Court Opinion

ID: 2879070
Source: CourtListenerOpinion
Date Created: 2015-09-07 05:04:32.958594+00
Date Added: 2024-06-11T11:35:53.083415
License: Public Domain

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                                 MEMORANDUM OPINION

                                        No. 04-08-00271-CV

                                      Claudia Ivonne MARIE,
                                             Appellant

                                                  v.

                                      David R. VELASQUEZ,
                                             Appellee

                     From the 131st Judicial District Court, Bexar County, Texas
                                  Trial Court No. 2006-CI-08137
                          Honorable John D. Gabriel, Jr., Judge Presiding

Opinion by:       Rebecca Simmons, Justice

Sitting:          Karen Angelini, Justice
                  Sandee Bryan Marion, Justice
                  Rebecca Simmons, Justice

Delivered and Filed: December 3, 2008

AFFIRMED

           This appeal stems from a divorce action. Claudia Ivonne Marie appeals the trial court’s

finding of a community debt in favor of Claudia’s in-laws, Jose and Olivia Velasquez. Claudia

contends the evidence is insufficient to support the trial court’s finding of a valid loan in favor of

Jose and Olivia; therefore, the trial court abused its discretion in characterizing the loan as

community debt. Claudia also contends the trial court’s enforcement of an oral agreement to repay
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monies for the purchase of real property violates the statute of frauds. We affirm the trial court’s

judgment.

                                          BACKGROUND

       In a divorce action filed by David R. Velasquez against Claudia, the trial court found that a

loan made to the parties by Jose and Olivia was a community debt. At trial, Jose and Olivia testified

they loaned the couple $107,000 to help construct a home. On direct examination, Olivia produced

checks totaling $91,160.00 made payable to David. Olivia testified that the repayment arrangements

were vague and that Claudia was not present when she gave David the checks. Jose testified that he

could not recall whether Claudia was present. Both Jose and Olivia testified that neither David nor

Claudia executed any documents to evidence their oral agreement for the financing arrangement.

       David testified the arrangement was a verbal loan agreement between his parents and himself.

David explained he handled all the financial transactions during the marriage and all the checks were

written directly to him. David testified that he paid $8,000 back to his parents on the loan and

produced accompanying checks made payable to his parents.

       The trial court made a finding that the community estate owed a balance of $83,160.00 on

the loan made by Jose and Olivia despite the lack of a written agreement. The amount was based

on the checks written by Jose and Olivia, totaling $91,160, minus the $8,000 David testified he

already paid, which was evidenced by the checks admitted into evidence.

                                     DIVISION OF PROPERTY

       We review a trial court’s community property division order under an abuse of discretion

standard. Murff v. Murff, 615 S.W.2d 696, 699 (Tex. 1981). A trial court has wide discretion when

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dividing the community property estate in a manner that it deems “just and right,” and we will

presume the trial court exercised its discretion properly. Id. To determine if a trial court abused its

discretion, we analyze the following two prongs: (1) whether the trial court had sufficient

information to exercise its discretion, and (2) whether the trial court abused its discretion by making

a property division that is manifestly unfair and unjust. Chacon v. Chacon, 222 S.W.3d 909, 915

(Tex. App.—El Paso 2007). “The trial court does not abuse its discretion if some evidence

reasonably supports the trial court’s decision.” Butnaru v. Ford Motor Co., 84 S.W.3d 198, 211

(Tex. 2002).

        Debts contracted during marriage are presumed to be community debt and therefore become

community obligations at divorce unless there is evidence that the creditor agreed to look solely to

a party’s separate estate. Wierzchula v. Wierzchula, 623 S.W.2d 730, 732 (Tex. App.—Houston [1st

Dist.] 1981, no writ). To overcome the presumption of community debt, the complaining party must

rebut the presumption by clear and convincing evidence. TEX . FAM . CODE ANN . § 3.003(b) (Vernon

2006). “‘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.” Malekzadeh v. Malekzadeh, Nos. 14-05-00113-CV, 14-06-00341-CV, 2007 WL
1892233, at *5 (Tex. App.—Houston [14th Dist.] July 3, 2007, no pet. ).

        In this case, there is evidence that a loan was made by Jose and Olivia to David and Claudia

during the existence of their marriage; thus, the loan is presumed to be community debt. Both Jose

and Olivia testified that checks were made payable to their son to use to build a marital house, and

David testified that he and Claudia discussed obtaining a loan from his parents frequently.

Additionally, the record contains evidence of multiple checks made to David from Jose and Olivia

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for the total amount of $91,160.00, and the record also contains evidence of monthly checks made

to Jose and Olivia from David in the amount of $8,000, showing evidence of repayment.

Accordingly, because there is some evidence that supports the trial court’s finding that Jose and

Olivia made a loan to Claudia and David during their marriage, the trial court did not abuse its

discretion by presuming the loan to be community debt. See Butnaru, 84 S.W.3d at 211.

       To rebut the presumption of community debt, Claudia bears the burden of showing by clear

and convincing evidence that Jose and Olivia agreed to look solely to David for satisfaction of the

debt. Wierzchula, 623 S.W.2d at 732. Here, there is no documentary evidence that Jose and Olivia

agreed to look solely to their son for repayment. Nevertheless, Claudia argues she was never

involved in the loan transaction between David and his parents. To support her position, Claudia

contends David was in charge of all financial matters. At trial, David testified he handled all the

transactions involving the loan and all the checks were written directly to him. Claudia further

alleges any money given by Jose and Olivia was a gift. However, Claudia’s lack of involvement in

the loan transaction does not rise to the level of clear and convincing evidence to rebut the

presumption of community debt, particularly when we consider the totality of the circumstances in

which the debt arose. See Cokerham v. Cockerham, 527, S.W.2d 162, 171 (Tex. 1975).

       Claudia extensively cites Sprick v. Sprick, 25 S.W.3d 7 (Tex. App.—El Paso 1999, pet.

denied), as authority for her proposition that the trial court relied on insufficient evidence when it

made a finding of a debt against the community estate. In Sprick, the El Paso court affirmed a trial

court’s finding of an unsecured loan against the community estate. Id. at 10. Claudia distinguishes

this case from Sprick by explaining that Sprick involved a written promissory note, while this case

involves a mere verbal agreement; therefore, according to Claudia, there is insufficient evidence for

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a finding of a valid loan due to the lack of a written agreement. See id. Although the testimony in

this case does establish that the loan was a verbal agreement, some evidence was presented to

establish that Jose and Olivia loaned money to the couple, and Claudia has failed to overcome the

clear and convincing evidence standard necessary to rebut the presumption of community debt. See

Butnaru, 84 S.W.3d at 211; Wierzchula, 623 S.W.2d at 732.

                                      STATUTE OF FRAUDS

       Claudia further argues that the loan arrangement was an oral agreement for the purchase of

real property and is therefore barred by the statute of frauds. Claudia asserts the time frame for

repayment was ambiguous at best and could not be performed within one year from the date of the

original agreement. Additionally, Claudia points out that David did not even begin performance on

the agreement by making payments until four years after the loan was made; therefore, the oral

agreement is barred by the statute of frauds.

       Whether an oral agreement to repay monies given for the purchase of real property violates

the statute of frauds is a question of law. Gerstacker v. Blum Consulting Eng’rs., Inc., 884 S.W.2d
845, 850 (Tex. App.—Dallas 1994, writ denied). The statute of frauds applies to agreements that

are “not to be performed within one year from the date of the making of the agreement.” TEX . BUS.

& COM . CODE ANN . § 26.01(a)(6) (Vernon 2002). “Thus, when a promise or agreement, either by

its terms or by the nature of the required performance, cannot be completed within one year, it falls

within the Statute and must be in writing to be enforceable.” Case Corp. v. Hi-Class Business

Systems of America, Inc., 184 S.W.3d 760, 777 (Tex. App.—Dallas 2005, pet. denied). However,

the one-year provision does not apply to 1) “a contract which is performed on one side at the time

it is made, such as a loan of money,” or 2) “any contract which has been fully performed on one side,

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whether the performance is completed within a year or not.” Estate of Kaiser v. Gifford, 692 S.W.2d
525, 527 (Tex. App.—Houston [1st Dist.] 1985, writ ref’d n.r.e.). Accordingly, we follow the rule

that “full performance by one party to an oral contract removes the contract from the prohibitions

of the Statute regardless of whether performance is completed within a year or not.” Id.

       In this case, the statute of frauds does not bar the oral loan agreement between the community

estate and Jose and Olivia. While the statute of frauds requires agreements that cannot be performed

within a year to be in writing, the one-year provision does not apply to an agreement if one side of

the agreement has been fully performed. Estate of Kaiser, 692 S.W.2d at 525. Here, Jose and Olivia

fully performed their side of the loan agreement as evidenced by the multiple checks made payable

to David for $91,160.00. Therefore, the enforcement of the oral loan was not barred by the statute

of frauds.

                                          CONCLUSION

       Because Claudia failed to rebut the presumption that the loan made by Jose and Olivia was

community debt and the statute of frauds does not bar its enforcement, we affirm the trial court’s

judgment.

                                                      Rebecca Simmons, Justice

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