In a recent Texas appellate case, a wife appealed from a final divorce decree that incorporated the terms of the couple’s mediated settlement agreement. After she and her husband entered into the agreement, she asked the trial court to set it aside.
The couple had married in 1997 and had no kids. They decided to divorce in 2015 and mediated their differences. They signed an agreement dividing up their property and debts, but it was contingent on a short sale of a house they owned. The husband was awarded the interest in the property, and the wife had to sign certain documents. She would be paid a portion of the proceeds from the sale. Meanwhile, the husband got all of the interest in their two trusts.
A few weeks later, the wife tried to withdraw, and the trial court granted the motion. The husband asked the court to sign a final divorce decree, while the wife tried to quash the agreement. The husband asked a receiver to be appointed, claiming that the wife refused to sign the papers in order to facilitate the property sale.
The trial court granted the motion and appointed him as a receiver. He was authorized to sell the house, which he did. Her proceeds were put into the court registry.
The wife moved again asking the trial court to revoke the agreement. The trial court held a hearing, and in that, the husband testified that he’d inherited pieces of real property from his mother, one of which was the parcel in question. He’d given his wife the 50% interest in the property. The wife argued she’d wanted a 50% interest in all of the parcels associated with the inheritance, rather than just the one currently at issue.
She claimed that the husband had sold property without telling her, and in doing so he broke the rules of their trust. However, the trial court denied her request to set aside the mediated settlement agreement and signed the final divorce decree. The court determined there wasn’t any credible evidence of duress, fraud, or other circumstances to justify setting it aside. It also found that even before she’d signed it, she knew of the real property being sold.
The appellate court explained that a mediated settlement agreement is binding under the Texas Family Code as long as it meets certain statutory requirements. If it does meet those requirements, the court doesn’t need to evaluate whether a division is just and right.
The wife argued that there was fraud during the mediation because he said the real estate owned by the trust was his separate property when, in fact, she owned the other property through the trust instruments and was entitled to an equal share of the proceeds of the sale. She also argued that the mediation should be considered duress, since she was disabled and it lasted 12 hours. The appellate court explained that the sale of the properties was known to her during the mediation, and when she entered into the agreement, she knew that her husband had already sold the property. Therefore, there was no credible evidence of duress or fraud.
If your divorce involves matters related to property distribution, contact the Texas attorneys at the McClure Law Group at 214.692.8200.
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