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Bernard v. Bernard

Court of Appeals of Texas, Second District, Fort Worth

May 30, 2019

Bryan P. Bernard, Appellant
Doris W. Bernard, Appellee

          On Appeal from the 233rd District Court Tarrant County, Texas Trial Court No. 233-571359-15

          Before Kerr, Pittman, and Birdwell, JJ.


          Mark T. Pittman Justice.

         Appellant Bryan P. Bernard appeals from the trial court's October 4, 2017 judgment awarding his ex-wife Appellee Doris W. Bernard attorney's fees and "the balance of the Lincoln American Legacy II Variable Annuity account" (the Lincoln Annuity), which had not been expressly divided in their January 25, 2001 Agreed Final Decree of Divorce (Divorce Decree). In four issues, Bryan challenges certain of the trial court's findings of fact and conclusions of law as well as the award of attorney's fees. Because we hold that the Lincoln Annuity was community property not divided in the divorce, that Doris filed suit within the applicable two-year limitations period, and that the trial court did not abuse its discretion by awarding her attorneys' fees or the Lincoln Annuity after the post-decree proceeding, we affirm the trial court's judgment.


         I. Doris's Former Broker Testified That an Annuity Is a Contract.

         Bryan was Doris's Edward Jones broker until shortly after the divorce; her brother Joe replaced him in 2001. Joe's son Doug replaced Joe at his retirement in 2008. At the August 2017 post-decree proceeding, Doug, no longer Doris's Edward Jones broker, defined an annuity:

It is a legal contract between an insurance company and an investor that they enter into together where the investor puts in a certain amount of money and then, depending on the type of annuity, receive[s] some benefits, some of which are guaranteed by the insurance company.

         II. Bryan Bought the Lincoln Annuity During the Marriage and Named Doris Its Beneficiary.

         In March 1993 while Bryan and Doris were married, Bryan paid Lincoln National Life Insurance Company $19, 587.92 to begin the Lincoln Annuity contract; its maturity date is in November 2041. Bryan is the listed owner and annuitant; Doris is the listed beneficiary. Edward Jones is not a party to the contract.

         III. The Lincoln Annuity Was Not Held by Edward Jones; It Was Linked to the Couple's Joint Account During the Marriage.

         In the months preceding the January 2001 divorce and the month of the divorce, the Lincoln Annuity was listed on the parties' Edward Jones joint-account statement under "Your Assets Held Outside Edward Jones."

         IV. Doris Included the Lincoln Annuity in Her Inventory; Bryan Included Its Value in His Inventory.

         While the divorce was pending, Doris expressly included the Lincoln Annuity as community property in her September 2000 inventory and appraisement (inventory) in the "Annuities (non IRA's)" subsection of "Insurance and Annuities." She noted in her inventory that Bryan owned the Lincoln Annuity. Bryan did not expressly include the Lincoln Annuity in his inventory but testified at the August 2017 post-decree proceeding that it was fair to assume that he had included the Lincoln Annuity's value in his valuation of the Edward Jones joint account because the Lincoln Annuity was linked to that account. Bryan did not list separate property in his inventory.

         V. Neither the Mediated Settlement Agreement (MSA) nor the Divorce Decree Named the Lincoln Annuity.

         In the Divorce Decree, Wife was awarded as her sole and separate property:

W-5. All funds on deposit, together with accrued but unpaid interest, in the following banks, savings institutions, or other financial institutions:
a. . . . .
b. [The] Edward Jones [Joint]Account . . ., subject to a prohibition by both parties from margining, transferring, selling or withdrawing any funds . . . from December 5, 2000.

         VI. After the Divorce, the Edward Jones Joint Account Was Closed, and the Lincoln Annuity's Linking Information Began Appearing on Doris's Statements for Her Edward Jones Individual Account.

         The Edward Jones joint-account statement covering the month immediately following the divorce, January 27, 2001 through February 23, 2001, does not mention the Lincoln Annuity.

         Doris's Edward Jones individual-account statement does not include the Lincoln Annuity during the month of the divorce, but in her individual-account statement covering January 27, 2001 through February 23, 2001-the month immediately following the divorce-the Lincoln Annuity appears on the list entitled, "Your Assets Held Outside Edward Jones."

         The boilerplate of many of the Edward Jones statements from both the joint account and Doris's individual account that are included in the admitted ...

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