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Gray's Interesting Cases for February 2004

Updated and presented by David Gray
  1. In the Interest of Circone, No. 06-03-00050-CV, not yet published (CA, Texarkana).

    H&W were divorcing and went to mediation which resulted in an irrevocable MSA by which H got custody of the kids. Before judgment W revoked the MSA but the T/C entered judgment based on the MSA. W appeals saying the T/C erred by: (a) failing to require the ad litem to find that the MSA was in the kids' best interest, (b) not allowing W to withdraw her consent to the MSA and (c) finding that there's no defense to a properly done MSA.

    CA affirms. Under the terms of the mediation statute [§153.007(d)(e)], a T/C has no authority to go behind the signed MSA.

    Comment - Just another case that says §153.007(d)(e) really means what it says -- the T/C has no power to look beyond what the parties signed even in the face of a kids' best interest challenge.

  2. Stavinoha v. Stavinoha, No. 14-02-01081-CV, not yet published (CA, Houston -- 14th, 2004, no writ hist.).

    H joined the Houston HPD in '75 and enrolled in its pension plan. In '79 he married. HPD's pension plan provides that after 20 yrs, H is entitled to retire and draw his pension but at his election he can continue to work (and receive his salary) and the pension payments which he would had received had he elected to retire will be paid into a deferred retirement plan (DROP). When H finally retires, the am't in the DROP account is paid to H in a lump sum. Any salary increases will not increase the am't of pension payments paid into the DROP account. H is also required to pay a portion of his salary into the DROP account after he elects to continue to work. In '95 H became eligible to retire but he continued to work and elected to enter the DROP. In 2000 a divorce is filed & a decree signed in 2002 after a trial to determine the character of various pension payments ultimately due H when he finally quits working. The T/C ruled that the DROP account is H's sep. prop. apparently based upon the plan's administrator=s testimony that the plan has always considered DROP accounts to be a "future benefit increase" post divorce which was not divisible per a QDRO. In the past, the plan has never approved a QDRO which attempted to divide the proceeds in the DROP account. W appeals.

    Reversed. The retirement payments paid into the DROP account (excluding the am'ts earned prior to marriage) were earned during marriage; therefore, the DROP account is community property subject to division by the T/C. The CA also said they didn't give a fig about the plan's characterization of the DROP account as H's sep. prop. because it was a future benefit increase" post divorce. The character of such property is determined by the Tx. Leg. and the courts -- not some administrative beancounter.

    Comment - Although this is a case of first impression, it seems to be a no-brainer to me. Apparently the 43 pension plans across Tex. who have DROP accounts and who have refused to recognize QDRO's on these DROP accounts are going to have to change their ways thus effecting hundreds of millions of dollars. Texas Cts - 1, Bean Counting Bureaucrats - O.

  3. In the Matter of the Marriage of Perkins, No. 07-02-0417-CV, not yet published (CA, Amarillo).

    H & W were divorcing. During the 2001 trial, W called an expert to testify as to the FMV of a piece of land. H objected on the basis that this expert had not been disclosed in discovery although H admitted that W had advised him, in writing, of her intent to call this expert witness and provided H with a copy of the expert's written appraisal. T/C admitted the expert's testimony over H's objection. On the issue of c/s, it was proved that H earned $29,7000 in 2001 (current earnings), $37,400 in 2000, and $35,800 in 1999 (3 year average -- $34,300). The T/C set c/s based on H's earnings of $32,000 even though H's current earnings were $29,700.

    H appeals and CA affirms. T/C didn't abuse its discretion in setting c/s based on $32,3000. Aditionally, the T/C did not err in admitting the expert's testimony even though he wasn't properly disclosed in discovery responses. Admitting or excluding testimony is within the T/C's discretion. As there was no surprise to H when W called her expert, the T/C didn't abuse its discretion in admitting the testimony.

    Comment - I think the CA went a little far saying that the admission of evidence is discretionary with the T/C; however, it appears that W probably satisfied the requirements of TRCP 193.6 so her expert could testify. As to c/s I have a real problem with using a multi-year average or something akin thereto. If an obligor is in his low earning cycle, c/s based on an average could be higher than his current monthly net. If he's in his high earning cycle; using an average gives her less than the c/s guidelines. Why not set c/s at the current actual earnings (high or low) and order the obligor to furnish copies of his yearly (and timely filed) income tax returns so either party may file a motion to modify? This way everyone is protected. Hopefully with completed info, the parties may agree on modified c/s and if not the stubborn one can be tapped with atty fees and retro-active modification of c/s.