As a community property state, Texas law holds that spouses generally share joint ownership of assets acquired by either individual during the course of a marriage. This property is referred to as the community estate. Additionally, each spouse has their own marital estate referred to as their separate estate, which includes assets that they owned prior to being wed, as well as items that are not included within the community estate for a legal reason, such as a valid prenuptial agreement. 

In a typical divorce, community property is divided the between the parties, while each spouse retains their own marital estate (separate property). However, there are instances where a husband or wife uses assets from the community estate, or their spouse’s marital estate, for their own personal benefit. When this occurs, a reimbursement claim might be warranted during a divorce proceeding. 

A situation that frequently gives rise to reimbursement claims is when one spouse owns a home with a mortgage prior to getting married. Once the couple is wed, funds from the community estate might very likely be used to make payments on that mortgage. Should the marriage end in divorce, the home would stay with the owner spouse, but the non-owner spouse can seek reimbursement for their share of community estate funds used to make mortgage payments which resulted in the pay down of the principal amount of the mortgage. 

Although not spelled out in the statute, courts often consider equitable factors in deciding whether reimbursement is fair and in what amount. It’s important to alert your attorney as soon as possible if you believe you are entitled to some form of reimbursement because separate property funds were available but not used. Courts may reduce or deny a claim based on offsets, such as when both parties enjoyed a separately owned home, or when rent collected on a property in one party’s marital estate became part of the community estate.

As with many claims in a divorce, the burden of proof generally resides with the party making the claim.  While the burden of proof for making a reimbursement claim is “clear and convincing evidence” which is higher that the burden of proof normally applied in civil matters which is referred to as “preponderance of the evidence”, it is frequently worth making such claims even if you believe that you may fall short of meeting your burden.  This is due to the equitable factors considered by the Court in making the division of the marital estate.  In other words, the court will consider the evidence relating to a reimbursement claim in dividing the overall estate and such evidence could result in a party receiving more than 50% of the marital estate eventhough they did not receive a reimbursement claim.

Whisenant & Associates handles issues related to Texas community property law and other aspects of the divorce process. For a consultation regarding your specific legal needs, please call 281-681-8889 or contact us online. Our office is located in The Woodlands. Se habla español.