Mullins v. Mullins

• Decision Date: 27 February 1990
• Docket Number: No. 2-89-005-CV,2-89-005-CV
• Citation: 785 S.W.2d 5
• Parties: Robert H. MULLINS, Appellant, v. Ruthie M. MULLINS, Appellee.
• Court: Texas Court of Appeals

Page 5

785 S.W.2d 5

Robert H. MULLINS, Appellant, v. Ruthie M. MULLINS, Appellee.

No. 2-89-005-CV.

Court of Appeals of Texas,

Fort Worth.

Feb. 27, 1990.

Kenneth N. Price, Azle, for appellant.

Stites, Hoover, Clark & Smith, Robert D. Hoover and Ellen S. Smith, Fort Worth, for appellee.

Before WEAVER, C.J., and JOE SPURLOCK, II and MEYERS, JJ.

OPINION

WEAVER, Chief Justice.

Appellant, Robert H. Mullins, appeals from the trial court's final decree of divorce. He complains of the division of the parties' property. After "finding" appellant was at fault in the divorce, the trial court distinguished separate and community property of each party and divided community assets by item and awarded certain money judgments in favor of appellee, Ruthie M. Mullins. The court awarded appellee a judgment of $23,152.90 as her share of the community estate. In addition, appellee was awarded all community cash assets on deposit ($22,875.57) plus a $10,624.43 judgment ($33,500 total) as reimbursement for her separate property used to improve appellant's separate property.

We affirm the judgment.

Appellant alleges eight points of error by the trial court: 1) holding appellant responsible for all federal income tax liability incurred during the marriage; 2) awarding appellee 70% of the community estate; 3) awarding appellee all of the cash on deposit in the accounts of the parties; 4) awarding appellee a judgment of $23,870; 5) awarding appellee a judgment of $9,400; 6) awarding appellee reimbursement of all of the proceeds from the sale of her separate property; 7) awarding appellee a Deed of Trust Lien secured by "every stick and stone" of appellant's separate property; and 8) awarding appellee attorney's fees of $3,500. We overrule all points.

We first note that no findings of fact or conclusions of law were requested by appellant. In a trial to the court where no findings of fact and conclusions of law are filed, the judgment of the trial court implies all necessary fact findings in support of the judgment. In the Interest of W.E.R., 669 S.W.2d 716, 717 (Tex.1984) (per curiam); Buchanan v. Byrd, 519 S.W.2d 841, 842 (Tex.1975). The judgment of the trial court in such cases must be affirmed if it can be upheld on any legal theory that finds support in the evidence. Seaman v. Seaman, 425 S.W.2d 339, 341 (Tex.1968); see also Point Lookout West v. Whorton, 742 S.W.2d 277, 279 (Tex.1987) (per curiam). Therefore, appellant has an extraordinary burden to demonstrate error in the trial court's judgment since we must presume all facts were found against appellant. Point Lookout West, 742 S.W.2d at 279.

In point one, appellant complains of the imposition of all federal income tax liability incurred by the parties during the marriage. Specifically, appellant complains that potential income tax liability arising from the sale of appellee's separate property residence should not be borne by appellant. Appellant argues that because appellee was allegedly awarded a "disproportionate share" of community assets, appellee should be liable for the same proportionate share of tax liability. Finally, appellant argues there is no evidence supporting any such tax liability.

In his brief, appellant describes his involvement in the sale of appellee's separate property. The parties had previously been married to each other, and appellee was awarded this residence in their divorce of 1976. Appellant testified at trial that he was present when appellee sold the house, and appellant even claims to have paid transaction costs of $1,000. In addition, he knew the buyer to be a drug dealer. The buyer paid $45,000 for the property, even though appellant "discussed" with the buyer "getting thirty-five thousand" for it. The buyer told appellant "he was fixing to be busted and he was fixing to go down and he had some money he had to get rid of." Appellant testified "I didn't know if Internal Revenue would come in and claim the money." This money was not reported as income, and was kept in a deep freeze at the community residence. Therefore, there is evidence of potential tax liability from appellant's own testimony.

Next we address appellant's legal liability for the proceeds of the sale. The property was sold in 1986 during the marriage. The parties filed a joint tax return for the year of 1986. Under federal law, if a couple files a joint income tax return, each spouse is jointly and severally liable for the tax due, even if only one spouse had income. I.R.C. sec. 6013(d)(3) (1989); Treas.Reg. sec. 1.6013-4(b) (1989). The "innocent spouse rule" is of no help to appellant since he knew of the sale and thus knew about any substantial understatement of taxable income as a consequence of the sale. I.R.C. sec. 6013(e)(3) (1989).

While a tax liability is not technically a "debt," a court may take tax liability into consideration in the division of property upon divorce, and may even require one party to assume the other's tax liability. Able v. Able, 725 S.W.2d 778, 780 (Tex.App.--Houston [14th Dist.] 1987, writ ref'd n.r.e.); Vautrain v. Vautrain, 646 S.W.2d 309, 317 (Tex.App.--Fort Worth 1983, writ dism'd); Benedict v. Benedict, 542 S.W.2d 692, 698 (Tex.Civ.App.--Fort Worth 1976, writ dism'd); Cole v. Cole, 532 S.W.2d 102, 105 (Tex.Civ.App.--Dallas 1975, no writ); Brooks v. Brooks, 515 S.W.2d 730, 733 (Tex.Civ.App.--Eastland 1974, writ ref'd n.r.e.). We hold this is particularly true when both parties are liable for the debt under federal law. Therefore we hold the trial court acted within its authority in holding appellant responsible for federal income tax liability during the marriage. Point one is overruled.

In point of error two, appellant alleges the trial court abused its discretion in awarding appellee 70% of the community estate. We observe that appellant does not challenge the trial court's characterization of property. Therefore, we only look to the trial court's division as it appears in the Nunc Pro Tunc Final Decree of Divorce. At the hearing, appellant's counsel asked the court to explain the "70-30" division of property, discussed from the bench, to which the court said "70-30 of the only community assets that I can actually find that I haven't already divided. That's the cash." It thus appears the court intended to make such a 70-30 division of cash community property assets after dividing other assets. Indeed, the Nunc Pro Tunc Final Decree of Divorce reveals that noncash assets were apparently divided evenly, and perhaps even in the appellant's favor. The community residence was ordered sold with the proceeds split one-half to each party with appellant bearing transaction and other costs. Appellant was also awarded three automobiles, a tractor, a boat, trailer, and assorted personal items. Appellee was awarded real property worth $8,000 (as property bought during the marriage with her separate property), one vehicle, and assorted personal items.

In regards to the cash assets of the estate, the trial court awarded all cash under each party's control to that party. The accounts, however, were all in appellant's name. The trial court went on to award appellee a judgment of $23,152.90, apparently in order to effect its 70-30 division of the community cash assets.

Appellant argues there is a "conflict within the Decree of Divorce as to how much 70% is equal to in the Community Estate." This apparently refers to the trial court's summation at the hearing of the assets where it "found" $34,100 of community cash and said "she gets an additional judgment for twenty-three thousand eight hundred and seventy" (70% of $34,100). This alleged conflict is asserted in other points of error below. We hold that at the hearing the trial court was merely summarizing how he intended to dispose of various assets, rounding dollar figures to convenient sums for purposes of discussing with counsel how he would arrive at a final judgment. Obviously, when the trial court precisely calculated all these assets for the written final decree, it was not the same as the round working figures used at the hearing. Thus, the reference to the $23,870 figure is of no consequence. We look to the written decree for the final judgment ($23,152.90), therefore we find no conflict.

As to the division itself, we note that the Texas Family Code provides that the trial court must equitably divide the community estate upon divorce:

(a) In a decree of divorce or annulment the court shall order a division of the estate of the parties [the community] in a manner that the court deems just and right, having due regard for the rights of each party and any children of the marriage.

TEX.FAM. CODE ANN. sec. 3.63 (Vernon Supp.1990). This provision has been interpreted by the Texas Supreme Court to allow the trial a great deal of discretion in dividing the community estate:

[T]he trial court may consider such factors as the spouses' capacities and abilities, benefits which the party not at fault would have derived from continuation of the marriage, business opportunities, education, relative physical conditions, relative financial condition and obligations, disparity of ages, size of separate estates, and the nature of the property. We believe that the consideration of such factors by the trial court is proper in making a "just and right" division of the property. Likewise, the consideration of a disparity in earning capacities or of incomes is proper....

Murff v. Murff, 615 S.W.2d 696, 699 (Tex.1981). The trial court may determine that one party is entitled to a greater share of the community to effect a just and equitable division. Id. Appellant argues that there is "no evidence" as to these factors. However, we find a wealth of such evidence. Appellee pled that appellant committed adultery and testified that "I knew he's running around on me again." Appellee testified that while she was ill due to cancer treatment, she was unable to engage in sexual relations, and appellant...