Hooray for the attorney who cites a case from 1889 and wins! Perhaps we all should review Schmidt v. Huppman, 11 S.W. 175 (Tex. 1889), which held “Where it satisfactorily appears, as in this case, that one spouse brought into the partnership separate funds invested in a particular business, which business was carried on and the profits arising therefrom used in creating and building up the community estate, and the separate funds are employed in the same business at the dissolution of the partnership, upon settlement with the community estate we think the spouse furnishing such separate funds is entitled to reimbursement therefore.” At the trial of this divorce, 123 years after the Schmidt v. Huppman case was decided, the husband proved that his sole proprietor law firm on the date of marriage had $383,233.35 in accounts receivable, $175,391.70 in unbilled time for work in progress, $5,000 in furniture and fixtures, $22,003.74 in accounts payable and $95,307.40 in accrued payroll. ... Read More >
A party can do his own tracing of separate property!
This case stands for the proposition that a party (in this case, the husband) can do his own tracing of financial accounts to prove how much is separate property. In this case, the husband was an attorney and a CPA. There was no objection to his qualifications made to the trial court. The court of appeals reviewed some very complex financial account tracing and approved what the husband calculated. It certainly seems logical that if we allow a party to testify about the value of his house without being a real estate appraiser, that we should allow a party to testify about tracing as long as the methodology is explained and is proper. Richard v. Towery, 1st Court of Appeals, 01-11-00132-CV, April 18, 2013. Another case decided this month by the San Antonio Court of Appeals is another example of a party tracing (or trying to trace) his own separate property. Unfortunately, this is also a great example of how not to trace and what evidence is insufficient to prove separate ... Read More >