Most Texas divorce cases do not involve reimbursement claims, but if you are reading this article, they probably pertain to you. Better understanding the basics can help you move forward with increased confidence. One of the most significant components of any Texas divorce is the division of marital property, which is to be divided between the two of you in a manner that is just and right (rather than equally). Sometimes, however, reimbursement claims come into play when properties are more complicated.
Marital vs. Separate Property
The property that you and your spouse brought into your marriage will generally remain your separate property and will not be divided between the two of you in the event of divorce. This issue, however, can be complicated by any number of factors. For example, if your spouse owned a home that he or she brought into your marriage and used as a rental property during the course of your marriage, that house may remain your spouse’s separate property (especially if you have a prenuptial or postnuptial agreement to this effect). If you and your spouse put $80,000 of your community funds into fixing the house up in order to bring in higher rents, however, it changes the issue somewhat, and a reimbursement claim may be in order. The fact is that if you and your divorcing spouse cannot come to a mutually agreeable decision on the matter, it is left to the attending judge’s discretion, and that discretion is vast.
If the judge determines that you are, indeed, eligible for reimbursement for the community funds spent on improving your spouse’s property, the next question is what kind of relief is necessary to make you whole. Again, this is at the judge's discretion. Therefore, if the court finds that you have a valid reimbursement claim worth $80,000, it means that the amount becomes a marital asset in your divorce that will be divided in a manner that is just and right. The outcome can go in one of several directions, including:
- If there are sufficient marital funds, you may be awarded a greater percentage of your joint assets in order to compensate you for your half of the $80,000 ($40,000).
- The court can grant you a simple money judgment in your favor that allows you to pursue the specified amount using the full scope of Texas's debt collection laws. If your spouse does not have the resources to pay you in full, however, then he or she has legal protections of his or her own.
- The court may simply award you a marital property that is of equal value to your $80,000 claim. This means that if there is another property or asset that is worth $80,000, it would go to you rather than be divided in the divorce – thus reimbursing you for your half of the marital contribution to your spouse's separate property.