Daniel Lee Haining v. Thu-Dung Thi Haining

Opinion issued March 25, 2010

In The

Court of Appeals

For The

First District of Texas

NO. 01-08-00091-CV

DANIEL LEE HAINING, Appellant

V.

THU-DUNG THI HAINING, Appellee

On Appeal from the 308th District Court

Harris County, Texas

Trial Court Cause No. 2006-13649

MEMORANDUM OPINION

Appellant, Daniel Lee Haining, appeals from a decree of divorce dissolving the

marriage between himself and appellee, Thu-Dung Thi Haining.

In four issues, Daniel contends that (1) “[t]he trial court improperly divested

[him] of his separate property interest in the Savings Plan and IRA”; (2) “[t]he trial

court abused its discretion by awarding a $100,000 penalty against [him] for wasting

of community assets and fraud on the community estate”; (3) “[t]he evidence is

legally and factually insufficient to support $70,189 in reimbursement to [the]

community for waste”; and (4) “[t]he trial court clearly abused its discretion in

effectively dividing the community estate 104% to -4% in Thu’s favor.”

We affirm.

Summary of Facts and Procedural History

Daniel and Thu married on February 1, 1995. They have no children. Daniel

has a bachelor’s degree in electrical engineering and has worked for ExxonMobil

since 1989. Thu has a bachelor’s degree in accounting and works as an independent

computer consultant. In 1998, they purchased a home in Pearland.

In 2001, the couple began to experience marital discord. It is undisputed that,

in 2003, Daniel began a relationship with Dr. Zhili Fu. Daniel maintains, however,

that his relationship with Zhili was, at all times during his marriage, merely a

friendship, and he denies that it was ever adulterous.

Daniel testified that, in October 2003, while at a training class in Florida, he

met Zhili through a mutual friend. He and Zhili spent time together touring the city

and exchanged telephone numbers. Over the two months that followed, Daniel and

Zhili conversed regularly.

In December 2003, Daniel arranged for Zhili to visit him at his Pearland home.

To introduce the idea to Thu, Daniel asked Zhili to send him an email, purporting to

be their first contact since the training class. In her email to Daniel, Zhili asked if he

remembered her and stated that she would soon be in Houston on business. Daniel

forwarded the email to Thu and suggested that Zhili stay with them. Thu testified

that, during Zhili’s visit, Thu was uncomfortable with the way Daniel and Zhili were

interacting. After Zhili left, Thu asked Daniel not to have any further contact with

her, and Daniel agreed.

Over the two years that followed, however, Daniel and Zhili traveled to visit

one another and took several trips together. It is undisputed that, in May 2004,

Daniel surreptitiously traveled to Florida to attend Zhili’s graduation from pharmacy

school; in October 2004, Daniel flew to Florida and visited Disney World with Zhili,

then helped Zhili move to Houston by driving her back with him; in February 2005,

at the end of a Disney trip with Thu, Daniel purportedly had to stay in Florida and

work and Thu flew home alone, however, Zhili flew in the same day to be with

Daniel; and, in September 2005, Daniel and Zhili traveled to Hawaii together.

Days after Daniel and Zhili returned from Hawaii, Daniel asked Thu to move

from their four-bedroom home in Pearland to a condominium in downtown Houston.

Ultimately, Daniel and Thu leased a one-bedroom condominium next door, or very

near to, Zhili’s condominium.

In December 2005, Daniel gave Thu a Hummer SUV, which he paid cash for

out of their community account. In February 2006, Thu returned from a business trip

to find that Daniel was not at home. When she called him, he would not tell her

where he was, except to say that he was at a friend’s house. He told her that he had

left her Hummer at work, but that he would be home with it the next day. The next

day, Thu saw through the panoramic windows of her condo, her Hummer being

driven out of the garage at the next-door building. Thu did not confront Daniel that

day. Later, rather, Thu went over to the garage and found her Hummer parked next

to a car she determined was Zhili’s.

On February 28, 2006, Thu filed an original petition for divorce, alleging

insupportability. In addition, Thu sought a disproportionate division of community

property, alleging, inter alia, Daniel’s fault in the break-up, his fraud on the

community, and his wasting of community assets. Thu sought reimbursement and

attorney’s fees. The same day, Thu filed an affidavit alleging, inter alia, that Daniel

had transferred over $275,000 from their joint account at Energy Capital Credit Union

(“ECCU”) to “other accounts” that were beyond her “control or access”; that Daniel

was similarly transferring other community funds “to places and accounts unknown”;

and that Daniel had paid $68,247.58 for a Hummer without her knowledge from

funds from their joint checking account and had forged her name to the title and

purchase documents. The trial court froze Daniel’s assets.

Daniel counter-petitioned for divorce, alleging insupportability and cruel

treatment by Thu. Daniel also sought a disproportionate share of the community

estate, alleging in support, inter alia, Thu’s fault in the break-up, fraud, and wasting

of community assets.

In April 2007, trial to the bench ended in a mistrial. The trial court awarded

$26,712.50 in attorney’s fees to Thu and lifted the freeze so that Daniel could

withdraw the fees out of the community account at ECCU. Subsequently, the trial

court ordered that the Hummer be sold to pay Thu’s additional attorney’s fees and her

living expenses. The Hummer was sold for $50,000.

In July 2007, the case was re-tried to the bench. Daniel, Thu, and Zhili each

testified in lengthy detail. Thu testified concerning the events and the property at

issue. Thu presented evidence, in the form of an email from Daniel, that Daniel had

admitted to her his infidelity and that he had endeavored to conceal his relationship

with Zhili. Thu testified that, among other things, on February 15, 2006, Daniel had

transferred $20,050 from a joint account into a Wells Fargo checking account in his

name; that he had taken $5,000 cash back; and that, the next day, Zhili had flown to

China using 30,000 frequent flyer miles that Daniel had acquired through his work

travel during the marriage. With regard to the affidavit Thu had filed alleging that

Daniel had transferred $275,000 out of their joint account, Thu testified at trial that

she knew that the amounts withdrawn had gone to pay off the mortgage on the

Pearland house and to buy the Hummer that Daniel had given her.

At trial, Daniel and Zhili admitted that they had engaged in a relationship with

one another, that they had taken the alleged trips to Florida and Hawaii together, and

that they had actively concealed these facts from Thu. They each asserted, however,

that their relationship was properly characterized as a friendship and that, on each of

their trips, they had stayed in the same room, but in separate beds, and they had never

expended community funds for their travel expenses, beyond incidental meals. They

each testified that Zhili had paid their travel expenses. Daniel testified that he had

been dishonest with Thu, that he had concealed things from her, and that she deserved

a disproportionate share of the community estate because of his conduct.

Daniel and Thu each submitted to the trial court an inventory and appraisement,

and a proposed property division, which were admitted by agreement.

In its September 4, 2007 “Rendition on Trial and Property Division,” the trial

court granted Daniel and Thu’s petition for divorce “on the grounds of Adultery,

Wasting of Community Assets, Fraud on Community Estate, Fault in Breakup of

Marriage, Reimbursement, and Attorney’s Fees already awarded.” The trial court

accepted as its division of the estate Thu’s exhibit 5a, inventory and appraisement and

proposed division of property, with some exceptions. Namely, the trial court ruled

that Daniel was to retain $260,000 of the $830,000 in his ExxonMobil Savings Plan,

and that Thu would take $570,000. The trial court also awarded,

[f]or wasting of community assets and fraud on community estate:

$100,000 to [Thu] from [Daniel’s] estate. Said award shall be out of

Exxon Mobil Savings Plan and 401K Plan. Therefore, [Thu] shall

receive $670,000 of 401K plan as listed on [Thu’s Inventory &

Appraisement], Ex 5a and respondent’s share shall be reduced to

$160,000[.]

In its November 2007 final decree, the trial court divided the marital estate

disproportionately, awarding to Thu, among other things, the Pearland house, various

household contents, a Corvette pace car, 15,000 frequent flyer miles, and a total of

$670,000 from Daniel’s ExxonMobil Savings Plan. In addition, the trial court stated

in the decree as follows:

W–7. The Court FINDS that [Daniel] has committed fraud on the

community estate and wasted community assets, and IT IS

THEREFORE ORDERED that [Thu] is awarded a judgment against

[Daniel’s] separate property awarded herein, to be taken as her sole and

separate property, a sum total of $70,189.00, together with interest as the

maximum rate permitted by law from the date the Court signs this Order,

for which let execution issue.

The trial court also “confirmed as the separate property of” Thu “$50,000, payable

by [Daniel] to [Thu] at her last known address on day of divorce.”

Daniel was awarded the couple’s timeshare in Hawaii, various household

contents, a 1998 Lexus, a Sea-doo watercraft, sums in various accounts, $160,000 of

his Exxon/Mobil Savings Plan, and certain debts.

At a hearing on Daniel’s objections to the entry of judgment on the decree, the

trial court explained,

Well, what I did was I gave them each a fairly equal and I don’t

remember if it was exactly equal on his plan [sic] and as the division of

the estate. And then I came back as a penalty and awarded her a

hundred thousand of the estate and the rendition of the division of the

estate, it was fairly equal. Then I came back as a penalty and awarded

her a hundred thousand. [sic]

Daniel asked again, “So that was a penalty?” And, the trial court responded, “Right.”

The trial court did not file requested findings of fact and conclusions of law,

and it denied Daniel’s motion for new trial.

Findings of Fact and Conclusions of Law

As a preliminary matter, Daniel contends that the trial court’s judgment should

be reversed because it failed to file findings of fact and conclusions of law, as he

requested.

Texas Rule of Civil Procedure 297 provides, in pertinent part, as follows:

The court shall file findings of fact and conclusions of law within twenty

days after a timely request is filed. . . . If the court fails to file timely

findings of fact and conclusions of law, the party making the request

shall, within thirty days after filing the original request, file with the

clerk and serve on all parties in accordance with Rule 21a a “Notice of

Past Due Findings of Fact and Conclusions of Law” which shall be

immediately called to the attention of the court by the clerk. . . .

Tex. R. Civ. P. 297.

When findings of fact and conclusions of law have been properly requested,

a trial court’s failure to file findings and conclusions is presumed reversible, unless

the record affirmatively shows that the requesting party was not harmed by their

absence. Alsenz v. Alsenz , 101 S.W.3d 648 , 651–52 (Tex. App.—Houston [1st Dist.]

2003, pet. denied) (citing Tenery v. Tenery , 932 S.W.2d 29, 30 (Tex. 1996)). If a

party is prevented from presenting his case on appeal, he has been harmed. Id.

Here, Daniel requested the trial court to make findings of fact and conclusions

of law; however, the record does not reflect that he filed the requisite notice of past

due findings. Failure to file the reminder required by Rule 297 waives any issue

concerning the trial court’s failure to file findings of fact and conclusions of law. See

Alpert v. Crain, Caton & James, P.C. , 178 S.W.3d 398, 410 (Tex. App.—Houston

[1st Dist.] 2005, pet. denied).

Thu contends that the trial court’s failure to file findings and conclusions is

fatal to many of Daniel’s contentions on appeal. In Alsenz , the appellant contended

that the trial court’s rendition and decree were confusing and that he could not discern

what amounts were allowed for the parties’ reimbursement claims. Alsenz , 101

S.W.3d at 652 . We held that, because the attachment to the decree clearly identified

the nature and source of the couple’s financial assets and debts, the claims for

reimbursement, and the proportion of the division, it was possible for us to follow

each asset, claim, and debt from its inception to its disposition. Id. Hence, the

appellant was not harmed by the absence of findings and conclusions. Id.

Here, like Alsenz , the decree, in conjunction with the proposed settlement and

rendition, clearly identifies the nature and source of Daniel’s and Thu’s financial

assets and debts, Thu’s claims for reimbursement, and the proportion of the division.

Hence, it is possible for us to follow each asset, claim, and debt from its inception to

its disposition.

Standards of Review

When, as here, a trial court makes no separate findings of fact or conclusions

of law, we must presume that the trial court made all the necessary findings to support

its judgment. Boyd v. Boyd , 131 S.W.3d 605, 612 (Tex. App.—Fort Worth 2004, no

pet.) (citing Pharo v. Chambers Co. , 922 S.W.2d 945, 948 (Tex. 1996)). We draw

every reasonable inference supported by the record in favor of the trial court’s

judgment. Gainous v. Gainous , 219 S.W.3d 97, 103 (Tex. App.—Houston [1st Dist.]

2006, pet. denied). The trial court’s judgment must be affirmed it if can be upheld on

any legal theory that finds support in the evidence. In re W.E.R. , 669 S.W.2d 716,

717 (Tex. 1984) . When the appellate record includes the reporter’s record, the trial

court’s implied fact findings are not conclusive and may be challenged for legal and

factual sufficiency of the evidence supporting them. See Tucker v. Tucker , 908

S.W.2d 530, 532 (Tex. App.—San Antonio 1995, writ denied).

Pursuant to the Texas Family Code, “the trial court shall order a division of the

estate of the parties 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.

§ 7.001 (Vernon 2006); Alsenz , 101 S.W.3d at 654 . The trial court has broad

discretion in dividing the marital property and its division will not be disturbed on

appeal unless the complaining party shows that the trial court clearly abused its

discretion. Alsenz , 101 S.W.3d at 654–55 (citing Murff v. Murff , 615 S.W.2d 696,

698 (Tex. 1981)). Under an abuse of discretion standard, legal and factual

insufficiency are not independent reversible grounds, but are relevant factors in

assessing whether the trial court abused its discretion. Mai v. Mai , 853 S.W.2d 615,

618 (Tex. App.—Houston [1st Dist.] 1993, no writ).

To determine whether there has been an abuse of discretion because the

evidence is legally or factually insufficient to support the trial court’s decision, we

consider (1) whether the trial court had sufficient evidence upon which to exercise its

discretion and (2) whether it erred in its application of that discretion. In re T.D.C. ,

91 S.W.3d 865, 872 (Tex. App.—Fort Worth 2002, pet. denied).

Under the first prong, we apply the applicable sufficiency review. Id. In a

legal sufficiency review, we consider all of the evidence in the light most favorable

to the verdict and indulge every reasonable inference that would support it. City of

Keller v. Wilson , 168 S.W.3d 802, 822 (Tex. 2005). We consider evidence favorable

to the finding if a reasonable factfinder could and disregard evidence contrary to the

finding unless a reasonable factfinder could not disregard it. Id. at 827 ; Brown v.

Brown , 236 S.W.3d 343, 348 (Tex. App.—Houston [1st Dist.] 2007, no pet.). The

factfinder is the sole judge of the credibility of the witnesses and the weight to give

their testimony. Wilson , 168 S.W.3d at 819 . The final test is “whether the evidence

at trial would enable reasonable and fair-minded people to reach the verdict under

review.” Id. at 827 . In a legal sufficiency challenge on an issue on which an appellant

bears the burden of proof, he must demonstrate that the evidence conclusively

established all vital facts to support the issue. Sterner v. Marathon Oil Co. , 767

S.W.2d 686, 690 (Tex. 1989).

In a factual sufficiency review, we consider all the evidence for and against the

challenged finding and set it aside only if the evidence is so weak as to make the

finding clearly wrong and manifestly unjust. Cain v. Bain , 709 S.W.2d 175, 176 (Tex.

1986). “In a bench trial, the trial court is the sole judge of the credibility of the

witnesses, assigns the weight to be given their testimony, may accept or reject all or

any part of their testimony, and resolves any conflicts or inconsistencies in the

testimony.” Rich v. Olah , 274 S.W.3d 878, 884 (Tex. App.—Dallas 2008, no pet.).

“We may not pass upon the credibility of the witnesses or substitute our judgment for

that of the trier of fact, even if a different answer could be reached upon review of the

evidence.” Id. In a factual sufficiency challenge on an issue in which that party had

the burden of proof, the party must demonstrate that the adverse finding is against the

great weight and preponderance of the evidence. Dow Chem. Co. v. Francis , 46

S.W.3d 237, 242 (Tex. 2001).

Under the second prong, we consider whether, based on the evidence, the trial

court’s decision was arbitrary, unreasonable, or without reference to guiding rules or

principles. In re T.D.C. , 91 S.W.3d at 872 .

If we find reversible error that materially affects the trial court’s property

division, we must remand the cause for a new division of the community estate.

Jacobs v. Jacobs , 687 S.W.2d 731 , 732–33 (Tex. 1985).

Division of Property

In his fourth issue, Daniel contends that “[t]he trial court clearly abused its

discretion in effectively dividing the community estate 104% to -4% in Thu’s favor.”

Daniel contends that the division is not supported by legally and factually sufficient

evidence.

The record shows that Daniel and Thu, by agreement, each submitted an

inventory and proposed property division. However, the proposals are not the same

and do not show an agreement between the parties. See Tex. Fam. Code Ann.

§ 7.006(a) (Vernon 2006). When, as here, the record contains disputed values, we

must presume that the trial court valued the property in the amount most favorable to

its judgment.

The record shows that the trial court adopted Thu’s proposed division of the

community property with certain changes. The trial court awarded to Thu the

Pearland house (which Thu valued at $362,500), various household contents, a

Corvette pace car, frequent flyer miles, and $670,000 of Daniel’s Exxon/Mobil

Savings Plan. In addition, the record shows that the trial court took into account in

its division $70,189 in reimbursement claims, as presented in Thu’s sworn inventory.

Daniel was awarded various household contents, a 1998 Lexus, the couple’s

timeshare in Hawaii, a Sea-doo watercraft, sums in various accounts, $160,000 of his

Exxon/Mobil Savings Plan, and certain debts.

Using the property values that most favor the trial court’s judgment, as we

must, the evidence does not reflect, as Daniel contends, that the trial court awarded

Thu “more than 100% of the community estate.” Rather, the evidence reflects that

Daniel received community property with a net value of approximately $446,195, or

about 27 percent of the community estate. Thu received community property with a

net value of approximately $1.2 million, or about 73 percent of the community estate.

Daniel next contends that the “factors support an equal division.” The trial

court is not required to divide community property equally, and we must presume that

the trial court properly exercised its discretion in dividing the marital estate. Murff ,

615 S.W.2d at 699 ; Alsenz , 101 S.W.3d at 655 . We must uphold the judgment on any

legal theory supported by the evidence. Murff , 615 S.W.2d at 699 ; W.E.R. , 669

S.W.2d at 717 ; Wilson v. Wilson , 132 S.W.3d 533, 537 (Tex. App.—Houston [1st

Dist.] 2004, pet. denied). The factors we consider include: (1) the education of the

parties; (2) the spouses’ relative earning capacity; (3) their relative financial condition

and obligations; (4) the size of their separate estates; (5) the nature of the community

property, (6) fault in the breakup of the marriage, and (7) benefits that a party not at

fault would have derived from the marriage, had it continued. Murff , 615 S.W.2d at

699 ; Alsenz , 101 S.W.3d at 655 .

The testimony shows that Daniel and Thu each have bachelor’s degrees. The

record shows that Thu’s earnings historically have been higher than Daniel’s.

Specifically, in 1998, Thu earned $31,824 more than Daniel earned; in 1999, Thu

earned $50,535 more; in 2001, Thu earned $180,997 more; in 2004, Thu earned

$107,535 more; and in 2005, Thu earned $67,071 more. This factor militates against

awarding a larger proportion of the community estate to Thu.

Daniel admitted at trial, however, and there is ample evidence in the record to

support, that Daniel engaged in an extramarital relationship involving deceit and that

he intentionally concealed financial transactions from Thu. Through his testimony

at trial, Daniel conceded that he had been “dishonest” and “unfaithful,” and had, for

years, maintained a relationship with Zhili that had included surreptitiously traveling

to Florida and Hawaii with her and transfers of community funds to Zhili. In

addition, the record shows that Daniel convinced Thu to leave their marital home and

to move to into a leased condominium in downtown Houston, at a cost to the

community estate of $1,700 a month, so that Daniel could live closer to Zhili. Daniel

testified that a disproportionate division of the community estate in favor of Thu was

appropriate, based on his conduct.

These are factors tending to favor the disproportionate award. See Twyman v.

Twyman , 855 S.W.2d 619, 625 (Tex. 1993). The trial court may consider a spouse’s

dissipation of the community estate as well as any misuse of community property.

Vannerson v. Vannerson , 857 S.W.2d 659, 669 (Tex. App.—Houston [1st Dist.]

1993, writ denied); see Schlueter v. Schlueter , 975 S.W.2d 584, 589 (Tex. 1998)

(stating that wasting of community assets may be considered). Further, when, as here,

one spouse not only deprives the other of community assets, but does so with

dishonesty and intent to deceive, the trial court may consider such heightened

culpability in its division. Schlueter , 975 S.W.2d at 589 ; Boaz v. Boaz , 221 S.W.3d

126, 133 (Tex. App.—Houston [1st Dist.] 2006, no pet.). Here, Thu may recover not

only her share of the property that existed in the community at the time of the divorce,

but also that which was improperly depleted from the community estate. See

Schlueter , 975 S.W.2d at 589 .

Daniel specifically complains that the trial court (1) overvalued the Hawaii

timeshare; (2) “overvalued the ExxonMobil Stocks/Options” when it accepted Thu’s

value of $130,000; (3) failed to credit Daniel for $95,474 in attorney’s fees; (4)

charged Daniel for $85,440 in undisclosed liquid assets without sufficient evidence;

and (5) “gave a double recovery for fraud when there should have been none at all.”

In a divorce proceeding, the ultimate and controlling issue is whether the trial

court divided the property in a “just and right manner,” pursuant to the Family Code.

See Tex. Fam. Code Ann. § 7.001; Rafferty v. Finstad , 903 S.W.2d 374, 376 (Tex.

App.—Houston [1st Dist.] 1995, writ denied). The valuation of specific property is

not an ultimate issue. Rafferty , 903 S.W.2d at 376 ; Finch v. Finch , 825 S.W.2d 218,

221 (Tex. App.—Houston [1st Dist.] 1992, no writ). Disparate divisions exceeding

70 percent to one spouse and 30 percent or less to the other have been upheld where,

as here, the facts so warrant. See Sprick v. Sprick , 25 S.W.3d 7, 14 (Tex. App.—El

Paso 1999, no pet.) (holding that award of 77 percent of net assets of community to

wife was equitable); Thomas v. Thomas , 603 S.W.2d 356, 358 (Tex. App.—Houston

[14th Dist.] 1980, no writ) (holding that 70/30 division did not constitute an abuse of

discretion); Cluck v. Cluck , 647 S.W.2d 338 (Tex. App.—San Antonio 1982, writ

dism’d); Huls v. Huls , 616 S.W.2d 312 (Tex. Civ. App.—Houston [1st Dist.] 1981,

no writ); Bokhoven v. Bokhoven , 559 S.W.2d 142 (Tex. Civ. App.—Tyler 1977, no

writ).

The issue before us is not whether we might have reached a different decision.

The question is whether some evidence of a substantive and probative character

supports the trial court’s decision. See Gainous , 219 S.W.3d at 103 (stating trial

court’s judgment must be affirmed if it can be upheld on any legal theory that finds

support in evidence). Given that the evidence supports the trial court’s judgment, we

hold that the trial court did not abuse its discretion in dividing the assets as it did. See

Alsenz , 101 S.W.3d at 654–55 (stating that division will not be disturbed on appeal

without clear abuse of discretion); Mai , 853 S.W.2d at 618 (stating that, under abuse

of discretion standard, legal and factual insufficiency are not independent reversible

grounds, but are relevant factors in assessing whether trial court abused its

discretion).

Accordingly, we overrule Daniel’s fourth issue.

Characterization of Property

In his first issue, Daniel contends that “[t]he trial court improperly divested

[him] of his separate property interest in the Savings Plan and IRA.” Daniel contends

that the trial court improperly characterized his ExxonMobil Savings Plan (the

“Plan”) as community property.

The trial court has no discretion to divest a spouse of his separate property.

Cameron v. Cameron , 641 S.W.2d 210, 215 (Tex. 1982). Separate property includes

property owned or claimed by the spouse before marriage, property acquired by the

spouse during marriage by gift, devise, or descent, and recover for personal injuries.

Tex. Fam. Code Ann. § 3.001 (Vernon 2006). Such property remains that spouse’s

separate property during and after the marriage. Pace v. Pace , 160 S.W.3d 706, 711

(Tex. App.—Dallas 2005, pet. denied).

Only community property is subject to the trial court’s division. Osborn v.

Osborn , 961 S.W.2d 408 , 413–14 (Tex. App.—Houston [1st Dist.] 1997, writ

denied). “Community property consists of the property, other than separate property,

acquired by either spouse during marriage.” Tex. Fam. Code Ann. § 3.002 (Vernon

2006). Property possessed by either spouse during or upon the dissolution of their

marriage is presumed to be community property. Tex. Fam. Code Ann. § 3.003(a)

(Vernon 2006).

To overcome the community property presumption, a spouse claiming assets

as separate property is required to establish their separate character by clear and

convincing evidence. Id. § 3.003(b); McElwee v. McElwee , 911 S.W.2d 182, 188

(Tex. App.—Houston [1st Dist.] 1995, writ denied). “Clear and convincing” evidence

means the measure or degree of proof that will produce in the mind of the trier of fact

a firm belief or conviction as to the truth of the allegations sought to be established.

In re J.F.C. , 96 S.W.3d 256, 264 (Tex. 2002); Slaton v. Slaton , 987 S.W.2d 180, 182

(Tex. App.—Houston [14th Dist.] 1999, pet. denied). When the burden of proof at

trial is by clear and convincing evidence, we apply a higher standard of legal and

factual sufficiency review. In re J.F.C. , 96 S.W.3d at 265–66; In re C.H. , 89 S.W.3d

17, 26 (Tex. 2002).

The spouse claiming separate property must trace and clearly identify the

property claimed to be separate. Boyd , 131 S.W.3d at 612 (citing Estate of Hanau v.

Hanau , 730 S.W.2d 663, 667 (Tex. 1987)). Tracing involves establishing the

separate origin of the property through evidence showing the time and means by

which the spouse originally obtained possession of the property. Id. (citing Ganesan

v. Vallabhaneni , 96 S.W.3d 345, 354 (Tex. App.—Austin 2002, pet. denied)).

The inception of title doctrine fixes the character of property interests at the

time the party first acquires a right or claim to the property; title need not be vested

at such time. See, e.g., Stavinoha v. Stavinoha , 126 S.W.3d 604, 613 (Tex.

App.—Houston [14th Dist.] 2004, no pet.). “Separate property will retain its

character through a series of exchanges” if the party asserting separate ownership

traces the assets back to property that, because of the time and manner of acquisition,

is separate in character. Cockerham v. Cockerham , 527 S.W.2d 162, 168 (Tex. 1975).

If the evidence shows that separate and community property “have been so

commingled as to defy resegregation and identification, the community presumption

prevails.” Hanau , 730 S.W.2d at 667 . Any doubt as to the character of property

should be resolved in favor of the community estate. Boyd , 131 S.W.3d at 612 .

a. The Plan

Daniel presented, as his evidence of his separate interest in the Plan, (1) exhibit

21, Plan statements dated February 1, 1995 through December 1996; (2) exhibit 22a,

which Daniel refers to as his “tracing document”; and (3) his testimony.

Daniel and Thu married on February 1, 1995. Daniel presented a Plan

statement dated February 1, 1995 (“Statement”) as evidence of his separate property

interest in the Plan. Daniel contends that the Statement shows that he owned 779

shares as his separate property prior to marriage.

The Statement reflects a series of columns, each depicting a number of trustee’s

shares, and includes a column titled, “Total shs/units,” which reflects the total

trustee’s shares.

The total of the trustee’s shares, as reflected in the table (4 + 315

+ 460) is 779. Although the trustee’s shares figures are not preceded by dollar signs,

the figure under the “Total shs/units” column is preceded by a dollar sign. The trial

court concluded that Daniel’s interest was $779, rather than 779 shares. Daniel

complained in the trial court that the dollar sign was simply a typographical error;

however, the court refused to consider his contention. Ten days after trial, Daniel

submitted an affidavit from the custodian of records for the Plan, explaining the error.

The affidavit states, “These schedules inadvertently and incorrectly had dollar sign

inserted under the column ‘Total shs/units.’ The number under that column should

not have read as a dollar amount, but rather as the total number of shares owned.” A

corrected schedule appears in the clerk’s record. On appeal, Daniel complains that

“[t]he trial court relied on an immaterial formatting error in the Savings Plan

statements and determined that the 779 shares were not shares, but dollars.”

Our review of the record shows that we need not resolve this issue because, as

Thu contends, Daniel conceded in his motion for new trial that the Statement was,

nevertheless, inaccurate with regard to the number of shares. In his motion for new

trial, Daniel stated, “The savings plan balances were calculated from the wrong date;

they should have been calculated effective January 31 of the year in question, not

February 1.” More importantly, Daniel conceded, “The difference in the date resulted

in an inaccuracy as to the actual number of shares—that is, it showed more shares in

the plan than actually were in the plan as of January 31 of each year.” Hence, Daniel

failed to carry his burden to establish his separate property interest by clear and

convincing evidence.

The Statement also reflects a loan balance of approximately $20,000 against

the account, which Daniel testified was taken prior to marriage, affected the actual

balance of the account, and was not paid back until after he and Thu married.

Daniel also submitted, as evidence of his separate property interest, his own

computations, exhibit 22a, to which he referred at trial as his “tracing document.”

Daniel testified at trial, however, that his computations in the tracing document were

based on the 779 shares reflected in the February 1, 1995 Statement. The record

shows that Daniel has conceded that the 779 shares reflected in the Statement is

inaccurate. Hence, we cannot conclude that the trial court erred by implicitly

concluding that Daniel’s tracing document did not constitute clear and convincing

evidence of Daniel’s separate property interest.

Daniel contends on appeal that, without regard to the Statement or the tracing

document, his testimony at trial was sufficient to establish that 779 shares constituted

his separate property. Daniel testified that he was employed at Exxon and

participated in the Savings Plan for six years prior to February 1, 1995, the date he

married Thu; that he owned 779 shares of stock on that date; that, in 1997 and 2001,

the shares underwent two, two-for-one stock splits; and that his interest became 3,116

shares.

Mere testimony that property was purchased with separate funds, without

any tracing of the funds, is insufficient to rebut the community presumption. Boyd ,

131 S.W.3d at 614–17; Zagorski v. Zagorski , 116 S.W.3d 309, 316 (Tex.

App.—Houston [14th Dist.] 2003, pet. denied); McElwee , 911 S.W.2d at 188 .

Moreover , the record reflects that Daniel has conceded that an interest of 779 shares

prior to marriage is inaccurate. Hence, we cannot conclude that the trial court erred

by implicitly concluding that his testimony did not constitute clear and convincing

evidence of his separate property interest.

Daniel also contends that the total value of the Plan at the time of trial, July 6,

2007, was $810,250; that his separate property interest was $285,473; and that the

community property interest was $524,777. As Thu contends, however, Daniel does

not direct us to anyplace in the record in which he raised these calculations in the trial

court. Hence, nothing is presented for our review. See Tex. R. App. P. 33.1.

The record shows that the trial court accepted, as the value of the Plan at the

time of trial, the sum of $830,000. The court ordered that Daniel take $260,000 and

that Thu take $570,000. We cannot conclude on this record that the trial court erred.

Daniel did not overcome the presumption that the Savings Plan constituted

community property. Further, Daniel did not provide clear and convincing evidence

of a separate property interest.

b. Wells Fargo IRA

Daniel also contends that the trial court abused its discretion by divesting him

of his Wells Fargo IRA, which he owned before marriage. The record shows that

Daniel testified that the Wells Fargo IRA is his separate property. The record shows

that Daniel’s Wells Fargo IRA is included in Thu’s inventory and appraisement as a

community asset and that it was awarded to Daniel as part of his portion of the

community property. The final decree does not mention the IRA or award any

interest in the IRA to Thu.

Here, again, Daniel’s testimony that the IRA is separate property was

insufficient to rebut the community presumption. See Boyd , 131 S.W.3d at 616 .

Moreover, to prevail on a mis-characterization challenge, Daniel must establish not

only that the trial court erred, but that this error caused sufficient harm to constitute

an abuse of discretion. See Long v. Long , 234 S.W.3d 34, 37 (Tex. App.—El Paso

2007, pet. denied) (mis-characterization of community property as separate property

is not reversible unless mis-characterization had more than de minimis effect on just

and right division). Daniel has not made any attempt to meet his burden to show that

he was harmed by having been awarded the IRA in lieu of any other property. See

Magill v. Magill , 816 S.W.2d 530, 533 (Tex. App.—Houston [1st Dist.] 1991, writ

denied).

Accordingly, Daniel’s first issue is overruled.

Reimbursement

In his third issue, Daniel contends that “[t]he evidence is legally and factually

insufficient to support $70,189 in reimbursement to [the] community for waste.”

In its decree, the trial court found that Daniel committed fraud and waste, and

it ordered that Daniel pay, “from his separate property awarded herein,” $70,189 to

Thu, to be taken as her separate property, as follows:

W–7. The Court FINDS that [Daniel] has committed fraud on the

community estate and wasted community assets, and IT IS

THEREFORE ORDERED that [Thu] is awarded a judgment against

[Daniel’s] separate property awarded herein, to be taken as her sole and

separate property, a sum total of $70,189.00, together with interest as the

maximum rate permitted by law from the date the Court signs his Order;

for which let execution issue.It is well-settled that a trial court may award a money judgment to one spouse

against the other to achieve an equitable distribution of the community estate.

Schlueter , 975 S.W.2d at 588 . A trial court may award damages for a spouse’s

wasting of community assets or fraud on the community; however, such personal

judgment is a means of recoupment and is not awarded as independent damages. Id.

at 589 . An injured spouse may recoup not only her share of the property existing in

the community at the time of the division, but also that which was improperly

depleted from the community estate. Id.

A party may bring a claim for reimbursement of payments by one marital

estate to satisfy unsecured liabilities of another marital estate.

A trial court resolves

claims for reimbursement under equitable principles.

An equitable right of

reimbursement arises when the funds or assets of one estate are used to benefit and

enhance another estate without itself receiving some benefit. Vallone v. Vallone , 644

S.W.2d 455, 458 (Tex. 1982). The party seeking reimbursement has the burden of

pleading and proving that the expenditures were made and that they are reimbursable.

Id. at 459 . Permissible reimbursement may run from community estate to separate

estate, from separate estate to community estate, or from separate estate to separate

estate. Alsenz , 101 S.W.3d at 655 . A trial court’s discretion in evaluating a claim for

reimbursement is as broad as that discretion exercised by a trial court in making a just

and proper division of the community estate. Penick v. Penick , 783 S.W.2d 194, 198

(Tex. 1988).

The record shows that Daniel and Thu, “by agreement,” each submitted an

inventory and proposed property division, which were admitted at trial. Once an

inventory and appraisement is admitted, it may be considered as evidence before the

court. See Barnard v. Barnard , 133 S.W.3d 782, 789 (Tex. App.—Fort Worth 2004,

pet. denied). Further, this court has held that testimony alone can suffice as evidence

to establish a reimbursement claim. See Sheikh v. Sheikh , 01-05-00218-CV, 2007 WL

3227683 , at *7 (Tex. App.—Houston [1st Dist.] Nov. 1, 2007, no pet.) (mem. op.).

The record shows that Thu itemized in her proposed property division that

Daniel wasted $70,189.00 of the community estate as follows:

REIMBURSEMENT TO COMMUNITY/WASTE

Loan against 401K after meeting [Zhili]

$20,000

Gifts to [Zhili]

$3,055

Amex payment

$3,900

Hawaii vacations with [Zhili]

$9,776

Florida Disney trips with [Zhili]

$3,787

Husband Family Phone Plan with [Zhili]

$2,671

Reimbursement to ECCU

$27,000

First, Daniel testified that, in March 2005, he took a $20,000 payroll loan and

deposited it into a Wells Fargo bank account that was solely in his name. The same

month, Daniel made three online transfers of $1,500 from that account into Zhili’s

Wells Fargo account. The testimony of Daniel and Zhili shows that Daniel

“surprised” Zhili with a 50-inch plasma television, valued at $2500, and DVD player.

Daniel also conceded at trial that he had, since 2004, maintained a separate cellular

telephone account with Zhili. Zhili testified that the purpose of the separate cellular

telephones was to conceal the relationship from Thu.

Daniel does not deny that these transactions took place. He directs us, rather,

to his testimony explaining that he used the $20,000 for community purposes; that the

$1,500 transfers to Zhili were actually for her to give to his mother; that Zhili

reimbursed him for the television and DVD; and that Zhili paid for the cellular

telephone.

There is some evidence to support the trial court’s award for reimbursement of

these items. At most, Daniel presents conflicting evidence. The trial court chose to

credit Thu’s testimony. The factfinder is the sole judge of the credibility of the

witnesses and the weight to give their testimony. See Wilson , 168 S.W.3d at 819 ;

Cain , 709 S.W.2d at 176 .

Regarding the vacations to Hawaii and Florida, Daniel and Zhili each admitted

at trial that they had surreptitiously traveled together to Hawaii and to Florida, and

they testified concerning the details of the accommodations and the duration of their

stays. Although they each testified that Zhili paid the expenses, Zhili also testified

that she was unemployed until March 2005. Zhili testified that she paid the expenses

from her savings. Daniel did not dispute the amount of Thu’s claim for

reimbursement; rather, he generally denied having expended any funds. Daniel

contends that Thu’s testimony to support the amounts she listed in her inventory is

speculative, at best, and that she failed to produce any documentary evidence to

support her claims for reimbursement.

Thu’s inventory, which was admitted at trial and properly before the court, and

her testimony constitute some evidence of Daniel’s expenditures. See Sheikh , 2007

WL 3227683 , at *7 (concluding that wife’s testimony constitutes some evidence of

transfers from community estate). The absence of documentary evidence does not

render Thu’s testimony incompetent; rather, it goes to the credibility of her testimony

and the weight to be accorded it. See In re Doe 4 , 19 S.W.3d 322, 325 (Tex. 2000);

Holt Atherton Indus., Inc. v. Heine , 835 S.W.2d 80 , 84 n.2 (Tex. 1992) (stating that

absence of documents to support opinions and estimates goes to weight of evidence).

Moreover, Thu testified that she did not have access to some of Daniel’s financial

records, and Daniel admitted at trial that he had concealed financial transactions from

Thu.

In rendering its order of reimbursement, the trial court chose to disbelieve

Daniel and Zhili, and chose to believe Thu. We are not permitted to interfere with the

factfinder’s resolution of conflicts in the evidence or to pass on the weight or

credibility of a witness’s testimony. See Wilson , 168 S.W.3d at 827 ; Zagorski , 116

S.W.3d at 317–18 (stating that credibility of husband and wife in divorce action falls

strictly within purview of trial court). Daniel failed to provide the trial court with any

alternative, and the trial court arrived at its own estimation of the total amount

wrongfully spent. See Morrison v. Morrison , 713 S.W.2d 377, 380 (Tex.

App.—Dallas 1986, writ dism’d) (concluding that husband’s failure to document

transactions involving his admittedly having taken trips to Hawaii with other women

gave trial court broad discretion to “arrive at its own estimation of the total amount

wrongfully spent”). The trial court could have reasonably inferred that funds were

wrongfully diverted from the community estate which could not be discovered

because of the lack of records. See id.

Concerning the reimbursement of $3,900 for the American Express bill,

because the trial court made no separate findings of fact or conclusions of law, we

must presume that the trial court made all the necessary findings to support its

judgment. See Boyd , 131 S.W.3d at 612 . Thu’s sworn inventory, which was admitted

into evidence by agreement, constitutes some evidence to support the trial court’s

award. See Barnard , 133 S.W.3d at 789 . Further, Daniel has not shown that a

discrepancy in this regard, if it exists, would materially affect the trial court’s

property division. See Jacobs , 687 S.W.2d at 732–33; see also McElwee , 911 S.W.2d

at 189 (mistake in property division at divorce which has de minimis effect on overall

division not reversible error).

Finally, the record shows that the $27,000 reimbursement is for Thu’s

attorney’s fees in the first trial that resulted in a mistrial. The record shows that the

trial court ordered that the amount be paid from the community ECCU account.

Daniel complains on appeal of a double recovery. As Thu contends, however, Daniel

does not direct us to anyplace in the record in which he presented his complaint to the

trial court. As such, the point is waived. See Tex. R. App. P. 33.1.

We cannot conclude that the trial court abused its broad discretion with regard

to the reimbursement claims, as part of its overall division of the estate. See Penick ,

783 S.W.2d at 198 ; Mai , 853 S.W.2d at 618 (stating that, under abuse of discretion

standard, legal and factual insufficiency are not independent reversible grounds, but

are relevant factors in assessing whether trial court abused its discretion).

Accordingly, Daniel’s third issue is overruled.

Penalty

In his second issue, Daniel contend that “[t]he trial court abused its discretion

by awarding a $100,000 penalty against Daniel for wasting of community assets and

fraud on the community estate.” Thu contends that there was “no money judgment”

for $100,000 against Daniel.

Daniel directs us to the trial court’s rendition of property division, which it

issued prior to the Final Decree, and to statements it made on the record.

In its rendition of property division, the trial court ordered that Daniel take

$260,000 of his ExxonMobil Savings Plan and that Thu receive $570,000 of the Plan.

In addition, however, the trial court ordered,

[f]or wasting of community assets and fraud on community estate:

$100,000 to petitioner from respondent’s estate. Such award shall be

out of Exxon Mobil Savings Plan and 401K Plan. Therefore, Petitioner

shall receive $670,000 of 401K Plan as listed on petitioners I &A, Ex.

5a and respondent’s share shall be reduced to $160,000.

At a hearing on Daniel’s objections to the entry of judgment on the decree, the trial

court explained, “Well, what I did was I gave them each a fairly equal and I don’t

remember if it was exactly equal on his plan [sic] and as the division of the estate.

And then I came back as a penalty and awarded her a hundred thousand of the estate

and the rendition of the division of the estate, it was fairly equal. Then I came back

as a penalty and awarded her a hundred thousand. [sic]” Daniel asked again, “So that

was a penalty?” And, the trial court responded, “Right.”

First, we cannot consider the trial court’s recitations in its rendition. It is

well-settled that even recitations in the judgment itself of findings of fact and

conclusions of law cannot be considered as a substitute for separately filed findings

of fact and conclusions of law. Willms v. Am. Tire Co. , 190 S.W.3d 796, 802 (Tex.

App.—Dallas 2006, pet. denied); see also Chacon v. Chacon , 222 S.W.3d 909, 916

(Tex. App.—El Paso 2007, no pet.) (concluding, in divorce case, that prejudgment

letter rulings do not constitute formal findings of fact and will not substitute as such).

Such statements do not afford any basis upon which a losing party may attack a trial

court’s judgment.

Next, oral comments from the bench cannot substitute for written findings of

fact and conclusions of law. See In re Jane Doe 10 , 78 S.W.3d 338 , 340 n. 2 (Tex.

2002). In E.A.S. , the appellant complained that the trial court had improperly

modified his child support obligation on the basis that the appellant was intentionally

underemployed. 123 S.W.3d 565 , 568 (Tex. App.—El Paso 2003, pet. denied). No

findings of fact and conclusions of law were filed. Id. at 569. Rather, the appellant

relied upon oral statements made by the trial court on the record, finding that the

appellant was underemployed and finding the amount that the appellant had the

ability to earn. Id. The appellate court refused to consider the trial court’s oral

statements, concluding that such statements could not be accepted as findings of fact.

Id. (citing W.E.R. , 669 S.W.2d at 716 ). The court concluded, “We recognize that this

rule may appear hypertechnical given the trial court’s comments but it is not within

our province to disregard it.” Id. at 570. The court then considered whether there

was evidence in the record to support the trial court’s ruling and, concluding that

there was such evidence, affirmed the trial court’s judgment. Id. at 570–72

(recognizing that, in the absence of findings, trial court’s judgment must be affirmed

if it can be upheld on any legal theory that finds support in evidence).

Here, as in E.A.S. , we cannot consider the trial court’s oral statements as a

substitute for properly filed findings of fact and conclusions of law.

The Final Decree before us reflects only that the trial court made an unequal

distribution, in the form of an award Thu of $670,000 of Daniel’s $830,000

ExxonMobil 401K Plan. We cannot conclude that the trial court abused its discretion

on the ground Daniel asserts, that is, by assessing a $100,000 “penalty” against him.

Accordingly, Daniel’s second issue is overruled.

CONCLUSION

We affirm the judgment of the trial court.

Laura Carter Higley

Justice

Panel consists of Justices Jennings, Higley, and Massengale.