's right of equitable contribution was computed incorrectly. The trial court denied the motion for new trial and this appeal followed. STANDARD OF REVIEW A trial court is charged with dividing the community estate in a "just and right" manner, considering the rights of both parties. Tex. Fam. Code Ann. § 7.001 (Vernon 2006). "A trial court has broad discretion in dividing the 'estate of the parties[.]'" Raymond v. Raymond, 190 S.W.3d 77, 82 (Tex. App.--Houston [1st Dist.] 2005, no pet.). The party complaining of the trial court's division of property must demonstrate from the record that the division was so unjust that the trial court abused its discretion. Pletcher v. Goetz, 9 S.W.3d 442, 446 (Tex. App.--Fort Worth 1999, pet. denied). We may reverse the trial court's division of property only if the trial court clearly abused its discretion and if the error materially affects the court's just and right division of the property. Nelson v. Nelson, 193 S.W.3d 624, 628 (Tex. App.--Eastland 2006, no pet.) (citing Jacobs v. Jacobs, 687 S.W.2d 731, 733 (Tex. 1985)); see also Raymond, 190 S.W.3d at 82. If there is any reasonable basis for doing so, we must presume that the trial court exercised its discretion properly. Pletcher, 9 S.W.3d at 446. Under an abuse of discretion standard, legal and factual sufficiency challenges are not independent reversible grounds of error but are relevant factors in assessing whether the trial court abused its discretion. Doyle v. Doyle, 955 S.W.2d 478, 479 (Tex. App.--Austin 1997, no pet.). In considering a "no-evidence" issue, anything more than a scintilla of evidence is legally sufficient to support the trial court's finding. Leitch v. Hornsby, 935 S.W.2d 114, 118 (Tex. 1996). In considering a party's contention that the evidence is factually insufficient, we consider all the evidence in the case. Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402, 406-07 (Tex. 1998). The evidence will be factually insufficient only where "the evidence . . . is so weak or the evidence to the contrary is so overwhelming that the finding should be set aside and a new trial ordered." Garza v. Alviar, 395 S.W.2d 821, 823 (Tex. 1965). Because this appeal proceeds without the benefit of findings of fact and conclusions of law, we will presume the trial court made all necessary findings to support its judgment and will affirm based upon any legal theory that is supported by the evidence. Wilkerson v. Wilkerson, 992 S.W.2d 719, 722 (Tex. App.--Austin 1999, no pet.). ISSUES Reimert asserts five issues on appeal. In issue one, Reimert asserts that the trial court abused its discretion in awarding Dean a claim for economic contribution because there were no pleadings to support the claim and no or insufficient evidence that the Grimes County property ("Property") was enhanced in value. In issues two and three Reimert contends that the trial court abused its discretion in finding the community was entitled to reimbursement because there were no pleadings to support such a claim, and no or insufficient evidence to support a reimbursement award. Reimert asserts in issue four that the pleadings did not support the evidence presented, the evidence presented did not support the judgment, the evidence did not support a claim for economic contribution or reimbursement, and the final divorce decree does not conform to the evidence presented or the trial court's judgment in open court. Finally, Reimert maintains in issue five that the trial court erred in imposing a $39,000 equitable lien based on an erroneous judgment for economic contribution of $25,000 plus other amounts purporting to be a division of marital assets. ECONOMIC CONTRIBUTION AND REIMBURSEMENT A claim for economic contribution arises when community funds are used to reduce the principle amount of a debt secured by a lien on the separate property of one marital estate. Tex. Fam. Code Ann. § 3.402(a)(1) (Vernon 2006). A claim for economic contribution also arises when the community makes capital improvements to one marital estate. Id. § 3.402(a)(6). A marital estate can also make a claim for reimbursement under the current statutory scheme, as opposed to a claim for economic contribution, however such a claim is limited to (a) two specific, narrow instances, or (b) "a factual circumstance not covered by this subchapter." Id. § 3.408(a)(Vernon Supp. 2008). A claim for reimbursement may only be awarded for (1) payment by one marital estate of the unsecured liabilities of another marital estate; or (2) inadequate compensation for the time, toil, talent and effort of a spouse by a business entity. Id. § 3.408(a). Because under the facts presented here we conclude that Dean's claim is governed by the law of economic contribution, (3) rather than the law of reimbursement, we need not address issues two and three. ECONOMIC CONTRIBUTION PLEADINGS AND EVIDENCE Reimert asserts in issues one and four that Dean failed to plead a claim for economic contribution or reimbursement, and contends that as a result the trial court's judgment fails to conform to the pleadings under Rule 301 of the Texas Rules of Civil Procedure. "In determining whether [a] judgment conform[s] to the pleadings, an appellate court should view the pleadings as a whole. A prayer for general relief will support any relief raised by the evidence and consistent with the allegations in the petition." Raymond, 190 S.W.3d at 83 (citing Khalaf v. Williams, 814 S.W.2d 854, 858 (Tex. App.--Houston [1st Dist.] 1991, no writ)). In her original petition, Dean requested that the Court divide the estate in a manner that the Court deemed just and right, as provided by law. Dean also made a prayer for general relief. A failure to specifically plead a claim for economic contribution is not per se fatal to recovery for such a claim under Texas law as family law courts generally construe divorce pleadings more liberally than in other civil cases. See Jensen v. Jensen, 665 S.W.2d 107, 110 (Tex. 1984) (remanding the cause to the trial court to determine the amount of reimbursement, if any, due to the community even where a claim for reimbursement was not pleaded); (4) see also Tex. Fam. Code Ann. §§ 3.402, 3.403. We find Dean's pleading, coupled with the evidence in the record, sufficient to include a claim for economic contribution. In issues one and four, Reimert also asserts there is no or insufficient evidence to support the economic contribution award to Dean. A spouse seeking economic contribution bears the burden of proving that claim. See Hailey v. Hailey, 176 S.W.3d 374, 388 (Tex. App.--Houston [1st Dist.] 2004, no pet.); Boyd v. Boyd, 131 S.W.3d 605, 613 (Tex. App.--Fort Worth 2004, no pet.). To calculate a claim for economic contribution to separate property there must be evidence of: (1) the net equity of the separate property as of the date of the first economic contribution to the property by the community estate or by the separate property estate of the other spouse; (2) the amount(s) of the economic contributions (if any) by (a) the other spouse's separate property estate, (b) the community property estate, and (c) the separate property estate of the spouse who owns the benefited separate property; and (3) the net equity of the separate property as of the date of divorce. See Tex. Fam. Code Ann. § 3.403(b), (b-1)(2). It is not disputed that the Property where Dean and Reimert lived during marriage was Reimert's separate property. The record shows the Property was purchased by Reimert in April of 1998, four months prior to the marriage for $100,000. The record further establishes that Reimert made a down payment of $20,000 using his separate funds, and executed a note for $80,000 secured by the real property. Monthly mortgage payments in the amount of $745 per month were made out of community funds from September of 1998 until July of 2004, for approximately six years. (5) Thus, there was evidence that more than $50,000 of community funds were used to pay toward Reimert's separate debt secured by the marital homestead. The trial court also heard testimony regarding improvements made to the Property during marriage. Dean testified that during the marriage the couple had built a barn and that everything in the house had been redone or updated. Improvements to the home included updating the plumbing, ac/heating, sinks, and the addition of new appliances. Dean offered photographs to corroborate her testimony as to the improvements to the property. (6) Finally, Dean testified at trial that the couple had talked to an appraiser two or three years after purchasing the property and the value of the property had already increased two to three times. The trial court, as fact finder was charged with evaluating the evidence, including Dean's credibility. Cardwell v. Cardwell, 195 S.W.3d 856, 859 (Tex. App.--El Paso 2005, no pet.); see also Griffin Indus., Inc. v. Honorable Thirteenth Court of Appeals, 934 S.W.2d 349, 355 (Tex. 1996). Without specifying the contributions being referred to, the trial court found that the value of the Property had increased by $50,000 as a result of contributions made by the community. We have no details from the court concerning how it computed the award as neither party requested findings of fact and conclusions of law. See Tex. Fam. Code Ann. §6.711 (Vernon 2006). We presume the trial court made all necessary findings to support the judgment. See Wilkerson, 992 S.W.2d at 722. Though the trial court used the terms "contribution" and "reimbursement" interchangebly, we conclude that the record contains more than a scintilla of evidence, and is legally and factually sufficient, to support the $25,000 awarded to Dean for her claim for economic contribution for community funds used to enhance the value of the Property. We further find that Reimert has failed to demonstrate that the property division, including the finding for economic contribution, was so unjust that the trial court abused its discretion. See Pletcher, 9 S.W.3d at 446. The $25,000 awarded to Dean is supported by the record and consistent with the allegations. Any error has not been shown to have materially affected the court's just and right division of the property. We overrule issues one and four. EQUITABLE LIEN In his fifth issue, Reimert complains on appeal that the trial court erred in imposing a lien on his separate Property because the amount of the lien includes the erroneous claim and judgment for economic contribution purporting to be $25,000, "plus other amounts purporting to be a division of other marital assets, not entitled to be secured by an equitable lien." The Texas Family Code directs a trial court to impose an equitable lien on property of a marital estate to secure a claim for economic contribution in that property by another marital estate. Tex. Fam. Code Ann. § 3.406 (Vernon 2006). Therefore, pursuant to section 3.406 an equitable lien in the amount of $25,000 against the Property was proper. The trial court's judgment states as follows: IT IS ORDERED AND DECREED that Respondent pay $39000.00 to Petitioner for economic contribution to Respondent's separate estate. The claim shall bear interest at 12 percent per year and shall be payable on the date that the court signs the decree. IT IS ORDERED AND DECREED that an equitable lien to secure the claim for economic contribution is imposed in favor of Judy A. Reimert against Ten acres and house located at 9872 Glass Lane, Plantersville, Grimes County. It is clear from the record that $25,000 was awarded to Dean for her economic contribution to appellant's separate property, $5,000 for her interests in the contents of the home, and $9,000 for the difference in value of Dean and Reimert's retirement accounts and her interest in those. We hold that the court erred in imposing an equitable lien on appellant's separate property in any amount in excess of the $25,000 awarded to Dean for economic contribution. Because it appears from the language in the judgment that the trial court imposed an equitable lien for the entirety of its award in the amount of $39,000 we sustain issue five. We overrule all issues save and except issue five and affirm the judgment of the trial court, but reverse that portion of the court's order imposing an equitable lien on appellant's separate property in excess of $25,000 for the economic contribution claim. We affirm the award of $39,000 to Dean but reform the judgment to impose an equitable lien against the Property in the amount of $25,000. We affirm the judgment as reformed. AFFIRMED AS REFORMED. __________________________________ CHARLES KREGER Justice Submitted on February 28, 2008 Opinion Delivered November 13, 2008 Before McKeithen, C.J., Kreger and Horton, JJ. DISSENTING OPINION In this case, the majority concludes that the trial court's award of contribution to Dean is supported by the evidence and need not be pled. In my opinion, the trial court's award was improper for three reasons. First, contribution should have been pled and was not. See Raymond v. Raymond, 190 S.W.3d 77, 83 (Tex. App.-Houston [1st Dist.] 2005, no pet.); Huval v. Huval, 2007 WL 1793771, *2 n. 5 (Tex. App.-Beaumont 2007, no pet.); see also Tex. R. Civ. P. 301. Since Reimert and his attorney did not appear at the trial, a theory of trial by consent does not operate to salvage the pleadings deficiency. See Stoner v. Thompson, 578 S.W.2d 679, 682-83 (Tex.1979) ("A post-answer 'default' constitutes neither an abandonment of defendant's answer nor an implied confession of any issues thus joined by the defendant's answer."). Second, there must be evidence to support the trial court's determination of the property's value. See Boyd v. Boyd, 131 S.W.3d 605, 613 (Tex. App.-Fort Worth, 2004, no pet.). Here, the evidence, consisting of Dean's opinion, was not competent evidence. See Lefton v. Griffith, 136 S.W.3d 271, 277 (Tex. App.-San Antonio 2004, no pet.); Roberts v. U.S. Home Corp., 694 S.W.2d 129, 135 (Tex. App.-San Antonio 1985, no writ). Third, the calculation under the economic contribution formula contained in the Family Code requires proof of the equity in the benefitted property on the date of the dissolution of the marriage. See Tex. Fam. Code Ann. § 3.403(b), (d) (Vernon 2006); Rogers v. Foxworth, 214 S.W.3d 196, 199 (Tex. App.-Tyler 2007, no pet.); In re Morris, 123 S.W.3d 864, 871 n. 4 (Tex. App.-Texarkana 2003, no pet.). Here, there was no such evidence. Based on any one of these reasons, the trial court's judgment in my opinion should be reversed and remanded for further proceedings to determine a just and right property division. Because the majority affirms a judgment not supported by the pleadings or the evidence, I dissent. ______________________________ HOLLIS HORTON Justice Dissent Delivered November 13, 2008 1. Upon final divorce of this matter Judy Reimert's name was changed to her maiden name, Judy Dean. For ease of reference, we will refer to Judy Reimert by her changed name "Judy Dean" or "Dean." We will refer to Randy Reimert as "Reimert." 2. Reimert does not take issue on appeal with the trial court's award to Dean in the amount of $9,000 for Dean's interest in Reimert's retirement or the court's award in the amount of $5,000 for her interest in the contents of the home. 3. While the trial court sometimes mistakenly transposed the terms contribution and reimbursement, we find that the case was tried and decided by employing the significant principles of economic contribution. See Cardwell v. Cardwell, 195 S.W.3d 856, 860 (Tex. App.--Dallas 2006, no pet.); see also Garcia v. Garcia, 170 S.W.3d 644, 652 (Tex. App.--El Paso 2005, no pet.). 4. In a concurring opinion in Jensen, Justice Robertson states: Until Vallone [v. Vallone, 644 S.W.2d 455 (Tex. 1983)], Texas courts had traditionally followed a general rule of construing divorce pleadings liberally. Cohen v. Cohen, 194 S.W.2d 273, 275 (Tex. Civ. App.--Austin 1946, no writ). The majority opinion in Vallone appeared to mark the beginning of a shift to a policy requiring specific pleadings in family law matters. 644 S.W.2d at 466. . . . The majority opinion [in Jensen], . . . announces a return to a broad construction of divorce pleadings. Although a member of the majority in Vallone, I am of the opinion that this Court's return to a more liberal policy for construing divorce pleadings will provide trial judges with the freedom needed to reach just decisions in complex and sensitive family law actions. Jensen, 665 S.W.2d at 110-11 (Robertson, J., concurring). 5. We note that the trial court did rough calculations, rounding up to seven years, concluding that "at least sixty some odd thousand [dollars] of community property" were used to pay down the mortgage. 6. The photographs, although admitted into evidence and considered by the trial court, were not included in the record before us as the trial court allowed the party to retain such exhibits at the conclusion of the trial.