Monday, April 20, 2009

Austin Divorce Lawyer Tip Regarding Separation, Community Property, and Divorce in Texas.

I am asked all the time whether there is a way to "legally" separate in Texas. The short answer to this question is no. There is no "Legal Separation," per se, in Texas. There are no Court proceedings to essentially put a marriage "on hold." To the contrary, even though the parties may be living in separate homes and doing everything separately, the community property presumption still applies to the marriage.

In Texas, all property (and liabilities) on hand at the time of Divorce are presumed to be those of the "community." The community property presumption exists irrespective of whether the parties are living together at the time they divorce, or whether they are separated.

Over the years, I have had several cases where the parties separated and then went on with their lives -- sometimes for many years -- accumulating properties (and debts). Sometimes, the assets, which included real estate, stocks, and mutual funds, appreciated substantially. These assets, just like all of the other property, are subject to being divided by the Court. This sometimes comes as a shock to the party that finds out that they have to share the property that they separately bought, paid for, and maintained.

As a result, when you separate and fail to follow through with a Divorce, all assets are subject to a "just and right" division by the divorce court. Likewise, despite a separation, the debts that are accumulated by either spouse will also be presumed to be community debt. For example, you and your husband separate. He goes out and charges a big screen TV on the joint credit card. Not only is the credit card company going to look to you for payment, the divorce court can order that you pay part of the debt (hopefully, the TV is still around and maybe you can get it).

One way around these problems, is to enter into a Property Agreement Between Spouses so as to eliminate community property (and community liabilities). With such an agreement, the Divorce court could treat all property owned at the time of Divorce as the separate property of one or the other spouse. Even accounts that are jointly owned are oftentimes treated under this type of an agreement (and, hence, by the Court) as being owned 50% by each spouse. Such an agreement could completely avoid the possibility of having the Judge (or worse, yet, a jury) decide what constitutes a "just and right" division of the property.

This type of agreement is a relatively simple document that can prevent the continued accumulation of community assets and liabilities, even during a period of separation. If you would like to set up a consultation with an Austin, Texas Divorce Lawyer, contact Erik E. Cary.