The Woodlands Divorce Attorney » just and right

Who Pays the Student Loans?

Rich Shea — Thu, 18 Nov 2010 22:06:15 +0000

More and more people make use of student loans to help pay for their education. As recently as 2009 almost 60% of Texas students graduated college with student loan debt. If you add on graduate school student loan debt can easily exceed $100,000. If your soon to be ex-spouse has student loans with a significant balance you may be very concerned about how the student loan debt can be allocated as part of a Woodlands Divorce. With the great amount of discretion given to judges, you are right to be concerned. Fortunately, a recent case sheds some light on how the courts are examining student loan debt and divorce.

Background

Albert and Sophia began living together in 1987. One year later, Sophia gave birth to their only child. To help cover living expenses, Sophia’s educational expenses, and the expenses of Albert’s asbestos consulting business, Sophia applied for and received student loans totaling over $90,000. In February 1994, Albert and Sophia married, and in 2002, Sophia filed a petition for divorce.

The Trial

In a surprise ruling, the trial court ordered Albert to pay Sophia’s entire student loan debt. Albert’s divorce attorney quickly filed an appeal on this critical issue.

Student Loan Debt

Albert’s divorce attorney argued that the trial court was legally wrong when it ruled that he had to pay Sophia’s student loan because the loans were taken out before they were married.

Property owned or claimed by a spouse before marriage or acquired after marriage by gift, devise, or descent is that spouse’s separate property. A court may not decree that separate property of one spouse becomes the separate property of the other spouse because “the nature of separate property is determined by the Texas Constitution, rather than by what is ‘just and right.’”

Sophia’s divorce attorney did not dispute that the student loans were acquired before marriage. At trial, Sophia testified as follows:

Q All right. Ma’am, you and your husband got married in 1994. Isn’t that a fair statement?

A Yes.

Q And these student loans that you made, you made long before 1994, didn’t you?

A I made them before 1994.

Q Okay. So, these are not even community debts, are they? These are your separate property debts?

A Yes, I guess you can say that.

When Sophia received the student loan proceeds, those proceeds constituted Sophia’s separate property. If the divorce court had awarded Albert part of the student loan proceeds, it clearly would have been in violation of Sophia’s separate property right to the proceeds. The appeals court relied on this point to characterize the pre-marriage student loan debt as separate debt which could therefore not be assigned to the other spouse.

Protect Your Rights

Don’t get stuck paying for a debt that is not yours. Call (832) 592-7913 and speak with a Montgomery County Divorce Attorney at The Shea Law Firm.

To find out more about divorce in Montgomery County take some time to review my free Woodlands Divorce Guide

About The Author

The Woodlands Divorce Resource is here to help you with your divorce, child custody, or other family law issue in Montgomery County or Harris County. Many of our visitors come from the areas of The Woodlands, Conroe, Oak Ridge North, Cut and Shoot, and other communities in the Montgomery County area or Houston and North Harris County. If you need legal assistance with your family law issue speak with a Montgomery County divorce lawyer in The Woodlands, TX today and protect your rights. Contact The Shea Law Firm at (832) 592-7913.

Trial Court Overturned on Finding Husband Wasted Community Property

Rich Shea — Thu, 11 Nov 2010 19:00:16 +0000

Wasting community property is one valid reason a judge may order a disproportionate division of community property in a Montgomery County Divorce. A common example of wasting community property in a divorce would be if one spouse makes substantial gifts to a new girlfriend, boyfriend, or anyone outside the marriage using community property. If you take money or property that is community property and transfer it outside of the community estate then you may have a “waste” situation which opens the door for a disproportionate division of community property. One court recently ruled that a husband who used community property while the divorce was pending to purchase a new home and car for himself was guilty of waste. The appeals court disagreed. Let’s see why.

Background

Wife and husband married in 1990. In 2006, wife and children fled the family home alleging family violence by husband. The couple filed for divorce in 2007. During divorce proceedings, husband sold community property and used those assets to pay community debts and to purchase a home and an automobile for his personal use. Following trial, trial court awarded wife a disproportionate share of the community estate due to husband’s “wasting of community assets” in violation of a court order.

Husband appealed on multiple grounds including that trial court abused its discretion in finding that he wasted community assets and making a disproportionate property division and money damages award based on that finding.

Waste and Community Property Division

Under the family code, a trial court in a divorce proceeding is charged with ordering a division of the community estate in a manner that the court deems “just and right,” having due regard for the rights of each. In dividing the community estate, the trial court can consider several nonexclusive factors including whether one party wastes community property. Waste occurs when one spouse, dishonestly or purposefully with the intent to deceive, deprives the community estate of assets to the detriment of the other spouse. Waste requires disposal of community assets for non-community purposes or transfer of assets outside of the com-munity.

Is This Waste?

In this case, husband testified that he used the proceeds from selling community assets to pay community bills, including attorney’s fees for the divorce, to buy a new car, and to buy and furnish the new house. While husband’s actions may have been in violation of trial court’s orders and may have been done without wife’s knowledge, the evidence conclusively shows that husband’s actions either were done for community purposes or did not deplete the community assets. In fact, the evidence shows that the net balance of the community remained the same because the community debt was reduced and the community assets were simply transmuted, not lost. Thus, no waste occurred. Accordingly, trial court abused its discretion in finding husband wasted community assets and then basing its division of community property on that finding.

Protect Your Rights

If your husband or wife has used community property in a way that you are concerned about, or if you are accused of misusing community property protect your rights and get help today by calling (832) 592-7913 and speaking with a Montgomery County Divorce Attorney at The Shea Law Firm.

About The Author

Why You Won’t Get 50% of the Community Property

Rich Shea — Sat, 26 Jun 2010 22:30:40 +0000

Many people believe property is divided in half as a result of divorce. It certainly sounds reasonable on many levels. Equal division of property is the standard in some other states, but not in Texas. You can end up with a lot more, or a lot less, than 50% of the community property so you better understand the legal standard the judge is going to use.

It may not mean much to you right now, but if you have significant property to divide in your Woodlands Divorce case then the words “just and right” may end up haunting you if you are not prepared. “Just and Right” is the legal standard used to divide property in a Woodlands Divorce; not “equal”, “50/50” or anything like that. The magic words the judge will use to justify whatever decision he or she makes concerning property division is “just and right.” So, what does it mean?

Nobody really knows what “just and right” means. It is a moving target. The legislature put those words into the statute but never bothered to define them. Over the years countless judges have made rulings on what they interpret to be “just and right” in the case before them and that is what your Woodlands Divorce Attorney will rely on to present your case.

Be Prepared

Don’t risk losing a large portion of your property by not being prepared for your Woodlands Divorce. Attorney Richard L. Shea of The Shea Law Firm can represent you and help protect you from losing everything. Call (832) 592-7913 today.

About The Author

The Woodlands Divorce Resource is here to help you with your divorce, child custody, or other family law issue in Montgomery County or Harris County. Many of our visitors come from the areas of The Woodlands, Conroe, Oak Ridge North, Cut and Shoot, and other communities in the Montgomery County area or Houston and North Harris County. If you need legal assistance with your family law issue speak with a divorce lawyer in The Woodlands, TX today and protect your rights. Contact The Shea Law Firm at (832) 592-7913.