Leibman v. Grand

• Decision Date: 01 October 1998
• Docket Number: No. 08-97-00307-CV,08-97-00307-CV
• Citation: 981 S.W.2d 426
• Parties: Reuven S. LEIBMAN, Appellant, v. Yana GRAND, Appellee.
• Court: Texas Court of Appeals

Page 426

981 S.W.2d 426

Reuven S. LEIBMAN, Appellant, v. Yana GRAND, Appellee.

No. 08-97-00307-CV.

Court of Appeals of Texas,

El Paso.

Oct. 1, 1998.

Pamela E. George, Houston, for Appellant.

Thomas Clarke, Houston, for Appellee.

Barbara K. Runge, Houston, for Interested Party.

Before BARAJAS, C.J., and McCLURE and CHEW, JJ.

OPINION

McCLURE, Justice.

Reuven S. Leibman appeals from a turnover order requiring that Fidelity Life Insurance Company deliver to the duly appointed receiver the funds in Leibman's annuity account. In addition to challenging the sufficiency of the evidence to support the trial court's determination that the premium payments he made in purchasing the annuity were in fraud of his former wife and judgment creditor, Leibman attacks the turnover order on procedural grounds. We affirm.

FACTUAL SUMMARY

Reuven Leibman (Leibman) and Yana Grand (Grand) were married in 1980 and separated in 1989. In July of that year, Grand filed a complaint in the courts of North Carolina, seeking a divorce, an equitable distribution of marital property, and alimony. On May 21, 1990, a Judgment of Absolute Divorce was granted. By November, Leibman had moved to Houston, Texas. In the spring of 1992, the North Carolina courts entered two judgments relating to the remainder of relief sought by Grand. The first, pertaining to an equitable distribution of the marital property, awarded Grand the sum of $67,733.55 with interest at 8 percent per annum. The second involved a judgment for delinquent alimony pendente lite in the amount of $24,636.88, together with interest at 8 percent per annum, and awarded permanent alimony to Grand payable in the amount of $1,040 per month. Leibman remarried in December 1992. He made no alimony payments nor did he pay any part of the money judgments. ¹

Pursuant to the Uniform Interstate Family Support Act, ² Grand filed a petition in the 247th District Court of Harris County, Texas to register and enforce the foreign judgments. On May 30, 1996, the trial court entered an order confirming registration of both judgments. See TEX.FAM.CODE ANN. § 159.608 (Vernon 1996). Grand then filed an application for the turnover of non-exempt property, and alternatively, she requested the appointment of a receiver. On December 23, 1996, the initial hearing proceeded on the turnover relief. The sole asset addressed during the testimony was the Fidelity Life Insurance Company (Fidelity) annuity. Counsel for the litigants argued the issues of whether the contributions to the annuity account constituted the transfer of non-exempt property, whether the transfer was fraudulent, and whether the annuity qualified for any statutory exception. At the conclusion of the arguments, the trial court appointed a receiver and enjoined Leibman from interfering with the financial status quo. After a bench trial on the merits, the court found that the judgments had an outstanding balance, including interest, of at least $195,500 and that Leibman had wholly failed to satisfy them. The court further found that Leibman fraudulently transferred non-exempt funds in the amount of $35,000 into the Fidelity annuity. Consequently, the trial court set aside the transfer and ordered Fidelity to turn over to the receiver the annuity funds in the amount of $41,608.45 ³ so that the funds could be applied in partial satisfaction of the registered judgments.

APPLICATION OF THE TEXAS INSURANCE CODE

Leibman first challenges the turnover order by three related issues on appeal. In Issue No. One, he asserts that the trial court abused its discretion in entering the turnover order because the annuity funds are exempt, as a matter of law, under Article 21.22 of the Texas Insurance Code. In Issue No. Two, he attacks the legal and factual sufficiency of the evidence to support a number of findings pertaining to the court's determination that he fraudulently transferred non-exempt property. In his third issue, he challenges the legal and factual sufficiency of the evidence to support the trial court's findings that he used non-exempt funds to fund the annuity. Although Leibman raises these contentions as separate issues on appeal, we conclude that they must be reviewed together under an analysis which incorporates the appropriate abuse of discretion and evidentiary sufficiency standards of review.

Standards of Review

In a bench trial, factual and legal sufficiency challenges to the trial court's findings of fact are reviewable under the same standards that are applied in reviewing evidence supporting a jury's verdict. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex.1994); Schwartz v. Pinnacle Communications, 944 S.W.2d 427, 431 (Tex.App.--Houston [14th Dist.] 1997, no writ). In considering a "no evidence," or legal insufficiency point, we consider only the evidence that tends to support the jury's findings and disregard all evidence and inferences to the contrary. Garza v. Alviar, 395 S.W.2d 821 (Tex.1965); Tri-State Wholesale Associated Grocers, Inc. v. Barrera, 917 S.W.2d 391, 394 (Tex.App.--El Paso 1996, writ dism'd by agr.). If more than a scintilla of evidence exists to support the questioned finding, the "no evidence" point fails. Tseo v. Midland Am. Bank, 893 S.W.2d 23, 25 (Tex.App.--El Paso 1994, writ denied).

The test for factual insufficiency is set forth in In re King's Estate, 150 Tex. 662, 244 S.W.2d 660 (1951). In reviewing a point of error asserting that a finding is against the great weight and preponderance of the evidence, we must consider all of the evidence, both the evidence which tends to prove the existence of a vital fact as well as evidence which tends to disprove its existence. It is for the jury to determine the weight to be given to the testimony and to resolve any conflicts in the evidence. Carrasco v. Goatcher, 623 S.W.2d 769, 772 (Tex.App.--El Paso 1981, no writ). The jury's finding should be sustained if there is some probative evidence to support it and provided it is not against the great weight and preponderance of the evidence. Id.The parlance used by the courts of appeals is that such a finding "shocks the conscience" or that it is "manifestly unjust," limited by such phrases as "the jury's determination is usually regarded as conclusive when the evidence is conflicting," "we cannot substitute our conclusions for those of the jury," and "it is the province of the jury to pass on the weight or credibility of a witness's testimony." See, e.g., Transportation Ins. Co. v. Moriel, 879 S.W.2d 10, 30-31 (Tex.1994); Beall v. Ditmore, 867 S.W.2d 791, 795-96 (Tex.App.--El Paso 1993, writ denied). Here, of course, the factfinder was the trial court and not a jury. Nevertheless, we cannot substitute our judgment for that of the factfinder even if we find a fact contrary to that found by the trial court, provided the finding is supported by probative evidence and is not against the great weight and preponderance of the evidence. If, however, the finding is so contrary to the great weight and preponderance of the evidence as to be manifestly unjust, the point should be sustained.

We review a turnover order under an abuse of discretion standard. Beaumont Bank, N.A. v. Buller, 806 S.W.2d 223, 226 (Tex.1991). In conducting this review, we engage in a two-pronged analysis: (1) Did the trial court have sufficient information upon which to exercise its discretion; and (2) Did the trial court err in its application of discretion? Lindsey v. Lindsey, 965 S.W.2d 589, 591 (Tex.App.--El Paso 1998, no pet.). The traditional sufficiency of the evidence review, articulated above, comes into play when considering the first question. Id. at 591. We then proceed to determine whether, based on the elicited evidence, the trial court made a reasonable decision, or whether it is arbitrary and unreasonable. Id.The question is not whether, in the opinion of the reviewing court, the facts present an appropriate case for the trial court's action, but whether the court acted without reference to any guiding rules and principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 242 (Tex.1985), cert. denied, 476 U.S. 1159, 106 S.Ct. 2279, 90 L.Ed.2d 721 (1986); Lindsey, 965 S.W.2d at 591. The mere fact that a trial judge may decide a matter within her discretionary authority in a different manner than an appellate judge in a similar circumstance does not demonstrate that an abuse of discretion has occurred. Southwestern Bell Telephone Company v. Johnson, 389 S.W.2d 645, 648 (Tex.1965); Lindsey, 965 S.W.2d at 592.

Turnover Statute and Statutory Exemption

Grand filed her application for turnover relief pursuant to Section 31.002(a) of the Texas Civil Practice and Remedies Code, which provides:

(a) A judgment creditor is entitled to aid from a court of appropriate jurisdiction through injunction or other means in order to reach property to obtain satisfaction on the judgment if the judgment debtor owns property, including present or future rights to property, that:

(1) cannot readily be attached or levied on by ordinary legal process; and

(2) is not exempt from attachment, execution, or seizure for the satisfaction of liabilities.

TEX.CIV.PRAC. & REM.CODE ANN. § 31.002(a)(Vernon 1997). The actions which a trial court may take in exercising its discretion are set forth in Section 31.002(b). The court:

• may order the judgment debtor to turn over non-exempt property to a designated sheriff or constable for satisfaction of the judgment; or

• may otherwise apply the property to the satisfaction of the judgment; or

• may appoint a receiver with the authority to take possession of the non-exempt property toward satisfaction of the judgment.

TEX.CIV.PRAC. & REM.CODE ANN. § 31.002(b). A court may not, however, enter or enforce an order that requires the turnover of the proceeds of, or the disbursement of, property exempt under any statute. TEX.CIV.PRAC. & REM.CODE ANN. § 31.002(f).

Leibman maintains that the cash surrender value of the...