Appeal from the 169th District Court Bell County, Texas Trial
Court Cause No. 258, 387-C.
consists of Justices Boyce, Donovan, and Wise.
Linda Hill Miller (Linda) and Dr. Brian Terry Miller (Terry)
had been married for forty-three years when Linda filed for
divorce. After a bench trial, the court granted the divorce
on the ground of insupportability and divided the
couple's property and debts. The court also found that
Terry committed fraud on the community and that the value
owed to the community estate was $189, 672.34. After
reconstituting the community estate, the court valued the
community estate at $7, 621, 044.80. The court awarded 49.28%
of the community estate to Linda and 50.72% to Terry. On
appeal, Terry contends that the trial court abused its
discretion by recognizing a fraud on the community claim,
arbitrarily reconstituting the community estate absent
evidence of damages, ordering a business not a party to the
divorce to pay Linda, and making a grossly disproportionate
property division in a no-fault divorce. We affirm.
and Linda Miller were married in 1969 and had three children,
all of whom were adults at the time of the divorce. Terry is
a licensed and practicing physician. Beginning in 2005 or
2006, Linda worked at Terry's medical practice, the
Central Texas Allergy & Asthma Clinic (the Clinic).
2007, the Millers embarked on a business plan to increase the
size of their real estate holdings. In so doing, the Millers
accumulated a significant amount of community property and
debt associated with that property. The Millers maintained a
bank account for their real estate investments known as the
"real estate account" that was separate from their
personal checking account and the Clinic account. Most of the
Millers' income, however, came from the Clinic.
Clinic had locations in several Texas cities, at times
including Killeen, Georgetown, Cedar Park, Round Rock, and
South Austin. Some of the Clinic's locations leased their
buildings from BTM Medical Properties, LLC, a company owned
by Terry and Linda. Another clinic leased its location from
103-109 Bell Blvd, LLC, a company in which Terry owned a 50%
interest. The other members in 103-109 Bell Blvd were Kota
and Uday Reddy, who together owned a 40% interest, and
Terry's close personal friend and long-time neighbor,
Hubert "Bud" Kott, who owned a 10% interest. Terry
made all decisions and handled all business dealings with
Kott and the Reddys; Linda had no business dealings with
either Kott or the Reddys.
also invested in real estate unrelated to clinic business.
Terry and Kott formed MK Developers, LC, which invested in
several commercial properties and land. Terry and Kott each
owned a 50% interest in MK Developers, but Kott managed its
daily operations. Terry and Kott also participated with
several other individuals in Bar Seven Partners LP, a
partnership that owned a tract of land divided into
residential lots for resale and development. Kott was the
managing partner of Bar Seven. Through BTM Medical
Properties, Terry and Linda also purchased a commercial
building located at 2014 W. Pecan Street in Pflugerville for
rental to business tenants.
2010, Terry suffered a massive stroke that left him unable to
work for a substantial period of time. Terry was hospitalized
for eight days before being transferred to a rehabilitation
facility and later a nursing home. In May 2011, Terry
returned to the marital residence. Because Terry was still
unable to care for himself, Linda became his full-time
caregiver. Linda found caring for Terry to be physically
demanding and exhausting. In addition, the relationship
between Linda and Terry began to deteriorate after Terry
returned home. According to Linda, Terry became withdrawn and
verbally abusive, frequently making critical or demeaning
comments to her.
was not actively involved in Clinic operations at the time of
Terry's stroke. With the assistance of family members,
Linda made the decision to sell a condominium the Millers
owned in South Padre Island for $275, 000.00 to cover their
expenses. Linda also decided to suspend the Clinic's
payment of salaries to the Millers and other family members
who were on the Clinic's payroll because the Clinic's
income decreased during Terry's absence.
Clinic's long-time office manager, Geralyn Hall, made the
primary decisions concerning the daily management of the
Clinic's five locations while Terry was recovering. At
some point, Terry gave Hall a financial power of attorney
that authorized Hall to access the Millers' real estate
account and to conduct financial transactions relating to the
Millers' real estate holdings. Terry also instructed Hall
to not pay the rental obligations of clinics that were
leasing property from BTM Medical Properties, which was
solely owned by the Millers, but to continue paying the
rental obligations of clinics that were leasing property that
was independently owned or jointly owned with others.
overwhelmed by the demands of caring for Terry and their
increasingly deteriorating relationship, attempted suicide.
Shortly after that, in July 2012, Linda filed for divorce.
to trial, Kott was indicted for misappropriating funds from a
former employer. Bar Seven was then reorganized as Cactus
Creek, LLC, and Kott was removed as manager. Despite the
indictment, Terry continued to trust Kott with the management
of MK Developers.
non-jury trial was held over twelve days spanning nearly
year-from June 3, 2015, to May 18, 2016-during which time
changes in the community estate required that valuations be
updated and proposed property divisions be revised. On
December 20, 2016, the trial court signed the final decree of
divorce. Terry filed a motion for new trial. After a hearing,
the motion was denied by written order.
Terry's request, the trial court filed findings of fact
and conclusions of law. In its findings, the trial court took
into consideration the following factors in making its
determination of a just and right division of the community
A.[Linda] has little or no future earning capacity. When she
did work during the marriage, she worked in the office of
B. [Linda] suffers from severe depression. Shortly before
filing the divorce, [Linda] purposely overdosed on pills and
then called for medical assistance.
C.[Linda] appeared frail and meek throughout the trial.
D.[Linda] was age 69 at the time of [sic] the divorce was
E.[Terry] was an obstructionist during the discovery process.
He failed to follow Court orders and his conduct delayed and
prolonged the trial of this case.
F. At times during the divorce, [Terry] failed to pay Court
ordered temporary support to [Linda]. For a period during the
pendency of the divorce, [Terry] permitted his office to
discontinue health insurance on [Linda].
G.During the pendency of the divorce, [Terry] gifted airline
miles to his children and employees without the knowledge or
consent of [Linda].
H. [Terry] is a licensed and practicing physician. He has the
ability to continue to earn a substantial income
post[-]divorce. During the divorce, even when [Terry] did not
work full time, his clinics generated substantial income, and
they should continue to do so in the future.
I. The property was divided in a manner so as to keep
[Terry's] medical practice intact. [Terry] was awarded
the real estate where his clinics operate so as not to
disturb his practice or to require him to either negotiate
leases with [Linda] or move his clinics to new locations.
J. The property was divided in a manner so that [Terry] was
awarded the property that was jointly owned with others.
* * *
P. [Linda] was reluctant to enter into business deals where
large sums of money were owed and felt pressured by [Terry]
to sign personal guarantees.
Q. [Linda] was primarily awarded property with little risk,
such as cash and retirement accounts.
R. [Terry] was awarded the property with mortgages. [Terry]
has the income and earning potential to service the debt
associated with the property awarded to him without having to
deplete his assets.
S. [Terry] has the business experience to actively
participate in decisions regarding property jointly owned
trial court also found that Terry committed fraud on the
community and reconstituted the community estate based on the
[Terry] committed actual or constructive fraud on the
community. The Court further finds that the community estate
should be reconstituted to the value that would exist if an
actual or constructive fraud had not occurred. The Court
further finds that value owed to the community estate is
$189, 672.34. The Court reduced the value of the
reconstituted estate to $189, 672.34. [Terry] had use and
control of $476, 016.59 in cash during the pendency of the
divorce. This cash, which was generated by community assets,
was acquired and spent by [Terry] without the knowledge or
consent of [Linda]. In reducing the value of the
reconstituted estate, the Court considered payments by
[Terry] for his medical bills, the cost of his care by
Visiting Angels, preservation of the community estate, and
remodeling of community property.
court determined that the value of the community estate was
$7, 621, 044.80. The court awarded 49.28% ($3, 755, 571.40)
of the community estate to Linda, and 50.72% ($3, 865,
473.40) to Terry.
appealed the trial court's judgment to the Austin Court
of Appeals, and the case was transferred to this
Standard of Review
divorce, the trial court divides the estate of the parties
"in a manner that the court deems just and right."
Tex. Fam. Code § 7.001. On appeal, we review the trial
court's division of community property for an abuse of
discretion. Murff v. Murff, 615 S.W.2d 696, 698
(Tex. 1981); Iliff v. Iliff, 339 S.W.3d 126, 133
(Tex. App.-Austin 2009), aff'd, 339 S.W.3d 74
(Tex. 2011); Knight v. Knight, 301 S.W.3d 723, 728
(Tex. App.-Houston [14th Dist.] 2009, no pet.). Legal and
factual sufficiency are relevant factors, rather than
independent bases for reversal, in determining whether the
trial court abused its discretion. Iliff, 339 S.W.3d
court's division may take into consideration a variety of
factors in making a just and right division of property.
Schlueter v. Schlueter, 975 S.W.2d 584, 589 (Tex.
1998); Murff, 615 S.W.2d at 799. Every reasonable
presumption should be resolved in favor of the trial
court's proper exercise of its discretion in dividing the
parties' property. Zieba v. Martin, 928 S.W.2d
782, 791 (Tex. App.-Houston [14th Dist.] 1996, no writ). In
making the determination of a just and right division, the
trial court is the sole judge of the witnesses'
credibility and the weight to be given their testimony.
Iliff, 339 S.W.3d at 138 (citing McGalliard v.
Kuhlmann, 722 S.W.2d 694, 696 (Tex. 1986)). The trial
court is free to accept or reject the testimony of each
witness in whole or in part and to resolve any
inconsistencies in the testimony. Id.
disturb a trial court's division of property, the
appellant must show that the trial court clearly abused its
discretion by making a division that is manifestly unfair.
See, e.g., O'Carolan v. Hopper, 414
S.W.3d 288, 311 (Tex. App.-Austin 2013, no pet.); Evans
v. Evans, 14 S.W.3d 343, 345-46 (Tex. App.-Houston [14th
Dist.] 2000, no pet.). The trial court's ultimate
division need not be equal as long as it is equitable.
O'Carolan, 414 S.W.3d at 311. The trial court
does not abuse its discretion when it bases its decision on