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In re A.T.

Court of Appeals of Texas, Fifth District, Dallas

May 31, 2017

IN THE INTEREST OF A.T., N.T., B.T., AND B.T., CHILDREN

         On Appeal from the 470th Judicial District Court Collin County, Texas Trial Court Cause No. 470-51820-2014

          Before Justices Fillmore, Whitehill, and Boatright.

          MEMORANDUM OPINION

          ROBERT M. FILLMORE JUSTICE.

         Father filed a petition for divorce in the 401st Judicial District Court seeking to dissolve his common law marriage with Mother. Mother filed a counter-petition for divorce also seeking to dissolve the parties' common law marriage. Father failed to appear at trial and, after hearing evidence, the trial court made oral rulings granting the divorce, naming Mother the sole managing conservator of the parties' four children, A.T., N.T., B.T., and B.T., and dividing the community estate. Before the judge of the 401st Judicial District Court signed a final divorce decree, the case was transferred to the 470th Judicial District Court. The judge of the 470th Judicial District Court signed a final divorce decree reflecting the rulings made at trial.[1]

         Father appeals the final divorce decree asserting, in his first eight issues, that the trial court abused its discretion by (1) granting, ten days prior to trial, Father's attorney's substantively defective motion to withdraw and by failing to sign a written order granting the motion; (2) entering a default judgment against Father without proof that he had actual notice of the trial setting; (3) ordering Father to pay child support and medical support for the children without evidence of his income at the time of trial; (4) granting a divorce and dividing property without evidence at trial establishing a common law marriage; (5) awarding a disproportionate share of the community estate to Mother; (6) appointing Mother sole managing conservator and Father possessory conservator of the children when there was no or insufficient evidence to rebut the statutory presumption that parents should be named joint managing conservators (7) ordering Father to pay Mother's attorney's fees when there was no evidence of fees incurred for the divorce that were not related to enforcement and other proceedings for which Father had already paid attorney's fees ordered by the trial court; and (8) denying Father's motion for new trial. In his ninth issue, Father asserts he was denied due process of law because the judge of the 401st Judicial District Court applied a different standard for notice of the trial setting than did the judge of the 470th Judicial District Court. We reverse those portions of the final divorce decree (1) pertaining to child support and medical support for the children and to conservatorship of the children, and (2) ordering Father to pay $20, 000 in attorney's fees and remand those issues to the trial court for further proceedings consistent with this opinion. In all other respects, we affirm the final divorce decree.

         Background

         On April 11, 2014, Father filed a pro se petition for divorce seeking the dissolution of his and Mother's common law marriage. Father alleged the parties were married on or about May 2007. Father requested he and Mother be appointed joint managing conservators of the parties' four children, but that he be given the exclusive right to establish the children's primary residence and to make decisions regarding their education.

         Mother responded and filed a counter-petition for divorce also seeking to dissolve the parties' common law marriage. Mother alleged the parties had been married on or about July 30, 2005. Mother also alleged Father had a history of committing family violence. Mother requested she be appointed sole managing conservator of the children and sought child support and spousal maintenance. She also requested a disproportionate share of the marital estate based on fault in the breakup of the marriage, disparity in the earning power of the spouses and their ability to support themselves, need for future support, wasting of community assets by Father, attorney's fees to be paid, and actual and constructive fraud committed by Father.

         Temporary Orders Hearing

         The trial court held a hearing on May 8, 2014, on the parties' request for temporary orders. Father testified that he began living with Mother in 2002 in his mother's house. He and Mother were married without a marriage license or a wedding ceremony, but had a Vietnamese-style ceremony for their engagement. According to Mother, she and Father were married without a marriage license on July 30, 2005. The couple moved to the marital residence in 2006.

         Mother testified there was always a "lot of tension" in her and Father's relationship, and Father was physically, mentally, and emotionally abusive. Father would often come home late at night intoxicated and would wake her and the children by yelling and screaming. Mother stated that Father had hit her, thrown things at her, and called her "very bad names, " and had threatened to kill her sister. Mother's sister testified that Father threatened to physically harm her and she had seen Father hit, strike, and push Mother. According to Mother, Father had a criminal history including convictions for assault in a family violence case, driving while intoxicated, possession of marijuana, evading arrest, and driving with a suspended license.

         Father testified he was never physically abusive toward either Mother or the children, but Mother physically abused him. According to Father, every time he and Mother had an argument, she would push him. In 2004, Mother pushed him during an argument and he "tried to block." While he was trying to defend himself with his hands, he accidently hit Mother in the face. After a neighbor called the police, he was arrested for "family violence." Father also testified about an incident in which he hit a wall after Mother pushed him when he was holding their son. Father "pressed charges, " but dropped the case after Mother asked him to do so.

         Mother testified she quit working in 2007 to care for the children. Father owned an automotive mechanic shop specializing in European vehicles. According to Mother, Father was sometimes paid in cash for his work, "made money" from his business, and owned a Ferrari, a Mercedes, a BMW, and a Honda Odyssey. Father testified he earned approximately $100, 000 per year, but was not certain of the amount because he did not "keep track." Father denied that he was ever paid for his work in cash. As to the vehicles that Mother testified about, Father stated the Honda was his brother's van, his father owned the Ferrari, and he sold the BMW two years before the hearing. He currently owned a 1999 Mercedes S500.

         Mother testified that, during the marriage, she had access to personal bank accounts and bank accounts for Father's business. The money in Mother's personal account was from "what [Father] gave" her, and she used the money to pay the family's expenses. With Father's authorization, she also made personal and family purchases using the business accounts. According to Father, he gave Mother cash and Mother would pay the family's expenses. He never authorized Mother to spend money from the business's bank accounts. Father left the marriage after he learned during an audit of his business by the Internal Revenue Service (IRS) that Mother had been embezzling money from his company. A deficiency notice issued by the IRS on December 5, 2012, following an audit of the business for the 2010 tax year, indicated that $196, 775.25 of corporate business income was deposited in Mother's and Father's personal bank accounts, $5, 615 was transferred from business bank accounts to Mother and Father's accounts, and $59, 850.69 of personal expenses were paid by the business. The IRS found a tax deficiency of $30, 228.

         According to Mother, in February 2014, Father "cut off" her access to funds, canceled the automobile insurance on her vehicle, and canceled her and the children's health insurance policy. Mother had been forced to borrow money from her family to pay her monthly bills and attorney's fees. After moving out of the marital home, Father changed his phone number and had not told Mother where he was living. Father had not been involved in caring for the children and had not seen the children since March 30, 2014. Mother's sister confirmed that, based on her observations, Father had not been very involved with the children.

         At the end of the hearing, the trial court orally made an affirmative finding of family violence, named Mother temporary sole managing conservator and Father possessory conservator of the children, and established a standard visitation schedule for Father. The trial court ordered Father to reinstate the automobile insurance policy for Mother's vehicle and the health insurance policy for Mother and the children. The trial court also ordered Mother and Father to prepare inventories and appraisals within forty-five days of the hearing. "By way of temporary spousal support, " the trial court ordered Father to pay the mortgage and insurance on the marital residence. Mother was ordered to pay the costs of utilities and maintenance for the residence. Father was also ordered to pay $15, 000 to Mother for interim attorney's fees and, based on the finding of family violence, $500 per month in spousal support. Noting the evidence showed a "lifestyle that sure indicates a heck of a lot of money, " the trial court ordered Father to pay "guideline child support" based on "at least $100, 000."

         Finally, the trial court made a finding that there was an informal marriage. It indicated it did not have sufficient evidence to determine the exact date of the marriage, but stated it was clear both Mother and Father "believe they have been married for a number of years." The trial court stated it would "figure that one out" if it needed to, "but at the very least, we're eight years."

         The trial court signed "agreed" temporary orders on August 11, 2014, reflecting its rulings. Father was ordered to pay $2, 917 per month for child support, $500 per month for spousal support, and the mortgage payment, insurance, and utilities for the marital residence and to maintain health insurance on the children.[2]

         Setting Case for Trial

         Father failed to comply with the temporary orders, and Mother filed a number of motions to enforce and to hold Father in contempt. Father was arrested twice, but each time was able to quickly post bond in the amount of past due child and spousal support. Father also had a number of different lawyers representing him following the entry of the temporary orders.

         On March 13, 2016, the trial court held a hearing on three motions filed by Mother: a motion to enforce, a motion to compel, and a motion to allow Mother to sell the marital residence. Father was not present at the hearing, but was represented by attorney David Beyer. Mother's counsel, Clinton Brown, argued on the motion to compel that Father had failed to produce responsive documents. Beyer indicated he had attempted to obtain the documents from Father, but had not received a response. The trial court granted the motion to compel and awarded Mother $3, 500 for attorney's fees incurred in bringing the motion. The trial court noted it could not rule on the motion for enforcement because Father had not been personally served with the motion. The trial court also informed Beyer that Father had been filing pro se motions and needed to be advised the trial court would not consider the motions. At the conclusion of the hearing, Brown stated, "[w]e'd like to see Valerie and set this for trial." The trial court indicated the parties should "[g]et yourself a date." On March 13, 2015, Valerie Blackwell, the Court Coordinator of the 401st Judicial District Court, issued a notice that the case was set for trial on May 14, 2015, at 9:00 a.m.

         Motion to Withdraw

         Beyer filed a motion to withdraw on April 16, 2015, and an amended motion to withdraw on April 27, 2015. The certificate of service on both the original motion and the amended motion stated the motion was served by electronic transmission on Father and on Brown, but did not contain an email address for Father. The reasons given for withdrawal were that Father had failed to pay for Beyer's services and had failed to heed Beyer's instructions and advice by repeatedly being absent from hearings, failing to respond to telephone calls and texts, continuing to "stonewall" counsel's requests for documents Father had been ordered to produce, and filing pro se motions. Beyer represented in both the original and the amended motion that Father had been informed, via email, that Beyer would have to withdraw if Father "refuse[d] to comply with what the court has ordered and with my advice." On April 28, 2015, the trial court signed a notice setting the motion to withdraw for hearing at 9:00 a.m. on May 4, 2015. The appellate record does not reflect whether Father was served with notice of the hearing on the motion to withdraw. The appellate record also does not contain a reporter's record from the hearing held on May 4, 2015, and does not contain a written order ruling on the amended motion to withdraw.

         Trial

         The case was called to trial on May 14, 2015. Neither Father nor Beyer appeared. The trial court noted its docket sheet "incorrectly indicates that [Beyer] is counsel for [Father]" because it had "previously, after a hearing, granted his motion to withdraw." The trial court stated it was "satisfied at that time that [Father] knew well of this setting."

         Mother testified she was married to Father and the couple had four children. While the divorce was pending, Father had failed to consistently exercise his periods of possession. He saw the children only sporadically and had last seen them in February. The trial court stated it would take judicial notice of the temporary orders that had been entered in the case, and Mother requested those orders become permanent. Mother also provided the trial court with her requested rulings.

         The trial court admitted into evidence a chart showing Father had not paid child support, spousal support, and mortgage and utility payments since October 2014 and had not paid the $3, 500 in attorney's fees awarded to Mother at the March 13, 2015 hearing. In total, Father had failed to pay $35, 432. Mother testified Father had also not obtained health insurance for the children. Father had been placed in jail two times during the divorce proceedings for failing to pay the ordered child support, and Mother did not believe Father would ever pay the ordered child support. Because Father owed her over $35, 000, Mother requested she be awarded all of the $83, 000 equity in the marital residence.

         Mother also introduced evidence that Father and his sister owned two pieces of property in Garland, Texas, with a combined appraised value of $42, 240. Mother testified that, during the marriage, Father transferred those properties to his sister and then his sister transferred them back to him. The information from the appraisal district showed that, as of the time of trial, Father and his sister owned the properties. Mother requested that, based on Father's fraudulent conduct, she be awarded Father's approximately $20, 000 share of the properties. However, because she did not believe Father would pay her the $20, 000, Mother requested the trial court award her six vehicles that records from the Texas Department of Motor Vehicles (the DMV) reflected Father had bought during the marriage and owned at the time of trial. The records from the DMV indicated Father purchased those vehicles for $17, 600.

         Mother introduced records establishing Father or Father's business had nine accounts at ViewPoint Bank. Mother requested she be awarded fifty percent of any funds in these accounts.

         According to Mother, Father failed to produce requested documents regarding his assets. Further, in the two months before the trial, Father had created a family partnership with his sister, and Mother believed he was transferring assets into that partnership. Father had also transferred the title to a Ferrari to his father and received no money in return. Mother believed the Ferrari was worth approximately $60, 000. Mother testified she had incurred approximately $20, 000 in credit card debt because she was required to pay the family's expenses with a credit card after Father "failed to pay the things he's supposed to pay." She also had borrowed money from her mother and her sister. Mother's sister and mother confirmed that Mother had borrowed $30, 800 to assist her with her living expenses and her attorney's fees during the pendency of the divorce. Mother requested a judgment for $30, 000 for her interest in the Ferrari and a judgment in an unspecified amount to allow her to repay the loans from her family.

         Finally, Mother testified she had incurred a "lot" of attorney's fees during the divorce and part of the reason the fees were so high was because Father had multiple lawyers and failed to appear for numerous hearings. Brown testified he was board certified in family law and routinely practiced in Collin, Dallas, and Tarrant Counties. He was familiar with the usual and customary rates on a case such as this one and, in his opinion, the $350 hourly rate he was charging Mother was reasonable and necessary. Brown testified his legal assistant was preparing to take the board certification exam and he had "leveraged as much work as possible" to her while he worked with the client and the investigators. His legal assistant had an hourly rate of $135 and, in Brown's opinion, this rate was reasonable and necessary.

         Brown testified Father had had six lawyers during the pendency of the case, failed to appear for at least three hearings, and been incarcerated twice. Prior to trial, Brown and his legal assistant reviewed the billing statements and categorized each task that was related to Father's failure to appear, drafting capiases, and drafting motions to compel and estimated Brown had spent approximately thirty-five hours of time and his legal assistant approximately sixty hours of time on those activities. Brown requested an award of attorney's fees in the amount of $20, 000.

         The trial court stated that, to its recollection, after Father was arrested for the second time during the divorce proceedings, he posted a cash bond in the amount of $35, 000. The trial court inquired whether any of that money "made it" to Mother. Brown indicated that Mother received the funds that were owed at the time for past due child support and he received some funds for attorney's fees. The trial court granted the divorce and all the relief requested by Mother. It noted Mother had requested a disproportionate share of the estate and found each of the pleaded grounds to be true and to be a sufficient ground independently of the others to support the disproportionate division. Finally, the trial court awarded the attorney's fees requested by Mother.

         Post-Trial Proceedings

         On June 17, 2015, Father, represented by new counsel, filed a motion for new trial and/or motion to reconsider. Effective September 1, 2015, the case was administratively transferred to the 470th Judicial District Court.[3] On November 6, 2015, Mother filed a motion to enter a final divorce decree.

         The trial court held a non-evidentiary hearing on January 28, 2016, on Father's motion to reconsider and Mother's motion to enter a final divorce decree. The trial court denied the motion to reconsider and ruled on Father's objections to Mother's proposed decree. After modifying the proposed decree, the trial court signed a final decree on February 11, 2016. In the final decree, the trial court named Mother sole managing conservator and Father possessory conservator of the children, and gave Father possession of the children pursuant to a standard possession order. The trial court also made a finding that Father had a history or pattern of committing family violence during the two-year period preceding the filing of the suit or during the pendency of the suit. Father was ordered to pay $2, 917 monthly child support, with the support to "step down" as each child matriculated out of the system, and to maintain health insurance on the children.

         As to the division of the marital estate, Father was awarded all household furniture, furnishings, fixtures, goods, art objects, collectibles, appliances, equipment, clothing, jewelry, and other personal effects in his possession or subject to his sole control; all sums of cash in his possession or subject to his sole control; all bank accounts in his sole name or from which he had the sole right to withdraw funds or which were subject to his sole control except for listed accounts at ViewPoint Bank and Chase Bank; fifty percent of the listed accounts at ViewPoint Bank and Chase Bank; all individual retirement accounts, simplified employee pensions, annuities, and variable annuity life insurance benefits in his name; all policies of life insurance insuring his life; and the business known as Master Tune-up. Although not specifically listed, Father was also apparently awarded the two properties located in Garland, Texas, that he owned with his sister. Mother was awarded the marital residence; all household furniture, furnishings, fixtures, goods, art objects, collectibles, appliances, equipment, clothing, jewelry, and other personal effects in her possession or subject to her sole control; all sums of cash in her possession or subject to her sole control; all bank accounts in her sole name or from which she had the sole right to withdraw funds or which were subject to her sole control; fifty percent of the listed accounts at ViewPoint Bank and Chase Bank; all policies of life insurance insuring her life; a Cadillac Escalade automobile; and seven listed vehicles "for [Mother's] undivided interest in the real property parcels which were fraudulently transferred during the course of the divorce" located in Garland, Texas. Mother was also awarded a judgment against Father to equalize the division of the estate in the amount of $30, 000 and a judgment in the amount of $20, 000 against Father for attorney's fees. Father was ordered to pay all debt associated with the business known as Master Tune-up as well as all debt he had incurred after "January 1, 2014, " and all credit card debt in his name. Mother was ordered to pay the balance of the mortgage on the marital residence, all debts she had incurred after "January 1, 2015, " and all credit card debt in her name.

         Father filed an amended motion for new trial on March 8, 2016, arguing the final divorce decree was contrary to the law and the evidence because: (1) there was no evidence to rebut the presumption the parents should be appointed joint managing conservators of the children; (2) there was no evidence to prove the existence of a common law marriage or the date of the marriage; (3) there was no evidence of Father's ability to pay the ordered child support; (4) the child support obligation was set without a calculation of Father's net resources at the time of the final trial and without consideration of the cost and quality of health insurance coverage available to the parties; (5) the trial court erred by awarding a disproportionate share of the community estate to Mother; (6) Father had a meritorious defense that Mother committed fraud on the community estate; (7) Mother misled the trial court about the character of the property in Garland, leading to an inequitable division of that property and resulting in the award of a monetary judgment to Mother of Father's separate property; (8) the trial court improperly took into a consideration a business that was no longer owned by Father in dividing the community estate; and (9) Father's attorney was allowed to withdraw ten days prior to the trial and Father did not receive notice of either the order to withdraw or the trial date.

         At the hearing on Father's amended motion for new trial, Father testified his previous attorney had not informed him about either the motion to withdraw or the trial setting and that he would have appeared if he had known about the trial setting. He also testified he was sick on the day of trial ...


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