Faulkner v. Faulkner
| Decision Date | 31 May 1979 |
| Docket Number | No. 19947,19947 |
| Parties | Lois Ann FAULKNER, Appellant, v. Bobby Gerald FAULKNER, Appellee. |
| Court | Texas Court of Appeals |
Robert C. Cox, James Albert Jennings, Erhard, Cox & Ruebel, Dallas, for appellant.
Brian A. Eberstein, Dallas, for appellee.
Before GUITTARD, C. J., and STOREY and HUMPHREYS, JJ.
Both parties to this divorce suit appeal from a decree dividing the community property and awarding the wife a "judgment lien" on certain corporate stock given to the husband by his parents. The court found that the stock was enhanced in value by the couple's personal services and by the lending of their credit to the corporation. The wife contends that the court should have awarded her an ownership interest in the corporation. The husband contends that there is no evidence to support the finding of enhancement or to justify imposition of the "judgment lien." We agree with the husband that there is no basis in the evidence for the finding of any community interest in the corporation or its stock or for any finding of enhancement of the stock. Accordingly, we reverse and remand for a new trial of the property issues.
The parties were married approximately twenty years. Their only possessions were a home subject to a large mortgage, household goods, automobiles, life insurance, and 2,170 shares of stock in Dallas Truck Plaza, Inc. Both were employed by that corporation, and the husband was a participant in the corporation's profit-sharing plan. The stock was originally owned by the husband's parents, and was transferred to the husband as a gift on April 1, 1976.
The corporation was organized by the husband's father. In 1971, the father proposed that the corporation go into the truck repair and servicing business on a tract of land he owned. To obtain funds for construction costs a loan was sought from Skelly Oil Company, which agreed to lend the corporation $275,000 on condition that a promissory note be signed by the father, the mother, the three sons, and their wives. Accordingly, on May 25, 1971, a note in that amount was executed on behalf of Dallas Truck Plaza, Inc. and was signed individually by the father and mother, the three sons, and their wives.
The proceeds of the loan were used to build the truck stop. The present parties went to work as employees, the wife as a waitress and the husband as mechanic and shop manager. The husband served also as general manager in his father's absence. Both husband and wife were compensated for their services by salaries paid by the corporation. The business prospered and its stock increased in value. The corporation paid the installments on the note to Skelly as they fell due. None of the individual signers of the note have ever been required to make a payment.
None of the stock in the corporation was issued to either of the present parties until April 1, 1976, when the husband's parents transferred the 2,170 shares in question to him. This was one-eighth of the total shares outstanding. Similar gifts were made at the same time to the other two sons, and all these gifts were listed in a federal gift tax return filed by the parents.
The only point urged by the wife for reversal of the decree is the court's failure to find that she and her husband had a twenty-five percent community interest in Dallas Truck Plaza, Inc. by virtue of the tender of their community credit for the construction of Dallas Truck Plaza and their guaranty of its financial obligation. In support of this contention, she cites Broussard v. Tian, 156 Tex. 371, 295 S.W.2d 405 (1956) and Gleich v. Bongio, 128 Tex. 606, 99 S.W.2d 881 (1937). Those cases stand for the rule that property Acquired by either spouse on the credit of the community is community property. The obvious distinction is that in this case neither the husband nor the wife acquired any property interest in the stock of the corporation or in its assets by signing the corporation's note. That note was secured by the land, which had been owned by the husband's father, and by the truck stop and other facilities built on it. There is no evidence of any conveyance to the husband of any interest in that property or of any agreement that he should have such an interest. Neither is there any evidence that the husband acquired any property interest in the corporation until five years later, when his parents made him a gift of 2,170 shares of stock and made similar gifts to his two brothers. Counsel has cited no authority to support the view that a married couple can obtain a community interest in an incorporated enterprise by co-signing the corporation's note, and we know of none that would even remotely tend to support such a view. Consequently, we hold that the trial court was correct in its finding that the parties did not have a twenty-five percent community interest in the Dallas Truck Plaza, Inc.
The divorce decree recites findings that the community estate of the parties, through tendering its credit on the $275,000 note and the work efforts of both parties, has contributed a community interest in 2,170 shares of stock of Dallas Truck Plaza, Inc. It further recites that there has been an increase in value of the 2,170 shares attributable in part to the community by reason of both parties' efforts. The decree recites, however, that the part of the increase so attributable is not precisely ascertainable, and, consequently, that the entire amount of the increase is community in character by reason of commingling. To determine what portion of the 2,170 shares is community property, the court found the value per share to have been $11.97 on April 1, 1976, and $14.44 on July 31, 1978, making a "community increase" per share of $2.47. Multiplying this figure by the 2,170 shares resulted in a total "community increase" of $5,359.90, of which the one-half interest of each spouse was $2,679.95. However, the judge did not award this figure to the wife as her...
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