Opinions, August 9, 2016: Think Your Spousal Support is Too High? Try $350,000 Per Month

The First District Court of Appeals released a published opinion in In re Fuentes, No. 01-16-00366-CV, a mandamus proceeding notable for setting aside an order for $350,000 monthly payments for post-judgment temporary spousal support and attorney’s fees. Also, the Fourteenth Court of Appeals released a memorandum opinion in In re Fajardo, No. 14-15-00653-CV.

Taking the First first, in In re Fuentes, Evangelina Lopez Guzman Zaragoza filed for divorce from Miguel Zaragoza Fuentes. Her petition for divorce listed several companies as co-respondents. She alleged these companies were Miguel’s alter egos and requested the trial court appoint a receiver to oversee them.

In a verified motion for continuance for a hearing on Evangelina’s request for appointment of a receiver, Miguel’s counsel claimed he (Miguel) had assets worth more than a billion dollars and had dozens of companies in many different countries.

Miguel did not participate in the eventual trial and the trial court entered a default judgment against him. The final decree was signed December 21, 2015, awarding Evangelina one-half of the marital estate and $537 million in fraud-on-the-community damages, including cash in the amount of $537,680,823, real and personal property, and all shares and all interest of any kind in any business entities worldwide that the trial court found to be Miguel’s alter egos.

Miguel moved for a new trial and, on January 20, 2016, several intervenor companies filed notices of appeal (the “Intervenors”). The trial court denied the MNT on March 4, 2016 and Miguel filed his notice of appeal on March 18, 2016. Ten days later, Evangelina moved for temporary orders pending appeal under Tex. Fam. Code §6.709, seeking spousal support and payment of her attorney’s fees during the appeal.

Miguel moved to dismiss the motion for post-judgment temporary orders, arguing the request was untimely as 6.709 says a request must be filed “[n]ot later than the 30th day after the date an appeal is perfected.” As the Intervenors perfected their appeal on January 20, 2016, Miguel argued the deadline for the request was February 20, 2016, because any notice of appeal–including that of the Intervenors’–was sufficient to trigger the 30-day clock. The trial court denied Miguel’s motion to dismiss and heard Evangelina’s request for temporary orders. The trial court ordered Miguel to pay Evangelina $300,000 in spousal support per month and $50,000 in attorney’s fees per month.

Miguel filed a petition for writ of mandamus, arguing the temporary orders are void because Evangelina’s request was untimely and, alternatively, the order for $350,000 in monthly payments was not supported by the evidence.

The Court of Appeals overruled Miguel’s first issue, finding that it was his perfection of appeal that was the trigger for the 30-day deadline under 6.709, not the Intervenors’. The Court of Appeals found persuasive Evangelina’s argument that she is not entitled to temporary support without a pending appeal of the divorce. None of the Intervenors could be or were ordered to pay spousal support to Evangelina. In other words, because the provisions of 6.709 are effective only against the ex-spouse, it is the perfection of appeal of the ex-spouse which starts the 30-day clock.

Having found that the temporary orders were timely, the Court of Appeals turned to the issue of whether the trial court abused its discretion in making the orders because they lacked evidentiary support.

In her FIS filed with the trial court, Evangelina claimed she was entitled to $600,000 per month in spousal support and $100,000 in legal fees. How on earth could one person not named Bill Gates or Warren Buffet have monthly expenses of $600,000? Well, it adds up:

$200,000 per month for travel; $120,000 for security guards and drivers; $50,000 for clothing; $20,000 for medical expenses; $6,000 for water; $6,000 for energy; $4,000 for telephone; $14,000 for groceries; $3,000 for flowers; $10,000 for payments on her Neiman Marcus credit card; and $50,000 for loan repayments.

But when testifying about these alleged expenses, Evangelina admitted she didn’t feel threatened enough to need security guards; she doesn’t personally pay for utilities or groceries; had no documentation to support the clothing or travel expenses; had no idea how much she owed on her Neiman Marcus credit card; and she does not owe loan repayments. She also testified that her adult children have deposited money into her bank account to pay these expenses.

I have found that if you read enough appellate opinions, you can often identify the exact tipping point when someone is about to get poured out, the fulcrum where the decision pivots to its conclusion. In this case, it is immediately after the above laundry list of evidentiary deficiencies where the opinion then states, “Temporary spousal support is intended to provide for the parties’ necessary expenses.” The Court of Appeals found Evangelina “did not provide any evidence” to the trial court to establish which expenses were actually incurred by her and were necessary for her maintenance.

Evangelina also argued that though the evidence of her actual expenses may have been skimpy, the trial court was entitled to rely on its familiarity with the parties, the scope of the marital estate and the parties’ needs. The Court of Appeals disagreed, finding the trial court’s supposed familiarity with the case “does not cure the lack of explanation or evidentiary support for awarding $300,000 per month in spousal support.” Similarly, the Court of Appeals also found the monthly award of $50,000 for attorney’s fees was not supported by the evidence.

In conclusion, the Court of Appeals ordered the trial court to vacate its temporary orders and conduct a hearing and enter new temporary orders.

Taking the Fourteenth next, In re Fajardo concerned a plea to the jurisdiction. Maria and Guillermo met in 2000 and had four children together (born in 2001, 2003, 2008 and 2013). Guillermo has a total of 11 children by seven different women.*

In July, 2013, Maria filed a petition for divorce and a SAPCR. A hearing on whether a common-law marriage existed was held in front of the Associate Judge. The AJ found there was a common-law marriage. That ruling was appealed and a de novo hearing was granted. At the de novo hearing, Guillermo’s counsel urged the court to grant a plea to the jurisdiction and motion to dismiss for lack of standing, arguing Maria lacked standing to bring the divorce suit because there was no common-law marriage. The presiding judge took judicial notice of the transcript from the AJ hearing, but refused to take judicial notice of the exhibits from that hearing.

At the de novo hearing, the facts were disputed. Maria testified she believed Guillermo agreed to marry her and they lived together from 2000 until December 2012. She testified Guillermo introduced her as his wife “many times” from 2000-2003. They had a joint bank account. In several tax returns, Maria is listed as Guillermo’s wife but the returns are signed only by the preparer and not Maria or Guillermo.

Guillermo admitted he filed tax returns with Maria but disputed that he ever agreed to marry her, never lived with her, and never told people she was his wife. He also produced evidence that he was ceremonially married to another woman on August 16, 2005.

Other witnesses testified for both Maria and Guillermo.

The presiding judge found Maria had failed to rebut the presumption of Tex. Fam. Code §2.401 regarding informal marriages, granted Guillermo’s plea to the jurisdiction, and dismissed the divorce portion of Maria’s suit for lack of jurisdiction and standing. The presiding judge did retain the SAPCR though and a final order in the SAPCR was signed on February 16, 2015.

The Court of Appeals’ analysis begins with the observation that Guillermo filed a plea to the jurisdiction arguing Maria did not prove the elements of informal marriage under section 2.401, but he did not provide any authority for the proposition that such a failure deprives the trial court of subject-matter jurisdiction. But even assuming that a plea to the jurisdiction is a proper vehicle to make that argument (as the parties evidently did) the Court of Appeals concluded the plea failed because Maria presented more than a scintilla of evidence of each element.

When a jurisdictional challenge implicates the merits of a case, the trial court may review the evidence to determine if a fact issue exists. If the evidence creates a question of fact, the trial court cannot grant the plea to the jurisdiction. The standard resembles that of the summary judgment standard, in that a dismissal for lack of jurisdiction on a contested factual issue is only appropriate if the issue is proven as a matter of law. In other words, when Guillermo filed a plea to the jurisdiction premised on lack of standing, his motion implicated a summary judgment standard.

On appeal, Maria presented four issues: 1) the trial court erred by granting the plea to the jurisdiction; 2) the trial court erred by finding no genuine issue of material fact of common-law marriage; 3) the trial court erred by finding Maria failed to overcome the presumption of section 2.401; and 4) the trial court erred by refusing to allow Maria to make an offer of proof. The Court of Appeals did not reach the fourth issue, but addressed the first three concurrently as it regarded them as intertwined.

Essentially, no evidence was presented which disproved a common-law marriage as a matter of law. Maria produced more than a scintilla of evidence as to each element of her claim of a common-law marriage. Maria produced enough evidence to have standing to bring her divorce petition. Because the common-law marriage was not disproven as a matter of law, the trial court erred by granting the plea to the jurisdiction.

Because the order granting the plea to the jurisdiction was vacated, the Court of Appeals remanded the divorce for a determination on the merits.

 

* Another thing about reading and summarizing appellate opinions: Sometimes in its factual recitation, the opinion will include a fact which seems either out of place or vaguely incongruous. Frequently, that fact later proves to be relevant and important to the outcome of the case. Other times (like here), it just appears to be added for factual ambience, as if to not-so-subtly say to the reader, sotto voce, “This is the type of person we’re dealing with.”

 

 

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