Divorce and Property Improvements in Texas
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How Is Property Divided upon Divorce In Texas?
The state of Texas follows community property rules. This means that any property acquired by either partner during a marriage will be divided equally between the two parties upon divorce. Such property is called “community property” or shared property.
Community property principles also classify any items acquired before marriage or by inheritance or gift as separate property. Separate property will be distributed in full to its legal owner upon a divorce or separation.
Are Improvements to a Home Regarded as Community or Separate Expenses?
Texas law provides for spouses to be reimbursed upon divorce for certain expenses incurred during the course of marriage. Depending on the type of property involved and the source of the funds used, a party may be reimbursed for improvements made to property such as remodeling or the installation of a swimming pool.
Generally speaking, if community funds were utilized to increase the value of one spouse’s separate property, then the community estate may be reimbursed for the costs of the expenditures. This means that upon divorce, the parties will split the cost of the improvements equally. On the other hand, if one spouse has used their own separate funds to benefit community property (such as the marital home), then that spouse may be entitled to a reimbursement from the community funds.
Sometimes these principles can lead to unfair results for one party. Thus many couples choose to specify the details of improvement costs in a marriage agreement. Disputes can also be resolved through alternative means such as settlements or mediation.
What Other Principles Do Texas Divorce Courts Follow?
Texas divorce courts follow general principles of equity when assigning reimbursements. This means that a court may choose to increase or decrease the amount of reimbursements based on the proportionate amount that one party contributed to a home improvement.
For example, if 85% of the improvement was paid for using one spouse’s separate funds, then a court will factor this in and distribute the reimbursement accordingly. Courts will also consider such factors as the amount of time expended, and the degree of labor or toil involved in the improvement project. Parties are not entitled to reimbursement for increases in value due simply to economic factors, such as shifting market values.
Equitable principles also state that the party seeking reimbursements must clearly plead for the reimbursements and be able to prove the amount of money expended. Failure to do so will prevent them from recovering the costs.
Finally, if one party is unable to pay the reimbursements, the court is entitled to place a lien on their own property in order to secure a monetary payment. This is done because improvements are usually attached to the marital property and cannot be distributed physically. So, monetary payment is the only method available for reimbursing costs.
Do I Need a Texas Lawyer for a Dispute over Improvement Costs?
Home improvements can often be sizable projects which involve a great deal of time and resources. It may be worth your while to contact an experienced family law attorney if you are involved in a dispute over reimbursements. Some people may choose to hire a Texas lawyer to help them draft a marriage agreement providing instructions regarding improvement costs. You should document any improvements using receipts, dates, and written descriptions or photographs of the projects. A qualified Texas lawyer can provided you more information if there is a legal basis for a division of community property.
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Last Modified: 01-22-2015 04:00 PM PST
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