Vickery v. Vickery

• Decision Date: 27 May 1999
• Citation: 999 S.W.2d 342
• Parties: (Tex. 1999) GLENN VICKERY AND DIANNE RICHARDS, PETITIONERS v. HELEN ROBERTA VICKERY, RESPONDENT NO. 98-0059
• Court: Texas Supreme Court

Page 342

999 S.W.2d 342 (Tex. 1999)

GLENN VICKERY AND DIANNE RICHARDS, PETITIONERS v. HELEN ROBERTA VICKERY, RESPONDENT

NO. 98-0059

IN THE SUPREME COURT OF TEXAS

MAY 27,1999

ON PETITION FOR REVIEW FROM THE COURT OF APPEALS FOR THE FIRST DISTRICT OF TEXAS

Nathan L. Hecht, Justice

JUSTICE HECHT, dissenting from the denial of the petition for review.

The lower courts in this case awarded mental anguish damages and punitive damages to one spouse for the other's fraud in the division of their marital estate, and awarded mental anguish damages against an attorney for breach of her fiduciary duty to her client. These awards are not permitted under two of this Court's opinions that have issued while this petition for review has been pending. In Schlueter v. Schlueter, the Court held that "a separate and independent tort action for actual fraud and accompanying exemplary damages against one's spouse do not exist in the context of a deprivation of community assets".¹ In Douglas v. Delp, we held that mental anguish damages cannot be recovered for legal malpractice if plaintiff's loss is entirely economic.² If the holdings of Schlueter and Douglas were applied to the same issues in this case, the petition for review would have to be granted, the court of appeals' judgment reversed, and the case remanded to the district court for further proceedings. But the Court simply refuses to follow Schlueter and Douglas in this case that has been pending while those cases were being decided. The Court would not tolerate a lower court's refusal to follow our decisions, nor should it,³ yet the Court will not follow its own decisions in contemporaneous appeals involving the same issues. It is awfully hard to insist on others' adherence to the rule of law when one's own commitment to the rule is, shall we say, intermittent. I would grant the petition for review in this case because I cannot see that Schlueter and Douglas leave any principled alternative. Accordingly, I respectfully dissent.

Mrs. Schlueter complained in her divorce proceeding that her husband had diverted to his father $12,565 in cash and an emu business worth $10,000 to avoid having these assets included in the couple's $122,600 community estate to be divided by the court.⁴ Based on the jury's findings that Mr. Schlueter had defrauded the community estate and conspired with his father to harm Mrs. Schlueter, the district court rendered judgment that the community recover $12,850 from Mr. Schlueter and his father, jointly and severally, and that Mrs. Schlueter recover $30,000 in punitive damages and $18,500 in attorney fees from her husband, and $15,000 punitive damages from his father.⁵ The court of appeals affirmed.⁶ This Court reversed, holding that one spouse's fraud on the community estate could justify an unequal division of the estate but that "there is no independent tort cause of action for wrongful disposition by a spouse of community assets".⁷ The Court added:

while we hold that a separate and independent tort action for actual fraud and accompanying exemplary damages against one's spouse do not exist in the context of a deprivation of community assets, if the wronged spouse can prove the heightened culpability of actual fraud, the trial court may consider it in the property division.⁸

The petition for review in the present case was filed almost four months before Schlueter was decided, and the Court was well aware of the similarity of the issues in the two cases.⁹ I specifically mentioned this case in my dissent to show that Schlueter was "not an isolated case."¹⁰ The circumstances of this case, as depicted in the evidence supporting the jury's verdict, present an even stronger argument for recovery that those in Schlueter. Mr. Vickery, an attorney, misrepresented to his wife that they needed to divorce to protect their community estate from liability to a former client suing him for malpractice. When Mrs. Vickery balked, her husband enlisted a friend from law school days, Dianne Richards, to initiate divorce proceedings on behalf of Mrs. Vickery but without her consent. Richards also filed an answer and cross-petition for Mr. Vickery. A few weeks later the plaintiff in the malpractice case offered to settle with Mr. Vickery within the limits of his insurance coverage, but he did not disclose that offer to his wife. Instead, he insisted on proceeding with the divorce on the pretext of protecting the community estate and preserving his relationship with Mrs. Vickery and their nine-year-old daughter. Reluctantly acquiescing, Mrs. Vickery agreed to a divorce decree that gave her $1.1 million (about 7.5%) of the $14.6 million community estate. The balance of the estate was either given to Mr. Vickery or left undivided (the decree is vague). The couple's principal residence, a ranch where Mrs. Vickery and her daughter were living, was Mr. Vickery's separate property, although the community had a reimbursement claim that was not addressed in the decree. The decree thus did little to accomplish Mr. Vickery's stated purpose in the divorce, to remove community property from the reach of a potential judgment creditor, although Mrs. Vickery may not have realized this at the time. Within six months, Mr. Vickery demanded that Mrs. Vickery agree to a nunc pro tunc decree that included a metes and bounds property description for the residence omitted from the original decree. Mrs. Vickery acceded. The next day Mr. Vickery retained a lawyer to have his former wife evicted from the residence. Shortly after Mrs. Vickery was served with process, Mr. Vickery married one of her best friends.

Realizing at last the depth of her former husband's deception, Mrs. Vickery attempted to negotiate a redivision of their community estate, but without success. Mrs. Vickery then filed the present action for a bill of review setting aside the divorce decree, a different division of the community estate, and actual and punitive damages from Mr. Vickery and attorney Richards. The jury found Mr. Vickery liable for fraud and breach of fiduciary duty and assessed Mrs. Vickery's damages at $6.7 million for loss of marital property and $1.3 million mental anguish, plus $1 million punitive damages. The jury also found that Richards' breach of fiduciary duty caused Mrs. Vickery a $100,000 loss of marital property and $350,000 in mental anguish damages. The district court rendered judgment: setting aside the prior divorce decree as having been obtained through fraud extrinsic to the proceeding; dividing the $14.6 million community estate $8.5 million (58%) to Mrs. Vickery and $6.1 million (42%) to Mr. Vickery; awarding Mrs. Vickery $1.3 million mental anguish damages, $1.5 million prejudgment interest, and $1 million punitive damages against Mr. Vickery; and awarding Mrs. Vickery $350,000 in unspecified damages against Richards. Mrs. Vickery elected to receive the larger share of the estate awarded by the court rather than the $6.7 million for loss of marital property found by the jury.

The court of appeals affirmed in an unpublished opinion, a copy of which is attached as Appendix I. Justice Andell dissented from the denial of rehearing en banc, explaining that he would have held that while Mr. Vickery's conduct should have been considered in dividing the community estate, Mrs. Vickery had no independent tort action against her former husband and thus was not entitled to actual or punitive damages or prejudgment interest. Justice Andell would have remanded the case to the district court to reconsider the community division.

After this Court's decision in Schlueter issued, Mrs. Vickery attempted to distinguish that case from hers, arguing that Schlueter involved "mere 'fraud on the community'" while the present case involves "actual and intentional fraud." The argument cannot survive even a cursory reading of Schlueter. Mrs. Schlueter vigorously contended that "allowing a separate tort cause of action for actual fraud is necessary so that exemplary damages may be awarded for the intentional acts of the wrongdoer spouse."¹¹ The Court expressly rejected this contention. Mrs. Vickery argues that her former husband's fraud is "particularly repugnant" because he "not only defrauded his spouse but he also tried to hoodwink the courts." The evidence favorable to the verdict indicates that Mrs. Vickery is correct, but Mr. Schlueter's fraud also involved both his spouse and the divorce court. Mrs. Vickery argues that her former husband did not merely deplete community assets, as Mr. Schlueter did by the transfers to his father, but directed his deception at her personally. I cannot see how Mr. Schlueter's deception was any less personal or actionable because he involved his father than was Mr. Vickery's.

Having dissented in Schlueter, I am not anxious to see its holding extended, but Mrs. Vickery has not distinguished Schlueter, and I think she cannot do so. In my dissent in Schlueter I argued that the present case, then pending, presented compelling reasons to allow one spouse to recover against another for fraud.¹² The Court was unmoved. While I remain in doubt that Schlueter was correctly decided, there is no doubt that it is the law. The Court cannot simply pick and choose the cases in which the rule it has announced will apply.

Applying Schlueter would require that the actual and punitive damages awarded Mrs. Vickery against her former husband be reversed and the case remanded to the district court to reconsider what division of the community is just and right. The district court may consider Mr. Vickery's "dishonesty of purpose or intent to deceive" and "the heightened culpability of actual fraud"¹³ as found by the jury. As I understand Schlueter, the court may not simply divide the community estate to award Mrs. Vickery damages she cannot otherwise recover, but it also need not measure her share by the damages she has suffered. The court must consider all relevant factors in dividing...