Court Opinion

ID: 9666704
Source: CourtListenerOpinion
Date Created: 2023-08-24 01:26:03.975115+00
Date Added: 2024-06-11T18:15:32.311037
License: Public Domain

DUNN, Justice,
concurring and dissenting.
I concur with the majority in the disposition of the Subchapter S issue, but I dissent from the holding with respect to the reimbursement issues.
The appellee asserts two separate claims for reimbursement, one for the appellant’s time, toil, and talent used to enhance the value of his separate estate, and another for the use of community credit to enhance the value of the appellant’s separate estate. With respect to the reimbursement claim for the appellant’s time, toil, and talent, the “right to reimbursement is only for the value of the time, toil and effort expended to enhance the separate estate other than that reasonably necessary to manage and preserve the separate estate, for which the *346community did not receive adequate compensation.” Jensen v. Jensen, 665 S.W.2d 107, 110 (Tex.1984) (Vallone v. Vallone, 644 S.W.2d 455, 459 (Tex.1982)). The ap-pellee had the burden of introducing sufficient evidence to establish each of the elements of her reimbursement claim. Id. The appellee failed to introduce any evidence of the amount of time that was reasonably necessary for the appellant to spend managing and preserving his separate estate. Further, there ⅛ no evidence in the record concerning the value of the time, toil, and talent expended by the appellant beyond what was reasonably necessary to preserve his separate estate. The appellee has, therefore, failed to meet her burden of establishing the community’s right to reimbursement for the appellant’s time, toil, and talent expended on his separate property.
With respect to the reimbursement claim based on the use of community credit to enhance the appellant’s separate property, the appellee has again failed to satisfy her burden of going forward with evidence of each element of this claim. Initially, I note that this is not a case of community credit being used to construct an improvement on separate property.
On May 29,1979, the Coca-Cola Bottling Co. borrowed $2,000,000, at a maximum interest rate of the prime rate + 1.35%, from the Guaranty Bank and Trust Co. of Alexandria, Louisiana. This loan was to be used to purchase land and construct improvements at the Coca-Cola bottling facility. The improvements were completed sometime in August 1980. On September 1, 1981, the Guaranty Bank and Trust Co. entered into an agreement, effective October 14, 1981, with the Industrial Development Board of the Parish of Rapides, Inc. for the issuance of industrial revenue bonds in the amount of $2,200,000 for the purpose of refinancing the May 29, 1979 loan to the Coca-Cola Bottling Co. Also on September 1,1981, both the Coca-Cola Bottling Co. and the appellant and the appellee entered into agreements with Guaranty Bank and Trust Co. guaranteeing the payment of the principal and interest on the bonds. The purpose of this refinancing agreement was to reduce Coca-Cola Bottling Co.’s interest costs on its loan. The maximum interest rate payable on the bonds was 70% of the prime rate, with a total savings to the corporation of approximately $638,000.
Neither the parties’ research nor ours has revealed a Texas case deciding the question of whether the community has a right to reimbursement for the use of its credit to secure a loan to refinance the husband’s separate property debts. However, I am not willing to state, at this time, that this new reimbursement theory is without merit. I would analogize this situation to cases where separate debts are discharged with community funds. See Villarreal v. Villarreal, 618 S.W.2d 99 (Tex.Civ.App.—Corpus Christi 1981, no writ); Hawkins v. Hawkins, 612 S.W.2d 683 (Tex.Civ.App.—El Paso 1981, no writ). However, there is an important difference between the case before us and cases involving the discharge of a separate debt with community funds. When a debt is discharged, the cost to the community is obvious, but when a separate property debt is refinanced with the community acting as a guarantor, the cost to the community is not so readily ascertainable. In the latter situation, expert testimony would be required on the percentage risk undertaken by the community, and a dollar value would have to be assigned to that risk.
In the case before us, there is no testimony concerning the cost to the community resulting from the use of their credit to guarantee the refinancing of the separate property debt. Further, there is evidence in the record that even though the guarantee was for $2,200,000, and the net community assets were approximately $660,000, the appellant was nevertheless able to negotiate a loan from the River Oaks Bank & Trust Co. subsequent to the guarantee. The appellee has, therefore, failed to meet her burden of establishing the community’s right to reimbursement for the use of the community credit.
Because I find that the community’s claim for reimbursement was not supported by sufficient evidence, the question *347is whether this error “was reasonably calculated to cause and probably did cause rendition of an improper judgment in the case.” Tex.R.App.P. 81(b)(1). In a decree of divorce the court shall order a division of the estate of the parties in a manner that the court deems just and right. Tex.Fam. Code Ann. sec. 3.63(a) (Vernon Supp.1987).
My review of the record indicates that the trial judge’s “just and right” division of the property constituted an approximately equal division of the community assets. However, this division was based on the jury’s erroneous finding that the community had a $150,000 claim for reimbursement. Because of this reimbursement error, the community estate has now been reduced causing a disproportionate disposition of the property not in accordance with what the trial court determined was a “just and right” division of the property. I would remand this case to the trial judge for a new division of the community estate that does not include the $150,000 reimbursement claim. Jacobs v. Jacobs, 687 S.W.2d 731, 732 (Tex.1985).